Porsche

Porsche describes its two-tier board structure (report p.187-191). Under Article 8 of the Articles of Association the Executive Board must have at least two members; as of December 31, 2024 it had eight members, with portfolios for Management, Procurement, Car-IT, Research and Development, Finance and IT, Human Resources and Social Affairs, Production and Logistics, and Sales and Marketing. The current share of women on the Executive Board is 12.5% (one woman), above the statutory minimum of one woman and one man. Diversity and a sufficient mix of ages are considered in Executive Board composition. The Supervisory Board has 20 members, split equally between ten shareholder representatives (elected by the Annual General Meeting) and ten employee representatives under the German Co-Determination Act, of whom seven are Porsche AG employees and three are trade union representatives. As of December 31, 2024 the Supervisory Board had eight women, corresponding to 40%. Four shareholder representatives are considered independent (a 40% share of independent members). The Audit Committee handles non-financial reporting tasks. The Supervisory Board must collectively hold sustainability expertise and received training on ESG topics.

Porsche discloses how sustainability information reaches its bodies (report p.191). Those overseeing the sustainability strategy (the Members of the Executive Board responsible for Production and Logistics and for Procurement) report to the full Executive Board on an ad hoc basis, and target achievement is generally reported to and reviewed by these overseers quarterly. When decisions are made on important transactions, all relevant sustainability information is prepared and provided to the Executive Board and taken into account. Reporting on sustainability is generally submitted to the full Executive Board once a year as part of the group's overall strategy. In the reporting year, the Executive Board and Supervisory Board addressed material impacts including the decarbonization program, electrification of the product portfolio and reduction of fleet emissions, sales and distribution planning, the resource efficiency program, occupational health and safety, the Business and Human Rights Council report on LkSG implementation, promotion of equal opportunities and diversity, corporate citizenship, the customer excitement index, integrity and management culture (Porsche Code), the whistleblower system, the German Corporate Governance Code and anti-corruption and bribery training, and geopolitical developments.

Porsche integrates sustainability into Executive Board pay (report p.191-193). Since fiscal year 2023, sustainability has been part of the remuneration system via an ESG factor that adjusts the variable annual bonus (short-term incentive). The bonus is calculated by multiplying weighted financial sub-targets (return on sales and automotive net cash flow margin) by the ESG factor, and can range from 0 to 180% of target. The ESG factor combines an environmental sub-target, the decarbonization index (DCI), weighted 40%, a social sub-target of gender quota, customer excitement index and employee satisfaction (equally weighted, together 60%), and a governance factor (multiplier 0.9 to 1.1). The DCI measures CO2 equivalent emissions per vehicle across the value chain. For the reporting year the DCI actual was 57.3 tCO2e/vehicle against a target of 58.3, and the overall ESG factor was 1.16. The Supervisory Board sets the target values. Since 2023 ESG targets are also anchored in management remuneration and, in the reporting year, for Porsche AG employees under collective bargaining agreements. Supervisory Board pay is not tied to ESG factors.

Porsche states that the overview of the core elements of due diligence prepared in accordance with ESRS 2 GOV-4 is set out in the Annex of the non-financial statement (report p.339, referenced in the general disclosures and the disclosure index). The statement maps how the core elements of the due diligence process are embedded in the group's governance, strategy and reporting and where they are described across the non-financial statement. Human rights due diligence is carried out under the German Supply Chain Due Diligence Act (LkSG), with the Business and Human Rights Council reporting on implementation, and negative human rights impacts with potential significance are automatically assessed as material and subject to in-depth review. Supplier due diligence is applied through the Code of Conduct for Business Partners and the sustainability rating (S-rating). The information refers to related disclosures in G1 Business conduct, S2 Workers in the value chain, and the double materiality assessment.

Porsche describes risk management and internal controls over sustainability reporting (report p.193). Sustainability-related risks and opportunities are managed through the group's general risk management processes, which were expanded with an additional process to identify sustainability risks and opportunities; there are no special controls for managing impacts. A CSRD internal control system (CSRD ICS) was gradually added to the accounting-related ICS during the reporting year to meet sustainability reporting requirements, aiming to mitigate material risks throughout the reporting process and reduce the risk of a material misstatement in the non-financial statement. The CSRD ICS covers all group companies in the CSRD consolidated group, with data secured by both decentralized and centralized controls. A risk-oriented, data-point-based concept assesses how susceptible individual data points are to error and the potential reputational damage, differentiating control depth and documentation requirements. Material risks were identified through process analysis and assessment, with risk-minimizing controls defined and implemented along the reporting process. Results are reported to the Executive Board and Supervisory Board of Porsche AG.

Porsche presents its strategy, business model and value chain (report p.171-175). The Porsche AG Group is a leading manufacturer of luxury sports cars that develops, produces and sells vehicles, engines and other components and parts, with financial services (finance and mobility services for customers and dealers) as a further business purpose. Porsche AG is the parent company and part of the Volkswagen Group. In the reporting year the group delivered 310,718 vehicles, down 3.0% versus 2023, generated sales revenue of 40.1 billion euros with a return on sales of 14.1%, and reported an automotive BEV share of 12.7%. 27% of new vehicles delivered were electrified (BEVs or PHEVs). As of the reporting date it had 42,615 employees, up 1.1%. The value chain includes more than 2,500 direct suppliers of production materials and more than 5,300 direct suppliers of non-production materials, spanning upstream raw material extraction, own development, production (plants of Porsche AG and Porsche Leipzig GmbH) and sales, and downstream use, service and end-of-life management. The revised Strategy 2030 Plus has four cross-functional strategies: Sustainability, Customers, Products and Transformation.

Porsche discloses stakeholder interests and views (report p.184-187). It operates a holistic stakeholder management system based on a balanced scorecard approach, systematically recording expectations of individual stakeholder groups. Key stakeholders identified through regular internal analyses are local residents and communities, customers and business partners, investors and analysts, the media, employees, policymakers and associations, NGOs and charitable organizations, the scientific community and experts, and competitors. Engagement is continuous and uses varied channels: employee representatives, employee surveys (including the Porsche Puls survey feeding an employee satisfaction index) and feedback talks; the dealer network and customer surveys covering purchasing, product quality, Porsche Connect services and charging; media reviews and ESG ratings; and capital-market events for investors. Views feed into strategy and business decisions. The external Porsche Sustainability Council, formed in 2016, institutionalizes the sustainability dialog; in 2024 it met once with the Supervisory Board, once with selected Executive Board members and once with the Chairman of the Executive Board, focusing on product strategy and the transformation toward electromobility. The Group Works Council represents the workforce. Stakeholders were also involved in validating the double materiality results.

Porsche discloses its material impacts, risks and opportunities and their interaction with strategy (report p.181-183). Of the ten topics assessed, nine were identified as material, with material impacts allocated to the ESRS sub-topics. Affected communities was the only one of the ten not found material but is still reported as an entity-specific topic (corporate citizenship under S3). The material topics span E1 Climate change, E2 Pollution, E3 Water, E4 Biodiversity and ecosystems, E5 Resource use and circular economy, S1 Own workforce, S2 Workers in the value chain, S4 Consumers and end-users, and G1 Business conduct. In October 2024 the group carried out a resilience analysis based on the double materiality assessment and the climate risk and scenario analysis, qualitatively assessing how well its strategy and business model can address the material impacts, using the same short-term (under one year), medium-term (one to five years) and long-term (over five years) time horizons. It concludes it can manage impacts across climate change, pollution, water, biodiversity, circular economy, own workforce, workers in the value chain, affected communities, consumers and business conduct, though short-term supply chain disruptions remain a challenge.

Porsche describes its double materiality assessment process (report p.176-183). Conducted under CSRD and ESRS in a multi-stage, six-step process (definition of scope and stakeholder inclusion; identification of potential topics and their impacts, risks and opportunities; assessment; consolidation and thresholds; validation and harmonization; derivation of reporting topics), it built on the 2023 methodology and was harmonized with the Volkswagen Group in 2024. The topic list is based on ten ESRS topics comprising 37 sub-topics plus one entity-specific sub-topic (corporate citizenship), giving 38 sub-topics. Impacts are assessed by severity (extent, scope, irreversibility) for actual impacts and severity times likelihood for potential impacts, with impact periods classified short-term (under one year), medium-term (one to five years) and long-term (over five years). Risks and opportunities are valued by multiplying anticipated financial effects by probability of occurrence, weighting financial potential and reputation effect. A five-point scale from informative to critical is used; a topic is material if it exceeds the second-highest category, significant. Individual risks or opportunities exceeding a net 100 million euro worst-case potential are reported even below the aggregate threshold. Results were validated with departments, the works council and Sustainability Council, harmonized with Volkswagen, and approved by the Executive Board. Nine of ten topics with 26 sub-topics were material.

Porsche discloses the ESRS disclosure requirements it covers, with the full list of disclosure requirements under ESRS 2 IRO-2 and the list of data points referencing other EU legislation set out in the Annex of the non-financial statement (report p.336). All ten topical standards were assessed in the double materiality assessment, and nine were identified as material and are reported: E1 Climate change, E2 Pollution, E3 Water, E4 Biodiversity and ecosystems, E5 Resource use and circular economy, S1 Own workforce, S2 Workers in the value chain, S4 Consumers and end-users, and G1 Business conduct. S3 Affected communities was not identified as material but is still reported because corporate citizenship is treated as an entity-specific topic. The statement also incorporates the disclosure requirements of the EU Taxonomy under Article 8 of Regulation (EU) 2020/852. Porsche used the option to omit certain narrative information on intellectual property, know-how or innovation results, but did not use the option to omit qualitative information on upcoming developments or matters under negotiation. Cross-references indicate where disclosures partially refer to information located outside the non-financial statement.

Porsche discloses a transition plan for climate change mitigation (report pages 201 to 207) built on its existing decarbonization approach within the Strategy 2030 Plus. The plan targets net zero by 2050, aligned with the International Energy Agency Net Zero Emissions by 2050 (NZE2050) scenario and the 1.5-degree ambition of the Paris Agreement. Reduction pathways for Scope 1 and Scope 2 use the Science Based Targets initiative (SBTi) methodology; the Scope 3 use-phase target follows the SBTi Land Transport guidance. The Executive Board approved the Scope 1, 2 and 3 targets in the reporting year. Progress is measured by the decarbonization index (DCI), the model-based average emissions per newly produced vehicle across its life cycle, which stood at 62.25 tCO2e per vehicle, a 5.3% decrease versus the recalculated 2023 base year of 65.75 tCO2. Decarbonization levers cover vehicle product strategy (increasing the BEV and PHEV share; 27% of new vehicles delivered in the reporting year were electrified), supply chain, own vehicle production sites, and the use phase. Taxonomy-aligned CapEx under economic activity 3.3 reached 3,371 million euros and OpEx 564 million euros in 2024, with roughly 8 billion euros of CapEx planned over the next five years.

Porsche describes its climate change mitigation and energy policies (report pages 208 to 211). The Group Sustainability Policy is the leading document for sustainability management, setting responsibilities and minimum requirements and aiming to go beyond legal compliance. The Group Environmental Compliance Management System (ECMS) Policy, based on Volkswagen Group specifications, standardizes environmental and energy processes and obliges group companies to set long-term environmental and energy targets and, for selected companies, to establish ISO 14001-certified management systems. Site managers must examine the use of renewable energy. For new buildings and conversions Porsche uses a manual on environmental requirements covering low global warming potential refrigerants, alternative fuels such as biomethane, and energy efficiency. Product compliance, including with environmental laws, is governed by the Group Product Compliance Management System (PCMS) Policy, with responsibility resting with the Porsche AG Executive Board. For the value chain, the Code of Conduct for Business Partners requires direct partners to reduce greenhouse gas and air emissions, increase renewable energy use, and improve energy efficiency; direct suppliers must disclose total energy consumption in MWh and CO2 emissions in tons (Scope 1, 2 and 3) at product level on request.

Porsche discloses actions and resources supporting its climate policies (report pages 211 to 212). In the reporting year it rolled out its largest model launch program to date, including the all-electric Macan and the 911 Carrera GTS T-Hybrid, and continued electrifying the portfolio. To decarbonize the supply chain, Porsche saved around 102,512 tCO2 in Taycan and new all-electric Macan models by using more sustainable materials and renewable electricity in high-voltage battery cell manufacturing, plus roughly 39,622 tCO2 from further actions at Volkswagen Group production sites. Since July 2021, new production-material contracts for all-electric series projects require suppliers to switch to certified renewable electricity, and almost all have committed. For vehicle production, the sites in Stuttgart-Zuffenhausen and Leipzig plus the Weissach development site use renewable electricity (since 2017) and biomethane, and were net carbon neutral in the reporting year. In the use phase, Porsche entered long-term indirect commitments with wind and solar operators; in total approximately 824,704 tCO2 were saved in the reporting year. Funds required are part of regular financial planning. Over five years, CapEx on economic activity 3.3 is expected to total around 8 billion euros.

Porsche discloses climate targets (report pages 212 to 213), with the reduction pathway based on 1.5-degree scenarios. For own operations (Scope 1 and 2), Porsche aims to cut CO2 by 76% between 2016 and 2030, using the SBTi modeling methodology to ensure 1.5-degree conformity. In the 2016 reference year, about 192,400 tCO2e was emitted in Scope 1 and 2 (comprising 164,159 tCO2 market-based for vehicle production and selected sites plus a retrograde estimate for group companies not then in scope). For the downstream value chain (Scope 3), Porsche aims to reduce absolute use-phase emissions of newly produced vehicles by at least 42% by 2030 versus 2023; this converts a previous specific target into an absolute one and moves the base year from 2022 to 2023, aligned with the SBTi Land Transport guidance and the XDC Model. In the 2023 reference year, 16,672,762 tCO2 was emitted in Scope 3 use phase (after base year recalculation). Porsche also tracks a BEV share target (proportion of purely battery-powered vehicles in deliveries), which stood at 12.7% in the reporting year, and aims to significantly increase the electrified share (27% in the reporting year).

Porsche discloses energy consumption and mix for 2024 (report page 214). Total energy consumption was 882,852 MWh. Total energy consumption from renewable sources was 659,242 MWh (fuel consumption from renewable sources 285,542 MWh; purchased or acquired electricity, heat, steam and cooling from renewable sources 358,174 MWh; self-generated non-fuel renewable energy 15,526 MWh), meaning the vast majority of energy came from renewable sources. Total energy consumption of fossil fuels was 223,610 MWh, comprising crude oil and petroleum products 152,441 MWh, natural gas 36,847 MWh, other fossil sources 218 MWh, purchased or acquired electricity, heat, steam and cooling from fossil sources 34,104 MWh, and no consumption from coal or coal products. There was no consumption from nuclear sources. Energy generation was 227,612 MWh renewable and 39,035 MWh non-renewable. Energy intensity associated with activities in high climate impact sectors was 22.0 MWh per million euros of revenue; because all activities fall under NACE code 29.10 (motor vehicle manufacture), total revenue and total energy consumption are used in the calculation.

Porsche discloses gross Scope 1, 2, 3 and total GHG emissions for 2024 (report pages 215 to 218). Gross Scope 1 was 76,989 tCO2e, of which 94.4% came from regulated emission trading schemes; the figure rose because biomethane emissions were included in Scope 1 for the first time, as RED II sustainability certificates could not be fully obtained. Gross Scope 2 was 138,255 tCO2e location-based and 14,191 tCO2e market-based, the low market-based figure reflecting widespread renewable electricity use. Total gross Scope 3 was 19,981,165 tCO2e, with the largest categories being purchased goods and services (5,555,629, i.e. Scope 3.1) and use of sold products (13,279,811, i.e. Scope 3.11); 12 of 15 categories were calculated, excluding 3.10, 3.15, and effectively 3.9. Total GHG emissions were 20,196,409 tCO2e location-based and 20,072,345 tCO2e market-based. GHG intensity was 500.8 tCO2e per million euros market-based (503.9 location-based). Biogenic CO2 emissions were 103,775 tCO2e for Scope 1 and 41,158 tCO2e for Scope 2 location-based. Prior-year reporting covered only Porsche AG and Leipzig, whereas 2024 covers the entire group.

Porsche discloses GHG removals and carbon credits (report page 218). It states there are currently no actions already implemented by the Porsche AG Group to remove and store GHG in its own operations or in the value chain. On carbon credits, Porsche offset a total of 1,490,506 tCO2e in the reporting year, all of it cancelled. Of the total carbon credits cancelled, 100.0% came from removal projects and 0.0% from reduction projects. By quality standard, 66.0% met the Verra standard and 34.0% the Gold Standard. None of the credits (0.0%) came from projects within the EU, and 0.0% were used as a corresponding adjustment under Article 6 of the Paris Agreement. Separately, to secure the carbon-neutral designation of its production and development sites, Porsche acquired voluntary carbon credits for a volume of 33,300 tCO2 to offset a special effect arising because full RED II evidence for biomethane could not be provided in the reporting year. Porsche states it only offsets emissions that cannot be avoided technically or at reasonable economic cost, and only uses credits meeting recognized international standards.

Porsche discloses that it applies internal carbon pricing (report page 218). It sees the decarbonization of its value chain as a strategic task achievable only through a stringent control mechanism. Within the context of vehicle projects, Porsche works internally with a CO2 target control system that continuously calculates the CO2 emissions of vehicle projects and evaluates and decides on measures to reduce them during the development process on the basis of marginal costs in euros per tonne of CO2 (EUR/tCO2). The financial resources required to achieve the decarbonization targets are included in the corporate planning. The report does not state a specific internal carbon price value.

On pages 223 to 224, Porsche discloses that pollution is governed by numerous frameworks and policies. For its own operations, the Group Environmental Compliance Management System (ECMS) Policy, based on Volkswagen Group specifications, standardizes procedures, responsibilities and processes for environmental and energy matters and also applies to pollution. The manual on environmental requirements of Porsche AG and Porsche Leipzig GmbH sets guidelines to minimize pollution in new buildings, conversions and building use, including a requirement that facilities handling water-polluting substances use the best available technology and keep such use to a minimum. Porsche AG adopted an Environmental protection resource regulation and Porsche Leipzig an Energy and resource efficiency resource regulation, covering air pollution control and water protection. The Group Hazard Prevention Management Policy defines a procedure for hazard prevention to reduce incidents, addressing the risk of improper handling of substances of very high concern. For the value chain, the Code of Conduct for Business Partners and specifications for battery raw materials, mica, leather and natural rubber set requirements, and Volkswagen standard 91101 governs chemical conformity.

On page 225, Porsche describes actions taken at vehicle production sites and in the upstream supply chain to avoid or reduce pollution of air, water and soil. Action plans for the reporting year were drawn up and implemented. Specific measures include the Weissach Development Center switching to dip coating for painting 3D-printed components in 2024, which reduces paint consumption, paint loss and waste compared with the previous spray-painting process, and retrofitting the cold chamber at the Weissach vehicle test bench so a refrigerant with lower global warming potential can be used. Porsche also carried out surveys under the EU Taxonomy Do No Significant Harm criterion at direct suppliers to assess substitutability of substances of very high concern, and substitution checks were carried out for the all-electric models. In the value chain, Porsche and Volkswagen are jointly involved in initiatives for more sustainable raw material extraction. Other pollution-related actions are cross-referenced to E1 Climate change, E3 Water and E5 Resource use and circular economy. The section does not report a separate financial resource amount for these pollution actions.

On pages 225 to 226, Porsche states the overarching target of avoiding negative environmental impacts, such as pollutant emissions into air and water, to the greatest possible extent, embedded in Strategy 2030 Plus and the Sustainability cross-functional strategy. Quantitative targets have been defined for greenhouse gas emissions (Scope 1, 2 and 3 and the decarbonization index), which are detailed in E1 Climate change. Porsche explicitly states it does not yet have specific targets related to other emissions into air and water; instead it manages the identified negative impacts through several environmental indicators. Porsche AG and Porsche Leipzig measure resource consumption using the Volkswagen Group Reduction of the environmental impact of production (UEP) method, a weighted average of five KPIs covering energy, water, CO2, solvents and waste. The UEP has been used since 2014 with the aim of reducing environmental impact per vehicle by 45% between 2014 and 2025; a reduction of 43.5% was achieved in the reporting year, or 39.9% using the CSRD methodology for biomethane accounting. From 2025 the UEP will be replaced by the impact points method.

On page 226, Porsche reports pollutant emissions from its vehicle production sites, including the Weissach development site. For air pollution the relevant pollutants are volatile organic compounds (VOC), chlorinated hydrocarbons (CHC), fluorinated hydrocarbons (HFC), nitrogen oxides (NOx), particulate matter (PM), carbon monoxide (CO) and sulfur dioxide (SO2). Reported 2024 air emissions in tonnes are VOC 114.89, HFC 0.58, NOx 31.00, PM 0.12, CO 29.51 and SO2 0.33, with CHC reported as nil. For water pollution the relevant parameters are zinc, nickel, organic pollutants (total organic carbon, TOC) and fluorides; reported 2024 water emissions in tonnes are zinc 0.14, nickel 0.01, TOC 90.24 and fluorides 2.02. Porsche notes that under regulatory requirements reporting only needs to cover facilities exceeding European Pollutant Release and Transfer Register (E-PRTR) thresholds, and that no Porsche facility exceeds any of these thresholds, but it reports the emissions to create transparency. Methods include emission factors, refrigerant refill quantities, a daily VOC measuring system in paint shops and accredited laboratory wastewater sampling.

On pages 226 to 228, Porsche addresses substances of concern (SOC) and substances of very high concern (SVHC) under the REACH regulation. It has processes to avoid and substitute SVHC at the vehicle development stage, and reports that a medium- to long-term financial risk was identified regarding per- and polyfluoroalkyl substances (PFAS), given a proposed EU REACH restriction and that PFAS is used in most Porsche products; this is managed by a dedicated working group. Metrics use a reference vehicle approach across five vehicle segments. For 2024, SVHC as part of products or services totaled 2,883 tonnes, of which toxic for reproduction (Article 57c) was 2,832 tonnes, carcinogenic (57a) 14, vPvB (57e) 7, endocrine disrupting for environment (57f) 15, respiratory sensitizing (57f) 5, and probable serious effects (57f) 10; mutagenic, PBT and several 57f human-health classes were nil. Lead, found mainly in lead starter batteries, was by far the most relevant SVHC. Porsche states it cannot fully assess SVHC quantities because purchasing is not tracked in a central IT system. Microplastics was identified as a pollution topic but Porsche states quantitative information on it was completely omitted.

On pages 230 to 231, Porsche discloses that water consumption, withdrawal and discharge are governed by various frameworks and policies. For its own operations, the Group Environmental Compliance Management System (ECMS) Policy, based on Volkswagen Group specifications, applies to water consumption and water management. The manual on environmental requirements sets additional requirements for using water resources, including promoting groundwater renewal, reducing surface runoff via the sewer system, expanding rainwater use and using innovative sanitation systems. A site checklist covers water withdrawal aspects such as the proportion of water recycling and the use of process water or rainwater to reduce fresh water consumption, and contains pollutant concentration limits for wastewater. The Environmental protection resource regulation requires water-saving technologies and the pursuit of reuse or closed-loop recycling. The Volkswagen Group Environmental Indicators standard defines indicators for water withdrawal, consumption and discharge. For the value chain, the Code of Conduct for Business Partners and specifications for leather, mica and battery raw materials set water-related requirements. Porsche notes it has not developed a policy linking vehicle product design to water challenges, because the material impact is limited to the upstream value chain and its own operations.

On pages 231 to 232, Porsche describes actions at production sites and in the upstream supply chain to minimize water consumption, withdrawal and discharge. An action plan on water was prepared in 2023 with medium-term actions until 2025 and longer-term actions from 2027 to 2030 for vehicle production sites. At Stuttgart-Zuffenhausen, Porsche has met EMAS requirements since 1996, ISO 14001 since 1999 and ISO 50001 since 2011, with annual surveillance audits and recertification every three years. Water-saving measures include cascade rinsing to recycle water in paint shops, bath treatment to extend life in pretreatment and dip coating, optimized spray nozzle timing, adjusting a system to reuse pretreatment wastewater to reduce fresh water use, closed-loop operation of watertightness testing and washing plants where possible, and optimizing evaporative coolers. For water-polluting substances, technical protective devices and organizational measures are used at Stuttgart-Zuffenhausen, with the site fire department involved since September 2021. In the value chain, Porsche has been a member of the Responsible Lithium Partnership in Chile since 2021, addressing water in the Salar de Atacama, and continued a study with TU Berlin on the water footprint of the Macan Turbo Electric.

On pages 232 to 233, Porsche discloses that Porsche AG and Porsche Leipzig manage the identified negative water impact at their production sites by setting qualitative and quantitative targets in coordination with internal experts. Under the Porsche Strategy 2030 Plus, Porsche AG aims to reduce water withdrawal, water consumption, the amount of water discharged and emissions into wastewater at all Porsche vehicle production sites, so that production has a minimal negative impact on the environment. No specific numeric target value or target year is stated for these water reductions in this section. Water use is tracked through the overarching Reduction of the environmental impact of production (UEP) indicator, which measures water consumption per vehicle and is disclosed annually. The UEP water indicator shows total fresh water consumption per vehicle at each site; since 2014 water withdrawal per vehicle produced by Porsche itself has been reduced by more than 16%, keeping the indicator within the linear target corridor for the overall UEP. From 2025 the UEP will be replaced by the impact points method, which also considers water discharge and local water risks.

On page 233, Porsche reports water consumption, defined as the difference between water withdrawal and water discharge, describing water no longer available for further use. Water consumption mainly results from evaporative loss during production processes. In the reporting year the Porsche AG Group recorded water consumption of 162,722 m3, giving a water intensity of 4.1 m3 per million euros of sales revenue. Water consumption in areas with high water stress amounted to 25,362 m3. Reclaimed and reused water was reported as nil. Water sources are the public drinking water networks, so the water used is assumed to be of sufficient quality and quantity. Verisk Maplecroft Water Stress Indices were used to analyze sites, and none of the vehicle production sites are in areas of high or extreme water stress. For methods, evaporative loss is measured with internal water meters or calculated; 46.4% of water consumption was measured directly and 53.6% estimated using qualified approximation. Porsche distinguishes reclaimed water (treated on site before reuse) from reused water (reused without treatment), excluding water that merely extends life in the same process.

On pages 235 to 237, Porsche describes how biodiversity is considered in its strategy and business model. Biodiversity is one of eleven strategic fields of action on the path to vehicle production and development with the lowest possible environmental impact at selected sites. Porsche states its impact on biodiversity is largely indirect through complex supply chains, for example raw material extraction (mineral raw materials, rare earths, natural rubber for tires) that can cause deforestation and pollution. It analyzed impacts and dependencies in 2024 using the ENCORE tool at sector level, covering vehicle and parts manufacturing at Porsche AG and Porsche Leipzig GmbH. Vehicle production has potential impacts on seven of thirteen categories; noise or light emissions are the only impact rated very high, while pollutant emissions to soil and water are rated potentially medium. The assessment found a potential medium dependency on biodiversity. Porsche does not present a full transition plan but describes an intention to reduce land use and enhance green spaces in nature-oriented ways. Land-use change through soil sealing was identified as a material negative factor.

On pages 238 to 239, Porsche describes its biodiversity policies. The topic is governed by the Group Environmental Compliance Management System (ECMS) Policy, based on Volkswagen Group specifications, which also covers biodiversity and ecosystems. A Porsche AG manual addresses biodiversity in various dimensions. Porsche AG and Porsche Leipzig GmbH have each developed a biodiversity guideline with instructions for planting and creating green spaces suited to local conditions and for construction projects intruding on green spaces. A site checklist sets requirements for promoting biodiversity, such as observing conservation areas near sites. For the value chain, the Code of Conduct for Business Partners plus specific material and raw material specifications (developed with Volkswagen Group) address biodiversity; leather suppliers must disclose country of origin and hold Leather Working Group certification, natural rubber specifications are being piloted, and deep sea mining raw materials should be excluded. Porsche states it has not yet drawn up policies focused on operating sites in or near conservation areas, nor policies on land use and agriculture, oceans and seas, or combating deforestation. Social consequences of biodiversity impacts are not specifically addressed in these policies.

On page 240, Porsche describes biodiversity actions, mainly at its own vehicle production sites. At the Stuttgart-Zuffenhausen site, a guideline for future planting was developed with landscape and species conservation experts; an area of around 2,000 square meters converted in 2021 into a green recreational space continued to be enhanced in 2023 and 2024 with native plants, deadwood logs, sandy areas and quarry stones to create habitats for reptiles, insects and birds, partly through the Porsche hilft volunteer program. At the Weissach site, two large nature-oriented ponds covering more than 3,000 square meters were completed in the reporting year, with marshes and flower meadows created as habitats for amphibians such as newts and toads, plus dragonflies and birds. At the Leipzig site, biodiversity projects on the former military grounds continued, including grazing land for wild oxen, Exmoor ponies and sheep, around three million honey bees, new flower meadows and adjusted mowing cycles. The Porsche Safari environmental education project with Auwaldstation Leipzig continued. Further employee activities included tree planting, clean-up campaigns and environmental education.

On page 241, Porsche discloses that it has not yet formulated a measurable, outcome-oriented and time-bound biodiversity target in the meaning of the ESRS that could serve as a key performance indicator for its material negative impacts, which include supporting activities that contribute to biodiversity loss, endangerment of species due to production and product use, degradation of ecosystems in own activities and the value chain, and negative impacts on ecosystem services. Porsche states it is important to set sustainable and ambitious targets ideally based on evidence while complying with ESRS legal provisions. A corresponding target for the Porsche AG Group's impact on biodiversity and ecosystems is to be developed in coordination with the Volkswagen Group in 2025. To support this, the Volkswagen Group developed a new biodiversity-related indicator in the reporting year, which was piloted at Porsche AG and Porsche Leipzig GmbH sites. The indicator relates factory premises to biodiversity conservation and enhancement actions, weighting enhanced spaces by a quality factor, and is intended to allow land usage to be assessed and targets set in future.

On page 241, Porsche reports impact metrics related to biodiversity and ecosystems change. Land-use change in the sense of land sealing was identified in the materiality assessment as a negative factor that could significantly influence biodiversity and ecosystems, for example through expanding or building new sites. In the reporting year the Porsche AG Group sealed an area of 45 hectares. The figure covers all areas where soil was covered in an air-tight and water-tight manner so that rainwater cannot seep away, including areas under buildings without green roofs, asphalt, jointless concrete and tightly jointed paving. Where a sealed area is unsealed, for example through land renaturation, the unsealed area is deducted from the total. Beyond this land-sealing figure, Porsche does not provide quantitative information on impacts within biodiversity-sensitive areas. It reports a piloted biodiversity indicator (developed with Volkswagen Group) that is not yet a full quantitative metric. A table on pages 234 to 235 lists conservation areas near each site with numbers of protected species and habitats.

On pages 246 to 248, Porsche describes policies on resource use and circular economy. The Group Environmental Compliance Management System (ECMS) Policy, based on Volkswagen Group specifications, applies. The Porsche AG manual on environmental requirements sets actions for new and converted buildings to increase resource and energy efficiency and avoid waste, and a site checklist assesses eleven fields of action including material and waste. Porsche AG adopted an Environmental protection resource regulation and Porsche Leipzig GmbH an Energy and resource efficiency regulation for contractors. The Group Scrapping or Alternative Use of Obsolete Items Policy prioritizes alternative use over scrapping. For the value chain, the Code of Conduct for Business Partners requires efficient resource use, reuse, recycling, prioritizing renewable resources and proper waste disposal. Raw material specifications developed with Volkswagen Group under the Raw Material Due Diligence Management System (RMDDMS) apply to battery raw materials, mica and leather, and set secondary material targets for copper, aluminum, plastics and steel. The Volkswagen Vehicle Environmental Standard requires vehicles to be at least 85% recyclable and 95% recoverable and prioritizes recycled over primary materials.

On pages 248 to 250, Porsche describes actions on resource use and circular economy at production sites and in the upstream supply chain, coordinated under a circular economy strategy field. Actions include increased use of recyclable materials, secondary materials and renewable raw materials in vehicles. In battery recycling, Porsche, with the Volkswagen Group and partners, is optimizing the recycling process for high-voltage batteries; three pilot projects tested a battery raw material cycle (mechanical processing and refining black mass into recyclates), expected to complete in 2025. In a second-life project, a stationary power storage system made from 4,400 used Taycan battery modules in four containers was installed at the Leipzig plant, partly powered by the site's 9.4 MW solar plant. For packaging, the proportion of recycled plastics in internally used PE flat bags in after-sales rose to an average of 60 to 70%, and non-recyclable foams were reduced by about 7.5 tonnes versus the prior year; since 2023 non-recyclable packaging materials were cut by around 40%, targeting 80% by end of 2025. Vehicle development increasingly considers recyclability, remanufacturing and repairability, including improved dual-clutch transmission repair and the Macan electric battery drive dismantling.

On pages 250 to 251, Porsche describes targets on resource use and circular economy. The Porsche Strategy 2030 Plus aims to minimize energy and resource consumption, including avoiding waste and supporting recycling of components such as battery modules. Resource use is measured through overarching environmental indicators calculated by the Volkswagen Group method: the Reduction of the environmental impact of production (UEP) indicator and the impact points method, which will replace the UEP from 2025; both cover energy and water consumption, emissions, wastewater and waste. Specific quantitative targets for the use of circular materials have been defined for newly developed, purely battery-electric vehicle models. For the first time in the reporting year, the Volkswagen Group set a group-wide ambition, including for Porsche AG, for 40% of materials used in products to be made from recycled products by 2040, measured by material weight; Porsche aims to help achieve this where technically and economically possible. Waste-related impacts are managed through general targets on waste avoidance or reduction at own production sites and support of the circular economy, tracked using an electronic waste register.

On pages 251 to 252, Porsche reports resource inflows. Total material consumption for vehicle production in the Porsche AG Group amounted to 621,679 tonnes in the reporting year, of which 0.2% was made up of sustainably sourced biological materials. Consumption is calculated from the percentage material composition of a representative vehicle per model series, using categories derived from VDA standard 231-106, extrapolated by vehicles produced and average weight. Biological materials play a subordinate role; leather is the most relevant biological material, and the 0.2% biological share was determined based on leather because leather was the only subcategory for which suppliers must comply with an external sustainability standard (Leather Working Group audit, at least bronze level). The figure excludes secondary products such as tools and after-sales products and materials not contained in the final vehicle. Because no new production sites opened in the reporting year, there were no material property, plant and equipment resource inflows. Porsche states the proportion of secondary (recycled) materials used for vehicles produced could not be determined for the reporting year, as a method to obtain this information is still being developed.

On pages 252 to 254, Porsche reports resource outflows. Porsche vehicles are designed on circular economy principles. On recyclability and recoverability, all vehicles produced in the reporting year comply with EU end-of-life vehicle regulations, meaning each vehicle is at least 85% recyclable and at least 95% recoverable; the recyclable proportion is determined pursuant to UN R133 in accordance with ISO 22628 and checked during type approval. In after-sales, around 5,000 spare parts (gearboxes, navigation systems, starter motors and others) are placed on the market as refurbished old parts each year, with a goal to reuse and recycle more parts and design more parts to be reusable and recyclable. Porsche extends product lifespan by keeping spare parts available and reissuing discontinued parts. Regarding product durability, Porsche states that because there is currently no established system available to assess the repairability of vehicles, no disclosures can be provided on that metric. Repairability requirements are nonetheless defined in Porsche specifications for suppliers, and repair concepts are incorporated early in vehicle development.

On pages 252 to 254, Porsche reports waste-specific outflows. In the reporting year the Porsche AG Group generated total waste of 36,524 tonnes. Of this, 30,509 tonnes was waste for recovery, comprising 1,349 tonnes prepared for reuse, 23,605 tonnes recycling, and 5,555 tonnes other recovery operations. Total waste for removal was 6,015 tonnes, split into 1,404 tonnes incineration, 3,704 tonnes landfill and 908 tonnes other disposal; radioactive waste was zero. Non-recycled waste, which Porsche defines as waste for removal plus waste flowing into other recovery processes, totaled 11,570 tonnes, giving a proportion of non-recycled waste of 31.7%. Total hazardous waste was 8,860 tonnes and the remainder was non-hazardous. The most relevant waste stream is metal waste (sheet metal stamping waste, castings and shavings, mainly aluminum and steel), followed by plastic waste (mainly polypropylene) and paint and coating waste, plus packaging and electronic waste. Hazardous waste arises mainly from chemical surface treatment and coating, used oils and lubricants, and cleaning agents and solvents. Waste is recorded via an electronic waste register and classified per the List of Wastes Ordinance.

Porsche AG describes the policies governing its own workforce (p276-278, p287-289). Working conditions rest on international standards including the UN Guiding Principles on Business and Human Rights, the ILO Declaration on Fundamental Principles and Rights at Work and the UN Global Compact. Named policies include the Group Business and Human Rights Policy, the Group Occupational Health and Safety Policy "Driven by Safety and Health" (implementing ISO 45001 as a minimum standard), the Code of Conduct, the Group HR Compliance Policy, the Group Labor and Social Security Law Policy and various company and collective agreements. A 2022 declaration of intent signed by the Executive Board and Group Works Council commits to human rights and good working conditions. On equal treatment, Porsche relies on the German General Equal Treatment Act (AGG), has signed the German Diversity Charter since 2019 and defines diversity dimensions of ethnic origin, gender, religion and ideology, disability, age and sexual identity. The general works agreement "Tradition. Transformation. Future" (2020) rules out compulsory redundancies at Porsche AG until 2030.

Porsche AG describes engagement with its workforce and workers' representatives (p271-273). The Executive Board member responsible for Human Resources and Social Affairs holds the position of Labor Director, and the Principles and Labor Relations department is the central interface to the works council. Under the German Co-Determination Act (MitbestG), half of Porsche AG's Supervisory Board is made up of employee representatives; Supervisory Board elections took place in the reporting year. The Economic Committee meets several times a year with employee representatives, with Executive Board members present. Employees are informed at regular company meetings and through departmental meetings, information events, focus weeks and digital formats. The "Porsche Puls" employee survey is usually conducted once a year to gather feedback on satisfaction, work-life balance and workload. A representative body for severely disabled employees offers support and advice, and a Construction Committee ensures codetermination in construction projects and workplace design. Porsche AG bears the statutory costs of codetermination, including works council elections and training.

Porsche AG describes channels to raise concerns and processes to remediate negative impacts (p273). Adherence to statutory requirements, internal policies and the Code of Conduct is a top priority. A group-wide whistleblower system lets employees and external third parties report actual or potential rule violations. A company complaints desk known as "AGG" (after the German General Equal Treatment Act) handles potential discrimination cases and is open to employees, trainees, interns, applicants and, under certain conditions, former employees. Complaints are treated in strict confidence with access limited to a few employees on a need-to-know basis. The AGG desk checks whether discrimination is present, and if a complaint is justified, labor law or disciplinary action is initiated case by case. Employees can also turn to their managers, the HR department, the social counseling service, the works council or the representative body for severely disabled employees. A multi-stage Business and Human Rights (BHR) complaints procedure, defined in the Group Business and Human Rights Policy, provides a further channel. Action is taken to prevent, end or minimize any breach of duty identified.

Porsche AG describes actions taken on material impacts and to pursue positive impacts (p278-282, p289-293). On health and safety, actions include prevention in workplace and machinery design, risk assessments under the German Occupational Safety and Health Act, monitoring of construction and assembly sites, suitability tests, communication campaigns (the reporting-year safety campaign focused on personal protective equipment and the health campaign on addiction), and ISO 45001 certification, with Porsche AG recommended for its first certification in November 2024. Health management offers the "Porsche Check-up", social counseling, vaccinations and mental health support. Working-time and work-life balance actions include mobile working up to twelve days a month, Europe-wide remote work up to 20 days a year, flexible hours, "Porsche Care Leave", childcare places, a family service and a planned in-house nursery for up to 80 children opening fall 2025. Diversity actions include She@Porsche, Proud@Porsche, Vaeter@Porsche and Cultures@Porsche networks (2,780 employees engaged), Diversity Days, a Diversity Performance Award, a women in management project, and reskilling and upskilling programs.

Porsche AG discloses targets for its workforce (p282, p293). On occupational health and safety, it has a conceptual long-term vision enshrined in its policy plus annual targets reported quarterly to the occupational safety committee, and a target that all vehicle production sites meet ISO 45001 standards. On employer attractiveness, Porsche Strategy 2030 sets the objective to "be the top employer of choice", with a specific target to rank among the top three employers in the Trendence and Universum rankings by 2030 (measured across twelve data points for students and experienced professionals in business, engineering and IT); the 2024 base year average ranking was 3.66. On equal treatment, Porsche AG aims to increase diversity by 2030 and set a target, adopted by the Executive Board in 2021 and communicated publicly, of a 20% share of women at the first management level and 18% at the second level by 2025. In the reporting year the statutory gender quota reached 22% at the first management level (2023: 20%) and 18.8% at the second (2023: 17.3%), meeting the 2024 targets.

Porsche AG discloses the characteristics of its employees as of December 31, 2024 (p283-284). The Porsche AG Group had a total of 42,615 employees across all regions, defined as anyone with an active employment contract including top management and trainees. By gender, there were 8,801 women and 33,814 men, with no employees reported as "other" or "not disclosed". By contract type, 40,645 were permanent and 1,970 temporary; 39,463 were full-time and 3,152 part-time; there were no non-guaranteed-hours employees. By region, Germany accounted for 36,741 employees, the rest of Europe 3,182, North America excluding Mexico 1,087, China including Hong Kong 949 and overseas and emerging markets 656. In the reporting year 1,782 employees left the Group, a turnover rate of 4.2%. Turnover is calculated by dividing employee turnover for the year by the average number of employees (monthly basis) and covers voluntary leavers, dismissals, retirement and death in service. There were no mass layoffs. Figures are actual, reported in headcount as of the reporting date.

Porsche AG discloses information on non-employee workers (p283). In the reporting year, the Porsche AG Group had around 2,988 non-employees, including temporary workers provided by external companies whose activities are controlled by the Group. Company agreements govern the use of employees under contracts for work and services at Porsche AG and selected group companies; contractors must legally assure compliance with occupational health and safety regulations, accident prevention rules and other standards for a safe working environment, and employees deployed on Porsche premises must receive at least the remuneration of the relevant sectoral collective bargaining agreement. When using temporary workers, Porsche AG and selected group companies apply the principle of "same work, same pay" and set a maximum length of service of 48 months based on collectively agreed regulations. Qualified temporary workers are given priority over external applicants when filling vacancies. Data on non-employees is provided by the group companies via the HR system.

Porsche AG discloses collective bargaining coverage and social dialogue (p284). In the reporting year, 76.8% of all employees in the Porsche AG Group were covered by collective bargaining agreements. In Germany specifically, 83.7% of employees are covered by collective bargaining agreements, and 97.2% of employees in Germany are covered by employee representatives. For Porsche AG the relevant agreements are the collective bargaining agreements for the metal and electrical industry, complemented by works agreements under the German Works Constitution Act (BetrVG). Working conditions and terms of employment for executives not covered by collective bargaining are guaranteed in speaker's committee agreements or policies. There are no agreements in the Group on representation via a European Works Council (EWC), a Societas Europaea (SE) Works Council or a Societas Cooperativa Europaea (SCE) Works Council. Data on coverage is collected through a survey of the group companies and analyzed centrally to determine group-wide coverage rates.

Porsche AG discloses diversity metrics for top management and age distribution as of December 31, 2024 (p294). At the first management level there were 144 employees: 20 female (13.9%) and 124 male (86.1%), with none reported as diverse. At the second management level there were 879 employees: 141 female (16.0%) and 738 male (84.0%), with none reported as diverse. Porsche AG uses the two levels below the administrative and supervisory bodies when disclosing gender distribution in the first and second management levels. On age distribution across the Porsche AG Group, 16.1% of employees were under 30 years of age, 65.6% were aged between 30 and 50, and 18.3% were over 50 years of age. The digital "Horizon" platform provides an overview of workforce diversity, evaluating metrics on gender diversity, personal capabilities (severe disability), internationality and generations annually.

Porsche AG discloses information on adequate wages (p283, p285). In the reporting year, the remuneration of employees in the Porsche AG Group was in line with the respective reference values for an adequate wage, with one exception: in Singapore, the remuneration of 9.5% of employees was below the local reference value for an adequate wage. This gap related exclusively to sales staff whose remuneration includes a substantial variable component; when these variable components are taken into account, their total income is significantly higher than the reference value. Within the European Economic Area the reference value is the statutory minimum wage of a country, or where none exists a value corresponding to at least the minimum wage of a comparable neighboring country. Outside the EEA, the WageIndicator Foundation's Living Wage database is used for all countries where the Group has employees, with underlying values last updated in October 2024. Group companies report whether their wages are above the corresponding reference values.

Porsche AG discloses training and skills development metrics (p295). In the reporting year the average number of training hours per employee was 21 hours. Broken down by category and split into scheduled and unscheduled training, average hours were: industrial apprentices 60.1 (53.6 scheduled, 6.5 unscheduled); commercial apprentices 106.4 (85.0 and 21.4); students in a work placement program 103.0 (96.2 and 6.8); performance-based wage earners 6.5 (4.5 and 1.9); salaried employees 27.6 (21.0 and 6.6); management 23.1 (17.7 and 5.4); senior management 19.4 (15.7 and 3.7); top management 9.6 (6.6 and 3.0); and time-based wage earners 10.9 (8.7 and 2.2). Training data and costs are collected via a survey of the group companies and summarized at group level, with average training time calculated using the number of employees in each category. The calculation is based on data from December of the prior year to December of the reporting year.

Porsche AG discloses health and safety metrics (p285-286). In the reporting year, 99.5% of the Porsche AG Group's employees were covered by a health and safety management system based on legal requirements and/or recognized standards. There were 483 recordable work-related accidents among employees, a rate of 7.4 accidents per one million hours worked. Employees lost 5,417 days due to work-related injuries. There were no fatalities among the Group's own employees, but there was one fatality among workers in the value chain (categorized as other workers employed at Porsche AG Group sites). Porsche AG measures workplace accidents in all organizational units using an "occupational accident index" reported internally each month, supported by software to document and analyze accidents with automated reminder and escalation functions. As part of CSRD reporting the accident frequency metric was changed in the reporting year to include significant accidents regardless of days lost, and days lost switched from working days to calendar days, so figures are not comparable with the prior year.

Porsche AG discloses remuneration metrics (p294). The gender pay gap, defined as the difference in average pay levels between female and male employees expressed as a percentage of the average pay level of male employees, stood at 15.4% in the reporting year. Porsche AG notes this figure is significantly influenced by the gender distribution across its hierarchical levels. The annual total remuneration of the highest-paid individual was 39.6 times the median annual total remuneration of all employees (excluding the highest-paid individual). The gender pay gap is determined through a three-step process in which group companies submit data on wages per gender and hours worked per gender, average hourly wages per gender are calculated in euros after currency adjustment, and the gap is derived from the hourly wages. The median pay ratio is determined in four steps starting from the median pay levels of the group companies, converted to euros, with a group median approximated using median pay levels, personnel expenses and number of employees.

Porsche AG discloses incidents, complaints and severe human rights impacts (p296). A total of 164 reports were received via the Porsche AG Group's whistleblower system in the reporting year. Of these, 35 were potentially severe breaches of the rules, and three of these related to discrimination and harassment, of which two cases have been confirmed. Neither of the two potentially severe rule breaches on workforce issues that did not relate to discrimination and harassment was confirmed. No fines, penalties or compensation for damages were recorded in connection with incidents and complaints of discrimination, including harassment, reported through the whistleblower system. In the reporting year there were no severe human rights cases, or associated fines, penalties and compensation for damages, involving employees of the Porsche AG Group. There are no known reports about the Porsche AG Group to the National Contact Points for OECD Multinational Enterprises. Severe human rights cases are determined based on the number of severe incidents reported at group level, including violations of the UN Guiding Principles, the ILO Declaration and the OECD Guidelines.

Porsche discloses policies on workers in the value chain (p302 to 304). It bases its action on international standards including the Universal Declaration of Human Rights, the UN Guiding Principles on Business and Human Rights, the ILO core labor standards, the OECD Guidelines and the UN Global Compact, and on German law such as the Supply Chain Due Diligence Act (LkSG). The central document is the Code of Conduct for Business Partners, which is part of supplier contracts and requires direct suppliers to prohibit child, forced and compulsory labor and modern slavery, ban discrimination and harassment, respect freedom of association and collective bargaining, pay a living wage, and meet occupational health, safety and hygiene standards. Suppliers must cascade these requirements to their own upstream suppliers. In 2022 Porsche adopted a Group Business and Human Rights Policy and issued a declaration of intent to observe and promote human rights covering no child labor, no forced labor, diversity, non-discrimination and good working conditions. It has signed the German Diversity Charter. Additional material- and raw-material-specific specifications address human rights in the upstream supply chain.

Porsche describes engagement processes for value chain workers (p299 to 300). It reports that direct interaction with upstream workers is only possible to a limited extent through representatives, so their inclusion is promoted via indirect and direct formats. Several times a year Porsche representatives engage with stakeholders in the automotive industry dialog on the German government's National Action Plan (NAP) for Business and Human Rights. Porsche also participates in cross-industry initiatives, including the Responsible Mica Initiative, where it sits on the Board of Directors and works to improve conditions for mica miners in India and Madagascar, with direct conversations held with workers and communities in mining areas during on-site project visits in the reporting year. Since 2020 it has been involved in the CASCADE project with Michelin, offering on-site training to improve working and living conditions for smallholder rubber farmers in Sumatra, Indonesia. Supplier audits, including RSCI audits conducted under the VDA standard, include direct interviews with value chain workers to improve supply chain transparency.

Porsche discloses channels to raise concerns and remediation for value chain workers (p304 to 305, with the mechanism described on p298 to 299). It operates a group-wide whistleblower system and a multi-stage Business and Human Rights (BHR) complaints procedure, defined in the Group Business and Human Rights Policy and run centrally by Porsche AG. This procedure gives internal and external complainants a confidential channel to report potential human rights breaches and environmental violations and is available to value chain workers, with reporting channels communicated on the Porsche website and selected group company websites. A separate supply chain grievance mechanism (SCGM) processes reports of breaches of the Code of Conduct for Business Partners by direct or indirect suppliers, handled by sustainability experts in Procurement. Complaints follow a standardized process. Where a violation occurs at Porsche's own operations or a direct supplier, action is taken to prevent, end or minimize it, and for indirect suppliers available legal and actual options are exercised. Depending on severity, Porsche may terminate the business relationship. The rules of procedure are publicly accessible and effectiveness is reviewed regularly and ad hoc.

Porsche describes actions taken on value chain workers (p304 to 305). Within its responsible supply chain (ReSC) system it applies preventive actions including media screening of freely available internet and social media sources to detect potential risks in raw material supply chains, and dialog activities such as participation in the NAP business and human rights dialog. As a member of the German automotive industry's Responsible Supply Chain Initiative (RSCI/VDA), Porsche conducted supplier audits in the reporting year and scheduled further audits for 2025, including direct interviews with value chain workers. It runs employee awareness and training in Procurement on risk and supplier management, sustainability and the S-rating, and provides training to selected direct suppliers on sustainability standards, the S-rating and integrity through supplier development programs. Remedial actions handle potential breaches via a standardized process; if a violation is found at a direct supplier during an on-site inspection, a corrective action plan is drawn up and effectiveness is reviewed case by case, for example through a re-audit. Suppliers with a negative S-rating receive targeted improvement actions and, depending on severity, business relationships may be terminated.

Porsche discloses that it manages the impacts and risks related to workers in the value chain centrally via the sustainability rating (S-rating) described in its strategic approach (p305). It states that the Porsche AG Group wants to ensure that its direct suppliers practice more ecologically sustainable procurement, adhere to human rights standards, implement social employment practices and achieve responsible resource management. The specific, quantified target linked to this ambition is not set out in the S2 section itself; Porsche notes that the specific target is described within Business conduct under the heading Management of relationships with suppliers (in G1). A related metric reported elsewhere in the statement is that 92 percent of direct suppliers of production material and selected suppliers of non-production material received a positive sustainability rating (S-rating).

Porsche discloses policies for its entity-specific material topic of corporate citizenship, reported under ESRS S3 Affected communities (p306 and following). It has established internal management approaches and guidelines to ensure the uniform and legally compliant implementation of corporate citizenship projects, fundraising campaigns and CSR activities. The central policy is the Group Donations and CSR Sponsorship Policy, which covers the basic framework conditions for sponsorship projects and regulates all processes, responsibilities and approval conditions. Under this policy, all donations and sponsorship funds must be used consistently, legally and exclusively in the interest of the Porsche AG Group, and only institutions that strive to make a positive contribution to respecting and promoting human rights are supported. All incoming donation and sponsorship requests must be processed and reviewed using the principle of dual control within value limits set out in the policy, resulting in a recommendation for approval or rejection. Local management approves group companies' sponsorship projects, while larger projects require the approval of Porsche AG, with overall responsibility held by the Communications, Sustainability, and Politics department.

Porsche describes actions taken on corporate citizenship (p306 and following). In the reporting year the Porsche AG Group sponsored 117 projects with a total of EUR 9.8 million, many supported for years, and the donation total includes a donation in kind of around EUR 2 million. Projects are organized under the Partner to society strategy field, guided by the motto Creating chances and focused on good working and living conditions, climate change, education, integration and sports. Named initiatives include Porsche Aftersales Vocational Education (PAVE) vocational training, running for 15 years with a new Porsche Academy launched in Saudi Arabia in the reporting year; Join the Porsche Ride; the Porsche hilft volunteering initiative, where volunteers performed more than 3,645 hours of voluntary work; the Turbo for Talents youth sports development program; Make-A-Wish, which had fulfilled 223 wishes; the Lukas project for children with disabilities; and international projects such as Un Techo in Latin America. Fundraisers included Racing for Charity, which donated EUR 911,000 based on race laps at Le Mans, Aces for Charity (EUR 60,000) and Goals for Charity (EUR 30,000).

Porsche discloses targets for corporate citizenship (p310 to 311). It states clearly that at present the Porsche AG Group does not have fully quantified targets for its corporate citizenship projects, in order to allow the necessary flexibility in projects and funding levels. Instead, the projects pursue overarching Partner to society targets under the motto Creating chances: promoting safe work along the vehicle value chain, including occupational health and safety and sustainable livelihoods; enabling a self-determined life, particularly for people in the Global South; and fulfilling big dreams through education and integration, with a focus on engaging and supporting young people via sports projects. To measure effectiveness, Porsche developed its own evaluation methodology incorporating quantitative and qualitative data, producing an annual overall score for each project. The stated target is to further improve the average score of all projects each year. This methodology applies to all existing donations and CSR sponsorships relating to social sustainability, with the Turbo for Talents program evaluated separately by the project team and partner clubs on a weekly basis.

Porsche discloses policies for consumers and end-users, meaning its customers (p314 to 315). The central document is the Porsche AG safety standard, adopted by the Executive Board, which is set out in a comprehensive catalog of vehicle safety requirements defining how safety standards are implemented and adhered to in a binding manner regardless of vehicle model or market. It applies to all series and derivatives in all target markets and is updated regularly. The safety standard ensures conformity with laws in target markets and also contains Porsche standards that can go far beyond legal requirements, based on current science, technology and consumer protection requirements, from which Porsche derives specific target specifications for passive vehicle safety to minimize accident consequences. It supports the wider Porsche safety strategy adopted in 2021 and running until 2030, which aims to ensure a high level of protection for customers and contribute to road safety worldwide, covering active safety (accident prevention) and passive/integral safety. Responsibility for the safety standard lies with the Executive Board, and vehicle safety departments oversee final approval of safety features.

Porsche describes engagement processes with consumers and end-users (p312 to 313). It states that Porsche AG does not directly involve customers in vehicle safety processes; in accident analysis, some customers are interviewed after accidents using standardized questionnaires provided they consent, and the vehicle safety system specialist department is responsible for integrating customers into the corporate concept. Nonetheless Porsche welcomes questions, suggestions and concerns from internal and external stakeholders at any time and has set up a complaints management system as a central point of contact. Since 2023 Porsche has used the customer excitement index (CEI) to measure how enthusiastic customers are across the life cycle, from initial contact through purchase and ownership to potential repurchase. The CEI is based on a global survey of more than 300,000 customers each year, covering purchase, product quality, user experience with displays and controls, Porsche Connect services, charging of electric and hybrid vehicles, and service. It distinguishes unsatisfied, satisfied and excited customers, counting only excited ones, and is used as a management tool and in Executive Board and management remuneration.

Porsche discloses channels to raise concerns and remediation for consumers and end-users (p313). Consumers and end-users can contact the general complaints management of the Porsche AG Group for any complaints relating to personal safety, including breaches of product safety and licensing regulations. Internal and external whistleblowers can report potential compliance violations by employees or direct and indirect suppliers at any time through any of the whistleblower system's six publicly available reporting channels. Porsche notes there are no complaint channels specifically dedicated to personal safety, and its complaints process is described in detail in G1 Business conduct. Reports of breaches of product safety and licensing regulations are treated differently from customer concerns relating to products and services; the latter are handled by Porsche customer support, with contact channels listed on the homepage so customers can raise concerns directly. During the reporting year, no cases of non-compliance with the UN Guiding Principles on Business and Human Rights, the ILO declaration or the OECD Guidelines were reported by customers in the downstream value chain.

Porsche describes actions taken on consumers and end-users (p315). It uses its management approaches and safety policies to derive ongoing and ad hoc actions that protect the health and safety of customers. All Porsche vehicles undergo in-house quality management inspections that go beyond the legal minimum, including a final safety inspection spanning development, production and after-sales. Child safety is a key focus, with vehicles and child car seats designed to protect children of all ages and sizes, and pedestrian and other road user protection is addressed in cooperation with the Exterior Design and attachment development departments. Porsche continuously monitors the changing legal situation in each target market, the activities of consumer protection organizations, competitive vehicle safety technology, and field observations and accident analyses. A specific example is the electric Porsche Macan, which premiered in the reporting year with a center airbag as standard across all derivatives to protect occupants in side impacts, reflected in compliance with Euro NCAP far-side requirements, with plans to gradually extend the feature to other model series. Euro NCAP-tested Porsche vehicles, including the Macan, Taycan and Cayenne, have all received five-star ratings.

Porsche discloses targets for consumers and end-users (p315). It states directly that, for the material positive impact of guaranteeing the health and safety of customers, the Porsche AG Group does not yet have a measurable, outcome-oriented and time-bound target that could serve as a key performance indicator, while noting it considers it important to set sustainable and ambitious targets. For the related information-oriented impact for consumers, Porsche has set itself a target related to customer satisfaction. One management tool is the customer excitement index (CEI), regularly compiled from customer surveys. Porsche has set the target of increasing the average share of excited customers throughout the entire customer life cycle across numerous aspects, including purchase, product quality, user experience with displays and controls, Porsche Connect services, charging of electric and hybrid vehicles, and service. The aim is to enhance customer relationships and satisfaction over the long term so that Porsche ranks high in selected customer studies. In the base year 2023 the CEI was 46.7 percent, and in the reporting year it fell slightly to 45.5 percent.

Porsche AG discloses that compliant, integrity-based conduct is central to its success and that it rejects corruption, cartelization, money laundering and other white-collar crime. Conduct is governed by a group Code of Conduct (publicly available online), a Porsche Code cultural mission statement built on four concepts (passion, pioneering spirit, sportsmanship, one family), and numerous group policies including the Group Avoidance of Conflicts of Interest and Corruption Policy, Group HR Compliance Policy, Group Compliance Management Policy and Group Whistleblower System Policy. A compliance management system (CMS) run by the Legal and Compliance department under a Chief Compliance Officer forms the preventive framework, with quarterly reporting to the Executive Board and the Supervisory Board Audit Committee. Corporate culture is monitored through the Porsche Puls employee survey. The whistleblower system lets internal and external parties (employees, business partners, customers, third parties) report breaches anonymously by email, post, phone or online tool, or via external ombudspersons, with reports handled by the independent Porsche Investigation Office (PAO). Whistleblowers are protected from discrimination and retaliation, and the system reflects the German Whistleblower Protection Act (HinSchG).

Porsche AG describes managing an increasingly complex, electrified supply chain through preventive supplier risk management under the responsible supply chain (ReSC) system, aligned with the German Supply Chain Due Diligence Act (LkSG). Direct suppliers must comply with the Code of Conduct for Business Partners, which sets business ethics rules, anti-corruption and antitrust requirements, and obliges partners to pass requirements down their own supply chain. Before awarding a contract, Procurement runs multi-stage eligibility, financial (Supplier Status report) and compliance reviews, and a sustainability rating (S-rating). Used since 2019, the S-rating assesses environmental, social and compliance behavior via a mandatory self-assessment questionnaire (SAQ) for supplier sites with ten or more employees, country risk data and risk-based audits, producing A, B or C ratings; A and B are eligible for contracts, C is generally not. Suppliers with unsatisfactory results receive corrective action plans and can face on-site inspections or exclusion. Porsche fosters cooperation based on partnership and trust and runs supplier development and training. It reports no reason to terminate business relationships in the reporting year due to significant negative environmental impacts.

Porsche AG addresses prevention and detection of corruption and bribery through its compliance management system and risk-based training. An internal compliance risk assessment continuously identifies risks and derives preventive actions, and since 2021 the central Compliance department conducts annual compliance monitoring including risk-based spot checks of transactions. Key policies include the Group Avoidance of Conflicts of Interest and Corruption Policy, which sets rules on gifts, invitations, screening of business partners, and anti-corruption training. Porsche Event and Gift Management (PVGM) advises on benefits, and a central compliance help desk gives confidential advice. Training is risk-based and target-group oriented. For the reporting year, 95.1% of relevant employees took part in anti-corruption training (or Code of Conduct training). Around 524 employees received classroom or virtual compliance training and 9,658 participants completed digital interactive modules on anti-corruption, money-laundering prevention and antitrust law; the digital Code of Conduct module was completed by 19,324 employees. 97.3% of the risk functions defined for anti-corruption had rolled out an anti-corruption training concept, and a money-laundering prevention concept was rolled out in 100% of defined risk functions.

Porsche AG reports that in the reporting year there were no matters that led to convictions for violations of anti-corruption and anti-bribery laws, and no fines within the Porsche AG Group. In other words, both the number of confirmed convictions and the amount of fines were zero. The company explains its methodology: the number of convictions and the amount of fines for violations of anti-corruption and anti-bribery laws are requested from the group companies and then aggregated at group level.

Porsche AG states that remaining impartial toward political parties and interest groups is essential and that in 2024 the Porsche AG Group made no financial or in-kind political contributions, such as party donations or sponsorship of party-political events, worldwide. Responsibility for political lobbying lies with the Executive Board members, the head of the Communications, Sustainability and Politics department, and the head of the Politics and Society department; none of these responsible bodies held positions in public administration or regulatory authorities in the reporting year. The Politics and Society department centrally coordinates lobbying, working with the Volkswagen Group Public Affairs division. Porsche AG is entered in the German Lobby Register (R001768), the Baden-Wuerttemberg Transparency Register, and, via Nardo Technical Center S.r.l., the Apulia region lobby register in Italy; the Volkswagen Group (REG number 6504541970-40) is in the EU Transparency Register. Lobbying is governed by the Group Principles of Communication and Governmental Affairs Policy, requiring integrity, transparency and traceability. Porsche notes it has not yet set a measurable, time-bound ESRS target for the lobbying-related impact, as the impact was only identified as material in the reporting year.

Porsche AG discloses that it has largely transitioned payment practices to electronic processes to increase supply chain transparency and reduce corruption attempts, with direct suppliers of production material sending invoices via electronic data interchange (EDI) in the VDA format and status information available through the Volkswagen Group business platform (FIN) and the Porsche Invoice Interaction Center (PIIC) introduced in 2024. Payment terms are set in standard terms and conditions of purchase: for Porsche AG, suppliers are to be paid within 30 days, while subsidiaries apply different terms in line with national legal requirements, ranging from 30 to 90 days. Individual deviations are possible through negotiated contracts, and there is no standard deviation for any specific group of suppliers. On average, the Porsche AG Group takes 45 days to settle an invoice, calculated using days payable outstanding (DPO) based on trade payables as of 31 December and sales revenue for the reporting year. Porsche AG states that it omitted quantitative information on any pending legal proceedings for late payment (G1-6).