1 2 4 3 Risk analysis Reporting Complaint mechanism Declaration of priciples The chart shows the systematic approach to respecting human rights and related environmental rights. Measures and effectiveness monitoring Enhancing transparency for conflict minerals We expect all our business partners to comply with all the applicable regulations relating to conflict minerals. We review which smelters produce the raw materials for our products so that we are in a position to assess this. This process involves using the methods defined by the Responsible Minerals Initiative. As part of the supplier self-assessment, we also require our business partners to provide us with information about the use of potential conflict minerals. Furthermore, we complete the “Conflict Minerals Reporting Template” (CMRT) drawn up by the Responsible Minerals Initiative so as to create transparency. This is intended to increase the proportion of certified smelters across the world. Compliance with legal requirements We also review purchased products in conformity with an internal standard. The aim is to comply with the required substance bans and declaration obligations. Key regulations in this area include the European Chemicals Regulation on the Registration, Evaluation, Authorization, and Restriction of Chemicals (REACH) and the EU Directive on the Restriction of the Use of Certain Hazardous Substances in Electrical and Electronic Equipment (RoHS). More information on this is provided in the Compliance section on the sustainability pages of our Group website. Other supplier-management tools to monitor the environmental requirements In 2024, nine suppliers were audited as part of supplier qualification or within the scope of regular review. We are currently planning the introduction of additional decision-making criteria and in future we also want to make a selection in accordance with their specific greenhouse gas emissions. Risk-based supplier review in conformity with the approach of the German Supply Chain Due Diligence Act (LkSG) Every year, we carry out a risk analysis of our supplier risks. In 2024, we analyzed around 2,000 suppliers during the course of this process. On the basis of the results, around 800 of them have to submit a specific self-assessment aligned with the German Supply Chain Due Diligence Act (LkSG), assessing the protected legal positions defined by the act. The issues covered in the assessment include the impact on social and environmental aspects and the risk arising from the individual countries. Approximately 98 percent of the purchasing volume is covered by the self-assessment. Sustainability audits were carried out in 2024 as a preventive measure relating to potentially high-risk suppliers in Bulgaria, Brazil, Hungary, India, and Turkey. These audits revealed individual violations of environmental requirements, which were swiftly remedied. Social requirements were not breached. At the same time, we used the findings to facilitate continuous improvement of the risk analysis. During the reporting year, we launched a comprehensive training campaign on the LkSG as an additional preventive measure for employees involved in purchasing and for suppliers. The campaign also encompassed other protected goods relevant to the environment. The training sessions can also be deployed as part of the support measures to help suppliers. Upholding Human Rights 3. Complaint mechanism based on a whistleblower portal for anonymous reports, as well as the Sustainability and Compliance Office for direct reports. In 2024, 15 reports were recorded through the whistleblower portal. The cases were reviewed, where necessary worked through, and resolved in collaboration with the relevant department. 4. Annual reporting on risk analysis and derived preventive measures. This is reported to the Management Board and the relevant authorities. We also provide information in the current Sustainability Report on our activities relating to implementation of the German Supply Chain Act (LkSG). You can find other details in our report to the German Federal Office for Economic Affairs and Export Control (BAFA), which is available on our corporate website www.festo.com/ethics-and-governance. 1. Declaration of principles and voluntary commitment to protect human rights and related environmental rights within our own business unit and with our direct and indirect suppliers and prevent violations of legal rights. It was updated in 2024. 2. Annual risk analysis of aspects in our value chain related to human rights and the environment. On the basis of the results, we investigated a total of 44 suppliers in countries subject to high and medium risk for potential human rights violations in 2024. We provided additional details on risk analysis in chapter 6.3 of the Sustainability Report 2023. Systematic and global: our approach on respecting human rights Our global approach to the due diligence obligations for human rights is based on operational risk management. The Human Rights Officer of the Festo Group is responsible for this. The officer also chairs our quarterly Human Rights Committee, composed of experts from the field of Strategic Purchasing, Corporate Compliance, Internal Control Systems and Risk Management, Global Health and Safety, Human Resources, and Sustainability. The committee monitors implementation and continuous improvement of our approach consisting of: Festo SE & Co. KG Sustainability Report 2024 Festo SE & Co. KG Sustainability Report 2024 2. Social 48 49
RkJQdWJsaXNoZXIy NzczNDE0