ACEA SpA

Since the issuance of the Green Finance Framework in 2021, Acea has established within its governance system an internal procedure for the establishment of best practices for the whole Group in the sustainable finance world, including processes for designing, planning, executing and monitoring all the sustainable finance activities in the Group. Furthermore, the company formed a Green Finance Working Group (GFWG), a cross-department table led by the Chief Financial Officer (CFO). It includes representatives from Finance, Sustainability Planning & Reporting and Planning & Control holding departments, each covering responsibility according to its own expertise, and works in harmony with representatives of the Group's operating subsidiaries. The GFWG is responsible of creating and updating the abovementioned Green Finance Framework in line with the sustainability objectives of the Group, and dives deep into the eligibility criteria for potential green projects. The initial process for the first selection and evaluation of potential eligible green projects was based on the materiality assessment carried out by the Group for both the Acea's Business and Sustainability Plans, in order to isolate and define the most relevant topics and issues at stake for the whole Group in terms of sustainability objectives and related investments. Today, this process is structured as follows: - reviewing and validation of the Eligible Green Projects identified in accordance with the defined Eligible Green Project Categories listed in the Use of Proceeds section of the Green Finance Framework; - monitoring of the Eligible Green Project portfolio during the life of the transaction through a tracked and integrated internal periodical report for the whole Group, fed with Enteprise Resource Planning tools and data, regarding financial allocation; - if the Sustainability department deems that an eligible project becomes subject to a major ESG controversy, the GFWG will analyse it and may decide to exclude and replace such Eligible Green Project; - managing any future update of the Green Financing Framework. All potential Eligible Green Projects comply with local laws and regulations, including any applicable regulatory environmental requirements, as well as Acea's internal standards for managing ethical and governance risks following the current Code of Ethics and different Management Systems, all publicly available in the Acea website. [...] Acea confirms to follow the Process for Project Evaluation and Selection description provided by Acea's Green Financing Framework. The report is in line with the initial commitments set in the Acea's Green Financing Framework: Acea formed a Green Finance Working Group (GFWG), a cross-department table led by the Chief Financial Officer (CFO). It includes representatives from Finance, Sustainability Planning & Reporting and Planning & Control holding departments, each covering responsibility according to its own expertise, and works in harmony with representatives of the Issuer's operating subsidiaries. The GFWG is responsible for creating and updating the Green Finance Framework in line with the sustainability objectives of Acea, and dives deep into the eligibility criteria for potential green projects. The projects selected are defined and structured in a congruous manner. The Issuer ensures compliance with the Eligibility Criteria. ESG risks associated with the project categories are identified and managed through an appropriate process. [...] Acea confirms to follow the Process for Management of Proceeds description provided by Acea's Green Financing Framework. The report is in line with the initial commitments set in the Acea's Green Financing Framework: proceeds are managed by the Green Finance Working Group. The proceeds collected represent 49.6% of the amount allocated to eligible projects, with no exceptions. 34.5% of this latter amount has been allocated to refinance eligible projects (investments made in 2022), 65.5% has been allocated to finance eligible projects (investments made in 2023). The proceeds are tracked in an appropriate manner and attested in a formal internal process. The Issuer discloses information regarding the allocation to individual or portfolio disbursements.

Acea's governance system also includes the monitoring of ESG (Environmental, Social & Governance) issues, including climate change. In this regard, a significant role is played by the activities carried out by the Board of Directors (BoD), assisted by the Board Committees, and specific functions of the Chair­person, the Chief Executive Officer (CEO) and the management, who - within their respective roles and responsibilities - contribute to ensuring the monitoring and proper management of these issues in business activities. [...] The Board of Directors defines the policies and strategic guidelines which form the basis of the business plan, also with regard to sustainability issues, while the CEO operates on the basis of the multi-year plans approved by the BoD, ensuring and verifying compliance with the resulting management guidelines; the CEO is also responsible for establishing and maintaining the Internal Control and Risk Management System. The Chair of the Board of Directors ensures that adequate information flows are organised between Acea and the Group companies in order to monitor the consistency between the Group's strategic guidelines and its performance; the Chair also oversees the issues relating to environmental impacts and social sustainability (corporate social responsibility) of company activities and processes. [...] The Ethics and Sustainability Committee has specific expertise in business ethics and Environmental, Social and Governance (ESG) issues, which it promotes, supervises and monitors. It therefore receives regular updates on the various sustainability-related initiatives and projects, also with reference to the Carbon Disclosure Project questionnaire. The Ethics and Sustainability Committee reviews the guidelines of the sustainability plan, approved by the Board of Directors, and monitors its implementation; it also carries out the necessary activities to support the Board of Directors in examining and approving the business plan, also based on the analysis of issues relevant to the generation of long-term value. The Ethics and Sustainability and Risk and Control Committees work in coordination on several topics: for example, evaluating the capacity of the periodic financial and non-financial reporting to correctly represent the business model, the company strategies, the impact of its business and the performance achieved. [...] The Risk & Compliance department designs, implements and monitors the Group Risk Governance model. Its duties involve identifying, describing and measuring the main risk factors - including climate-related risks - that could compromise the achievement of the Group's strategic and business objectives, defining and proposing risk management and mitigation policies, and guiding the implementation and evolution of the Group's Enterprise Risk Management (ERM) framework. The department is involved in preparing responses to the CDP Questionnaire and works with internal working groups on climate scenario analyses. The Investor Relations & Sustainability department is responsible for the promotion, general coordination and functional oversight of sustainability issues, including climate change aspects. In particular, within the framework of the Group's strategic sustainability planning - defined with the involvement of the operating units and monitored in its implementation - it also oversees the planning of climate change-related objectives and takes care of performance reporting, including the coordination of activities relevant to the CDP Questionnaire. The department reports regularly on sustainability issues to the relevant Board Committees.

Describe the process(es) your organization has in place to ensure that your engagement activities are consistent with your overall climate change strategy[…]Acea has a conduct in line with the Paris agreement and expresses this through various commitments and facts, for example with the participation in the publication of the GCNI paper on decarbonisation (may 2021), or with the release of its first green bond (January 2021) or with the recent release (June 2022) of the first document in line with TCFD Recommendations.
The operational level reflects the strategic position, therefore the Group undertakes initiatives aimed, on the one hand, at the process of adaptation to climate change, for example by making infrastructures more resilient and integrating the analysis of critical scenarios into operations and, on the other hand, to the mitigation process, through the progressive reduction of GHG emissions.

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