Arcelik AS

Arçelik's Global Sectoral Relations Management department under the Sustainability, Quality & Customer Care Directorate is responsible for coordinating relations with Trade and Industry Associations, operational NGOs and civil society organizations in all jurisdictions in which Arçelik operates. Through these relations, Arçelik advocates its corporate values and priorities such as fighting against climate change, digitalization, gender equality and diversity, and supporting industrial operational advancements. Arçelik works in collaboration with all public bodies, NGOs, trade associations and other related organizations or institutions in the advancement of the proposed legislation and/or other related regulations which may affect legitimate business interests that are compatible with international human rights legislation and the Paris Agreement. While working with these related bodies, it is of utmost importance that the policies of the Trade and Industry Associations and all other stakeholders in which Arçelik is a member comply with the UN Guiding Principles on Business and Human Rights as well as the Paris Agreement and its climate change policy to keep global warming limited to 1.5 degrees. The Chief Sustainability, Quality & Customer Care Officer is responsible for reviewing and monitoring the alignment of the policies of the NGOs, trade associations and other related organizations or institutions with Arçelik's decarbonization strategy and the requirements of the Paris Agreement. For trade associations, NGOs and other related organizations of which Arçelik is a member, Arçelik commits not to support any position conflicting with the Paris Agreement as well as UN Guiding Principles on Business and Human Rights. Arçelik also commits to publicly communicate the position of the trade associations and other related organizations in which Arçelik is a member, including reporting on any misalignment between the organizations and the Paris Agreement as well as UN Guiding Principles on Business and Human Rights. In addition, Arçelik does not engage in political campaigns, political organizations, lobbyists, or lobbying organizations itself and do not make contributions to these organizations. For further information, please refer to the Global Sectoral Relations Management & NGO Membership Policy Document and Industry Association Memberships Document."
"Arçelik's Global Sectoral Relations Management is responsible for coordinating relations in line with Arçelik's sustainability strategy with Trade and Industry Associations, operational NGOs and civil society organizations in all jurisdictions in which Arçelik operates. The Chief Sustainability, Quality & Customer Care Ofcfier is responsible for reviewing and monitoring the alignment of the policies of the NGOs, trade associations and other related organizations or institutions with Arçelik's decarbonization strategy and the requirements of the Paris Agreement. In order to ensure efef ctive implementation of the Company's sustainability strategy, the sustainability-related KPIs are included in the related employees', including C and D-level executives' annual performance evaluation score cards that are linked to annual compensation and bonuses as incentives.

Arçelik implements a due diligence process to identify, mitigate, and prevent potential and actual salient human rights and/or environmental issues in the entire value chain. The due diligence process covers risk identification in own operations, the value chain, and cases of acquisitions or mergers. All findings from the assessment of due diligence for own operations, for those in the value chain as well as any concerns raised for potential mergers/acquisitions, are systematically reported to respective departments and the Sustainability Council as well. Arçelik collects GHG emissions, water, waste and energy data from suppliers. Arçelik informs suppliers not only about the mitigation costs to be incurred today but also about the adaptation risks to be incurred in the future if the planet cannot be on track with a 1,5 degree warming scenario. [...] Moreover, a new and dedicated Human Rights Department has been established by the Board of Directors of Arçelik. The department is responsible for organizing regular third-party and internal human rights assessments within the global organization, preparing a risk mapping of potential and actual violations, and taking necessary mitigation and remedial actions pursuant to the Global Human Rights Due Diligence Process. The Human Rights department is responsible for convening the Human Rights Committee (HRC). The HRC meets four times a year to review and revise the risk mapping of potential human rights issues within our existing business and new business relations, and risks in the value chain. In terms of the value chain, our priority is assessing the risks of Tier-1 suppliers. The duty of the Human Rights Committee is to proactively ensure that the operations in the value chain do not have adverse impacts on individuals. The HRC is chaired by the Chief People Officer, and representatives from Occupational Health and Safety, Sustainability, Quality Systems, Purchasing, Global Compliance, Environment, and the Human Rights teams attend the committee.

Arçelik works in collaboration with all public bodies, NGOs, trade associations, and other related organizations or institutions in the advancement of the proposed legislation and/or other related regulations which may affect legitimate business interests that are compatible with international human rights legislation and the Paris Agreement. While working with these related bodies, it is of utmost importance that the policies of the Trade and Industry Associations and all other stakeholders in which Arçelik is a member complies with the Paris Agreement and its climate change policy to keep global warming limited to 1.5 degrees as well as the UN Guiding Principles on Business and Human Rights. Arcelik integrates its material sustainability topics into governance processes by identifying risks, opportunities, and business cases and defining targets and metrics throughout our value chain.

Management of Relations with Industry Associations and NGO Memberships in Line with Climate Strategy

We are closely following laws and regulations regarding climate change, circular economy, digitalization, and sustainable product criteria policies and strategies. We also play an active role in contributing to the formation of opinions on these laws and regulations with the organizations of which we are members\* of such as, DigitalEurope, APPLiA, AMDEA etc.

\*Please refer to Arçelik Sustainability Report, "SELECTED MEMBERSHIPS AND ARÇELİK'S CONTRIBUTIONS" for breakdown of the payments made to trade associations for managing our business, the % of payments and why the association is important for us. Please note that these payments are not related to any political campaigns or lobbying activities.

As a company with approved Science Based near term targets, and a Science Based Net Zero 2050 commitment in place to set science-based net zero targets, Arçelik is highly committed to act in line with the goals of the Paris Agreement. Therefore, in its relations with stakeholders including but not limited to trade/industry associations, coalitions, NGO's, suppliers, B2B customers, Arçelik commits to act and cooperate in line with the necessities of the Paris Agreement. Our sector related engagements and representations in the leading and major trade/industry associations are monthly reported to the top management. To the best of our knowledge, the leading and major industry associations that Arçelik has membership have no contradicting opinions against the Paris Agreement criteria. In case such contradicting opinions arise, Arçelik commits to not be part of any organization or cooperation that would divert its mission away from transition to a low carbon economy, aiming for a net zero world no later than 2050. On top of this, Arçelik tries to be in line with international climate-related initiatives and regulations and clearly declares its position against against these such as the European Green Deal, Emission Trading System (ETS), Carbon Border Adjustment Mechnasim (CBAM), Ecodesign for Sustainable Products Regulation (ESPR) and so on.

\*For detailed information, please see Arçelik's Review on Industry Association Memberships.*

Building on Arçelik's global approach to stakeholder engagement, Arçelik carefully manages its engagement with public institutions, non-governmental organizations, sectoral institutions including but not limited to climate change specific issues.

For detailed information, please see our Global Sectoral Relations Management & NGO Membership Policy Document.

Describe the process(es) your organization has in place to ensure that your engagement activities are consistent with your overall climate change strategy[…]The Board Member of Arçelik chairs the Turkish Industry&Business Association Investment Environment and Industry Policies Roundtables. The Quality, Sustainability and Corporate Affairs (QSCA) Director of Arçelik, chairs the Turkish Industry & Business Association Environment and Climate Change Working Group and regularly reports all climate change-related issues including but not limited to the EU Green Deal, Carbon Border Adjustment Mechanism, carbon pricing, carbon credits market, and renewable energy investment. Arçelik's CEO is a high commissioner on the Carbon Pricing Leadership Coalition under the auspices of the World Bank. In 2022, Arçelik's CEO was selected as the president of APPLiA (Home Appliance Association in EU) which engages with policymakers about the related issues in the home appliance industry including the impacts of the industry on climate change and impacts of climate change on the industry. In line with the SBT Net Zero 2050 Standard, Arçelik intends to invest in permanent carbon removal solutions to offset the company's residual emissions (blue carbon or a combination of both technology-based solutions & blue carbon projects). In 2021, Arçelik joined Business Ambition for 1.5°C and Race to Zero -Net-zero commitment. Arçelik committed to double energy productivity per revenue by 2030 based on the EP100 membership. Arçelik participated in COPs and represented Turkey. CEO of Arçelik attended the "Dialogue for Climate Action" event in Vienna,which was launched by WB, within the frame of COP21 goals. Arçelik signed The Principles for Dialogue on Climate Action. Arçelik made commitments to «Paris Pledge for Action» of Cambridge University and the "Responsible corporate engagement policy† of the "Road to Paris 2015 Project†. Arçelik shares its comments, opinions, experiences, and revisions for draft environmental legislation including climate-related regulations in the geographies it operates, and joins regulation-making meetings with other pairs.

Does your organization have a public commitment or position statement to conduct your engagement activities in line with the goals of the Paris Agreement?[…]Yes

Describe the process(es) your organization has in place to ensure that your external engagement activities are consistent with your climate commitments and/or climate transition plan?[…]Through a defined process, Arcelik ensures its corporate engagements are in line with Arçelik's Climate Change Strategy and Global Code of Conduct which are based on international guiding principles such as Paris Agreement. Quality, Sustainability and Corporate Affairs (QSCA) Executive Director is responsible for the oversight of all communications with related institutions in line with Arçelik's Climate Change Strategy and Global Code of Conduct. The Sectoral Relations Department is responsible for gathering all information. The Department follows developments on a global scale and provides guidance on strategic trends and general Arçelik views.