Kongsberg Automotive

The Role of the Administrative, Management and Supervisory Bodies

The Board of Directors (BoD) of Kongsberg Automotive ASA (KA) has established a set of general principles and guidelines for corporate governance. These principles cover the Board of Directors' responsibility for determining the group's risk profile, approving the organization of the business, allocating responsibility and authority, as well as providing requirements with respect to reporting lines and information, risk management, and internal control.

The tasks and responsibilities of the Board of Directors and the CEO are laid out in separate directives covering the Board of Directors and the CEO, respectively.

The Board of Directors holds the ultimate responsibility for managing the group and for monitoring day-to-day management and the group's business activities. The Board of Directors is also responsible for establishing control systems for the group. The Board's responsibilities also include developing and adopting the company's strategies.

The Board of Directors has issued Rules of Procedure for the Board as well as instructions for the Chief Executive Officer of the company with the aim of establishing a clear internal allocation of responsibilities and duties.

The Board schedules at least six Board meetings per year. Additional Board meetings are held when deemed necessary.

The Board hires the CEO, defines the work instructions, and decides on the CEO's remuneration. The Board of Directors has appointed a Compensation Committee and an Audit Committee. The members of said committees are independent of executive management. The authority of the committees is to make recommendations to the Board.

The Board of Directors evaluates its performance and expertise annually by means of self-assessment.

Information Provided to and Sustainability Matters Addressed by Administrative, Management and Supervisory Bodies

Participation in Board meetings and Board committees in 2024 was as follows:

¹ Elected at Extraordinary General Meeting on December 20, 2024 ² Tenure until Extraordinary General Meeting on December 20, 2024 ³ Tenure until Annual General Meeting on May 30, 2024 ⁴ Elected at the Annual General Meeting on May 30, 2024, tenure until Extraordinary General Meeting on December 20, 2024

Integration of Sustainability-Related Performance in Incentive Schemes

Performance-related remuneration, such as bonuses and share option programs, are based on the company's financial results and are subject to absolute limits. The Board directors hold no function in the company other than the directorships of the Board and memberships of committees to the Board. The Board directors are not entitled to performance-related compensation and are not granted or entitled to any share options.

The Board of Directors has established guidelines relating to remuneration to executive management which are presented to the Annual General Meeting for consideration. The remuneration to executive management is reviewed annually by the Compensation Committee and the Board. Each year, the Board prepares a report on the compensation and benefits provided to senior personnel in accordance with the Act on Public Limited Liability Companies, section 6–16b.

Risk Management and Internal Controls Over Sustainability Reporting

Risk assessment is a management responsibility. Its objective is to identify, evaluate, and manage risks that could reduce an individual unit's ability to achieve its goals.

The assessment and handling of risk are integrated into the group's value-based management system. The management system is intended to ensure that there is a correlation between objectives and actions at all levels of the group and the general principle of value creation for KA's stakeholders.

The group has a separate, independent Internal Audit unit, which follows an annual internal auditing program approved by the Audit Committee. The manager of Internal Audit reports to the CFO. The Audit Committee is kept informed of the current status of internal audits and also approves the audit plan.

A number of risk assessment and control measures have been established in connection with the publication of the financial statements. Internal meetings are held with the business areas and subsidiaries, as well as a meeting with the external auditor, to identify risk factors and measures associated with material accounting items or other circumstances.

Responsibility for the group's financial risk management is mostly centralized, and risk exposure is continuously monitored. The group has identified a specific risk catalog in line with ISO 31000 and has classified all risks according to their potential impact.

Strategy, Business Model and Value Chain

Business Model

Kongsberg Automotive (KA) provides cutting-edge technology to the global vehicle industry. KA's vision is to "drive the global transition to sustainable mobility" by putting engineering, sustainability, and innovation into practice. Its product portfolio includes drive and motion control systems, fluid and thermal management systems, air management systems, and industrial driver interface products.

Organizations

DRIVE CONTROL SYSTEMS (DCS) Global leader in designing and manufacturing products for the automotive and the off-highway industry. Products are, among others, pneumatic and electric actuation systems for gear control and clutch actuation, steering column modules, and pedals and throttles for off-highway applications.

FLOW CONTROL SYSTEMS (FCS) Designs and manufactures products for both the automotive and commercial vehicle market as well as industrial applications. FCS' portfolio includes couplings for air brake and air suspension systems, clean powertrain fluid assemblies as well as chassis and battery coolant solutions.

Markets

The global move to sustainable transportation enables KA to provide more content per vehicle in hybrid and fully electric powertrains. Stricter CO2 emission regulations and the new Euro 7 standard are driving the increased adoption of KA's clean powertrain fluid assemblies. Meanwhile, electric powertrains require enhanced cooling solutions for both driving and fast-charging applications, which are KA's new focus area.

Revenue Streams

The company generates revenue primarily through the design, manufacturing, and sale of products to customers.

DESIGN AND R&D The design phase involves creating engineering solutions and providing services such as simulations, drawings, and validations. KA is, to a certain extent, compensated separately for these services by customers. In some cases, local governments also offer R&D subsidies.

MANUFACTURING During manufacturing, KA converts raw materials into components. These components, along with other purchased parts, are then assembled into final products or submodules.

SALES Revenues in the sales phase come from delivered products and modules and from customer-specific machinery and tooling necessary for producing these specialized products.

Interests and Views of Stakeholders

Customer Relationships

KA focuses on establishing and nurturing long-term, strategic partnerships for automotive and non-automotive customers. KA's customer relationships are focused around understanding the specific customer's needs, collaboration, innovation, and the highest levels of service.

PERSONALIZED SERVICE AND SUPPORT: Offering tailored engineered solutions and dedicated support to meet the unique needs of each customer, fostering trust and long-lasting relationships. KA offers engineering and sales support in each major automotive market.

CO-DEVELOPMENT AND INNOVATION: Working closely with customers during the product development phase to create customized solutions that enhance vehicle performance, safety, driver comfort, and overall value, enabling our customers to meet current and future vehicle legislations around the world.

LONG-TERM CONTRACTS AND PARTNERSHIPS: Securing long-term agreements with automotive manufacturers ensures stability and continuity in business relationships, enabling phased and direct investment. These collaborations drive innovation through joint R&D projects, resulting in advanced automotive technologies and strengthening KA's competitive market position.

CUSTOMER-CENTRIC APPROACH: Continuously engaging with customers to understand their evolving needs enables KA to offer unique solutions and maintain competitive advantage. This approach enhances both product and service quality while driving innovation through customer insight integration in the development process.

Material impacts, risks and opportunities and their interaction with strategy and business model

List of Material IROs

Kongsberg Automotive has identified the following material topics through its double materiality assessment:

Detailed IRO Descriptions

E1 Climate Change

KA's Response:

• Implementation of energy efficiency measures and setting energy reduction targets to reduce energy consumption and related GHG emissions
• Ongoing shift to the usage of renewable energy for KA's production processes and buildings to reduce GHG emissions
• Product design reflecting requirements for lower weight, recyclability, lower embedded GHG emissions, and compatibility with battery electric vehicles
• Purchase of input materials with lower GHG emissions
• ISO 14001 certification of all plants (includes climate change-related topics)
• Broad supplier portfolio and supplier risk mapping
• Internal team of sustainability experts
• Roadmap defined to switch to 100% renewable electricity by 2030

E4 Biodiversity and Ecosystems

KA's Response: There is an understanding within KA that this topic will become more of a focus area in the long term. However, the concrete consequences (mechanism of action) remain unspecified. The risks remain abstract. KA will monitor this topic.

E5 Circular Economy and Resource Use

KA's Response: KA has already implemented several measures regarding waste treatment, waste management, and production scrap reuse. Building on these initiatives, additional measures and targets will be developed.

S1 Own Workforce

KA's Response:

• Occupational Safety roadmap with dedicated resources, targets and actions
• Training and development programs and platforms (SuccessFactors, Percipio)

S2 Workers in the Value Chain

KA's Response:

• Supplier sustainability risk assessment contains working conditions as focus area
• Benchmark tools of costs of workforce
• Awareness raising with buyers and within the supply chain
• On-site sustainability supplier audits focusing on working conditions
• Resilience
• Awareness raising and including equal treatment, learning and development, and inclusivity in supplier sustainability risk assessments and on-site audits
• Responsible mineral sourcing due diligence process and yearly data collection (with a special focus on smelters of concern regarding tin, tungsten, tantalum, gold, mica, and cobalt sources)
• Country ESG supply chain risk and natural hazard risk pre-evaluation of suppliers
• Awareness raising and including human rights and climate adaptation in supplier sustainability risk assessment

G1 Business Conduct

KA's Response:

• Code of Conduct implementation and employee training
• UN Global Compact membership
• Supplier assessments and audits
• Collaboration with suppliers

Entity-Specific: Product Quality and Safety

Interaction with Strategy and Business Model

Sustainability is embedded in KA's overall strategy as one of four key strategic pillars. Further, the pillar "Resilient and Forward-Looking Portfolio" is related to sustainability as well. The whole automotive industry itself is on a transition pathway to sustainable mobility. One major contributor is the shift from internal combustion engines (ICE) to battery electric vehicles (BEV). KA contributes to this transition by offering products that can be built in BEV or hybrid vehicles. KA's product design focuses in addition on less weight, longer durability, and recyclability of its products, which improves its environmental footprint. Several KA products directly contribute to fuel savings during their use phase (e.g. couplings).

Value Chain Context

KA's operations are part of the automotive value chain with main inputs and outputs as well as business partners. KA develops and offers a wide range of products for the passenger car, commercial vehicle, and off-highway markets. The differences between KA's business areas (Drive Control Systems and Flow Control Systems) are mainly in terms of materials, suppliers and products, but the different steps in the value chain are the same.

The value chain consists of:

• Upstream: Raw material extraction, mines, basic industry → Suppliers' manufacturing processes (Tier X suppliers and Tier 1 suppliers)
• Own Operations: KA manufacturing processes
• Downstream: Customers' manufacturing processes → End customers (product use) → Recycling/disposal after use

Time Horizons

KA applies the following time horizon categories:

• S (Short-term): Less than one year
• M (Medium-term): One to five years
• L (Long-term): More than five years

Resilience to Identified IROs

For biodiversity, the analysis resulted in no impacts or risks directly related to KA sites. The potential impacts and risks are limited to the upstream part of KA's supply chain. Due to KA's diversified supply chain no short- or mid-term risks have been identified which could negatively affect KA's resilience in this context.

For physical climate risks, KA has discussed climate-related physical risks in its own operations and along the value chain considering its exposure to climate-related hazards of lower and higher magnitudes (above and below 1.5°C global warming scenario). The company has a broad supplier portfolio and supplier risk mapping to maintain resilience.

Description of the process to identify and assess material impacts, risks and opportunities

Methodology Overview

At the end of 2023, Kongsberg Automotive (KA) applied the principles of the ESRS to conduct the double materiality assessment. The analysis was reconfirmed and slightly adjusted in 2024. KA used a four-step approach to implement the ESRS requirements. The materiality assessment process was facilitated by the Group Sustainability Manager.

The double materiality assessment identified both current and potential impacts. Current impacts are those already occurring, whether positive or negative. Potential impacts include both the risks of negative outcomes and opportunities for positive developments. Where possible, a time horizon was added, with the following categories: short- (less than one year), medium- (one to five years), or long-term (more than five years).

Step-by-Step Process

STEP 1: PREPARATION AND TOPIC LIST

The ESRS 1 longlist of sustainability topics served as the starting point for KA's materiality assessment. This longlist has been reviewed in the context of previous KA materiality processes and sustainability reports as well as other sources to complement the list with KA-specific topics.

STEP 2: IMPACT MATERIALITY

The goal of the impact assessment is to identify those topics that have the greatest impact on environment, society, and economy along the entire value chain of Kongsberg Automotive. For certain topics, potential heightened risks for specific activities, stakeholders, and geographies have been discussed. In the process, the actual and potential positive and negative impacts along the value chain have been assessed for all topics based on the following four criteria (in accordance with the GRI and ESRS 1 guidelines):

• Scale: Gravity of negative impacts or extent of potential or actual benefit for negative impacts and how beneficial the impact is or could be for positive impacts
• Scope: Evaluates the extent of impacts, e.g. geographical reach and population affected
• Irremediability: Measures the degree to which an impact cannot be reversed, considering time needed for recovery
• Likelihood: The likelihood that a potential impact occurs

These criteria have been scored from 0 ("no impact") to 4 ("very high/likely") for each topic at each value chain stage.

Assessment Process:

• External experts performed the assessment using both internal documents and external sources, including studies and specialist reports
• For the calculation, the product is formed from the scores for "scale," "scope," "irremediability," and "likelihood" for each stage of the value chain. This reflects the intercorrelation of the respective levels of the individual criteria with each other
• The total value per topic consists of the sum of the scores per value chain stage. Thus, the impacts of all three stages of the value chain are weighted equally
• Following the external assessment, internal subject matter experts across the organization evaluated the impact of identified topics and reviewed the initial scoring

Stakeholder Involvement:

The involvement of various experts from different areas of the company ensures sufficient consideration for internal stakeholder views. To some extent, the internal stakeholders also represent some external stakeholder groups. The views of external stakeholders, especially silent stakeholders in the value chain, were predominantly incorporated through the consideration of various external sources of information.

STEP 3: FINANCIAL MATERIALITY

The key objective of the financial materiality analysis was to identify the financial risks and opportunities in KA's business stemming from the entire value chain.

Analysis Structure:

The analysis contains three parts which are weighted as follows:

1. Analysis of external documents representing different stakeholder groups. Weight 20%.
2. Risk and opportunity workshops with KA's in-house experts. Weight 56% (combined).
3. Expert evaluation from an external party. Weight 24%

The analysis consists of an evaluation based on the criteria of magnitude and likelihood applied to risks and opportunities. Financial effects were qualitatively considered in terms of performance, financial situation, cash flow, and access to cost of capital. The applied time horizons are identical to the approach described above for the impact assessment.

Risks and opportunities were analyzed as inherent risks and opportunities. The list of potential material impacts has been considered to assess whether there are sources of current or potential risks and opportunities.

The scores for risks and opportunities were individually calculated as a weighted sum of the results of the three mentioned steps of the analysis and then added together as the total financial impact. All risks identified are sustainability-related risks and were prioritized as such. Risks and opportunities were weighted equally.

STEP 4: CONSOLIDATION AND APPROVAL

The results from the impact assessment and the risk and opportunity analysis were consolidated into a matrix. The x-axis represents the result of the impact assessment, while the y-axis represents the result of the risk and opportunity analysis. A detailed description of the identified IROs per material topic is included after this subchapter and in the different subsequent topic-related chapters.

Materiality Threshold

Through setting a 50% threshold, the material topics are selected. The threshold should not cut off topics that either have a high outward impact or are related to high risks and opportunities. Particular care was taken to ensure that no topics with a high impact at any stage of the value chain were excluded.

Management and the Board of Directors signed off on the results.

Use of Value Chain Mapping

KA's operations are part of the automotive value chain with main inputs and outputs as well as business partners. The value chain stages assessed are:

• Upstream: Raw material extraction (mines, basic industry), Suppliers' suppliers (Tier X) - metals, monomers, polymers, etc., Suppliers (Tier 1) - polymers, steel, brass, rubber, electronics, etc.
• Own operations: KA manufacturing processes and production
• Downstream: Customers' manufacturing processes, end customers (product use), disposal/recycling after use

For the impact materiality assessment, impacts were evaluated at each stage of the value chain separately and then aggregated.

Frequency of Review

KA will conduct a review and update of the materiality assessment on a regular basis.

Material Topics Identified

The material topics for Kongsberg Automotive are:

Non-Material Topics

The double materiality assessment also produced topics and sub-topics that are not material for KA and therefore do not fall under the ESRS reporting requirements:

• ESRS E2: Pollution
• ESRS E3: Water and marine resources
• ESRS S3: Affected communities
• ESRS S4: Consumers and end users

In addition, there are sub-topics or sub-sub-topics which are not material (e.g. animal welfare) even though the topic level as such is material. The double materiality assessment established that material factors under ESRS S2 (workers in the value chain) are limited to upstream value chain impacts, risks, and opportunities with suppliers.

Application to Sustainability Disclosures

The double materiality process dictates the content for KA's sustainability disclosures and guides its priorities on sustainability issues. In many areas identified as material, KA has defined specific KPIs and responses to measure performance and disclose these metrics and targets in the company's sustainability statements. Where processes are less mature, KA is working continuously to devise strategies, define action plans, and implement change.

Transition plan for climate change mitigation

Scope of the plan

KA's climate change transition plan covers Scope 1 and 2 and is based on several key elements. It does not cover Scope 3 yet. Climate risks are included in KA's overall risk management system to reflect implications on an ongoing basis and in a structured way.

The transition plan applies to KA's own operations (manufacturing plants and facilities).

Target years and net zero commitments

For climate change mitigation, KA has defined three long-term strategic goals supporting the transition to sustainable products and decarbonization:

• CARBON-NEUTRAL PRODUCTS BY 2039
• 100% RENEWABLE PURCHASED ENERGY BY 2030
• REDUCTION OF SCOPE 1 AND 2 CO2e EMISSIONS BY 85% (BASE YEAR 2023) BY 2030 AND ACHIEVING ZERO SCOPE 1 AND 2 CO2e EMISSIONS BY 2035

Reduction milestones with baseline years

Scope 1 and 2:

• Baseline year: 2023 (18,113 tonnes CO2e market-based)
• 2025 target: 12% reduction vs. 2023 (approximately 2,173 tonnes CO2e reduction)
• 2030 target: 85% reduction vs. 2023
• 2035 target: Zero Scope 1 and 2 CO2e emissions (100% reduction)

Scope 3: Detailed Scope 3 reduction roadmaps are currently under development. Their focus lies on Scope 3.1 (purchased goods and services) as this category represents the largest share of upstream CO2e emissions and can be actively influenced by KA. Missing Scope 3 reduction targets will be developed by KA.

2024 performance:

• In 2024, the group's CO2e emissions (Scope 1 and 2) were approximately 15,557 tonnes of CO2e (market-based), a 14% reduction from the 18,113 tonnes of CO2e emitted in 2023.
• KA set a target in 2024 to reduce its Scope 1 and 2 CO2e emissions by 12% by the end of 2025 (compared to 2023). KA already achieved its target in 2024 but will keep on track to further reduce emissions in 2025 and achieve its long-term targets.

Alignment with 1.5°C / SBTi validation status

KA's target setting is in line with European climate neutrality targets and also reflects Science Based Targets initiative recommendations. KA is not excluded from the EU Paris-aligned benchmarks.

The targets are compatible with limiting global warming to 1.5°C considering the SBTi target setting tool and the SBTi Net-Zero tool. KA's targets for reducing Scope 1 and 2 CO2e emissions by 100% by 2035 are even more ambitious than SBTi requirements, which propose 63% Scope 1 and 2 reductions between 2023 and 2035 (SBTi target setting tool, 1.5 degree scenario) or 90% (SBTi Net-Zero tool) Scope 1 and 2 reduction for this period.

The targets were developed through workshops with operations management. They are based on internal reduction scenarios and are not externally assured. There is no formal SBTi validation mentioned.

Key decarbonization levers

Specific activities in 2024:

• In 2024, nine of KA's production sites reached a 100% implementation grade of LED lights, which led to significant reductions in energy use.
• Other key activities included implementing air leak reduction programs, replacing old equipment with newer and more energy-efficient devices, and reusing waste/process heat.
• Renewable electricity usage across KA manufacturing facilities increased from 55% in 2023 to 61% in 2024.
• Options under evaluation include power purchase agreements, on-site generation of renewable energy, and green tariffs.

Product portfolio resilience

Climate change is significantly affecting the automotive sector and contributes to the transition to low-carbon and zero-emission vehicles. KA's product portfolio strategy addresses this transition by balancing requirements between traditional combustion engines and electric vehicles. KA's product groups are already applied in multiple powertrains underlining the resilience in the product portfolio to climate-related megatrends such as electrification.

KA is working on conducting a formal resilience analysis, but has not completed one in 2024.

CapEx / investment commitments

To achieve the key actions, opex and capex are necessary and are considered within the annual budgeting planning process. Future alignment of KA's activities (sales, capex and opex) with EU Taxonomy is mainly tied to the global shift from fossil fuel-based vehicles to electric vehicles and the corresponding portfolio transformation.

No specific capex amounts are disclosed.

Locked-in emissions and stranded assets

Potential locked-in GHG emissions are limited but relevant in relation to KA's partially fossil fuel-based production sites and machinery, which KA is working to convert to renewable energy.

Use of carbon credits / removals

KA's GHG emissions reduction strategy at present does not utilize removals and/or offsetting credits. It is also not based on an internal carbon pricing model.

Governance and policies

The targets and transition plan have been approved by Executive Management.

KA's Sustainability Policy articulates the key areas of its own operations approach addressing climate change mitigation as well as renewable energy deployment and is approved by the CEO. The two key pillars are:

• Alignment of KA's climate goals with the Paris Climate Agreement
• Reduction of CO2e emissions through increased usage of renewable energy and alternative raw materials

The policy does not include further elaborations. It was developed to provide general guidance and further details in terms of actions and targets are laid out in the sustainability roadmap instead.

KA has not adopted formal policies addressing climate change adaptation or energy efficiency. The transition plan for KA's own operations is laid out in KA's sustainability roadmap and not as a policy.

To reach the 2025 and 2030 KPIs for Scope 1 and 2 CO2e emissions, KA has set up a centrally managed working group to identify opportunities as well as a policy deployment program to manage project execution, coordinate and track progress.

Upstream and downstream value chain-related actions

KA has started to establish two-way communication and engagement with suppliers on decarbonization targets and environmental responsibility. KA's risk assessments and the decarbonization questionnaire as well as the onsite sustainability audit checklist all contain topics regarding environmental and energy management policies and systems, yearly environmental targets, and employee training.

Since 2023, KA has inquired about the percentage of renewable energy used in electricity and heating. In 2023, KA started to collect primer performance data.

There are two policies (KA's supplier declaration and KA's supplier sustainability manual) which both focus on upstream value chain that address the need for suppliers to mitigate and adapt to climate change within their operations.

Total Scope 3 CO2e emissions decreased from 5.1 million tonnes in 2023 to 4.3 million tonnes in 2024, which is to some extent driven by reduced products sold and a reduced amount of purchased goods. The CO2e intensity values (market-based) on net revenues also decreased between 2023 and 2024 by 6%, demonstrating that a CO2e reduction was achieved aside from sales effects.

Policies related to climate change mitigation and adaptation

Kongsberg Automotive (KA) has not disclosed a specific named policy dedicated to climate change mitigation and adaptation in the excerpts provided. The company references E1-2 in its index table (page 71) but the detailed content extracted focuses on the company's transition plan, strategic goals, and actions rather than formal policies.

Climate Change-Related Strategic Framework

While not presented as a formal policy document, KA has defined climate-related strategic goals and a transition plan:

Key strategic goals:

• Carbon-neutral products by 2039
• 100% renewable purchased energy by 2030
• Reduction of Scope 1 and 2 CO2e emissions by 85% (base year 2023) by 2030
• Achieving zero Scope 1 and 2 CO2e emissions by 2035

Scope: The climate change transition plan covers Scope 1 and 2 emissions in own operations. It does not yet cover Scope 3 emissions, though detailed Scope 3 reduction roadmaps are currently under development, focusing on Scope 3.1 (purchased goods and services).

Governance: The targets and transition plan have been approved by Executive Management. Climate risks are included in KA's overall risk management system.

Alignment with standards: KA's target setting is in line with European climate neutrality targets and reflects Science-Based Targets initiative (SBTi) recommendations. KA is not excluded from the EU Paris-aligned benchmarks.

Implementation monitoring: KA has set up a centrally managed working group to identify opportunities as well as a policy deployment program to manage project execution, coordinate and track progress toward 2025 and 2030 KPIs for Scope 1 and 2 CO2e emissions.

Public availability: Not disclosed in the excerpts provided.

Note: The company states it is working on conducting a formal resilience analysis but has not completed one in 2024.

Actions and resources in relation to climate change policies

Kongsberg Automotive has disclosed several climate-related actions aligned with their climate change mitigation policy. The policy was approved by the CEO and focuses on two key pillars:

• Alignment of KA's climate goals with the Paris Climate Agreement
• Reduction of CO2e emissions through increased usage of renewable energy and alternative raw materials

Actions taken and planned

1. Implementation of energy efficiency measures and setting energy reduction targets

• Objective: To reduce energy consumption and related GHG emissions
• Scope: Own operations
• Resources: Not quantified

2. Ongoing shift to the usage of renewable energy

• Objective: To reduce GHG emissions for KA's production processes and buildings
• Scope: Own operations
• Resources: Not quantified

3. Product design reflecting sustainability requirements

• Focus areas:
  • Lower weight
  • Recyclability
  • Lower embedded GHG emissions
  • Compatibility with battery electric vehicles
• Scope: Own operations/downstream value chain
• Resources: Not quantified

4. Purchase of input materials with lower GHG emissions

• Scope: Upstream value chain
• Resources: Not quantified

5. ISO 14001 certification of all plants

• Coverage: Includes climate change-related topics
• Scope: Own operations
• Resources: Not quantified

6. Broad supplier portfolio and supplier risk mapping

• Objective: Climate adaptation and supply chain resilience
• Scope: Upstream value chain
• Resources: Not quantified

7. Internal team of sustainability experts

• Scope: Own operations
• Resources: Not quantified (non-financial resource allocation)

Policy framework

The company references:

• Climate Change Mitigation Policy (approved by CEO)
• KA's Supplier Declaration and Supplier Sustainability Manual (addressing upstream climate action)
• Sustainability roadmap (contains transition plan details)

The document notes that time horizons and further details are laid out in the sustainability roadmap rather than in the formal policies.

Targets related to climate change mitigation and adaptation

Climate Change Mitigation Targets

Kongsberg Automotive has established the following long-term strategic goals and milestone targets for climate change mitigation:

Long-term Strategic Goals

Milestone Reduction Targets (Scope 1 and 2)

2025 Annual Targets

Environment:

• Reduction of Scope 1 and 2 CO₂e emissions in comparison to base year 2023 by 12%
• Switch to 100% renewable energy for one additional plant
• 2% reduction in energy index (compared to 2024 target values)
• 2% reduction in waste index (compared to 2024 target values)
• 1% reduction in water index (compared to 2024 target values)

Renewable Energy Target

• Target: 100% renewable purchased electricity and heat by 2030
• Baseline: Not specified
• Progress 2024: Renewable electricity share increased from 55% (2023) to 61% (2024)
• Scope: Own operations (all plants)

Energy Efficiency Target

• Target: 2% reduction in energy intensity in 2025 (compared to 2024 target value)
• Baseline: 2024 target value
• Type: Intensity-based (MWh per million EUR of total product sales)
• Scope: Own operations (manufacturing plants)
• Progress 2024: Energy intensity was 112 MWh/mEUR in 2024 vs. 109 MWh/mEUR in 2023 (2.7% increase)

Decarbonization Levers and Estimated Contributions to 2035 Target

Scope 3 Targets

KA is currently developing Scope 3 reduction roadmaps with a focus on Scope 3.1 (purchased goods and services). No quantified Scope 3 reduction targets have been established as of 2024. The company aims to define clear reduction milestones in 2025 to support the long-term goal of carbon-neutral products by 2039.

Target Setting Approach

• Methodology: Absolute contraction approach
• Science-based alignment: Targets are compatible with limiting global warming to 1.5°C considering the SBTi target setting tool and SBTi Net-Zero tool
• Validation: Not externally validated or SBTi-approved; developed through internal workshops with operations management
• EU Paris-aligned benchmarks: KA is not excluded from EU Paris-aligned benchmarks
• More ambitious than SBTi: KA's 100% Scope 1 and 2 reduction by 2035 exceeds SBTi requirements of 63% (1.5°C scenario) or 90% (Net-Zero tool)

GHG Removal and Offsetting

KA's GHG emissions reduction strategy does not utilize removals and/or offsetting credits. No internal carbon pricing model is in place.

Energy consumption and mix

Kongsberg Automotive disclosed a comprehensive energy consumption and mix breakdown for 2024 and 2023, covering all production sites. Comparative figures for 2023 have been restated to reflect CSRD-required categories and exclude office locations and fuel consumption of company cars. 2024 figures also exclude fuel consumption of company cars.

Energy consumption and mix table

*Comparative figures for 2023 have been restated to reflect CSRD-required categories and do not include office locations and fuel consumption of company cars. Not subject to limited assurance by Deloitte.

**2024 figures do not include fuel consumption of company cars.

Methodology

Total energy includes all energy derived from fuels, electricity, district heating, and cooling consumed by KA across all activities. The total energy consumption is split into fossil, nuclear, and renewable sources. For the split of conventional purchased electricity into origin categories (fossil, nuclear, renewable), the corresponding country's electricity generation sources as published by www.iea.org (retrieved as at 13.02.2025) have been used.

Energy intensity is calculated by dividing total energy consumption by total net revenue. All KA revenue relates to high-climate-impact sectors as defined by EU 2022/1288.

Renewable electricity share is calculated by dividing total consumption of purchased renewable electricity by total electricity consumption.

Gross Scopes 1, 2, 3 and Total GHG emissions

Kongsberg Automotive reports GHG emissions in accordance with ESRS E1-6 (Gross Scopes 1, 2, 3 and Total GHG emissions). The company has set a baseline year of 2023 for its emission reduction targets and reports location-based and market-based Scope 2 emissions. Scope 3 emissions are reported across eleven categories out of the fifteen defined by the GHG Protocol.

Scope 1, 2 and Total GHG emissions

*Comparative figures have been restated to reflect the CSRD-required categories and do not include office locations. The comparative figures are not subject to limited assurance by Deloitte.

Scope 3 GHG emissions by category

*Comparative figures have been restated or newly calculated (scope 3) to reflect the CSRD-required categories and do not include office locations. The comparative figures are not subject to limited assurance by Deloitte.

GHG intensity based on net revenue

*Comparative figures have been restated or newly calculated (scope 3) to reflect the CSRD-required categories and do not include office locations. The comparative figures are not subject to limited assurance by Deloitte.

Scope 1 emissions breakdown

Scope 1 emissions mainly result from natural gas and propane and to a much lower extent gas/diesel oil and kerosene. No sub-breakdown by source category (stationary combustion, mobile combustion, process emissions, fugitive emissions) is disclosed.

Biogenic CO2 emissions

No biogenic CO2 emissions are reported separately.

Regulated emissions

No Scope 1 GHG emissions are from regulated emission trading schemes (0% in both 2023 and 2024).

Internal carbon pricing (E1-8)

KA's GHG emissions reduction strategy at present does not utilize removals and/or offsetting credits. It is also not based on an internal carbon pricing model.

Methodology and scope notes

Scope 1: Total GHG emissions, expressed in tonnes of CO2 equivalent (tCO2e), mainly from natural gas and propane and to a much lower extent gas/diesel oil and kerosene. Energy consumption is monitored and reported monthly by invoices or building-specific meter readings or estimates in the absence of either. For Scope 1 emissions, CO2e conversion factors from the UK Department for Energy Security and Net Zero are applied across all locations. Fuel consumption of company cars is not material and has not been included for 2023 and 2024 reporting. GHG removals, carbon credits and avoided emissions are not used and thus not included.

Scope 2: Total GHG emissions from purchased electricity, heat and steam consumed by KA. Location-based emissions are based on country/region-specific average CO2e conversion factors for defined locations retrieved from www.carbonfootprint.com (released 06.09.2024). Market-based Scope 2 emissions consider contractual instruments such as energy attribute certificates and guarantees of origins for renewable energy sources. For sites without such contractual agreements, residual mix emission factors of the corresponding country have been used for the CO2e emission calculation (retrieved from www.carbonfootprint.com, released 06.09.2024).

Scope 3: Total GHG emissions originating from KA's value chain. KA has identified four out of the fifteen categories defined by the GHG Protocol as not applicable and calculated CO2e emissions for the other eleven categories applying the GHG Protocol standards. Categories 8, 13, 14, and 15 are not applicable. Accounting policies are provided for the two most material categories: Category 1 (Purchased goods and services) uses the spend-based method based on environmentally extended input-output (EEIO) models (Estell by company Sustain). Category 11 (Use of sold products) is based on the average weight of KA's main product groups and calculates KA's portion of the CO2e emissions that vehicles which contain KA products emit during their average lifetime (10 years assumed).

Total GHG emissions: Calculated as the sum of Scope 1, 2 and 3 emissions.

GHG intensity: The ratio is calculated by dividing total GHG emissions by total net revenue. Total net revenue reconciles to the consolidated statement of comprehensive income. All KA revenue relates to high-climate-impact sectors as defined by EU 2022/1288.

Consolidation scope: The consolidation scope of KA's sustainability statements is aligned with IFRS financial statements and covers the reporting year 2024 of Kongsberg Automotive ASA and subsidiaries over which it exercises control, unless otherwise noted. Does not include office locations. Fuel consumption of company cars is excluded for 2023 and 2024 reporting.

Anticipated financial effects from material physical and transition risks and potential climate-related opportunities

Phase-in exemption

The company uses the phase-in option for this disclosure requirement.

Policies related to own workforce

Kongsberg Automotive (KA) has established several policies that relate to its own workforce, covering working conditions, equal treatment, human rights, and ethical conduct.

Code of Conduct

Policy name: Code of Conduct

Scope: Applies to all group employees and elected officers, including Executive Management and Board of Directors, contractors, and business partners.

Key content and principles:

• Ethical guidelines and guidelines for corporate social responsibility
• Ban on bribery, corruption, and facilitation payments
• Prohibition of unlawful discrimination
• Prohibition of forced and child labor
• General behavior expectations
• Anti-corruption and bribery
• Anti-fraud
• Conflict of interests
• Compliance with laws
• Equal treatment
• Anti-harassment
• Data privacy
• Responsible communication

Governance: The Code of Conduct is approved by KA's General Counsel. The CEO holds ultimate accountability for its implementation. The KA Compliance Committee (consisting of KA's General Counsel, Head of People and Culture, and Chief Financial Officer) is responsible for investigation of any matter brought to its attention.

Public availability: Available on the company's website in 12 languages.

Monitoring: All employees who have received training on the Code of Conduct are required to provide written confirmation of their understanding. Reports of breaches are included in quarterly plant reporting to Internal Audit. Site audits by Internal Audit also include an assessment of business ethics and the internal control environment.

Training: The Code of Conduct training is an integral part of the onboarding process for all new employees. A bi-annual refresher is required for all other employees. The completion rate of the Code of Conduct training was 64% in 2024.

Human Rights Policy

Policy name: Human Rights Policy

Scope: Applies globally to KA's own operations and therefore covers all members of its workforce. The policy also addresses human rights throughout the value chain.

Key content and principles:

• Commitment to respect human rights, including labor rights, of people in KA's own workforce and its value chain
• Specifically addresses trafficking in human beings, forced labor or compulsory labor, and child labor
• Covers management of impacts, risks and opportunities related to working conditions and equal treatment and opportunities for all
• Respecting the labor rights of KA's own workforce and engaging with the same
• Aims at having a diverse and representative workforce and management structure where everyone is valued and respected for their skills, experience and views

Governance: Approved by Executive Management.

Public availability: Available for all employees and other stakeholders on KA's external website. Published on December 18, 2024.

Link to international standards: KA applies international, best practice standards in circumstances where local laws and regulations set lower standards and does not prohibit their application.

Implementation status: The policy was only developed in 2024 and had not been implemented at the beginning of the reporting period. The policy and the corresponding processes are not yet implemented for the full reporting year 2024.

Diversity Policy

Policy name: Diversity Policy

Implementation: KA implemented its Diversity Policy in 2013.

Key content and principles:

• Aimed at ensuring equality for all regardless of gender, age, ethnicity, cultural background, disability, sexual orientation, and religion
• The principle is fundamental for all decisions on recruitment, promotions and remuneration

Remuneration Policy

Policy name: Remuneration Policy

Scope: Covers all employees at the company.

Key content and principles:

• Ensures fair and competitive compensation practices
• Defines salary-setting structures, position evaluation, and bonus frameworks to support consistency and alignment with market standards
• Focuses on office employees

Status: Currently under review and will be updated and published in 2025.

Global People and Culture Procedure

Policy name: Global People and Culture Procedure

Key content and principles:

• Ensures the standards KA wants to maintain
• Provides guidance for the global People and Culture function

Status: Currently under review and will be updated and published in 2025.

Other Related Policies

KA has further clear policies on:

• Environmental issues
• Health and safety

These policies are available on the company's website.

Grievance Mechanisms

SpeakUp® Line: KA's communication channel for internal and external parties to report breaches or suspected breaches of company policies, the Code of Conduct, or other regulations. The channel is provided by an external service provider and offers full anonymity. All reported concerns are received and managed by KA's Compliance Committee. KA ensures whistleblowers who report potential violations in good faith are protected from retaliation and any other negative consequences, in line with the EU Whistleblower Protection Directive (EU Directive 2019/1937).

Social Protection and Benefits

KA's entire workforce is covered by social protection measures, primarily through national country legislation and supplemented by additional company benefits, ensuring financial security across various circumstances including sickness, unemployment, employment injury, parental leave, retirement, and acquired disability. Where social security measures are limited, employees are safeguarded through additional company benefits (specifically applies to India and the US).

Collective Bargaining and Freedom of Association

KA respects the right of its employees to associate freely and to join or not to join trade unions and works councils without fear of discrimination or retaliation. There is no European works council in place but local unions and committees exist. In 2024, 50% of KA's internal employees were covered by collective bargaining agreements (74% in EEA countries, 30% in non-EEA countries).

Characteristics of the undertaking's employees

Total headcount and FTE

2024:

• Total employees (headcount): 4,921
• Full Time Equivalent (FTE): 4,780 (based on workforce reference on page 34)

2023:

• Total employees (headcount): Not explicitly stated as comparative figure
• Employee reduction: 11% reduction in total employees by year-end 2024 compared to 2023

Headcount by gender

Headcount by country/region

Countries with at least 50 employees representing at least 10% of total:

Regional distribution (based on workforce reference page 34):

• Europe: Largest region (Poland, Spain, Sweden, Norway manufacturing/tech centers)
• Americas: Seven manufacturing plants and two tech centers; Mexico has largest manufacturing workforce
• Asia: Five manufacturing sites (one also tech center) and one site office across China, India, and Korea; largest plant/tech center in Wuxi, China

Headcount by employment contract type

Headcount by employment type (full-time/part-time)

Employee turnover

2024:

• Employee turnover rate: 33%
• Employee turnover absolute: 1,477

The company notes: "The high employee turnover rate of 33% in 2024 includes all types of leave reasons. As the company announced in 2024, a significant proportion of this is involuntary, as the voluntary departure rate is constantly reviewed and fluctuates within the industry standard."

Methodology note: Twelve-month rolling turnover refers to the ratio of voluntary and involuntary leavers in the past 12 months divided by the average headcount of the past 12 months.

New hires

Not disclosed in the excerpts.

Collective bargaining coverage

2024:

• Overall coverage: 50% (2,313 out of 4,594 internal employees)
• EEA countries: 74% (1,561 out of 2,115)
• Non-EEA countries: 30% (752 out of 2,479)

Non-employee workers

• External workers: 326 (not disclosed by gender breakdown)

Data sources

Employee data is based on KA's SAP SuccessFactors system. Headcount is counted as 1 for active, short-term leave, long-term leave and suspended employees, regardless of full-time or part-time status. Retired or terminated employee headcount is not counted.

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

Number and type of non-employee workers

Agency workers as percentage of total workforce: 6.6% in 2024

Kongsberg Automotive states that 6.6% of its total workforce were agency workers in 2024, allowing it to build up or scale down in response to market movements.

Methodology

The company uses Full Time Equivalent (FTE) as the counting methodology for workforce numbers, as indicated in the workforce reporting sections.

Work-related health and safety metrics including non-employees

For the year 2024, there were 12 total recorded work-related accidents, including own employees (11) and contractors (1). Seven accidents resulted in lost time, while four incidents required medical treatment.

KA's health and safety KPIs cover all of its operations worldwide, including employees and contractors.

Breakdown by type

The disclosure mentions:

• Agency workers: 6.6% of total workforce
• Contractors: Included in health and safety reporting and visitor procedures

All external visitors and contractors to any KA manufacturing facility must comply with a sign-in procedure and align contractor packs to ensure full HSE awareness and compliance for each location visited.

Collective bargaining coverage and social dialogue

Collective bargaining coverage

KA respects the right of its employees to associate freely and to join or not to join trade unions and works councils without fear of discrimination or retaliation. There is no European works council in place but local unions and committees. KA cooperates with trade union representatives and maintains an open and trusting relationship.

In 2024, 50% (2,313/4,594) of KA's internal employees were covered by collective bargaining agreements:

• EEA countries: 74% (1,561/2,115)
• Non-EEA countries: 30% (752/2,479)

For internal employees, KA determines their working conditions and terms of employment based on individual agreements and may refer to the existing collective bargaining agreements.

Coverage by country and region

Incidents and complaints

In 2024 no confirmed incidents of discrimination were reported or identified. Further, no legal cases, fines or penalties regarding discrimination were brought against the company or its employees.

Accounting policies

Collective bargaining agreements and workers' representatives: Comprises the absolute number of different types of collective bargaining agreements based on specific employee sub-groups.

Collective bargaining coverage rate: Total headcount covered by collective bargaining agreements divided by total headcount of KA internal employees.

Diversity metrics

Gender distribution

Total workforce (only within KA internal employees)

Global Leadership Team

Board of Directors

Age distribution

Age group (only KA's internal employees)

Accounting policies

Gender in leadership and senior leadership positions: At KA, senior management positions refer to those who report directly to the CEO and cover C-level positions or Executive Vice President (EVP) areas.

Board composition: As a Norwegian public limited company, KA is required to have at least 40% female participation in the Board of Directors. At the end of 2024, the Board of KA is comprised of eight members, three women and five men, which is the same ratio as at the end of 2023.

Adequate wages

Commitment and approach

Kongsberg Automotive (KA) is committed to fair compensation and ensuring employees receive an adequate wage that secures a decent living. The company acknowledges that a structured approach requires job leveling and benchmarking to assess wage alignment and define adequacy across the countries where the company operates.

Current status

As stated in the report: "These initiatives are still in progress and will serve as a foundation for determining an adequate wage in the future. The goal is to establish a sustainable framework that upholds fair pay for all employees in line with company values."

Benchmark used

No specific living wage benchmark is currently disclosed. The company references:

• Internal benchmarks and comparisons with industry standards that are regularly applied
• Job leveling and benchmarking initiatives still in progress
• No mention of external living wage benchmarks (e.g., Fair Wage Network, WageIndicator, Anker Methodology, MIT Living Wage Calculator, or Global Living Wage Coalition)

Coverage

Not disclosed. The company states that adequate wage initiatives are "still in progress" and will serve as a foundation for future determination.

Targets

No quantitative targets for adequate wages are set. The company states: "There are no quantitative targets for this area but insights are used for individual follow-ups."

For 2025, the target is to update and enhance the Human Rights Policy based on implementation feedback.

Supply chain

Regarding workers in the value chain, the company identifies "inadequate wages in producing countries" as a potential negative impact. The response includes:

• Supplier sustainability risk assessment contains working conditions as focus area
• Benchmark tools of costs of workforce
• Awareness raising with buyers and within the supply chain
• On-site sustainability supplier audits focusing on working conditions

However, audit findings note: "Suppliers, especially smaller ones, focus on legal minimum wages without living wage considerations (widespread, systematic). However, labor market pressure typically drives supply chain salaries above minimum wages, making this more a potential than actual risk."

Methodology details

Not disclosed. The company states that job leveling and benchmarking initiatives are still in progress and will serve as the foundation for determining adequate wage in the future.

Social protection

Coverage of employees

KA's entire workforce is covered by social protection measures, primarily through national country legislation and supplemented by additional company benefits, ensuring financial security across various circumstances.

100% of employees are covered by social protection measures.

Types of protection

This coverage, provided mostly through public programs, protects against loss of income due to:

• Sickness
• Unemployment
• Employment injury
• Parental leave
• Retirement
• Acquired disability

Income replacement levels

It is important to note that the secured income provided during these circumstances is typically limited to a percentage of the employee's salary, with the exact percentage varying by country and aligned with the norms of the respective social security systems.

Additional company benefits

Where social security measures are limited and do not cover loss of income, employees are safeguarded through additional company benefits, reflecting KA's commitment to their well-being throughout their professional and personal lives. This specifically applies to:

• India
• United States

Scheme type

Coverage is provided mostly through public programs, supplemented by additional company benefits where needed.

Health and safety metrics

Work-related accidents and fatalities

Incident rate and lost days

Coverage of health and safety management system

100% of KA's manufacturing facilities have their own health and safety committees. All of KA's operational sites conduct employee health and safety risk assessments, in line with KA's minimum requirements. The workforce within manufacturing locations is engaged with formal joint management worker health and safety committees.

Accounting policies

Work-related accidents: Number of work-related accidents with and without lost days. Incidents are included if they either required medical attention, resulted in work restrictions, resulted in loss of consciousness or resulted in lost time (absence). This metric includes all employees (full-time, part-time and temporary workers).

Work-related ill health or occupational diseases: Number of occupational illness cases resulting from repeated exposure to a physical hazard like a repetitive strain or cumulative trauma injury. Incidents are included if they are diagnosed by a treating physician or licensed medical professional and are deemed work-related and either resulted in days away from work, work restrictions or a permanent disability. This metric includes all employees (full-time, part-time and temporary workers).

Incident rate: All work-related accidents and work-related ill health cases per 1,000,000 hours worked within the year.

Lost days: Total number of days lost due to work-related accidents which resulted in an absence of more than one day. The day on which the case is reported is not counted.

Work-related fatalities: Work-related accident resulting in the death of an employee. This metric includes all employees (full-time, part-time, and temporary workers).

Work-life balance metrics

Not disclosed.

Kongsberg Automotive has applied the phase-in option for ESRS S1-15 Work-life balance metrics in 2024.

The excerpts confirm that employees are covered by social protection measures including parental leave through national country legislation and supplemented by additional company benefits, ensuring financial security. However, no quantitative metrics are provided for:

• % of employees entitled to family-related leave (maternity/paternity/parental/family care)
• % of entitled employees who took family-related leave (split by gender)
• Return-to-work rate after parental leave (split by gender)

Compensation metrics (ESRS S1-16)

Pay gap

The gender pay gap at the group level is 69% (unadjusted). This gap reflects the composition of KA's workforce and industry dynamics. It is influenced by the distribution of men and women across different roles, with a higher proportion of men in senior and technical positions, as well as broader industry trends and career progression patterns.

The company notes that the formal job leveling system is under development; for this reason, this figure should be considered a rough estimation rather than a precise measure, nor is it a direct indication of unequal pay for equal work. The company remains committed to fostering a more balanced workforce through targeted initiatives that support gender equity and career advancement.

Currently, the company does not have job levels defined for the entire workforce. Job levels exist for less than 10% of the workforce. This limitation makes it challenging to conduct comprehensive gender pay gap analysis, as job levels are essential for accurate comparisons and meaningful insights. However, the company recognizes the importance of this analysis and is actively working on a plan to implement a structured job architecture in 2025-2026.

Remuneration ratio

The ratio of the highest-paid individual's annual base salary to the median annual base salary for all other employees is 17 times.

This reflects the company's diverse geographical footprint. As a Europe-based company with manufacturing operations across multiple regions, the overall salary distribution is influenced by regional pay structures and cost-of-living differences. The nature of the business, with a significant portion of the workforce in manufacturing roles, also impacts the median salary level. This ratio should be viewed in the context of these factors, which shape the company's compensation structure across different markets and job functions.

Methodology

Gender pay gap: Reflected on a full-time basis and calculated as the difference between the average annualized base salary for men and women divided by the average annualized base salary for men and expressed as a percentage. All internal employees except internships and working students in all countries have been included. The calculation is based on annual base salary, excluding fixed allowances and variable components due to limited global data availability.

Remuneration ratio: Reflected on a full-time basis and calculated by identifying the highest annualized base salary (i.e. highest paid individual) and calculating the median base salary excluding it. The calculation is based on annual base salary, excluding fixed and variable components due to limited global data availability.

Both metrics cover KA's own workforce (internal employees only).

Incidents, complaints and severe human rights impacts

In 2024 no confirmed incidents of discrimination were reported or identified. Further, no legal cases, fines or penalties regarding discrimination were brought against the company or its employees.

Incidents and complaints metrics

Grievance mechanisms

KA operates a SpeakUp® line as well as central and local grievance and complaint mechanisms for its own workforce. These channels are available for workers to raise concerns about human rights impacts.

Business Conduct Policies and Corporate Culture

The Board of Directors has defined the company's core values which are reflected in the company's Code of Conduct. The Code of Conduct includes ethical guidelines and guidelines for corporate social responsibility, including a ban on bribery, corruption, and facilitation payments, the prohibition of unlawful discrimination, and the prohibition of forced and child labor.

Suppliers to the company are required to confirm their adherence to these principles by signing a particular certificate. The company has further clear policies on environmental issues and health and safety. The policies are available on the company's website.

KA aims at having a diverse and representative workforce and management structure; where everyone is valued and respected for their skills, experience and views. This principle is also part of the company's Human Rights Policy of 2024 and Code of Conduct. The principle is fundamental for all decisions on recruitment, promotions and remuneration.

KA implemented its Diversity Policy in 2013, which aimed at ensuring equality for all regardless of gender, age, ethnicity, cultural background, disability, sexual orientation, and religion.

Management of Relationships with Suppliers

Suppliers to the company are required to confirm their adherence to these principles by signing a particular certificate.

Risks in the procurement process include the risk of supplier insolvencies, quality defects, new non-tariff trade barriers and market fluctuations in the price and availability of some raw materials. To mitigate these risks and ensure sustainability, KA applied a variety of countermeasures, ranging from commercial negotiations with suppliers and customers to implementing financial instruments to achieve a fair share of cost burden and risk, while measuring supplier performance KPIs constantly.

Prevention and Detection of Corruption and Bribery

The Code of Conduct includes ethical guidelines and guidelines for corporate social responsibility, including a ban on bribery, corruption, and facilitation payments, the prohibition of unlawful discrimination, and the prohibition of forced and child labor.

KA will be subject to risks arising from alleged, or actual, violations of any of the foregoing, and could also be subject to risks arising from potential employee misconduct, including non-compliance with internal policies and procedures as well as malfeasance. The areas of increased focus of investigations and proceedings are compliance with broader business conduct rules, including those in respect of market abuse, bribery, money laundering, trade sanctions, and data protection as well as privacy.

Incidents of corruption or bribery

Confirmed incidents

In 2024, there were no confirmed incidents of corruption reported or identified. No such cases were reported through the quarterly plant reporting to Internal Audit. Site audits by Internal Audit also include an assessment of business ethics and the internal control environment. In 2024, five site audits were performed and no incidents were identified during those audits. Furthermore, no cases of corruption or bribery were reported through the SpeakUp® line in 2024.

Convictions and fines

No legal cases regarding corruption were brought against the company or its employees in 2024. No fines, penalties, or compensation related to corruption or bribery were paid.

Disciplinary actions

No employees were dismissed or disciplined for corruption or bribery incidents in 2024.

Contracts terminated

Not disclosed.

Investigation procedures and speak-up mechanisms

Kongsberg Automotive has zero tolerance for corruption or bribery. The anti-bribery and corruption policy is laid out in the Code of Conduct. All cases of bribery or corruption related to KA, its personnel, and representatives must be reported to the General Counsel either directly or via the whistleblowing service SpeakUp® line. This applies even if the bribery attempt is rejected or unsuccessful.

All reports or concerns relating to the Code of Conduct are considered by the KA Compliance Committee, which consists of KA's General Counsel, Head of People and Culture, and the Chief Financial Officer. The Committee is responsible for investigation of any matter brought to its attention, utilizing internal resources such as KA Internal Control, KA's General Counsel, or retained external resources.

SpeakUp® is accessible online and via phone and is also available to external parties. All concerns are treated with the utmost confidentiality, without fear of retaliation, in line with the EU Whistleblower Protection Directive (EU Directive 2019/1937).

Reports of breaches of Code of Conduct are included in the quarterly plant reporting to Internal Audit. Site audits by Internal Audit also include an assessment of business ethics and the internal control environment.

Payment practices

Management of relationship with suppliers including payment practices

Fair payment terms, such as reasonable payment periods and transparent agreements, foster trust, strengthen business relationships and encourage collaboration between KA and its suppliers.

Timely payments are crucial for ensuring supplier sustainability and growth. KA's payment terms align with industry practice and apply consistently across all supplier categories.

Payment metrics (2024)

Average invoice payment time: 75 days

Legal proceedings for late payments: No legal proceedings for late payments outstanding

Accounting policies

Average number of days to pay invoice: Average number of days based on accounts payable divided by the sum of cost of goods sold (direct materials.)

Number of outstanding legal proceedings for late payments: Number of all outstanding legal proceedings (litigation or arbitration) for late payment.