GOV-1 - The role of the administrative, management and supervisory bodies

GOV-1 - 21 A - EXECUTIVE AND NON-EXECUTIVE MEMBERS OF THE ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES

Number of Executive Board 2 Number of Supervisory Board 5

GOV-1 - 21 B - REPRESENTATION OF EMPLOYEES AND OTHER WORKERS IN ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES

Employees and other workers are not formally represented in the decision-making bodies at the SBO Holding level due to a lack of legal requirements, but their interests are fundamentally taken into account.

GOV-1 - 21 C - EXPERIENCES OF ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES RELEVANT TO THE SECTORS, PRODUCTS AND GEOGRAPHICAL LOCATIONS

Both the Executive and Supervisory Boards of SBO have diverse professional backgrounds and experience across relevant industries. Their varied expertise serves as a strong foundation for balanced and informed decision-making as well as effective strategic oversight.

GOV-1 - 21 D - GENDER DIVERSITY IN ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES

In 2024, the Executive Board consisted entirely of men (100 % male, 0 % female).

The Supervisory Board had a gender distribution of 60 % male (3 men) and 40 % female (2 women).

Considering both the Executive Board and the Supervisory Board together (total of 7 members):

Overall gender distribution: 71.4 % male (5 men) and 28.6 % female (2 women)

Female-to-male ratio: 1:2.5

GOV-1 - 21 E - PERCENTAGE OF INDEPENDENT BOARD MEMBERS

The Supervisory Board is considered fully independent, as per the independence criteria outlined in Annex 1 of the Austrian Corporate Governance Code.

GOV-1 - 22 A - NAMES OF THE ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES RESPONSIBLE FOR MONITORING THE IMPACT, RISKS AND OPPORTUNITIES

At the top executive level, both the CEO and COO take responsibility for impacts, risks and opportunities, ensuring alignment with strategic objectives. The Supervisory Board oversees these matters, providing guidance and ensuring compliance with sustainability-related priorities and objectives.

GOV-1 - 22 B - RESPONSIBILITIES OF EACH INSTITUTION OR PERSON IN TERMS OF IMPACT, RISKS AND OPPORTUNITIES

In exercising its functions, in particular monitoring and strategic support of the Executive Board, the Supervisory Board discusses the situation and targets of the Company and adopts resolutions. The rules of procedure for the Supervisory Board govern in detail the composition, working method and tasks of the Supervisory Board, the procedure in situations of conflicts of interest, and all committees (Audit Committee, Nomination and Remuneration Committee, Sustainability Committee) and their responsibilities. The Supervisory Board held five meetings in the period under review. Moreover, the Executive Board submitted several oral and written reports to the Supervisory Board to inform them about the development of business and the situation of the company and the Group companies. The main focus of discussion was on the strategic direction and development of the Group as well as on major business transactions. As part of the Group strategy, the changing energy market and the associated opportunities and risks for the existing business model and the future realignment of the company were also discussed, as well as the Group's ESG strategy and its implementation and monitoring. The members of the Supervisory Board attended all meetings of the Supervisory Board in the period under review, with only one member being excused for one meeting. Therefore, all members of the Supervisory Board attended more than 75 % of the meetings of the Supervisory Board. SBO's Presidents from the subsidiaries and Division Heads provide the Executive Board with analyses and recommendations on impacts, opportunities, and risks. The CEO and COO assess this input and make strategic decisions, with responsibilities related to impacts, risks, and opportunities (IROs) reflected in various policies, including the Code of Conduct, Whistleblowing Policy, and the Ethics and Fair Trade Policy.

GOV-1 - 22 C - ROLE OF SENIOR MANAGEMENT IN MONITORING, MANAGING AND OVERSEEING IMPACTS, RISKS AND OPPORTUNITIES

Responsibility for risk management is assigned to the Head of Risk Management and the Head of Compliance, whose work is monitored through regular reporting and oversight processes.

Reporting obligations for those responsible for monitoring risks are structured as follows: Risk-monitoring units are required to provide regular reports to the Executive Board, typically on a bi-annual basis or as needed for potential developments. These reports include detailed risk assessments, potential impacts, and proposed mitigation measures. Communication with the Supervisory Board occurs through periodic updates and dedicated reports. The reporting process ensures a clear flow of information to both the executive and supervisory levels, enabling informed decision-making and effective oversight of risks.

SBO uses specialized control mechanisms and procedures, such as internal audits, compliance calls and risk management, all of which are embedded into the corporate structure to effectively manage risks and opportunities.

GOV-1 - 22 D - MONITORING OF OBJECTIVES AND PROGRESS ON MATERIAL IMPACTS, RISKS AND OPPORTUNITIES BY ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES

The Supervisory Board and the Executive Board of SBO monitor key risks and opportunities through regular meetings and detailed reporting, with targets set based on strategic priorities, risk assessments and objectives. As part of the ongoing analysis, the defined impacts, risks and opportunities identified through the double materiality assessment are being reviewed for potential integration into the existing risk management framework to ensure a comprehensive and aligned approach.

GOV-1 – 23 - DETERMINING SKILLS AND EXPERTISE FOR OVERSEEING SUSTAINABILITY MATTERS

The Managing Directors/Executive Board possess relevant commercial as well as technical educational backgrounds and have gained significant professional experience in leadership roles, including managing strategic and operational challenges. The Supervisory Board members bring numerous expertise in areas such as corporate management, finance, technical and business administration, as well as corporate governance, sustainability, and compliance.

Composition of the Executive Board:

When developing and implementing the corporate strategy, which encompasses both organic and acquisitive growth, the Executive Board considers sustainability aspects as well as associated opportunities and risks related to environmental, social, and governance (ESG) factors. For example, during an M&A process, the Executive Board evaluates the extent to which a potential transaction impacts SBO's sustainability positioning with regard to key impacts, risks, and opportunities. In this process, the Executive Board is supported by internal and external ESG experts.

Integration of sustainability-related performance in incentive schemes

Roles covered

The remuneration system for SBO's Executive Board includes performance-based variable components linked to both financial and non-financial criteria. Non-financial criteria are partially aligned with sustainable and strategic objectives, contributing to accountability for environmental, social, and governance (ESG) priorities.

For the Supervisory Board, remuneration is not linked to company performance, as per Austrian regulations.

Sustainability KPIs tied to remuneration

Variable remuneration for Executive Board members includes both financial and non-financial performance criteria. Non-financial criteria are tied to areas like ESG projects and strategic corporate development.

In the reporting period 2024 SBO does not integrate sustainability-related targets into the performance measurement of the Executive Board. Performance is evaluated using qualitative criteria that align with SBO's broader strategic goals.

The qualitative performance criteria include strategic corporate development, ESG projects, the implementation of key initiatives, as well as market and product innovations.

Furthermore, SBO integrates sustainability aspects into the corporate strategy, particularly within the ESG approach. In this corporate strategy, which is valid in the 2024 financial year, the company pursues a sustainable growth strategy based on three key elements: "Value Creation in the Core Business," "Building a New Energy Business for Further Growth," and "Embedding Sustainability in the Company." These factors are reviewed and defined annually. The annually established qualitative goals serve as the basis for assessing both the overall performance of the Executive Board and the individual performance of each Executive Board member.

This strategy was recalibrated in 2024. The new corporate strategy of SBO will be presented in 2025, in which sustainability will also play a key role.

Climate-related considerations

Climate-related factors are integrated into the compensation of the Executive Board as part of its sustainability and ESG-related responsibilities; however, they are not separately quantified.

Weighting of variable remuneration

The average variable remuneration for both Executive Board members is 36.3 %. This remuneration part is linked to financial and non-financial performance criteria. The non financial performance criteria include sustainability-related projects and strategic corporate development but are not separately quantified.

Governance and responsibility

The Nomination and Remuneration Committee of the Supervisory Board is responsible for preparing, regularly reviewing and monitoring the implementation of the Remuneration Policy for the Executive Board. The Nomination and Remuneration Committee is responsible for determining the target achievement of the performance criteria for the performance-related remuneration.

Strategy, business model and value chain

SBM-1-40 Core elements of general strategy

Products and services

SBO manufactures high-alloy, non-magnetic steels and high-precision components and equipment for the energy sector and other industries. The company operates through two divisions (renamed in 2025):

Precision Technology (formerly Advanced Manufacturing & Services):

• Manufacturing of custom components with the highest accuracy
• High-Strength Non-Magnetic Steels: Over 70 years of expertise in high-strength, non-magnetic grades
• High-Precision Components: Custom components from non-magnetic, corrosion resistant steel and other high-performing alloys
• Advanced Additive Manufacturing: Mission-critical components using 3D metal printing
• High-Tech Service and Repair: Top-tier repair and maintenance facilities in major industry hubs

Energy Equipment (formerly Oilfield Equipment):

• High-end tools for horizontal and directional drilling and well completion
• Rotary Steerable Tools: Field-proven RSS, #1 independent provider
• High-Performance Drilling Motors: Market-leading motors with enhanced data sensor technology
• Circulation Tools: Downhole circulation tools (DSI) for mud loss prevention
• Well Completion Solutions: Patent-protected packers, composite frac plugs, dissolvable plugs and geothermal plugs

Significant product groups and share of revenue

Significant markets and geographies

Number of employees by geography

Customer groups

Operations in the fossil fuel sector

SBO operates in the fossil fuel sector (coal, oil and gas). The company specializes in manufacturing high-alloy, non-magnetic steels and high-precision components and equipment for the energy sector and other industries. Reliable data on the distribution of drilling activities across different energy sources is not available and cannot be derived with certainty.

Sustainability targets

SBO has established specific sustainability goals, including emission reduction targets and diversification objectives. As of today, there are no explicitly defined targets for individual product groups, services, customer groups or stakeholder relationships.

Emission reduction targets:

• 30% reduction in Scope 1+2 emissions by 2030
• 10% reduction in Scope 3 emissions by 2030

Strategic relevance of sustainability aspects

SBO's strategy includes sustainability targets. A key objective is the reduction of emissions, achieved through:

• Transition to renewable energy
• Optimization of manufacturing processes
• Resource-efficient circular economy practices

SBO is strategically leveraging its existing technologies to penetrate adjacent industries, such as Next-generation geothermal energy, while simultaneously driving innovation with advanced products in 3D metal printing in energy transition and industrial markets.

Key challenges include:

• Meeting evolving regulatory requirements
• Ensuring supply chain resilience
• Maintaining competitiveness while advancing sustainable solutions

SBM-1-42 Business model and value chain

Business model overview

SBO is a leading manufacturer of high-alloy, non-magnetic steels and high-precision components and equipment for the energy sector and beyond. With around 1,600 employees and a worldwide network of subsidiaries, SBO is at the forefront of the industry with an unwavering commitment to optimum precision. SBO's ability to deliver cutting-edge, high-performance solutions is backed by a highly innovative product portfolio, protected through strong intellectual property.

Headquartered in Ternitz, Austria, and with 23 locations worldwide, SBO stays close to its customers, ensuring fast, efficient and high-quality services. SBO's strategic, long-standing relationships with both customers and suppliers are key to delivering industry-specific solutions of the highest quality that enable greater operational efficiency and reduced environmental impact.

Key inputs

SBO's production processes rely on essential raw materials, including:

• Steel
• Metal powder for additive manufacturing
• Aluminium
• Resin and hardener (used for composites)
• Fiber glass
• Rubber
• Polyester
• Magnesium

To ensure supply chain stability and procurement security, SBO maintains long-term relationships with suppliers.

Outputs and outcomes

Outputs: SBO manufactures:

• High-precision components and equipment
• Components used for directional drilling
• Rotary steerable systems
• Well-completion products and solutions

These products are primarily used in the energy sector today, but increasingly in geothermal applications.

Customer Benefits: The products of SBO meet high performance and quality standards, providing customers with a technological edge and thus competitive advantages in their respective industry through tailored and often customer-specific designs.

Stakeholder Benefits:

• Investors: Benefit from revenue growth, an increase in company value, and dividends through diversification into business areas such as energy transformation and other industrial applications. Earnings and cash generation across market cycles thanks to a strong market position (niche provider).

• Employees: Personal development and career opportunities through innovation-driven programs.

• Communities: Experience reduced environmental impact through SBO's technologies as well as the company's compliance and sustainability efforts.

Upstream value chain

SBO's upstream value chain relies on robust relationships with suppliers of high-quality raw materials, ensuring the consistent manufacturing of its specialized products. The company maintains long-term partnerships to ensure supply chain stability.

Downstream value chain

SBO works closely with its customers, offering tailored solutions to maintain high performance standards, reliability, and efficiency improvements. This collaboration significantly contributes to the overall value creation in the energy sector.

Value chain overview

SBO's value chain encompasses all key stages from raw material sourcing to the end use of its products. The process begins with the global procurement of high-alloy and non-magnetic steels, followed by transportation to SBO's production facilities. Finished components are then distributed worldwide to customers in the energy, geothermal, and industrial sectors. After their use, many of these products can be recycled or reintegrated into further industrial processes, supporting long-term operational efficiency.

Strategic goals and execution pillars

Growth and portfolio expansion targets

• Grow sales to MEUR 900 until 2030, of which MEUR 200 in new business areas (energy transition and other industrial sectors)
• Strategic cooperations and M&A to extend capabilities and expand into high-margin industries

Value creation target

• Achieve an EBITDA margin above 20% over the market cycle

Four strategic pillars

1. Diversification

Diversification is the central pillar to achieve strategic goals. SBO is expanding its expertise beyond the oil and gas industry by entering new attractive industries in energy transition and other industrial sectors. One of the most significant new areas of focus is flow control, an industry with a market size of USD 262 bn in 2024, vital across multiple sectors including water treatment, semiconductors, space, power generation and specialty chemicals.

SBO has already successfully introduced flow control solutions for the oil and gas industry. Building on this, SBO will leverage its technology leadership to penetrate new attractive niche markets that are less cyclical than the oil and gas industry and thus offer long-term stability and growth.

2. Market expansion

Through continued expansion into high growth regions and by establishing new business models, SBO will drive organic growth. With the ongoing extension of its broad global footprint, SBO is strengthening its presence in high-growth oil and gas regions such as the Middle East, Latin America and Asia.

SBO is leveraging the expertise of the Energy Equipment division in the North American market to offer innovative and customer specific solutions to new markets. Through the expansion of facilities in Dubai (UAE) and Dammam (KSA), SBO has established a strong, regional presence in the Middle East, which will drive future growth in this region.

3. Technology leadership

The environment for SBO's applications is becoming increasingly complex and demanding, considering more extreme temperatures and higher pressures. At the same time, growing customer expectations for performance, reliability and efficiency require continuous advancements and optimizations of materials and technology.

These challenges need customized solutions to ensure reliable performance under extreme conditions. Whether in the oil and gas industry, in energy transition (such as enhanced geothermal energy and CCS), or in other industries (such as aerospace or flow control), SBO meets these demands and offers customers solutions with the highest precision.

4. Operational excellence

Operational excellence plays a critical role at SBO to drive value. In order to remain successful in the cyclical oil and gas industry, SBO will become even more agile and efficient. Therefore, SBO will continue to optimize manufacturing capacities across its locations and improve the resilience of its supply chain. Efficiency improvements in operations, vertical integration through organic initiatives, as well as energy efficient manufacturing processes will ensure sustainable value creation.

Global locations

SBO operates manufacturing, sales and service facilities in more than 20 locations across five continents:

Europe:

• Ternitz (Austria) – Headquarters: Manufacturing of high-strength, non-magnetic steels and European 3D metal printing competence center
• Aberdeen (UK)
• Bristol (UK)

North America:

• Houston, TX (USA)
• Broussard, LA (USA)
• Calgary (Canada)
• Nisku (Canada)
• Multiple additional US locations for development, manufacture, service and sales
• 3D metal printing center in Houston

Latin America:

• Macaé (Brazil)
• Villahermosa (Mexico)

Middle East:

• Dubai (UAE)
• Dammam (KSA)
• New and enlarged facilities supporting strategic growth initiatives

Asia:

• Binh Duong (Vietnam): Manufacturing facility currently being expanded
• Singapore
• Noyabrsk (Russia)

Interests and views of stakeholders

Key stakeholder groups and engagement methods

SBO engages with key stakeholder groups, including customers, suppliers, banks, shareholders, and employees, through regular communication and collaboration. This includes direct exchanges with customers to address specific needs, close coordination with suppliers to strengthen supply chain reliability and foster long-term partnerships, ongoing dialogue with banks regarding financial matters, transparent communication with shareholders on strategic developments, and continuous engagement with employees to support their well-being and professional growth.

Customers/Distributors

Employees

Shareholders

Suppliers

Banks

Authorities, Politics

NGOs

Local Communities

Media

Integration of interests and views into strategy and business model

SBO actively engages with its workforce to understand their interests, views, and rights, considering these insights to inform its strategy and business model while maintaining a strong commitment to respecting human rights. However, the interests and views of value chain workers, affected communities, and consumers are not fully integrated into this process, although their rights are upheld.

Informing governance bodies about stakeholder views

At SBO, the executive and supervisory boards are informed about stakeholder views and interests regularly through verbal updates or reports and summaries prepared by responsible managers, ensuring these insights are considered in decision-making processes.

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

Overview

SBO has identified key environmental impacts, risks, and opportunities, mainly focused on emissions and resource utilization in manufacturing and across the upstream and downstream value chain. Risks also arise from regulatory changes and market dynamics, while opportunities exist in business model diversification and advancements in the circular economy.

SBO acknowledges that material impacts, risks, and opportunities significantly affect its business model, value chain, strategy, and decision-making. Current and future focus areas include emission reduction and circular economy optimization.

Double materiality assessment

This was SBO's first double materiality analysis, so no comparisons to the previous reporting period are available.

By applying the double materiality principle, SBO has analyzed all Impact, Risk, and Opportunity factors (IROs). In addition, the climate risk and vulnerability analysis has provided valuable insights, further enhancing the understanding of key climate-related risks and opportunities. SBO is strategically well-positioned to manage these challenges and leverage opportunities.

Integration into strategy

The Executive Board considers material impacts, risks, and opportunities when defining the strategy of SBO, using input from subsidiaries to guide their decisions. ESG related IROs are initially identified through the double materiality assessment and a standardized process for their systematic consideration in decision-making is currently under analysis.

During the reporting period, SBO's Executive Board and Supervisory Board addressed key risks, including health and safety, financial risks, and regulatory changes. Efforts were made to improve workplace safety and meet regulatory requirements. In the reporting year 2024, SBO completed the double materiality analysis in accordance with the requirements of the ESRS and CSRD, identifying the key impacts, risks, and opportunities (IROs). Therefore, SBO has not yet actively addressed these IROs but will integrate them into its risk management and strategy in the future.

Resilience of strategy and business model

By applying the double materiality principle, SBO has analyzed all Impact, Risk, and Opportunity factors (IROs). In addition, the climate risk and vulnerability analysis has provided valuable insights, further enhancing the understanding of key climate-related risks and opportunities. SBO is strategically well-positioned to manage these challenges and leverage opportunities.

Material impacts

Environmental impacts

E1 - Climate change mitigation

E1 - Energy

E2 - Pollution

E3 - Water

E4 - Biodiversity and ecosystems

E5 - Circular economy

Social impacts

S1 - Own workforce

S2 - Workers in the value chain

S3 - Affected communities

Governance impacts

G1 - Business conduct

Material risks and opportunities

Environmental risks and opportunities

E1 - Climate change

E3 - Water

E5 - Circular economy

Social risks and opportunities

S1 - Own workforce

S2 - Workers in the value chain

S3 - Affected communities

S4 - Consumers and end-users

Governance risks and opportunities

G1 - Business conduct

Current financial impacts

For the majority of identified risks and opportunities, no significant financial impacts were reported during the reporting year 2024. SBO notes that currently, no estimates can be made for several impacts including rising energy prices, certain opportunities related to diversity and training, and water-related risks.

Climate resilience analysis

Methodology

SBO started its resilience analysis in 2023 and finalized it in 2024. The assessment applied climate scenarios (RCP 2.6, RCP 4.5, and RCP 8.5) to evaluate short-term (2030), medium-term (2050), and long-term (2100) risks and opportunities.

Time horizons:

• Short-term (2030): To address immediate risks and opportunities affecting current operations and strategies
• Medium-term (2050): To evaluate mid-range impacts and align with global climate goals and regulatory trends
• Long-term (2100): To assess long-lasting physical risks, such as sea-level rise and chronic climate impacts, ensuring long-term strategic resilience

Results

The resilience analysis revealed key climate-related risks and opportunities. Transition risks, such as rising carbon taxes, and physical risks like extreme weather events emphasize the importance of proactive risk management and long-term strategic planning. The results were also included in SBO's planned climate protection measures including electricity from renewable sources and operational optimizations.

Key findings:

• Physical risks include extreme weather events, water scarcity, and infrastructure impacts
• Transition risks include regulatory changes, carbon pricing, and market shifts away from fossil fuels
• Opportunities exist in diversifying into new energy technologies and improving operational efficiency

Integration into strategy

Strategic Integration: Development of a long-term decarbonization pathway to minimize regulatory and market-driven transition risks.

Investment Decisions:

• Consideration of climate scenarios (RCP 2.6, 4.5, 8.5) in risk assessment
• Investments in energy from renewable sources, energy efficiency measures, and climate-friendly technologies

Mitigation Measures:

• Reduction of CO2 intensity through measures to increase the use of energy from renewable sources and improve energy efficiency
• Scenario analyses for the early identification of financial impacts of climate-related risks

Uncertainties

• Data Gaps in the Value Chain: Limited availability of detailed supplier-level climate impact data
• Climate Scenario Variability: Differences in projections under RCP 2.6, 4.5, and 8.5 scenarios create challenges in long-term planning
• Evolving Regulations: Uncertainty regarding future regulatory frameworks and carbon pricing mechanisms

Adaptability

SBO considers climate-related risks in strategic decisions, investments, and operational processes. Site-specific measures, such as infrastructure improvements and energy efficiency initiatives, contribute to increasing resilience to physical risks. Climate scenario analyses (RCP 2.6, 4.5, 8.5) support long-term risk assessment, although uncertainties in projections and regulatory developments present challenges. Potential impacts on the supply chain are monitored, and adjustments to evolving market and regulatory conditions are made gradually. SBO continues to refine its measures to enable the most effective possible adaptation to climate risks.

In the short term, SBO's strategy focuses on enhancing energy efficiency and increasing the use of electricity from renewable sources, which strengthens resilience against transition risks. While medium- and long-term plans are still in development, SBO continuously evaluates risks and opportunities to ensure adaptability.

Biodiversity impacts assessment

The majority of SBO's operating sites are not located within or near biodiversity-sensitive areas. Three sites require attention due to their proximity to key biodiversity areas or protected zones:

• Schoeller-Bleckmann do Brasil Ltda. (Brazil - Macae): Located near a biodiversity hotspot
• DSI PBL de Mexico S.A. de C.V. (Mexico - Villahermosa): Situated near a Ramsar site
• DSI FZE Services Private Limited (India - Mumbai): Located near urban biodiversity zones

The activities at these locations are limited in size and include tool rental only, with no manufacturing. In India, SBO maintains only administrative operations, with no direct involvement in manufacturing. Most of SBO's operating sites have no significant negative impacts on biodiversity or ecosystems, as they are located on appropriately designated properties and comply with all legal requirements. The evaluation is based on an initial analysis and is still being refined to ensure a more comprehensive assessment.

No impact on individual species or their population size stemming from activities in operational areas could be identified.

SBO´s operating sites have no significant material negative impacts on biodiversity or eco-systems. In the double materiality analysis SBO has identified material negative impacts across the value chain, primarily linked to land-use change, pollution and ecosystem disruption.

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

Methodologies and Assumptions for Identifying IROs (IRO-1-53A)

The identification and assessment of impacts, risks, and opportunities were conducted in reporting year 2024 according to the principles of double materiality, as outlined in the methodological requirements of ESRS 1. This process integrates both financial materiality, which considers the impacts on SBO's financial position and performance, and impact materiality, which evaluates SBO's effects on the environment, society, and other stakeholders.

The methodologies applied include stakeholder analysis, value chain mapping, and scenario-based assessments. Key assumptions underpinning the analysis include the alignment with internationally recognized frameworks, such as the EU Taxonomy and IPCC climate scenarios, to ensure robust and consistent evaluations.

Assessment of Impacts (IRO-1-53B)

SBO has implemented a process to identify, assess, prioritize and monitor its potential and actual impacts on people and the environment. The assessment was conducted using SBO's value chain as the basis, capturing upstream, core, and downstream activities.

An impact assessment was methodically carried out to identify and evaluate both negative and positive impacts from an "inside-out" perspective. This analysis considered key parameters, including the scale, scope, and irremediability, using a predefined scale from 1 to 5, where 5 represents the highest severity for the respective parameter. This structured approach ensures that significant impacts are systematically prioritized and monitored, reflecting SBO's commitment to and compliance with CSRD requirements.

As part of the impact assessment and the outlined value chain, SBO specifically identified impacts associated with its business activities, business relationships, and geographical locations that pose heightened risks of adverse impacts. Company-specific information and assumptions were utilized to support an external expert assessment, enabling the differentiation between material and non-material impacts.

SBO's impact assessment process specifically considers the effects arising from its own operations and those linked to its business relationships. This includes identifying direct impacts, such as emissions or resource use from core activities, as well as indirect impacts that occur through interactions with suppliers, partners, or customers within the value chain.

By leveraging internal data and collaborating with external experts, the company ensures a robust evaluation of these interconnected impacts.

Stakeholder Consultation

SBO conducted consultations with relevant stakeholder groups to understand their perspectives and potential impacts on them. The process focused on identifying stakeholders connected to SBO's activities, business relationships, and value chain. Interviews were held with selected stakeholders, including employee representatives, customers, suppliers, and financial institutions. These interviews addressed topics within the CSRD framework to evaluate stakeholder-relevant impacts.

Stakeholders were asked to provide feedback on key topics and rate their significance using a predefined scale. The results were used to enhance the assessment of material impacts.

External experts were engaged to support this process, providing methodological guidance and validating the results. Their involvement ensured that stakeholder perspectives were accurately captured and incorporated into SBO's materiality assessment.

Scoring Criteria for Impact Materiality

SBO assesses potential and actual, positive and negative impacts using a structured methodology aligned with ESRS 1 Section 3.4 on impact materiality. The assessment evaluates impacts based on three parameters: scale, scope, and irreversibility. These parameters are scored on a predefined scale of 1-5, with an additional weighting applied for potential impacts based on their probability of occurrence.

For actual impacts, severity is calculated as an average value of the three parameters, while for potential impacts, the likelihood of occurrence further refines the assessment. This approach enables a prioritization of negative impacts by their relative severity and likelihood and, where applicable, evaluates positive impacts based on their contribution to sustainability objectives.

Assessment of Risks and Opportunities (IRO-1-53C)

SBO applies to a structured process for identifying, assessing, prioritizing, and monitoring risks and opportunities with potential financial impacts, as part of its double materiality analysis in accordance with ESRS 1. Initially, a risk inventory is created, identifying company-specific risks and opportunities. The assessment uses two parameters: "extent of damage" and "probability of occurrence," evaluated on a predefined 1-5 scale (1 being the lowest extent of damage). Quantitative financial thresholds, adapted from SBO's existing risk framework, were applied to refine the "extent of damage" parameter.

SBO evaluates the interconnections between impacts and the risks and opportunities that arise from these. As part of the materiality assessment process, impacts were identified and assessed first. Building upon these identified impacts, risks and opportunities for SBO were derived.

Additionally, the assessment also considered SBO's dependencies on ecosystem services, such as local water consumption at operational sites and social capital. These dependencies directly informed the identification and evaluation of specific risks and opportunities.

SBO currently addresses sustainability risks separately from other risk categories through a dedicated approach. In the coming years, this approach is planned to be integrated with the overall risk management system to enable a holistic assessment of all risk types.

Scoring Criteria for Financial Materiality

SBO assesses the likelihood, magnitude, and nature of identified risks and opportunities using a predefined scale of 1 to 5. This scale incorporates two key parameters: the extent of potential impact and the probability of occurrence. The extent of impact ranges from 1 (minor) to 5 (critical), while probabilities are defined in percentage intervals, with 1 representing very unlikely events and 5 representing almost certain events.

Decision-Making Process and Control Procedures (IRO-1-53D)

Workshops were conducted with the responsible departments to assess the identified topics concerning their positive and negative impacts, risks, and opportunities. The assessment considered both potential and actual effects, depending on the topic. The results were subsequently reviewed to ensure alignment with the identified impacts, risks, and opportunities. Final approval of the assessment was carried out by the relevant committees within SBO, confirming the materiality of these impacts, risks, and opportunities.

Integration of ESG Risks into Risk Management (IRO-1-53E)

The integration of processes for identifying, assessing, and managing sustainability-related impacts and risks into SBO's overall risk management system has been initiated. While ESG risks are currently evaluated using a distinct scale tailored to non-financial considerations, their classification has been aligned with financial thresholds to ensure comparability. SBO plans to further harmonize the assessment methodologies and fully incorporate ESG risks as a core component of its risk management framework in the coming years.

Integration of ESG Opportunities into Risk Management (IRO-1-53F)

SBO uses the same process for identifying and managing ESG opportunities as it does for ESG risks. These opportunities will be integrated into the existing management framework to ensure consistency and alignment in the future.

Input Parameters (IRO-1-53G)

SBO utilized a combination of internal and external data sources to evaluate impacts, risks, and opportunities. Internal data includes employee numbers and purchasing volumes, while external sources involve indices such as the OECD and UNICEF social indices, and environmental tools like a Water Risk Filter and WWF Biodiversity Risk Filter.

Changes and Reviews of the Materiality Analysis (IRO-1-53H)

The process for identifying, assessing, and managing impacts, risks, and opportunities represents the first double materiality assessment conducted by SBO. Future reviews are planned in alignment with the company's regular reporting cycles to ensure continuous improvement.

Climate-related IRO Process (E1 IRO-1)

Effects on Climate Change (E1 IRO-1-20A)

SBO's climate-related impacts primarily stem from emissions generated across its value chain. Key sources include transportation emissions and emissions from purchased and used raw materials and manufacturing at operational sites and emissions resulting from oil and gas extracted using SBO's equipment. To assess and manage these impacts SBO applies a structured Double Materiality Analysis (DMA) process considering both financial materiality which reflects how climate-related factors affect the company's performance and impact materiality which evaluates SBO's influence on climate change and the environment. Climate-related risks and opportunities are assessed through data collection and stakeholder engagement and scenario analysis taking into account regulatory developments and market trends and physical climate risks. The evaluation covers both transition and physical risks and also identifies potential opportunities.

Climate-related Physical Risks (E1 IRO-1-20B)

The identification and assessment of climate-related physical risks in SBO's operations and value chain involved a systematic process. This included analyzing potential impacts from extreme weather events, temperature variations, and other climate-related phenomena on facilities, supply chain, and logistics. SBO assessed upstream value chain risks such as disruptions in raw material extraction and downstream risks including impacts on distribution channels. Geographic and operational hotspots were identified using climate modelling tools and historical data. This process ensures comprehensive risk identification to mitigate potential disruptions and enhance resilience across the value chain.

The assessment of physical climate risks incorporated high-emission climate scenarios, such as RCP 8.5 (or SSP5-8.5), to account for severe outcomes if insufficient climate protection measures are implemented. This scenario assumes continued high emissions, resulting in more pronounced climate change effects and heightened physical risks. By integrating these scenarios, SBO ensured a comprehensive understanding of potential hazards under worst-case emission trajectories. This approach supports informed decision-making and strengthens resilience planning.

For SBO, the assessment of gross physical risks considers the potential exposure of its assets and business activities to climate-related hazards such as extreme weather events and long-term environmental changes. The focus includes specific operational sites, drilling processes, and the reliance on specialized materials, given their geographic distribution and climate-sensitive locations. SBO's documentation highlights the challenges in assessing risks across its upstream and downstream value chain, including suppliers and waste management systems, but acknowledges the importance of these evaluations for maintaining operational resilience. While detailed data for the full value chain is limited, SBO emphasizes localized assessments for its core operations, reflecting its strategic focus on high-priority areas for climate risk adaptation and mitigation.

Identification of Climate Hazards Across Time Horizons (E1 IRO-1-AR 11A)

To comply with the CSRD reporting requirements, the identification and assessment of climate-related hazards have been carried out across short-, medium-, and long-term time horizons. This process followed a standardized approach using the climate hazard table outlined in the EU Taxonomy (Appendix A, Annex 1, Delegated Act 2021/2139).

While robust climate data was available for some hazards, others presented challenges due to limited data availability. For instance, hazards like forest fires or specific wind-related risks required qualitative assessments or could not be included in the analysis due to a lack of reliable data.

In these instances, the exclusions and methodological limitations have been transparently documented. This ensures that stakeholders have a clear understanding of the scope of the assessment, the hazards analyzed, and the rationale for excluding certain risks. This approach aligns with best practices in climate risk management and fulfills the EU Taxonomy and CSRD requirements for transparent and comprehensive reporting.

Time Horizons and Asset Lifecycles (E1 IRO-1-AR 11B)

Short-, medium-, and long-term time horizons have been clearly defined and linked to the expected lifecycle of SBO's assets, strategic planning horizons, and capital allocation plans. These definitions take into account that physical climate hazards and associated risks may develop and reach critical thresholds over extended periods, especially for assets with long lifespans, such as manufacturing facilities or infrastructure.

Short-term: 2030

Medium-term: 2050

Long-term: 2100

Vulnerability Assessment (E1 IRO-1-AR 11C)

Short-, medium-, and long-term time horizons have been defined in alignment with SBO's operational planning and climate risk management framework. These horizons correspond to 2030, 2050, and 2100, reflecting the scenarios outlined by the IPCC and used for climate risk assessments.

These timeframes ensure that both immediate and long-term risks are considered. The extended horizons are essential for addressing the potential impacts of climate risks on long-lived assets, ensuring a comprehensive evaluation that supports both current operations and future sustainability. To quantify exposure, SBO applied a site-specific localization approach, using geographical coordinates and risk mapping tools to assess exposure to physical climate hazards such as floods, heavy precipitation, storms, extreme temperatures, and droughts. The climate risk scenario analysis incorporates RCP2.6, RCP4.5, and RCP8.5 projections for the years 2030, 2050, and 2100, ensuring a long-term risk perspective. Each site's susceptibility to climate-related hazards is further assessed through vulnerability matrices, where risks are classified based on impact severity and probability using a scale from 1 to 6.

The climate risk analysis indicates that the assessed locations are affected by physical climate risks to varying degrees. While some sites are particularly vulnerable to heavy rainfall events and storms, others face significant threats from hurricanes and extreme temperatures. The vulnerability assessment revealed that floods and strong winds, in particular, can cause structural damage to buildings and lead to operational disruptions. Additionally, rising temperatures pose a risk of production losses due to the overloading of cooling systems. The financial impacts vary by location and scenario, with increased repair costs and potential downtime identified as key risk factors. Adaptation measures such as improved infrastructure resilience, optimization of cooling and drainage systems, and adjustments to operational procedures have been identified as essential strategies for risk mitigation.

Climate Scenarios Used (E1 IRO-1-AR 11D)

The identification of climate-related hazards, as well as the assessment of exposure and vulnerability, is informed by climate scenarios that reflect varying levels of greenhouse gas emissions. These scenarios, IPCC RCP 2.6, RCP 4.5, and RCP 8.5, represent different pathways, ranging from moderate mitigation efforts to continued high emissions, with the latter leading to more severe physical climate risks. Additionally, relevant regional climate projections based on these emission pathways are incorporated into the analysis. These projections include localized climate models and region-specific datasets that account for geographic variations in temperature trends, precipitation patterns, and extreme weather events, ensuring a more precise assessment of risks at SBO's operational sites.

Climate-related Transition Risks and Opportunities (E1 IRO-1-20C)

From the perspective of SBO, climate-related transition risks and opportunities have been identified and assessed across its operations and value chain in alignment with TCFD guidelines. These risks primarily stem from regulatory changes, shifts in customer preferences toward lower-emission technologies, and emerging social and market expectations. The assessment includes analyzing potential cost increases due to stricter emission regulations. The identification of climate-related transition events includes the consideration of at least one climate scenario aligned with limiting global warming to 1.5°C, with no or limited overshoot. This scenario represents an ambitious pathway that assumes rapid and significant political and regulatory measures, such as substantial increases in carbon pricing, to achieve the temperature limit.

Under this scenario, physical risks are expected to be comparatively lower, while transition risks, including regulatory, market, and technological changes, become more significant. By incorporating this scenario, SBO ensures a comprehensive understanding of potential transition impacts.

Assessment of Transition Events (E1 IRO-1-AR 12A)

Transition events have been identified across short-, medium-, and long-term time horizons (2030/2050/2100) as part of an initial screening process.

SBO acknowledges the importance of aligning long-term horizons with climate-related public policy goals, such as the EU Green Deal and net zero emissions by 2050. A framework to assess these risks comprehensively is being designed and will be implemented in future reporting cycles to ensure full compliance with CSRD requirements.

Vulnerability to Transition Events (E1 IRO-1-AR 12B)

Initial efforts of SBO have focused on identifying physical risks. The detailed evaluation of exposure to transition risks, including factors such as likelihood, magnitude, and duration, is currently under development. Therefore, SBO has not completed a comprehensive assessment of the extent to which its assets and business activities may be exposed and sensitive to identified transition events.

Transition Scenario Analysis (E1 IRO-1-AR 12C)

SBO has not conducted a scenario analysis for transition risks. However, the identification of transition risks was guided by the TCFD classification.

Net Zero Compatibility (E1 IRO-1-AR 12D)

SBO is in the process of identifying assets and business activities that may be incompatible with the transition to a net zero emission economy or require significant efforts to achieve compatibility. As part of this assessment, activities that may necessitate substantial capital investment or technological innovation to meet net zero emissions are being evaluated. This ongoing analysis ensures transparency and alignment with CSRD reporting requirements while addressing the challenges posed by transition risks and opportunities.

Applying Climate Scenario Analysis (E1 IRO-1-21)

SBO utilizes climate-related scenario analyses to identify and assess physical and transition risks over short-, medium-, and long-term horizons. These analyses incorporate scientifically validated climate scenarios from the Intergovernmental Panel on Climate Change (IPCC). Specifically, three Representative Concentration Pathways (RCPs) are used to assess potential future climate conditions:

RCP 2.6 – A low-emission scenario aligned with the Paris Agreement's goal of limiting global warming to 2°C, requiring substantial emission reduction efforts.

RCP 4.5 – A moderate-emission scenario assuming stabilization policies and intermediate warming outcomes.

RCP 8.5 – A high-emission scenario representing continued fossil fuel use, leading to global temperature increases exceeding 4°C

These scenarios are applied across three key time horizons—2030, 2050, and 2100—to evaluate how climate risks may evolve over time. SBO integrates these findings into a vulnerability assessment to measure potential risks to operations, infrastructure, and supply chains.

While quantitative scenario modeling is conducted where feasible, SBO acknowledges that data limitations in certain areas require the use of qualitative analyses. These qualitative assessments ensure a comprehensive risk evaluation, incorporating expert judgment, industry benchmarks, and stakeholder insights.

Consistency with Financial Statements (E1 IRO-1-AR 15)

SBO acknowledges the importance of aligning climate scenarios and financial reporting to address and adequately reflect physical climate risks and opportunities. The sustainability report provides a detailed assessment of potential ESG-related risks, including potential impacts and management approaches. The financial statements correspondingly consider ESG-related risks towards non-current assets such as property, plant and equipment as well as towards intangible assets such as goodwill or other intangible assets. The notes section of the consolidated financial statements provides further explanatory information and addresses implications of ESG-related considerations on SBO's financial data.

Pollution-related IRO Process (E2 IRO-1)

Verification of Sites and Activities (E2 IRO-1-11A)

As part of the materiality analysis, SBO conducted an assessment of its own sites for pollution-related risks, considering both physical and transition risks. Additionally, the analysis covered upstream and downstream activities across the entire value chain to ensure a comprehensive evaluation in accordance with EU Taxonomy and CSRD requirements. Recognized materiality assessment methods were applied to identify and evaluate relevant risks, including impact materiality assessments and the use of quantitative thresholds and qualitative evaluations. The analysis was based on scientific foundations and stakeholder inputs to ensure a well-founded and objective assessment of material risks.

Consultations with Affected Communities (E2 IRO-1-11B)

SBO primarily relied on internal stakeholder engagements and external guidance. The perspectives of affected communities were not specifically included in the assessment process. Future evaluations may consider broader stakeholder engagement as regulatory requirements and best practices evolve.

Materiality Assessment Results (E2 IRO-1-AR 9)

SBO identified material pollution impacts at its manufacturing sites, particularly related to emissions and waste streams. In the upstream value chain, resource extraction and material processing are key pollution sources, while downstream value chain impacts are tied to waste management and recycling. Business activities with material impacts include manufacturing processes, waste handling, and upstream value chain procurement of raw materials. These findings are integrated into SBO's ongoing risk and opportunity assessments.

Water and Marine Resources IRO Process (E3 IRO-1)

Review of Assets and Activities (E3 IRO-1-8A)

SBO has evaluated its operations and value chain to identify impacts, risks, and opportunities related to water and marine resources. SBO utilized the World Resources Institute's Aqueduct Water Risk Atlas to assess water stress levels at its facilities. These assessments informed SBO's strategies to mitigate water-related risks and capitalize on opportunities within its operations and supply chain.

Consultations with Affected Communities (E3 IRO-1-8B)

SBO has consulted relevant stakeholder groups as part of its assessment of water and marine resource impacts, risks, and opportunities. Engagement has primarily been conducted via internal stakeholders, including suppliers and experts. These efforts aim to ensure a comprehensive understanding of impacts while addressing material issues identified in the value chain.

LEAP Approach (E3 IRO-1-AR 1)

SBO is currently not applying the LEAP approach.

Biodiversity and Ecosystems IRO Process (E4 IRO-1)

Assessment of Impacts on Biodiversity (E4 IRO-1-17A)

SBO has assessed actual and potential biodiversity and ecosystem impacts across its operations and value chain. The assessment uses structured criteria based on ESRS guidance, focusing on severity, scope, and irremediability. Impacts are analyzed, differentiating regions with diverse standards. SBO integrates stakeholder input and scientific data to evaluate materiality, emphasizing ecosystem changes due to resource use and waste generation. The approach aligns with CSRD and SASB frameworks to ensure comprehensive impact analysis and reporting.

Assessment of Dependencies on Ecosystems (E4 IRO-1-17B)

Dependencies on biodiversity and ecosystems at its own sites and across its upstream and downstream value chains are not fully assessed. Future evaluations may consider key criteria such as the extent of potential damage, probability of occurrence, and dependencies on ecosystem services like pollination.

Identification of Transition and Physical Risks (E4 IRO-1-17C)

SBO conducted a double materiality assessment to evaluate biodiversity-related risks and impacts, using scientific literature, global reports, and environmental studies. Key sources included the IPCC AR6 Synthesis Report (2023), European Environment Agency reports, UNEP studies, and research on habitat destruction and biodiversity loss from National Geographic, Science Advances, and the Royal Society B.

The assessment covered transitory and physical biodiversity risks, such as habitat destruction from mining, deep-sea drilling impacts, invasive species spread through shipping, and pollution across SBO's value chain. Additional insights were taken from studies on shipping traffic (Nature Sustainability) and offshore drilling safety (ScienceDirect).

While these sources provided a broad understanding of biodiversity risks, SBO has not yet conducted a dedicated, in-depth analysis to quantify these risks, nor has it analyzed any systemic risks. SBO is currently evaluating whether further assessments are needed to strengthen risk monitoring and mitigation efforts.

Consultations with Affected Communities (E4 IRO-1-17E)

SBO has not yet conducted consultations with affected communities.

SBO's materiality assessment has identified significant biodiversity-related impacts stemming from upstream value chain activities. These include:

• Land-use change associated with mining operations: Mining activities upstream contribute to habitat loss and alterations in land use, which can significantly impact local ecosystems and biodiversity.
• Freshwater use and sea-use change (upstream and downstream value chain): The extraction and manufacturing processes involve substantial freshwater use, creating potential stress on local water resources and aquatic ecosystems.
• Pollution along the value chain: Pollution from upstream value chain operations, including industrial waste and emissions, affects biodiversity by contaminating ecosystems and reducing habitat quality.

These impacts demonstrate clear dependencies and potential consequences for ecosystems and, indirectly, for local communities relying on these resources.

Assessment of Sites Near Protected Areas (E4 IRO-1-19)

SBO has not identified any negative impacts within our own operations; therefore, no mitigation measures are planned. However, this will continue to be analyzed as part of our ongoing assessment process. A detailed list of SBO's locations relevant to this assessment can be found in SBM-3-16.

Resource Use and Circular Economy IRO Process (E5 IRO-1)

Review of Assets and Activities (E5 IRO-1-11A-11B)

SBO aligns its practices with EU Taxonomy and CSRD requirements. The development and integration of additional tools such as Material Flow Analysis (MFA) or Product Environmental Footprint (PEF), to comprehensively assess actual and potential impacts, risks, and opportunities across its operations and value chain are currently not planned.

Manufacturing facilities use high-grade metals and alloys, with opportunities in improving material efficiency. Waste management handles scrap metals and manufacturing residues, supporting circular economy efforts. Product lifecycle services focus on refurbishing, remanufacturing, and recycling tools and components to extend their use and reduce waste.

SBO emphasizes the strategic importance of high-grade steel, alloys, and other specialized materials, which are integral to the manufacturing of precision components. These materials are indispensable due to their unique mechanical and chemical properties, ensuring optimal performance in demanding and extreme environments. SBO remains committed to securing a reliable supply of these essential resources while actively exploring opportunities to enhance resource efficiency and recyclability in line with general circular economy principles.

SBO is committed to continuous improvement rather than maintaining a business-as-usual approach. By proactively enhancing supply chain efficiency, SBO can unlock new opportunities upstream in the value chain. Downstream in the value chain, a stronger focus on recyclability and circular economy practices can help optimize waste management costs and ensure regulatory compliance, reinforcing long-term sustainability and resilience.

The transition to a circular economy basically presents both opportunities and risks for SBO. While further expenditures in product redesign and infrastructure for material recovery may enhance these efforts, the company already has strong foundations in place. Ongoing improvements in supply chain management and stakeholder collaboration will help optimize circular practices while minimizing operational complexities.

Upstream Value Chain (Material Procurement): The highest resource usage during the sourcing of raw materials, particularly high-grade metals and alloys. Risks at this stage include supply chain disruptions, environmental impacts from mining, and reliance on external suppliers.

Manufacturing (Own Operations): Negative impacts, such as energy consumption, emissions, and waste generation (including hazardous waste), are most concentrated in manufacturing processes.

Downstream value chain (End-of-Life Management): The downstream stage involves waste management, including the disposal and recycling of used components.

SBO has not conducted specific consultations with affected communities regarding resource inflows, resource outflows, and waste management.

Business Conduct IRO Process (G1 IRO-1)

Procedures for Identifying Material Impacts (G1 IRO-1-6)

SBO approaches the identification and assessment of material impacts, risks, and opportunities in business conduct matters by integrating location, activity, sector, and transaction structure as key evaluation criteria. This process aligns with the materiality analysis conducted under ESRS 2 and IRO-1 requirements. SBO identified corporate governance as material through stakeholder engagement and sector-specific evaluations, assessing its significance across various geographic locations and business activities. This determination was guided by factors such as regulatory requirements, operational activities, and stakeholder priorities, ensuring a comprehensive understanding of governance-related risks and opportunities. Further refinements to clearly link ESRS G1 and ESRS 2 criteria may enhance the transparency of this process.

Transition plan for climate change mitigation

Scope of the plan

SBO is developing a transition plan for climate change mitigation and will conduct a comprehensive analysis of all necessary components. As part of this process, SBO is committed to aligning climate targets with internationally recognized frameworks and is actively working towards joining the Science Based Targets initiative (SBTi). Although the specific SBTi standard for the oil and gas sector is expected to be published in 2025, SBO is already focused on establishing climate targets that drive the sustainable business strategy forward.

Geographical scope: Global - all geographical regions where SBO operates.

Value chain scope: The targets address:

• Own activities (Scope 1 & 2)
• Upstream and downstream value chain (Scope 3)

Target year(s) for net zero / carbon neutral

2050: Achieve net-zero emissions across Scope 1, 2, and 3, aligned with the Paris Agreement.

Scope 1, 2, 3 reduction milestones with baseline years

Baseline year: 2022

2030 interim targets:

• 30% reduction in Scope 1 and 2 emissions compared to 2022
• 10% reduction in Scope 3 emissions compared to 2022

2050 targets:

• 90% reduction in Scope 1 & 2 emissions compared to 2022
• 90% reduction in Scope 3 emissions compared to 2022

Baseline values (2022):

• Scope 1 & 2: 13,643 tCO2e
• Scope 3: 89,246 tCO2e

Target values:

Alignment with 1.5°C / SBTi validation status

SBO's environmental targets are aligned with the long-term goal of achieving Net Zero emissions. Today, it is formally not possible for SBO to align with the SBTi standards, as sector-specific guidelines for the oil and gas industry are expected to be introduced only in the course of 2025. SBO has set its targets to the best of its knowledge and ability. The compatibility with SBTi's official framework will be reassessed once the specific sector standard is published. At this stage, the 2030 milestone targets are not yet aligned with the SBTi framework.

External verification: The targets have not been externally verified, and the 2030 goal is not fully aligned with the 1.5°C trajectory. While reduction ambitions are based on a detailed internal assessment and an evaluation of measures across the value chain, further refinement will be necessary to ensure full compatibility with internationally recognized climate pathways.

Key levers / decarbonization pillars

Decarbonization levers Scope 1 & 2:

• Switch to electricity from renewable sources
• Energy efficiency improvements at production sites
• Reduction of fuel consumption
• Process optimization measures

Decarbonization levers Scope 3 (in tCO2e):

The reduction values in Scope 3 are based on estimates derived from the respective Scope 3 category, as exact measures within the value chain cannot yet be precisely quantified due to significant dependencies on the actions of value chain partners. The main focus lies on purchased materials within Scope 3.1:

• Fuel switching: 11,337 tCO2e
• Material efficiencies and consumption reduction: 60,274 tCO2e (primarily referring to more sustainable production of steel)
• Energy efficiencies: 5,826 tCO2e
• Other: 2,885 tCO2e

Strategic integration

Development of a long-term decarbonization pathway to minimize regulatory and market-driven transition risks.

Investment decisions:

• Consideration of climate scenarios (RCP 2.6, 4.5, 8.5) in risk assessment
• Investments in energy from renewable sources, energy efficiency measures, and climate-friendly technologies

Mitigation measures:

• Reduction of CO2 intensity through measures to increase the use of energy from renewable sources and improve energy efficiency
• Scenario analyses for the early identification of financial impacts of climate-related risks

CapEx / investment commitments

SBO has defined several measures within the framework of its Climate Transition Plan. Since the estimation of CAPEX and OPEX required for the implementation of these measures is not yet finalized, it is currently not permitted to disclose them. The actions and the Climate Transition Plan will be published once the financial assessments are completed.

Carbon credits / removals

SBO manufactures components used in carbon capture and storage (CCS) applications; however, CCS is not considered part of the company's own emissions reduction strategy and is therefore not quantified or included in this context.

Uncertainties in the resilience analysis

• Data Gaps in the Value Chain: Limited availability of detailed supplier-level climate impact data
• Climate Scenario Variability: Differences in projections under RCP 2.6, 4.5, and 8.5 scenarios create challenges in long-term planning
• Evolving Regulations: Uncertainty regarding future regulatory frameworks and carbon pricing mechanisms

Policies related to climate change mitigation and adaptation

SBO explicitly states that it does not have a comprehensive ESG policy established. The company acknowledges in its disclosure:

"SBO is in the process of developing a comprehensive ESG policy, as one has not been established. Until now, ESG aspects were covered within broader policies like the Code of Conduct."

Transition Plan for Climate Protection (Climate Transition Plan)

While not a formally adopted policy yet, SBO references a "Transition plan for climate protection (Climate Transition Plan)" in its target disclosures (E1-4). The company states:

"SBO is developing a transition plan for climate change mitigation and will conduct a comprehensive analysis of all necessary components. As part of this process, SBO is committed to aligning our climate targets with internationally recognized frameworks and is actively working towards joining the Science Based Targets initiative (SBTi)."

Status: Under development, expected to be finalized in 2025.

Alignment: The company is working towards alignment with the Science Based Targets initiative (SBTi), though the specific SBTi standard for the oil and gas sector is expected to be published in 2025.

Targets linked to this framework:

• 30% reduction in Scope 1 and 2 emissions by 2030 (baseline: 2022)
• 10% reduction in Scope 3 emissions by 2030 (baseline: 2022)
• 90% reduction in Scope 1 and 2 emissions by 2050 (baseline: 2022)
• 90% reduction in Scope 3 emissions by 2050 (baseline: 2022)
• Net-zero emissions across Scope 1, 2, and 3 by 2050, aligned with the Paris Agreement

Code of Conduct

The Code of Conduct is mentioned as having previously covered ESG aspects, though specific climate-related content is not detailed in the excerpts provided.

Actions and resources in relation to climate change policies

Disclosure Status

E1-MDR-A-62 - REASON FOR NON-DISCLOSURE OF ACTIONS

SBO has defined several measures within the framework of its Climate Transition Plan. Since the estimation of CAPEX and OPEX required for the implementation of these measures is not yet finalized, it is currently not permitted to disclose them. The actions and the Climate Transition Plan will be published once the financial assessments are completed.

Context

SBO is in the process of developing a comprehensive ESG policy, as one has not been established. Until now, ESG aspects were covered within broader policies like the Code of Conduct.

Planned Actions Framework

While specific actions are not yet disclosed, the company has indicated that measures have been defined within the Climate Transition Plan to support the following targets:

By 2030:

• 30% reduction in Scope 1 and 2 emissions
• 10% reduction in Scope 3 emissions

By 2050:

• Achieve net-zero emissions across Scope 1, 2, and 3, aligned with the Paris Agreement

Baseline year: 2022

Resources Allocated

Financial resources: CAPEX and OPEX estimates are under development and not yet disclosed.

Non-financial resources: Not disclosed at this stage.

The Climate Transition Plan is planned for finalization in 2025, at which point detailed actions and resource allocations will be published.

Targets related to climate change mitigation and adaptation

Overview

SBO has established climate change targets as part of its sustainability strategy. The targets are relative (percentage reduction) and cover Scope 1, 2, and 3 emissions with a baseline year of 2022.

Target alignment: The targets are aligned with the long-term goal of achieving Net Zero emissions. SBO plans to align with the Science Based Targets initiative (SBTi) once sector-specific guidelines for the oil and gas industry are published (expected in 2025). The 2030 milestone targets are not yet aligned with the SBTi framework.

External verification: The targets have not been externally verified, and the 2030 goal is not fully aligned with the 1.5°C trajectory.

Quantified Targets

2030 Target Details

Scope 1 & 2 target (2030):

• Target value in absolute terms: 9,550 tCO2e
• Included greenhouse gases: All seven Kyoto gases (CO2, HFC, SF6, PFC, CH4, N2O, NF3)
• No milestones or interim targets defined

Scope 3 target (2030):

• Target value in absolute terms: 80,321 tCO2e
• Included greenhouse gases: All seven Kyoto gases (CO2, HFC, SF6, PFC, CH4, N2O, NF3)
• Included Scope 3 subcategories: All
• No milestones or interim targets defined

2050 Target Details

Scope 1 & 2 target (2050):

• Target value in absolute terms: 1,364 tCO2e
• No milestones or interim targets defined

Scope 3 target (2050):

• Target value in absolute terms: 8,925 tCO2e
• No milestones or interim targets defined

Decarbonization Levers

Scope 1 & 2 (in tCO2e):

• Electrification: 3,762 tCO2e
• Use of renewable energy: 8,516 tCO2e

Scope 3 (in tCO2e):

• Fuel switching: 11,337 tCO2e
• Material efficiencies and consumption reduction: 60,274 tCO2e
• Energy efficiencies: 5,826 tCO2e
• Other: 2,885 tCO2e

Methodology and Climate Scenarios

• Target definition: Targets were defined through a comprehensive assessment of potential measures and their expected impacts, including screening of climate-related targets and strategies of key suppliers and customers.
• Climate scenarios: SBO is in the early stages of analyzing various climate scenarios to identify relevant environmental, social, technological, market, and policy-related developments.
• Scope 3 approach: Decarbonization levers in Scope 3 are based on estimates derived from the respective Scope 3 category, as exact measures cannot yet be precisely quantified due to dependencies on value chain partners. Main focus lies on purchased materials within Scope 3.1.

Monitoring and Review

As the targets have been set in 2024, they are in the early stages of implementation, and no measurable progress has been recorded.

Energy consumption and mix

Scope and methodology: Energy consumption data covers all SBO global locations (23 locations across five continents). Data sourced from energy meters and energy bills from each subsidiary, consolidated at group level. For the majority of energy consumption, energy mix is available; only few estimations were required. Energy consumption reflects manufacturing facilities, offices, and services.

Energy consumption by source

Own energy generation

Energy intensity

Notes on specific sources:

• Coal: SBO does not directly generate energy using coal; however, electricity purchased includes electricity generated by coal (included in purchased electricity from fossil sources)
• Crude oil and petroleum products: Based on diesel and petrol consumption, as well as fuel oil (light and heavy), mostly used for company vehicles
• Natural gas: Includes propane, butane, natural gas, liquefied petroleum gas (LPG), liquefied natural gas (LNG), and compressed natural gas (CNG)
• Nuclear sources: Used in a few locations; calculated by aggregating energy mixes from electricity supplier invoices
• Self-generated renewable energy: Data from energy production reports, utility invoices, and renewable energy monitoring systems; currently renewable energy is produced with PV-systems in a few subsidiaries
• Purchased heat: SBO consumes only a non-significant amount of acquired heat through district heating
• Purchased cooling and steam: Not applicable

High climate impact sectors: SBO is a manufacturer and equipment supplier in the oilfield services industry. Total energy consumption from activities in high climate impact sectors amounts to 51,562 MWh (2024).

Gross Scopes 1, 2, 3 and Total GHG emissions

Summary Table

Note: Percentage of Scope 1 GHG emissions from regulated emission trading schemes: 0% (both 2024 and 2023).

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Scope 1: Gross direct GHG emissions

Sub-breakdown by source: Not disclosed.

Included greenhouse gases: All seven Kyoto gases (CO₂, HFC, SF₆, PFC, CH₄, N₂O, NF₃).

Methodology note: Data were collected based on invoices for natural gas and petrol/diesel consumption. In few cases, mileage and average consumption were used for company vehicles. Emission factors from IEA 2021 and AIB 2021 were used.

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Scope 2: Gross indirect GHG emissions from purchased energy

Included greenhouse gases: All seven Kyoto gases (CO₂, HFC, SF₆, PFC, CH₄, N₂O, NF₃).

Methodology notes:

• Location-based: Calculated in accordance with the Greenhouse Gas Protocol Scope 2 Guidance. This approach focuses on the average emission factors of the grid in the geographical locations where electricity is consumed. In the absence of specific local emission factors, country or region-wide averages are applied.
• Market-based: Calculated based on information from the electricity provider.

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Scope 3: Gross indirect GHG emissions from value chain

Included greenhouse gases: All seven Kyoto gases (CO₂, HFC, SF₆, PFC, CH₄, N₂O, NF₃).

Percentage of GHG Scope 3 calculated using primary data: Currently SBO does not use primary data, as those are not available from suppliers yet. However SBO is working closely with major suppliers to receive primary data in the future.

Methodology notes:

Scope 3 emissions were calculated using a combination of the average-data method and the spend-based method. Due to the unavailability of product-specific carbon footprint (PCF) data from suppliers, the supplier-specific approach could not be applied.

Emission factors used:

• Mass-based factors: Idemat (2022)
• Spend-based factors: DBEIS (2020)
• Energy-related factors: Ecoinvent (3.9.1, 2022) and IEA (2022)

Category-specific methods:

• 3.1 Purchased goods and services: Raw materials assigned to mass-based emission factors from Idemat. Weights (metric tons) purchased multiplied by emission factors. For other goods and services where no weight information was available or the average data method was not applicable (e.g. services such as insurance or IT-support), the spend-based method was applied.
• 3.2 Capital goods: Spend-based method using DEFRA 2022 database.
• 3.3 Fuel and energy-related activities: Upstream emissions of fuels (petrol, diesel, ethanol) and electricity considered. Emission factors from Ecoinvent database and IEA.
• 3.4 Upstream transportation and distribution: Average data method based on tonne-kilometre (tkm). Emission factors from Ecoinvent per tonne-kilometre. If distances/mileage not available directly from shipping documents, online sources such as Google Maps or Searates.com were used.
• 3.5 Waste generated in operations: Weight disposed multiplied by emission factors from Ecoinvent database. Metal chips sold are excluded from scope 3.5 and considered under scope 3.12 instead.
• 3.6 Business travel: Spend-based emission factors from DBEIS database adjusted for exchange rate and inflation. Air-travel data from DEFRA.
• 3.7 Employee commuting: Average 2024 headcount by group company used as basis. Average emissions per employee according to data basis (Jayakrishnan et al 2023) applied depending on location/region.
• 3.8 Upstream leased assets: Non-significant amounts of leased assets directly considered in Scope 1 emissions.
• 3.9 Downstream transportation: Individual type of transport and relevant emission factors from Ecoinvent per tonne-kilometre. Online sources (Google Maps, Searates.com) used where mileage not available from shipping documents.
• 3.10 Processing of sold products: Emissions from processing/manufacturing of sold raw materials (non-magnetic steel) by third parties. SBO estimates the required average kWh to manufacture the final product and multiplies this with the related emission factor for electricity (location-based).
• 3.11 Use of sold products: SBO products sold (metal/steel components and downhole drilling tools) do not directly require energy such as fossil fuels or electricity to be used by SBO's customers.
• 3.12 End-of-life treatment of sold products: Emissions from disposal of manufactured products evaluated using emission factors from Ecoinvent database.
• 3.13 Downstream leased assets: SBO products rented to customers (downhole drilling tools) do not directly require energy.
• 3.14 Franchises: Not applicable.
• 3.15 Investments: Not applicable, as all group companies are fully consolidated.

Data quality and accuracy: The resulting accuracy varies depending on the data source and methodology. While mass-based emission factors generally have a lower margin of uncertainty, spend-based factors can introduce greater variability due to economic fluctuations and differing price structures. In particular, for suppliers outside the EU, where reliable PCF data is rarely available, there is an increased level of uncertainty in the estimations. Scope 3 data is based to some extent on industry benchmarks, generalized emission factors, projected future scenarios, and estimated values for data gaps.

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Total GHG emissions

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GHG intensity

Net revenue 2024: €560.4 million
Net revenue 2023: €585.9 million

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Regulated emissions

Percentage of Scope 1 GHG emissions from regulated emission trading schemes: 0% (both 2024 and 2023).

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Biogenic CO₂ emissions

Not separately disclosed.

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Consolidation approach

The system boundaries for calculating the Corporate Carbon Footprint include all locations that SBO directly controls. The scope of consolidation is the same as for the financial statements (see Note 3 in consolidated financial statements). The baseline year for the GHG emission reduction targets is 2022.

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Exclusions and phase-in

Scope 3 categories excluded:

• 3.8 Upstream leased assets: SBO does not lease warehouses or similar assets in its upstream value chain; non-significant amounts directly considered in Scope 1.
• 3.11 Use of sold products: SBO's sold products (metal/steel components and downhole drilling tools) do not directly require electricity or fossil fuels for their use.
• 3.13 Downstream leased assets: SBO products rented to customers do not directly require energy.
• 3.14 Franchises: SBO does not grant franchise licenses.
• 3.15 Investments: All subsidiaries are fully consolidated in both financial and sustainability reports.

External verification: The figures have not been externally verified. Internal quality controls include checks for data completeness, comparisons with prior year values, and plausibility checks between group companies.

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Guidelines and standards

GHG emissions are calculated in accordance with the Greenhouse Gas Protocol (GHG Protocol). Methodologies applied include stakeholder analysis, value chain mapping, and scenario-based assessments. Assumptions are aligned with internationally recognized frameworks such as the EU Taxonomy and IPCC climate scenarios.

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

The company uses the phase-in exemption for this disclosure requirement. E1-9 is marked as "Phasing-In" in the ESRS disclosure index.

Materiality Assessment

The following specific data points under E1-9 are assessed as material:

• Exposure of the benchmark portfolio to climate-related physical risks (§66)
• Disaggregation of monetary amounts by acute and chronic physical risk (§66 (a))
• Location of significant assets at material physical risk (§66 (c))
• Breakdown of the carrying value of its real estate assets by energy-efficiency classes (§67 (c))
• Degree of exposure of the portfolio to climate-related opportunities (§69)

Policies related to pollution

SBO currently has no specific policies related to pollution.

Reason for lack of policies

While pollution has been identified as a material topic in the course of the double materiality assessment, it requires further evaluation and alignment with the company's strategy before dedicated policies can be established. SBO is currently assessing these areas further to determine the need for specific policies in the future.

Context

SBO uses small quantities of certain substances in its manufacturing processes, including oils and other materials that are commonly used in industrial production. Due to proper handling of the low quantities used, additional detailed reviews were not conducted until now.

Actions and resources related to pollution

E2-MDR-A - 62 - REASONS FOR THE LACK OF ACTION

SBO uses small quantities of certain substances in its manufacturing processes. These include oils and other materials that are commonly used in industrial production. Due to proper handling of the low quantities used, additional detailed reviews were not conducted until now.

No specific actions disclosed.

Targets related to pollution

SBO currently has no specific targets set under E2 Pollution, as these topics have so far been addressed within a broader framework. Due to new regulatory requirements, SBO is currently in the analysis process to assess the need for specific targets.

Pollution of air, water and soil

Disclosure Status

SBO has identified E2-4 (pollution of air, water and soil) as not material for reporting purposes based on its materiality assessment.

According to the materiality assessment table (page 172), the disclosure requirement E2-4 relating to "Amount of each pollutant listed in Annex II of the E-PRTR Regulation (European Pollutant Release and Transfer Register) emitted to air, water and soil" is marked as not material.

Material Impacts Identified

While E2-4 is not material, SBO has identified the following material impacts related to pollution:

Air Pollution:

• Air pollution from global industrial processes (own activities)
• Air pollution from manufacturing of iron and steel (upstream value chain)
• Air pollution from transportation (entire value chain)
• Air pollution from mining operations - Nickel, Copper, Chromite and other raw materials (upstream value chain)

Soil Pollution:

• Soil pollution from mining operations - Nickel, Copper, Chromite and other raw materials (upstream value chain)

Water Pollution:

• Liquid pollutant discharges in the ocean (downstream value chain)

Quantified Emissions Data

No quantified emissions data to air, water, or soil is disclosed in accordance with E2-4 requirements. SBO has not provided:

• Emissions to air (NOx, SOx, SO2, PM, VOC, heavy metals) in kg or tonnes
• Emissions/discharges to water (heavy metals, nutrients, BOD/COD) in kg or tonnes
• Emissions/discharges to soil (heavy metals, microplastics) in kg or tonnes
• E-PRTR or other regulatory disclosure references
• Multi-year comparisons

Scope and Concentration

The identified pollution impacts are concentrated across different parts of the value chain:

• Own activities: Manufacturing processes at facilities in Asia, Middle East, and Middle/South America
• Upstream: Steel suppliers, mining operations, raw material extraction
• Downstream: Oil and gas operations using SBO products
• Entire value chain: Transportation and logistics globally

Policies related to water and marine resources

SBO does not have a dedicated policy on water and marine resources as of the reporting period.

Reasons for the lack of policies

SBO has provided the following explanation for not having specific water and marine resources policies:

• Water efficiency measures: Water efficiency measures are an integral part of SBO's general sustainability efforts, particularly in subsidiaries facing water shortages. A dedicated and cautious approach is in place to address water scarcity risks at SBO's own manufacturing sites.

• Scale and scope considerations: Given that SBO subsidiaries collectively employ approximately 1,600 people across 23 locations on five continents, with each subsidiary averaging fewer than 100 employees, there is currently no need for a specific policy to mitigate water scarcity risks affecting upstream value chain suppliers, such as those in mining and steel manufacturing.

• Prioritization: Previous assessments prioritized broader environmental topics such as emissions and energy efficiency over localized water resource challenges.

Planned policy

SBO operates locations in regions experiencing high water stress, which will be partially addressed by a planned water policy. However, the company has not yet implemented this policy as of the reporting date.

Actions and resources related to water

Disclosure Statement

SBO has not implemented specific actions for water and marine resources management.

Reasons for Lack of Action

E3-MDR-A - 62 - REASONS FOR THE LACK OF ACTION

SBO has prioritized addressing immediate and direct environmental impacts within its operations, which is why specific actions for marine resource protection and upstream water scarcity management have not been implemented.

Planned Policy Development

Water Policy (planned)

• Context: SBO operates locations in regions experiencing high water stress
• Scope: The planned water policy will partially address water stress in operational locations
• Status: Policy is planned but not yet implemented
• Time horizon: Not specified
• Resources allocated: Not disclosed

Water Stress Areas

SBO has identified water stress at locations in:

• Saudi Arabia
• Dubai

(Analysis conducted using the Aqueduct (WRI) tool)

Water consumption

E3-4 - 29 Water consumption and water intensity ratio

E3-4 - 28 Contextual information on water data

Methods used include scenario analysis to evaluate water risk impacts, data collection from operational sites. Significant assumptions consider stable supply chain operations and alignment with broader sustainability goals, such as resource efficiency and compliance with ESRS requirements. Local context, including water stress and community needs, is factored into evaluations to ensure relevance and feasibility.

SBO assesses water-related metrics primarily through direct measurements and third-party data, including water bills, meter readings, and subsidiary-level data collection, which is aggregated at the group level. The analysis of high-water-stress areas is conducted using the Aqueduct (WRI) tool. In the analysis, water stress was identified at locations in Saudi Arabia and Dubai. Data on recycled and reused water is based on third-party records. Water storage data is derived from the capacity of storage units at each location. For changes in water storage, it is estimated that no significant variations have occurred.

E3-MDR-M - Metrics relating to material sustainability aspects

The figures have not been externally verified. To validate the measurements, internal quality controls were carried out, including checks for data completeness, comparisons with prior year values, and plausibility checks between group companies.

Data on total water consumption is based on water bills from third parties as well as meter readings for groundwater consumption. Data is collected on the level of each subsidiary and then aggregated on the group level. Each location was mapped with Aqueduct (WRI) to assess which location is in an area of high-water stress.

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

This disclosure requirement is subject to the phase-in exemption and will be reported in future reporting periods.

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

E4-1 - 13 A - Assessing the resilience of the business model and strategy

SBO has analyzed and assessed physical, transition and systemic risks related to biodiversity and ecosystems as part of our materiality assessment and risk and opportunity analysis. A full resilience analysis has not been carried out.

E4-1 - 13 B - Scope of resilience analysis

SBO has considered its operational sites and locations with significant environmental interactions, focusing on areas where our own activities intersect with critical ecosystems, in the risk assessment for biodiversity risks.

Upstream and downstream activities in the value chain have been partially considered, particularly for suppliers and partners operating in areas of ecological sensitivity. For upstream value chain, raw material extraction sites and for downstream value chain, product life cycle impacts were prioritized.

The site analysis of biodiversity risks was conducted only for SBO's own operational sites, not for the value chain. Since the final application of our products is not fully known, we have assumed that the primary biodiversity risk arises from the activities themselves rather than specific end-use locations.

Associated Risks: Key risks include potential habitat degradation, regulatory non-compliance, and reputational impacts due to operations or partnerships in biodiversity-sensitive areas. Future efforts will focus on enhanced data collection and collaboration with stakeholders across the value chain to deepen risk analysis and mitigation.

E4-1 - 13 C - Main assumptions

Raw material sourcing and downstream value chain product lifecycle impacts are assumed to have potential biodiversity risks, especially in regions with fragile ecosystems. Climate change effects, such as temperature shifts and habitat loss, are assumed to exacerbate biodiversity risks in certain operational and supply chain regions.

The assumption that biodiversity risks exist in upstream raw material sourcing and downstream product lifecycle impacts is based on widely recognized scientific findings and environmental reports. Studies such as the IPCC AR6 Synthesis Report (2023), European Environment Agency research on raw material sourcing, and UNEP pollution and health assessments highlight the significant ecological impacts of mining activities, land-use changes, and pollution. Additionally, reports from Nature Sustainability, National Geographic, and the Royal Society B emphasize the long-term biodiversity risks associated with industrial activities, including habitat destruction, invasive species spread via global supply chains, and pollution from fossil fuel use. These sources collectively support the conclusion that SBO's upstream and downstream activities have potential biodiversity-related risks.

E4-1 - 13 D - Time horizons used

For biodiversity-related impacts, risks, and opportunities, the double materiality analysis considered multiple time horizons: short-term (<1 year), medium-term (2-5 years), and long-term (<10 years).

E4-1 - 13 E - Results of the resilience analysis

The analysis identified risks related to operations and value chain activities, including habitat disruption and ecosystem degradation. Resilience measures include adherence to environmental standards and engagement with stakeholders to minimize impacts. Certain operations and supply chain activities depend on natural resources sourced from regions at ecological risk. For example, raw material extraction (e.g. steel) and energy-intensive activities are directly linked to ecosystems. Transition risks include potential changes in environmental legislation (e.g., stricter biodiversity regulations), shifts in market demand for sustainable products, and reputational risks from non-compliance or ecosystem harm. These may impact operational costs and stakeholder trust.

E4-1 - 13 F - Stakeholder involvement

Stakeholders were not specifically consulted about biodiversity-related risks. SBO considers to expand stakeholder engagement in this area in the coming years. Stakeholder engagement on biodiversity may be prioritized based on proximity to operations, supply chain relevance, and expertise in biodiversity and ecosystem preservation. Future engagement may focus on directly affected stakeholders, including local communities and environmental groups, to ensure comprehensive risk identification.

E4-1 - 14 - Reference to information according to ESRS 2 SBM-3

The assessment of biodiversity risks and the resilience of our strategy and business model has been partially addressed in our materiality analysis. This assessment forms part of our broader environmental and governance considerations. While biodiversity-specific risks are recognized, there is no need for a formal policy. Further detailed analysis is considered to enhance SBO's understanding and reporting in alignment with ESRS 2 SBM-3 requirements.

Policies related to biodiversity and ecosystems

SBO has not implemented a standalone biodiversity policy. The company states that there are no significant impacts on biodiversity from its own operations, and therefore has determined there is currently no need for a formal policy addressing biodiversity and ecosystems.

The company has indicated that the need for such a policy will be reassessed if future developments require it. The relevance of biodiversity targets and policies will be reviewed if operational or regulatory conditions change.

SBO notes that it is committed to broader environmental goals such as emissions reduction, which also contribute to biodiversity protection. Biodiversity has been integrated into broader environmental initiatives rather than being managed separately as a standalone priority within the ESG framework.

Actions and resources related to biodiversity

Disclosure statement

E4-MDR-A - 62 - REASONS FOR THE LACK OF ACTION

SBO is committed to broader environmental goals such as emissions reduction, which also contribute to biodiversity protection. Biodiversity has not been addressed as a standalone priority within the ESG framework, resulting in no specific actions currently in place for it. So far, the topic has been integrated into broader environmental initiatives rather than being managed separately.

Status

• Current actions: None specific to biodiversity
• Approach: Biodiversity integrated into broader environmental initiatives (emissions reduction)
• Resources allocated: Not disclosed
• Future review: The need for specific biodiversity actions will be reassessed if future developments require it

Targets related to biodiversity and ecosystems

SBO has not set specific biodiversity targets due to the lack of significant impacts from its own operations. The relevance of biodiversity targets will be reviewed if operational or regulatory conditions change.

SBO is committed to broader environmental goals such as emissions reduction, which also contribute to biodiversity protection. Biodiversity has not been addressed as a standalone priority within the ESG framework, resulting in no specific actions currently in place for it. So far, the topic has been integrated into broader environmental initiatives rather than being managed separately.

Impact metrics related to biodiversity and ecosystems change

Operations in or near protected areas / Key Biodiversity Areas

Three SBO sites are located in proximity to biodiversity-sensitive areas:

• Schoeller-Bleckmann do Brasil Ltda. (Brazil - Macae): Located near a biodiversity hotspot
• DSI PBL de Mexico S.A. de C.V. (Mexico - Villahermosa): Situated near a Ramsar site
• DSI FZE Services Private Limited (India - Mumbai): Located near urban biodiversity zones

Activities at these locations are limited in size and include tool rental only, with no manufacturing. In India, SBO maintains only administrative operations, with no direct involvement in manufacturing.

Species impacts

No impact on individual species or their population size stemming from activities in SBO's operational area could be identified.

Assessment conclusions

Most of SBO's operating sites have no significant negative impacts on biodiversity or ecosystems, as they are located on appropriately designated properties and comply with all legal requirements. The evaluation is based on an initial analysis and is still being refined to ensure a more comprehensive assessment.

SBO's materiality assessment has identified significant biodiversity-related impacts stemming from upstream value chain activities, including:

• Land-use change associated with mining operations (upstream)
• Freshwater use and sea-use change (upstream and downstream value chain)

SBO has not identified any negative impacts within its own operations; therefore, no mitigation measures are planned. However, this will continue to be analyzed as part of the ongoing assessment process.

Quantitative metrics

No quantitative biodiversity impact metrics (land use footprint in hectares, deforestation footprint, restoration metrics, or ecosystem condition metrics) are disclosed in the reporting period.

Policies related to resource use and circular economy

SBO has no formal policy specifically addressing ESRS E5 – Resource Use and Circular Economy.

Company Statement

SBO states that it is actively advancing recyclable product designs, resource efficiency optimization, and collaboration with suppliers to increase the use of recycled materials. The company has determined that there is currently no need for a formal policy specifically addressing ESRS E5 – Resource Use and Circular Economy.

The company cites the following reason for the lack of a dedicated policy: ongoing activities and initiatives in recyclable product design, resource efficiency optimization, and supplier collaboration on recycled materials are already underway, making a formal policy unnecessary at this stage.

Actions and resources related to circular economy

E5-2 Disclosure Statement

SBO has stated that it has initiated several measures addressing key aspects of resource use and circular economy, but has not provided a formal, fully integrated approach. The company cites ongoing assessments aimed at deepening understanding of specific impacts, risks, and opportunities as the reason for the lack of a comprehensive action plan.

Actions Identified

While no formally named programmes or initiatives are disclosed, the following activities are mentioned:

1. Recyclable Product Designs

• What: Advancing recyclable product designs
• Scope: Product design (own operations)
• Resources allocated: Not disclosed
• Expected outcomes: Not specified
• Link to policy/target: Mentioned as rationale for not having a formal ESRS E5 policy

2. Resource Efficiency Optimization

• What: Efforts to optimize resource efficiency
• Scope: Own operations (implied)
• Resources allocated: Not disclosed
• Expected outcomes: Resource efficiency improvements (monitored through ongoing assessments)
• Link to policy/target: Part of ongoing monitoring activities mentioned in E5-3

3. Supplier Collaboration on Recycled Materials

• What: Collaboration with suppliers to increase the use of recycled materials
• Scope: Upstream value chain
• Resources allocated: Not disclosed
• Expected outcomes: Increased recycled material use (tracked through ongoing assessments)
• Link to policy/target: Part of ongoing monitoring activities

4. Material Reuse and Recovery Practices

As disclosed under E5-4, the following operational practices are in place:

• Metal Offcuts: Reused and reintegrated into new production processes to minimize waste and optimize material use
• Recycled Steel: Incorporated into manufacturing operations (51% of total materials used are secondary reused or recycled)
• Waste Heat Recovery: Systems utilized within production facilities to improve energy efficiency

Total secondary materials: 7,303 tons (51% of total 14,337 tons of materials used)

Resources Allocated

The company references investments in recyclable materials and extended product life designs (mentioned in SBM-3-48b business model changes) but provides no quantified financial or non-financial resource allocation (no capex, opex, headcount, or partnership details).

Time Horizons

No time horizons (short/medium/long-term) or specific dates are provided for any actions.

Expected Outcomes and KPIs

No specific KPIs or measurable expected outcomes are disclosed for individual actions. Monitoring is described generically as "ongoing assessments" covering resource efficiency improvements, waste reduction efforts, and supplier collaboration tracking.

Targets related to circular economy

SBO monitors progress through ongoing assessments of material impacts, risks, and opportunities. This includes evaluating resource efficiency improvements, tracking waste reduction efforts, and assessing collaborations with suppliers on increasing recycled material use. These measures ensure continuous progress and provide a basis for setting future targets.

At this stage, no specific targets have been set, as the company is still in the process of analyzing the most effective measures to implement.

Current status

The company has initiated several measures that address key aspects of resource use and circular economy, including:

• Efforts to optimize resource efficiency
• Collaboration with suppliers to increase the use of recycled materials

The absence of a fully integrated approach is due to ongoing assessments aimed at deepening the understanding of specific impacts, risks, and opportunities.

E5-4 – Resource Inflows

SBO reports the following resource inflow data for the reporting period:

Methods for Calculating the Data (E5-4-32)

SBO uses a combination of direct measurements and estimations to calculate data related to resource use and the circular economy, ensuring compliance with CSRD reporting standards and maintaining transparency in its disclosures.

Direct Measurements: Key resource consumption data, including energy usage and material inputs, are recorded using robust internal monitoring systems. These systems are managed and verified by operational teams to ensure accuracy, reliability, and consistency across all reporting activities.

Estimations: In cases where direct measurements are not feasible—such as supplier-provided data—estimations are applied based on recognized industry standards, historical data, and material specifications.

All reported usage data reflect materials in their original state and are presented without further adjustments.

Transparency on Sourcing from By-Products/Waste Stream (E5-4-AR 22)

SBO integrates materials derived from by-products and waste streams into its operations wherever feasible, reinforcing its commitment to resource efficiency and circular economy principles:

• Metal Offcuts: Metal offcuts are reused and reintegrated into new production processes, significantly minimizing waste and optimizing material use.
• Recycled Steel: Recycled steel is incorporated into manufacturing operations, reducing reliance on primary raw materials and supporting sustainable resource management.
• Waste Heat Recovery: Waste heat recovery systems are utilized within production facilities to improve energy efficiency and reduce overall energy consumption.

These efforts form an integral part of SBO's sustainability approach, enabling the reduction of material waste, enhanced resource utilization, and alignment with CSRD requirements for transparency and accountability in resource use and circular economy practices.

Avoidance of Double Counting (E5-4-AR 25)

SBO reports on the recycling category, as reuse is not tracked or reported in current processes. Recycling refers to the recovery and reprocessing of materials to be used in new applications, which alters the material's original properties. For example, scrap steel from operations is collected and melted to create new steel products.

Since reuse is not reported, there is no overlap or risk of double counting between these categories. Recycling activities are recorded independently and consistently, ensuring compliance with CSRD requirements and maintaining transparency in reporting.

Resource Inflow Categories (E5-4-30)

Resource outflows

Products designed for recyclability and circularity

SBO has identified the development of products that allow for higher recyclability as a positive impact (actual) under E5-Waste. The company states that this represents a proactive strategy to align product design with circular economy principles, concentrated in SBO's own activities, particularly in facilities integrating recycled materials into manufacturing.

Positive impact: Promotes circular economy and reduces material waste.

Expected influence on business model: Enhances SBO's environmental profile and creates competitive advantage in sustainable markets.

Product lifecycle and end-of-life

SBO's value chain encompasses all key stages from raw material sourcing to the end use of its products. After their use, many of these products can be recycled or reintegrated into further industrial processes, supporting long-term operational efficiency.

SBO's high-tech service and repair facilities operate in major hubs worldwide, equipped with state-of-the-art CNC lathes, milling machines, and specialized welding equipment. These workshops handle service and repair of existing components. Highly skilled and experienced personnel use state-of-the-art methods to extend product life and contribute to the circular economy.

Product lifecycle services focus on refurbishing, remanufacturing, and recycling tools and components to extend their use and reduce waste.

Metal scrap recycling

One of SBO's major "waste category" is metal scrap in the form of metal chips, stemming from the turning and milling operations. Those metal chips are sold to third parties/scrap dealers and therefore are regarded as secondary products and not as waste. As a result, metal chips sold are excluded from scope 3.5 and considered under scope 3.12 instead.

Only scrap metal was declared as waste that is recycled since it is collected separately and provided to a third party for recycling and reuse purposes.

Waste

Waste generation and treatment approach

SBO has identified waste from own processes as a material negative impact (potential) due to waste generation, disposal challenges and potential environmental pollution, particularly in regions of Asia, the Middle East, and Middle/South America.

Waste from manufacturing processes can lead to soil, air, and water pollution if not properly managed, affecting local communities and ecosystems. Poor waste management can also harm public health in the affected regions.

SBO adheres to all applicable legal and regulatory requirements regarding waste management. SBO recognizes the importance of developing a systematic approach to further reduce waste and minimize negative environmental and social impacts in the future.

Inefficient waste management could lead to regulatory penalties, reputational damage, and increased operational costs.

Waste data and measurement uncertainty

Waste quantities by treatment type were estimated based on waste types and industry standards. Only scrap metal was declared as waste that is recycled since it is collected separately and provided to a third party for recycling and reuse purposes.

Currently there is no data available on waste quantities by treatment type on the level of each subsidiary or location. This will be continuously improved over the next reporting periods.

The following parameters are considered to have a high degree of measurement uncertainty: E5-5 Waste by treatment type.

Scope 3.5 Waste generated in operations

CO2e emissions were derived by multiplying the weight disposed by emission factors. The emissions caused by the disposal of waste were determined using emission factors from the Ecoinvent database. Liquid waste was also measured in metric tons.

One of SBO's major "waste category" is metal scrap in the form of metal chips, stemming from the turning and milling operations. Those metal chips are sold to third parties/scrap dealers and therefore are regarded as secondary products and not as waste. As a result, metal chips sold are excluded from scope 3.5 and considered under scope 3.12 instead.

Waste metrics

Note: The above table shows only greenhouse gas emissions from waste disposal (Scope 3.5), not total waste quantities in tonnes. The report explicitly states that waste quantities by treatment type data is not currently available at subsidiary or location level.

Policies related to own workforce

SBO does not have a single dedicated policy on own workforce topics. Instead, it addresses ESRS S1 requirements through overarching group-wide policies supplemented by local subsidiary-level procedures.

Code of Conduct

Scope: Applies globally to all employees across all SBO operations and subsidiaries.

Key content/principles:

• Diversity, equal opportunities, and non-discrimination based on race, color, sex, religion, political opinion, national extraction, social origin, age, disability, pregnancy, marital status, sexual orientation, or trade union activity
• Prevention and addressing of harassment, intimidation, and slander in the workplace
• Zero-tolerance policy on violence and harassment
• Zero-tolerance policy on child labor, forced labor, and human trafficking
• Fair treatment and equal opportunities for all employees
• Compliance with internationally recognized human rights

Governance: Accountability assigned to the Executive Board. Monitored through regular audits, parameters used for performance measurement, and feedback mechanisms.

International standards alignment:

• UN Guiding Principles on Business and Human Rights
• ILO Declaration on Fundamental Principles and Rights at Work (Conventions 1-8)
• OECD Guidelines for Multinational Enterprises
• UN Global Compact Principles
• International Bill of Human Rights

Public availability: Available on website, intranet, and compliance platform.

Monitoring/implementation: The Code of Conduct is monitored through SBO's compliance management system derived from ISO 37.301 (not certified). Implementation overseen by Group Compliance Department supported by Local Compliance Coordinators, reporting directly to the Executive Board. Regular internal audits, training programs for managers and employees, and whistleblowing system enable monitoring. Employees and managers are tasked with identifying, preventing, and mitigating human rights impacts.

Whistleblowing Guideline

Scope: Applies to all employees globally and external stakeholders (suppliers, customers, business partners, value chain participants).

Key content/principles:

• Secure channel for reporting unethical or illegal activities
• Protection against retaliation for whistleblowers
• Confidential and anonymous reporting mechanisms
• Covers misconduct, compliance violations, human rights concerns

Governance: Managed by Compliance Officer or designated compliance team. Reports handled confidentially by Head of Compliance with direct reporting to Executive Board.

International standards alignment: Aligned with EU Directive 2019/1937 on whistleblower protection.

Public availability: Available via website, intranet, and compliance platform (online whistleblowing platform accessible to all stakeholders).

Monitoring/implementation: All submissions reviewed systematically with structured investigation process. Protection measures include anonymity guarantees and anti-retaliation safeguards.

Ethics Policy / Fair Trade Policy

Scope: Applicable to SBO's own business activities globally, covering own labor force.

Key content/principles:

• Promoting fairness, honesty, and transparency in operations
• Zero tolerance for bribery, corruption, and corporate misconduct
• Ethical business practices

Governance: Accountability assigned to Executive Board.

International standards alignment: US Foreign Corrupt Practices Act (FCPA), UK Bribery Act, Austrian Criminal Code.

Public availability: Available on intranet and compliance platform.

Monitoring/implementation: Regular audits, performance measurement parameters, feedback mechanisms.

Local health and safety policies

SBO subsidiaries implement local occupational health and safety regulations. All manufacturing companies and relevant subsidiaries have dedicated HSE (Health, Safety, Environment) managers who monitor implementation and compliance. SBO adheres to international health and safety standards including OHSAS across the group. In 2025, HSE is a key focus area within the "Compliance Future Fit" program addressing group-wide health, safety, and environmental priorities.

Rationale for decentralized approach

SBO notes that with approximately 1,600 employees across 23 locations on five continents (averaging fewer than 100 employees per subsidiary), it establishes overarching policies in key areas while enabling subsidiaries to implement local procedures tailored to specific needs. The company states this approach ensures maximum effectiveness while maintaining group-wide standards through policies like the Code of Conduct.

Topics addressed without dedicated standalone policies

SBO addresses the following workforce topics through the above policies and local subsidiary procedures rather than dedicated group-wide policies:

• Training and skills development: Implemented locally across subsidiaries without formalized group policy
• Workforce engagement: Structured processes managed at subsidiary level, including regular team meetings, works councils (where established), suggestion systems, and employee feedback mechanisms
• Fair wages: Covered in Code of Conduct with commitment that all subsidiaries pay above national benchmarks, but no formalized implementation and monitoring policy
• Freedom of association and collective bargaining: Respected where works councils/unions established, with good dialogue maintained, but no dedicated policy

Planned actions

SBO states it will evaluate the necessity of meaningful measures to further strengthen group-wide practices while considering local requirements and operational needs, recognizing the importance of aligning policies with ESRS S1 requirements.

Taking action on material impacts on own workforce

Health and Safety

Action: SBO adheres to international health and safety standards across the group to ensure occupational health and safety.

• Objective: Measures aim to prevent workplace injuries, mitigate risks related to non-compliance with safety regulations and enhance employee well-being
• Scope: All operational locations across the group's global footprint, including all subsidiaries
• Time horizon: Ongoing commitment with no fixed end date; annual audits, training, and updates are carried out
• Key measures:
  • Compliance with international safety standards (e.g., OHSAS)
  • Regular safety training and risk assessments
  • Conducting regular risk assessments
  • Providing health and safety trainings across all locations
  • Aligning workplace practices with international safety standards such as OHSAS
  • In 2025, HSE will be a key focus area within the "Compliance Future Fit" program
• Link to policy: Directly supports SBO's Code of Conduct by embedding high safety standards into daily operations
• Expected outcomes: Achieving zero workplace fatalities and fostering a safe and healthy working environment for all employees; reduction in Lost-Time Injury Rates (LTIR)
• Stakeholders affected: Employees benefit directly from improved workplace safety; suppliers, customers, and local communities benefit indirectly through improved operational standards, risk management practices, and strengthened relationships
• Progress (2024): SBO expanded health and safety programs by conducting regular risk assessments, providing safety trainings across all locations
• Resources allocated: SBO invests directly in health, safety, training, and human rights, covering training, equipment, audits. SBO is evaluating the need for specific allocation of capital expenditures (CAPEX) and operating expenses (OPEX) to the action plans under ESRS S1

Employee Training and Development

Action: SBO provides targeted training and development programs to enhance employees' skills and career opportunities.

• Objective: Enhance employee performance, foster innovation, and maintain competitive edge in the industry; attract and retain top talent
• Scope: Own employees across all regions where SBO operates (not limited to specific regions)
• Time horizon: All time horizons; ongoing
• Key measures:
  • Comprehensive training activities
  • Upskilling programs aligned with business goals
  • Professional development opportunities including training, mentoring, and coaching programs
  • 51,022 training hours recorded in 2024
• Stakeholders affected: Own employees (yes); Non-employees (no)
• Expected outcomes: Strengthens business model by enhancing employee performance, fostering innovation, and maintaining competitive edge; supports career growth and skill development
• Link to policy: Training initiatives are implemented locally across subsidiaries; no formalized policy established

Diversity and Inclusion Initiatives

Action: Fostering diversity by ensuring equal opportunities for all.

• Objective: Promoting equal opportunities and addressing discrimination risks
• Scope: Own employees across all operational regions (impact is systemic but may be more significant in areas with diverse labor markets)
• Time horizon: Ongoing
• Key measures:
  • Implementing anti-discrimination and harassment policies
  • Establishing grievance mechanisms (whistleblowing system)
  • Conducting awareness training for employees
  • Tailored initiatives for specific workforce groups (e.g., diversity programs for apprentices aimed at increasing female representation in management)
• Stakeholders affected: Own employees (yes); Non-employees (no); primarily affects women and minority groups
• Link to policy: Code of Conduct emphasizes non-discrimination and equal opportunities
• Expected outcomes: Need for diverse talent and inclusive work environment to foster innovation and maintain competitive edge; improve representation and inclusion across the workforce

Working Conditions Improvements

Action: Employee initiatives to improve working conditions.

• Objective: Improve workplace environment and conditions
• Scope: Affected regions during hot season
• Key measures:
  • Implementation of additional air conditioning units
  • Optimized overtime regulations
  • Intensified training and development programs
• Process: Part of company's suggestion system where employees' proposals for process improvements are incentivized
• Expected outcomes: Strengthened employees in professional growth and fostered long-term commitment to the company

Human Rights Protections

Action: Implementation of human rights protection measures.

• Objective: Ensure employees' rights are protected and concerns are addressed promptly
• Key measures:
  • Anti-discrimination and harassment policies
  • Whistleblowing system and grievance mechanisms
  • Awareness training for employees
  • Regular assessments and compliance
  • Internal audits and reviews to ensure adherence to Code of Conduct, Ethics Policy and Compliance Management Policy
• Link to policy: Aligns with UN Guiding Principles on Business and Human Rights, ILO Declaration on Fundamental Principles and Rights at Work, and OECD Guidelines for Multinational Enterprises
• Remediation approach: If human rights violations identified, SBO engages in dialogue with affected parties; corrective measures may include revised policies, employee retraining, or disciplinary actions

Employee Engagement and Feedback

Action: Structured processes for employee engagement and feedback.

• Objective: Measure satisfaction, incorporate feedback, ensure employee voices are heard
• Scope: Managed at subsidiary level
• Key measures:
  • Employee surveys
  • Feedback systems and consultation with employee representatives
  • Performance reviews
  • Recognition programs reward outstanding contributions
  • Regular dialogue between employees, employee representatives and management
• Involvement mechanisms: Informing employees about actions and decisions, consulting representatives on concerns, enabling co-determination in relevant matters
• Frequency: Ongoing basis, primarily at site level with inputs integrated into group-wide policies
• Effectiveness assessment: Metrics like staff turnover and retention are analyzed; employee satisfaction scores tracked in some subsidiaries

Health and Wellness Programs

Action: Initiatives to promote employee health and address physical and mental well-being.

• Key measures:
  • Health checks
  • Fitness programs
  • Health promotion resources
• Resources allocated: SBO invests in health and wellness programs

Transition to Greener Economy Support

Action: Supporting employees through transition to greener, net-zero emission economy.

• Objective: Ensure SBO remains a leading provider of precision components and equipment while supporting workforce through changes
• Approach: SBO is committed to supporting employees throughout transition, addressing both challenges (role adjustments, new technologies) and opportunities (new jobs, skill development)
• Impact assessment: SBO's strategy to diversify its business does not negatively affect employees

Resources Overview

Financial resources:

• SBO invests directly in health, safety, training, and human rights, covering training, equipment, audits or compliance
• SBO is evaluating the need for specific allocation of capital expenditures (CAPEX) and operating expenses (OPEX) to action plans under ESRS S1
• SBO is evaluating the need for exact allocation of future funds, including CAPEX and OPEX, for the action plan under ESRS S1

Non-financial resources:

• 51,022 training hours recorded in 2024
• Group Compliance Department under direct supervision of Executive Board holds operational responsibility
• Regional Compliance Managers and Local Compliance Coordinators
• Dedicated safety officer assigned at each site

Effectiveness Assessment

Tracking methods:

• Key Performance Indicators (KPIs): Lost-Time Injury Rates (LTIR), training participation rates, employee satisfaction scores
• Feedback mechanisms: Employee surveys, grievance systems, consultation with employee representatives
• Compliance monitoring: Internal audits and reviews
• Sustainability reporting: Annual progress reported as part of sustainability report, aligned with ESRS standards
• Quarterly compliance calls to discuss potential impacts, mitigation measures, and effectiveness

Planned Actions

SBO recognizes the importance of aligning its policies with ESRS S1 requirements and will evaluate:

• The necessity of meaningful measures to further strengthen group-wide practices
• Whether additional actions are necessary and reasonable for freedom of association and collective bargaining
• Whether and which targets to set for workforce management

Targets related to own workforce

SBO discloses qualitative target areas but has not yet set formal quantified targets. The company states it is in the process of evaluating whether and which targets to set.

Target areas under consideration:

Health and Safety:

• Achieving a reduction in Lost-Time Injury Rates (LTIR) and maintaining zero workplace fatalities
• No specific target value, baseline year, or target year disclosed

Diversity and Inclusion:

• Setting goals to enhance the representation of underrepresented groups
• No specific target value, baseline year, or target year disclosed

Target-setting approach:

SBO is developing its target-setting methodology through:

• Workshops and surveys to identify key focus areas and define achievable, relevant, and measurable targets
• Consultations with employee representatives
• Feedback mechanisms including suggestion boxes and QR-code reporting systems

Progress tracking:

While formal targets are not yet established, SBO monitors:

• Quantitative metrics: participation in training programs, Lost-Time Injury Rates (LTIR), and diversity ratios
• Qualitative indicators: consultation with employee representatives and feedback through structured channels
• Annual reporting cycle aligned with sustainability and operational reviews

Characteristics of the undertaking's employees

Total headcount and FTE

Current period (31 December 2024):

• Total headcount: 1,596 employees
• FTE: Not separately disclosed (headcount presented)

Prior period (31 December 2023):

• Total headcount: 1,601 employees
• FTE: Not separately disclosed (headcount presented)

Headcount by gender

31 December 2024:

31 December 2023:

Headcount by gender and age group

31 December 2024:

31 December 2023:

Headcount by gender and type of employment

31 December 2024:

31 December 2023:

Headcount by country/region

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

Headcount by contract type and gender

Reporting period 2024:

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

Not disclosed in the excerpts provided.

Employee turnover

Reporting period 2024:

• Total number of employees who have left: 450 (head count)
• Employee turnover rate: 22%

Reporting period 2023: Not disclosed in excerpts provided.

New hires

Not disclosed in the excerpts provided.

Methodology notes

• Employee figures at the end of the reporting period are reported as actual headcount as of the reporting date (31 December), rather than as an average.
• Gender is based on information provided by employees themselves.
• Data is collected from each subsidiary and consolidated at group level.
• Employee turnover rate calculated as: terminations in reporting period divided by total headcount (31.12.2023) plus recruitments in reporting period.

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

Number of non-employee workers

*i.e. self employed, people provided by undertakings primarily engaged in employment activities

Methodology

SBO generates data on non-employees, such as subcontractors, freelancers, or agency workers, from contractor records and site-level operational reports. These systems track the number of non-employees engaged at various locations and for specific projects.

Non-employees at SBO are typically reported as headcount rather than full-time equivalents (FTEs). This approach reflects the total number of individuals engaged with the organization, regardless of the number of hours worked. The numbers of non-employees at the end of the reporting period are typically reported as averages.

Basis for estimation

SBO has data on non-employees collected through vendor management systems, site-level operational reports, and contractor agreements. The data is tracked to ensure accurate reporting and alignment with project requirements. Estimates are generally not used, as the data is based on actual records maintained by project managers and HR systems.

Collective bargaining coverage and social dialogue

Coverage metrics

S1-8-60a - Employees covered by collective bargaining agreements

S1-8-60b-c, 63a & b - Share and scope of collective bargaining agreements within and outside the European Economic Area and workplace representation within the European Economic Area

Methodology

Data on the percentage of employees covered by collective bargaining agreements is collected from each subsidiary and then aggregated on group level. For EEA countries, data is collected from each subsidiary and aggregated at group level. For non-EEA regions, data on employees covered by collective bargaining agreements is collected from each subsidiary and consolidated at group level. Data on the percentage of employees covered by workers' representatives by specific EEA country is collected from each subsidiary and aggregated on group level.

Additional context

SBO respects the right for collective bargaining and maintains good relations with works councils and unions. Where subsidiaries have a Works Council, agreements are established to regulate relevant workplace matters. The employment practices within SBO subsidiaries are monitored by local management. Some subsidiaries lack collective agreements, varying by subsidiary location.

Diversity metrics

Gender distribution in top management

SBO defines top management as the Executive Board members, division heads, and managing directors who report directly to the Executive Board.

Board composition (2024)

Executive Board:

• Number of members: 2
• Gender distribution: 100% male, 0% female

Supervisory Board:

• Number of members: 5
• Gender distribution: 60% male (3 men), 40% female (2 women)

Combined Executive and Supervisory Boards (7 members total):

• Overall gender distribution: 71.4% male (5 men), 28.6% female (2 women)
• Female-to-male ratio: 1:2.5

Age band distribution - Total workforce

2024:

2023:

Total workforce by gender and age

2024:

2023:

Total workforce by gender and type of employment

2024:

2023:

New hires by gender and age

2024:

2023:

Methodology notes

• Total workforce data based on headcount as of 31 December for each reporting year
• New hires include permanent hires and personnel taken on from other SBO companies
• Gender is based on information provided by employees
• Data collected from each subsidiary and aggregated at group level
• Women accounted for 31% of white-collar employees and 7% of blue-collar employees in 2024; amongst apprentices, women accounted for 12%

Adequate wages

Own workforce

SBO states that all employees receive adequate remuneration in accordance with applicable wage regulations and benchmarks. The company reports:

• Benchmark used: National minimum wage or adequate wage requirements set by national legislation, collective agreements, or internationally recognized standards
• Coverage: "All SBO subsidiaries pay above the national benchmarks for fair wages"
• Countries below minimum wage: 0
• Percentage of employees paid below applicable wage benchmark: Not applicable, as all employees are paid above the national benchmarks

Methodology: Data on the lowest income category was collected for each subsidiary. The wage level of the lowest income category was compared to national benchmarks for fair wages.

Value chain workers

SBO identifies non-living wages as a material negative impact in its upstream and downstream value chain, particularly in regions such as Asia and South America.

• The company states: "Low wage standards in certain regions can exacerbate economic inequalities"
• No specific actions are currently in place to address non-living wages in the value chain
• SBO states: "Against the background of the previous statements, no targeted actions exist to address living wage disparities. Should SBO become aware of cases where non-living wages are an issue, it will of course investigate them thoroughly."
• A Supplier Code of Conduct is in development to help mitigate risks including non-living wages

No targets disclosed for achieving living wages across own workforce or value chain.

Persons with disabilities

S1-12-79 – Percentage of persons with disabilities amongst the employees

S1-12-AR 76 – Contextual information

SBO collects data about people with disabilities using its HR management systems and employee self-reporting mechanisms, ensuring compliance with local data protection regulations. Employees can voluntarily disclose disabilities through confidential reporting channels, which are used for compliance and inclusion initiatives.

Definition of Disabilities: SBO adopts definitions provided by local legislation in the countries where it operates. These definitions align with international frameworks, such as the UN Convention on the Rights of Persons with Disabilities, but variations may exist due to local legal interpretations.

Methodology

Training and skills development metrics

Total training hours

Total training hours recorded in 2024: 51,022 hours

Training hours by employee category

The company discloses average training hours by employee category for compliance training specifically:

Training participation rates

Specific training coverage rates:

• Employees in at-risk functions: 64% completed training on corruption prevention, company policies, and procedures
• Management: 51% completed training on corruption prevention, company policies, and procedures
• All other employees: 77% completed training on corruption prevention, company policies, and procedures

Performance and career development reviews

The company references evaluating employee involvement through "surveys, feedback systems, and performance reviews" and states that "feedback helps address concerns and guide improvements." However, no specific percentage of employees receiving performance and career development reviews is disclosed.

Training frequency

Training is required on a quarterly/bi-annually/annually basis depending on employee category.

Methodology notes

The disclosed training hours data focuses primarily on compliance-related training (corruption prevention, Code of Conduct, ethics, whistleblowing). The total training hours of 51,022 in 2024 appears to encompass broader training beyond compliance topics, but detailed breakdowns by gender or comprehensive average hours per employee across all training types are not provided.

Health and safety metrics

Coverage by health and safety management system

*based on HC (head count)
**based on legal requirements and/or recognised standards or guidelines

Fatalities and work-related accidents

Days lost

Methodology notes

Data on health and safety metrics was collected for each subsidiary and then consolidated at the group level. The LTIR was calculated based on the number of work-related accidents with lost time, relative to total hours worked. The health and safety management system certification is verified based on whether it is based on legal requirements or recognized standards or guidelines.

Compensation metrics (ESRS S1-16)

Pay gap

The gender pay gap for SBO Group is reported as follows:

The pay gap is calculated as the unadjusted percentage difference between female and male employees' average remuneration.

Remuneration ratio

The annual total remuneration ratio of the highest-paid individual to the median annual total remuneration for all employees is 8:1.

Methodology

Data on gender pay gap is collected from each subsidiary and then aggregated and weighted on group level based on the number of employees per category in each subsidiary.

Data on the remuneration ratio is collected from each subsidiary and then extrapolated to the group level based on the share of employees in each subsidiary.

Due to data privacy regulations, individual wage data is not shared on group level. Data on Gender Pay Gap and Remuneration for each subsidiary was extrapolated to group level using the share of employees by subsidiary. The figures have a high degree of measurement uncertainty.

The disclosure notes that data on Gender Pay Gap and Remuneration is available on the level of each subsidiary, but due to data privacy regulations, individual wage data is not shared on group level.

Incidents, complaints and severe human rights impacts

S1-17-102 Information on work-related incidents, complaints and human rights violations, as well as related fines and sanctions

During the reporting period, SBO recorded no verified incidents of discrimination, including harassment, within its operations. SBO has implemented robust systems to identify, address, and prevent discrimination, ensuring compliance with its Code of Conduct and relevant policies.

Stakeholders Affected: SBO's internal stakeholders, such as employees, are the primary focus of its anti-discrimination measures. External stakeholders, such as contractors, are also covered under broader policy commitments.

Actions and Prevention: SBO enforces a zero-tolerance policy for discrimination and harassment. Clear procedures are in place for reporting, investigating, and resolving incidents, including anonymous reporting channels. The effectiveness of these actions is evaluated through monitoring the utilization and outcomes of grievance mechanisms.

S1-17-103 Number of incidents of discrimination, including harassment

No incidents of discrimination or harassment were recorded during the reporting period, no complaints were submitted and no significant fines, sanctions, or compensation payments were recorded.

Metrics summary (from S1-17 section page 244)

Note: The figures have not been externally verified. To validate the measurements, internal quality controls were carried out, including checks for data completeness, comparisons with prior year values, and plausibility checks between group companies.

Policies related to value chain workers

SBO does not have a standalone policy explicitly titled for ESRS S2 (Workers in the Value Chain). However, the company states that key aspects addressing value chain workers are embedded within existing policies, particularly the Code of Conduct.

Code of Conduct

Scope:

• Covers SBO's global operations and extends throughout its value chain by engaging with suppliers and partners
• Addresses workers in the value chain

Key content and principles:

• Safe working environments
• Equal treatment and non-discrimination
• Respect for workers' rights
• Health and safety
• Adequate working conditions
• Equality
• Measures against violence and harassment
• Prevention of human trafficking, forced labor, and child labor
• Fair labor practices

Alignment with international standards:

• United Nations Guiding Principles on Business and Human Rights (UNGPs)
• ILO Declaration on Fundamental Principles and Rights at Work
• OECD Guidelines for Multinational Enterprises
• Fundamental ILO Conventions 1 to 8

Implementation and monitoring:

• Processes established to prevent, detect, and mitigate risks related to human rights violations across global operations
• Regular assessments and internal controls
• Mechanisms to address identified risks
• Whistleblowing platform and compliance reporting systems for workers in the value chain to raise concerns
• No violations found during the reporting period that contradict UNGPs, ILO Declaration, or OECD Guidelines

Governance:

• Responsibility for topics related to workers in the value chain is integrated into broader leadership roles rather than assigned to a single dedicated position

Continuous improvement:

• SBO is committed to continuously reviewing and enhancing its policies to align with evolving CSRD/ESRS standards
• Currently reviewing and refining policies to explicitly integrate critical topics including human trafficking, forced labor, and child labor
• No formal agreements with international trade union federations in place, but SBO continuously evaluates whether initiatives such as the Bangladesh Accord, the ACT Initiative, or partnerships with organizations like the Fair Labour Association are appropriate

Taking action on material impacts on value chain workers

Overall Disclosure Statement

SBO has not implemented specific targeted actions to address material impacts on value chain workers. The company relies on general policies and mechanisms (Code of Conduct, Whistleblowing Platform) but acknowledges gaps in systematic action.

Reasons for Lack of Action (S2-MDR-A-62)

SBO states it adheres to legal regulations and has internal policies to ensure compliance with human rights and labor standards, but continuously assesses whether further actions are necessary. Specific reasons given for lack of action by topic:

• Adequate Housing: No actions implemented as there has not been a single case of inadequate housing to date
• Non-Living Wages: No targeted actions to address living wage disparities
• Child Labor and Forced Labor: Strictly prohibited under Code of Conduct; no cases reported to date
• Gender Equality: Diversity and inclusion are part of SBO's principles; no targeted actions to address pay or representation disparities established
• Health and Safety: Health and safety standards exist; no additional actions for industry-specific risks (e.g., mining pollutants)
• Violence and Harassment: Whistleblowing platform allows reporting; no additional dedicated measures
• Water and Sanitation: Not prioritized due to limited relevance to operations

Planned Action: Supplier Code of Conduct

Action name: Development of Supplier Code of Conduct

• Description: Integration into general purchasing practices to help mitigate risks such as non-living wages, forced labor, and inadequate working conditions
• Scope: Upstream value chain (suppliers)
• Status: In development during reporting period
• Time horizon: Not specified
• Resources allocated: Not quantified
• Expected outcomes: Mitigation of value chain worker risks

Preventive and Remedial Measures (S2-4-32 & 37)

Current state: General policies (Code of Conduct, Whistleblowing Platform) indirectly contribute to mitigating risks like discrimination, forced labor, or unsafe working conditions. No targeted actions in place to address specific negative impacts in the value chain.

Future plans: May include evaluating material impacts and developing dedicated measures to systematically prevent and mitigate issues as part of broader sustainability strategy.

Procedures and Processes

Identifying measures for adverse impacts (S2-4-33A): No structured risk assessment or due diligence process in place to proactively identify and address impacts. Current mechanisms (Whistleblowing Platform) allow case-by-case responses only.

Approach to material adverse impacts (S2-4-33B): No formal approach or procedure specifically designed to address material impacts on value chain workers. Supplier Code of Conduct in development.

Ensuring effectiveness of remedial measures (S2-4-33C): Issues reported through Whistleblowing Platform reviewed by Head of Compliance on case-by-case basis; no formalized process.

Risk Mitigation and Opportunities

Risk mitigation (S2-4-34A): Current actions do not specifically target risk mitigation related to workers in the value chain.

Pursuing opportunities (S2-4-34B): No specific actions in place to promote or exploit material opportunities related to labor in the value chain.

Resources Allocated (S2-4-38)

SBO has allocated dedicated resources including:

• Supply Chain Managers (central level and subsidiary companies)
• Compliance Officers (central level and subsidiary companies)
• Head of Compliance

Roles and responsibilities: Monitoring compliance with ethical and legal standards, addressing risks, overseeing purchasing practices, conducting supplier evaluations and risk assessments, managing grievance mechanisms.

Quantified resources: No financial amounts (capex/opex) specified.

Future efforts: Focus on further integrating these roles into comprehensive framework for proactively managing material impacts and ensuring CSRD alignment.

Incidents and Progress

Serious incidents (S2-4-36): No issues or incidents of serious human rights violations reported during the reporting period.

Progress within reporting period: As the IROs (impacts, risks, and opportunities) were identified for the first time in the reporting year, no progress on prior efforts can be reported.

Targets related to value chain workers

S2-5 - Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities

S2-MDR-T - 72 - TARGETS

SBO has not established targets under ESRS S2 but monitors the effectiveness of its concepts and measures through qualitative assessments of material impacts, risks, and opportunities. This approach includes stakeholder engagement and outcome reviews, ensuring alignment with strategic goals while identifying areas for future development, including setting measurable targets.

Policies related to affected communities

SBO has no specific policies related to affected communities.

Reasons for the lack of policies

SBO employs approximately 1,600 people worldwide across 23 locations on five continents, with the average number of employees per legal entity globally being fewer than 100. Against this background, the company currently has no specific policies or strategies for managing material impacts, risks, and opportunities related to affected communities.

• While future strategies may address different community types, there are currently gaps in identifying and managing relevant social and economic impacts
• Clear frameworks for considering community aspects such as social equity, regional development, or indirect socio-economic effects are lacking
• Due to the company's structure, with relatively small entities, no targeted measures or strategies have been implemented to address these challenges to date

Taking action on material impacts on affected communities

S3-MDR-A - 62 - REASONS FOR THE LACK OF ACTION

No specific actions have been implemented to address the needs or concerns of affected communities systematically because there was no incident.

SBO is confident that the whistleblowing platform provides a foundation for affected communities to report incidents effectively.

S3-4 - 36 - SEVERE HUMAN RIGHTS ISSUES AND INCIDENTS CONNECTED TO AFFECTED COMMUNITIES

No incidents of human rights abuse have been reported to SBO by affected communities as of the latest reporting period.

Planned actions (from SBM-2 stakeholder engagement)

Focus on maintaining existing community engagement activities and evaluating potential new opportunities if aligned with strategic goals

• Scope: Not specified
• Time horizon: Long-term
• Resources allocated: Not disclosed
• Expected outcomes: Strengthened community relationships
• Note: At this moment SBO does not plan to modify its strategy based on input from local communities

Targets related to affected communities

S3-MDR-T - 81 - No measurable results-oriented targets available

SBO does not formulate measurable, results-oriented targets due to the ongoing development of a comprehensive framework for addressing material impacts on affected communities. The absence of robust data and structured stakeholder engagement processes has delayed target setting.

S3-MDR-T - 81 B - Tracking the effectiveness of policies and measures related to material impacts, risks and opportunities

Due to the above explained nature of SBOs company size and business SBO has no formal system in place to track the effectiveness of its concepts and measures regarding material impacts, risks, and opportunities. Potential actions may be defined in the future.

S3-MDR-T - 81 B I - Procedure for this purpose

SBO relies on qualitative approaches, such as internal reviews, stakeholder feedback, and ESG reporting, to track the general effectiveness of its concepts and actions.

S3-MDR-T - 81 B II - Defined level of ambition and assessment of progress

Progress is generally measured on an annual basis, aligned with SBO's ESG reporting cycle.

Policies related to consumers and end-users

SBO does not have specific policies dedicated to consumers and end-users. The company states that it builds strong customer relationships by following its Code of Conduct and Fair Trade Policy, ensuring trust and ethical practices. However, these policies are detailed in the G1 (Business conduct) section rather than as standalone consumer-focused policies.

Code of Conduct

• Scope: Applied to customer relationships
• Key content: Ensures trust and ethical practices in customer relationships
• Public availability: Referenced but details provided in G1 section

Fair Trade Policy

• Scope: Applied to customer relationships
• Key content: Ensures trust and ethical practices in customer relationships
• Public availability: Referenced but details provided in G1 section

Reason for lack of specific S4 policies

The company explicitly states under S4-MDR-P - 62 (Reasons for the lack of policies) that policies related to consumers and end-users are detailed in the G1 (Business conduct) section, indicating reliance on general business conduct policies rather than consumer-specific policies.

Information provision

SBO informs consumers and end-users about its actions to prevent and minimize risks through its website and other online platforms, with sustainability-related content regularly updated.

Grievance mechanism

SBO provides a whistleblowing platform as a key channel for consumers and end-users to raise concerns or report grievances confidentially. The platform is available online through SBO's official website.

Taking action on material impacts on consumers

S4-MDR-A - 62 - REASONS FOR THE LACK OF ACTION

SBO is currently screening the potential for organic and acquisitive growth opportunities in growing non-O&G markets.

Status: No specific actions are currently disclosed. The company states it is in the process of analyzing whether and to what extent target setting is necessary. Once this assessment is complete, SBO will derive appropriate measures and, if necessary, define relevant targets.

Targets related to consumers

S4-5 - Targets Related to Addressing Material Negative Impacts, Promoting Positive Impacts, and Managing Material Risks and Opportunities

S4-MDR-T-72 - TARGET

No specific targets have been defined in this area. SBO is in the process of analyzing whether and to what extent target setting is necessary. Once this assessment is complete, SBO will derive appropriate measures and, if necessary, define relevant targets.

Business conduct policies and corporate culture

SBO has established company-wide policies addressing business conduct, anti-corruption, and whistleblowing. These policies form the foundation of SBO's commitment to ethical business practices, transparency, and accountability across all operations and the value chain.

Code of Conduct

Policy name: Code of Conduct

Scope:

• Applicable to SBO's own business activities and covers the upstream and downstream value chain
• Applies globally across all SBO entities
• Covers own labor force, contractors, customers, and suppliers

Approval and oversight:

• Accountability: Executive Board
• Monitoring: Group Compliance Department, which reports directly to the CEO

Key content and principles:

• Establishes clear principles and guidelines for ethical behavior
• Ensures integrity, fairness, and compliance with laws and regulations
• Promotes culture of transparency, accountability, and respect
• Zero-tolerance policy on corruption, bribery, child labor, forced labor, and discrimination
• Emphasizes non-discrimination and equal opportunities based on race, color, sex, religion, political opinion, national extraction, social origin, age, disability, pregnancy, marital status, sexual orientation, or trade union activity
• Addresses human trafficking, forced labor, and child labor explicitly
• Requires managers and employees to take appropriate measures to detect, prevent, and mitigate possible and actual human rights violations
• Addresses fair wages and employment conditions
• Respects freedom of association and collective bargaining

Public availability:

• Available on website, intranet, and compliance platform

International standards alignment:

• US Foreign Corrupt Practices Act (FCPA)
• UK Bribery Act
• Austrian Criminal Code
• OECD Guidelines for Multinational Enterprises (2011 Edition)
• UN Global Compact
• UN Guiding Principles on Business and Human Rights
• ILO Declaration on Fundamental Principles and Rights at Work
• International Bill of Human Rights

Monitoring and implementation:

• Regular audits
• Parameters used for performance measurement
• Feedback mechanisms
• Periodic compliance reviews
• Regular policy updates to reflect new regulatory requirements
• Compliance assessments conducted to monitor adherence
• Internal controls and mechanisms to address identified risks

Fair Trade Policy and Ethics Policy

Policy names: Fair Trade Policy and Ethics Policy

Scope:

• Applicable to SBO's own business activities and cover the upstream and downstream value chain
• Global application
• Covers own labor force, contractors, customers, and suppliers

Approval and oversight:

• Accountability: Executive Board

Key content and principles:

• Ensures ethical business practices by promoting fairness, honesty, and transparency in all operations
• Zero tolerance for bribery, corruption, and other forms of corporate misconduct
• Safeguards compliance with laws
• Fosters trust with stakeholders

Public availability:

• Available on intranet and compliance platform

International standards alignment:

• US Foreign Corrupt Practices Act (FCPA)
• UK Bribery Act
• Austrian Criminal Code

Monitoring and implementation:

• Regular audits
• Parameters used for performance measurement
• Feedback mechanisms

Whistleblowing Guideline

Policy name: Whistleblowing Guideline

Scope:

• Applicable to SBO's own business activities and covers the upstream and downstream value chain
• Global application
• Covers own labor force, contractors, customers, and suppliers
• System applies to all employees, suppliers, and business partners across SBO's operations

Approval and oversight:

• Accountability: Executive Board
• Managed by the Group Compliance Management

Key content and principles:

• Provides a secure and confidential platform for employees, contractors, customers, and suppliers to report incidents, concerns, or violations related to corruption, bribery, or unethical conduct
• Emphasizes protection of whistleblowers
• Ensures transparency and accountability
• Guarantees confidentiality and safeguards against retaliation
• Allows anonymous reporting
• Secure reporting channels with limited access to reported information

Public availability:

• Available on website, intranet, and compliance platform

International standards alignment:

• European Market Abuse Regulation (MAR)
• National laws related to whistleblowing protections
• Aligned with EU Directive 2019/1937

Monitoring and implementation:

• Handled by Group Compliance Management, which handles notifications, preserves confidentiality, and conducts thorough investigations
• Audits and secured record-keeping to monitor effectiveness
• Data stored securely and deleted post-investigation unless further legal action is needed
• Formal investigation process evaluates concerns, implements remedial actions, and ensures de-escalation
• Regular governance audits to ensure compliance

Corporate Culture

SBO establishes its corporate culture through its Code of Conduct, which defines values, ethical principles, and expectations for employees and stakeholders. The culture is developed by embedding these principles in daily operations, leadership training, and employee engagement programs. SBO promotes its culture through internal platforms and meetings, and evaluates it through employee feedback, surveys, and performance reviews to ensure alignment with strategic goals and stakeholder expectations.

Training and Implementation

Compliance training:

• Conducted for all employees, focusing on leadership roles and high-risk areas such as finance, procurement, sales, and compliance
• Training sessions held during onboarding and after significant policy updates
• Key topics include anti-corruption, bribery, whistleblowing, business rules, sanction management, and embezzlement prevention
• In 2024: 64% of functions-at-risk covered by training programs
• Management: 51% have undergone training on corruption prevention, company policies, and procedures
• All other employees: 77% have received training on corruption prevention and related topics
• Executive and Supervisory Board actively participate in compliance training sessions covering anti-corruption and anti-bribery topics

Functions most exposed to corruption and bribery:

• Finance, compliance, purchasing, and sales, particularly in regions with high Corruption Perception Index

No Diversity Concept

Regarding the composition of its Executive Board and Supervisory Board, the company does not apply a diversity concept within the meaning of Section 243c (2) (3) Austrian Commercial Code (UGB), as sustained implementation would lead to significant restrictions for a company operating in the energy service industry. Instead, SBO focuses on diversity in the workforce with an aim to achieve a female quota of 25% among the company's executives.

Prevention and detection of corruption and bribery

SBO has implemented systematic procedures to prevent, detect, and combat corruption and bribery across its operations.

Code of Conduct

Scope:

• Applies across all SBO entities
• Defines ethical expectations for suppliers and customers
• Ensures alignment with governance policies

Key content and principles:

• Sets clear guidelines on ethical business conduct
• Addresses anti-corruption and bribery prevention
• Explicitly addresses anti-bribery and anti-corruption as part of ethical standards
• Aligned with the United Nations Convention Against Corruption

Governance and oversight:

• Continuously implemented and reviewed
• Enforcement through regular updates, employee training, and enforcement measures
• Periodic compliance reviews conducted

Public availability:

• Accessible to employees via company intranet during onboarding
• Available to external stakeholders through the corporate website

Monitoring and implementation:

• Code of Conduct enforcement across all business units
• Regular policy updates to reflect new regulatory requirements
• Compliance assessments conducted to monitor adherence

Ethics Policy

Key content:

• Establishes clear rules against corruption
• Promotes ethical business practices

Note: The Ethics Policy is referenced as a company-wide policy alongside the Code of Conduct, but detailed standalone information is not provided.

Prevention and Detection Procedures

Processes in place:

• Established policies, regular employee training, and risk assessments to prevent incidents
• Secure and confidential reporting channels including:
  • Dedicated whistleblowing hotline
  • Email system
  • Anonymous reporting options available to employees, suppliers, investors, banks, and the community

Investigation procedures:

• Formal process overseen by the compliance officer or designated compliance team
• Includes thorough investigations, documentation, and corrective actions
• Compliance Management Department responsible for investigating suspected cases, reports directly to the CEO
• If a suspected case concerns the CEO, independence ensured by involving external auditors, independent legal counsel, or independent internal committee
• Individuals conducting investigations fully separated from operational management to ensure unbiased process

Communication of results:

• Findings formally shared with Local Manager, Executive Board, and where applicable, the Supervisory Board
• Ensures transparency, accountability, and alignment with governance requirements

Protection against retaliation:

• Formal whistleblowing system managed by compliance officer or designated compliance team
• Reports handled confidentially and fairly
• Employees informed about reporting channels through onboarding materials, compliance training, and regular communications
• Specialized training for those handling reports to ensure whistleblowers are valued and protected from retaliation
• In line with best practices, though SBO notes it does not implement processes exceeding requirements of EU Directive 2019/1937

Training Programs

SBO conducts comprehensive anti-corruption and anti-bribery training:

Coverage:

• 64% of employees in at-risk functions (164 total at-risk function employees, 105 received training)
• 51% of managers (182 total managers, 93 received training)
• 77% of other employees (1,250 total other workers, 957 received training)
• Executive and Supervisory Board actively participates in compliance training sessions or reviews regular compliance summaries

Target audience:

• All employees, with focus on leadership roles and high-risk areas
• Finance, procurement, sales, and compliance functions identified as most vulnerable to corruption and bribery
• Particular attention to regions with high Corruption Perception Index

Topics covered:

• Anti-corruption and bribery prevention
• Whistleblowing procedures
• Business rules
• Sanction management
• Embezzlement prevention
• Ethics and due diligence
• Code of Conduct

Delivery methods:

• Classroom training (average hours: 2.9 for at-risk functions, 1.3 for managers, 0.3 for other workers)
• Computer-based training (average hours: 2.9 for at-risk functions, 1.0 for managers, 1.0 for other workers)
• Voluntary computer-based training available

Frequency:

• Quarterly/bi-annually/annually for at-risk functions
• Bi-annually/annually for managers and other workers
• Conducted during onboarding and after significant policy updates

Performance

Confirmed incidents in 2024:

• Number of convictions for violation of anti-corruption and anti-bribery laws: 0
• Fines for violation of anti-corruption and anti-bribery laws: €0

Financial resources:

• Exact financial allocation per measure has not yet been conducted
• A specific breakdown by individual measure has not yet been established

Incidents of corruption or bribery

Confirmed incidents

SBO reported zero confirmed incidents of corruption or bribery during the reporting period (2024).

Convictions and fines

No convictions or legal decisions (criminal or administrative) related to violations of anti-corruption and anti-bribery laws were recorded. No fines, sanctions, or compensation payments were made.

Disciplinary actions

No incidents of discrimination or harassment were recorded during the reporting period, and no complaints were submitted. Consequently, no employees were dismissed or disciplined due to corruption or bribery.

Contracts terminated

Not disclosed.

Investigation procedures and speak-up mechanisms

SBO has established a whistleblowing system accessible via the company website, which allows employees and external stakeholders (including suppliers, customers, and value chain workers) to report concerns confidentially and anonymously. The system is managed by the Group Compliance Department, which reports directly to the Executive Board.

Key features include:

• Confidential reporting channels: Reports can be submitted anonymously through online platforms and alternative channels such as local compliance coordinators
• Protection against retaliation: SBO ensures anonymity and protection for whistleblowers in accordance with EU Directive 2019/1937
• Investigation process: All submissions are reviewed systematically by the Head of Compliance, with formal investigation procedures in place to evaluate concerns, implement remedial actions, and ensure de-escalation where necessary
• Tracking and monitoring: Complaints are documented, and outcomes are reported internally to the Executive Board and, where applicable, the Supervisory Board

SBO maintains a zero-tolerance policy regarding bribery, fraud, and any form of corruption, as outlined in its Code of Conduct, Fair Trade Policy, and Ethics Policy. These policies align with international frameworks including the UN Guiding Principles on Business and Human Rights, ILO Declaration, OECD Guidelines for Multinational Enterprises, US Foreign Corrupt Practices Act (FCPA), and UK Bribery Act.

Anti-corruption training

SBO conducts regular anti-corruption and anti-bribery training:

The Executive and Supervisory Board actively participate in compliance training sessions covering anti-corruption and anti-bribery topics.

Payment practices

Receivables (Company receives payment)

Payment terms granted to customers:

• Trade receivables usually have payment terms of up to 90 days
• The Company grants payment terms at customary business terms
• Trade receivables granted beyond normal payment terms bear interest at arm's length rates
• Occasional customers and customers in high-risk countries: confirmed letters of credit obtained
• Generally no additional collateral or payment guarantees required

Trade receivables maturity structure:

Payables (Company makes payment)

No specific disclosure on payment practices for trade payables, average time to pay invoices, or contractual payment terms for suppliers.

Legal proceedings

No disclosure on legal proceedings outstanding for late payment.

Prompt payment code

No disclosure on participation in or compliance with prompt payment code.