E3: an integrated sustainability framework

03.1

Our sustainability commitment

ESRS 2 SBM-1 §40 General disclosure

Sustainability is a shared journey – one that shapes every stage of our value chain, from sourcing to end-of-life. At Hager we are committed to advancing this journey together with our partners, customers and stakeholders, with our respect for people and the environment guiding each step.

We have embedded our belief in building a sustainable future through collaboration into the heart of our sustainability framework, E3, which focuses on Ethics, Employees and the Environment.

E3 is our vision for upholding ethical business practices, creating an inclusive and healthy workplace, and delivering reliable, future-proof, low-carbon solutions in partnership with our suppliers, customers and other stakeholders.

As noted elsewhere in this report, our business is in a privileged position: we have the capacity to make positive change in people’s lives, and in the life of the communities in which we operate. By placing sustainability at the heart of everything we ensure that we thrive, and so does the world around us.

E3 forms an integral part of our overall Project 2030 strategy. Detailed reports on our interconnected activities around Ethics, Employees and the Environment follow this introductory section. A brief summary of each topic is included here.

Ethics

Ethics is at the core of our approach to business, guiding responsible conduct across our operations and value chain. Our commitment is reflected through ongoing ethics training, a secure integrity alert system, and clear expectations for all stakeholders upstream and downstream.

We seek to uphold human rights, ensure fair and safe working conditions, and maintain transparent sourcing practices, reinforced by our adherence to international standards such as the UN Global Compact and OECD Due Diligence Guidance¹.

Employees

Employees are central to our long-term success and sustainability journey. Hager fosters an inclusive environment where everyone can fulfil their potential through lifelong learning and meaningful career development, supported by initiatives such as Early Careers and Eureka. The health, safety and well-being of our workforce are fundamental priorities, embedded in our policies and practices across all sites.

We strive to create a workplace that values diversity and equal opportunities, and encourages collaboration across generations. Our commitment is further reinforced by our Diversity Charter and ongoing investment in employee development, through which our aim is to cultivate an environment where individuals feel respected, supported and able to thrive.

In 2025 we are reinforcing this commitment with the launch of our Human Sustainability programme, which will advance our ambition in this pillar of the E3 framework. This programme builds on our existing efforts and provides a structured approach to support employees in a workplace that strives to be inclusive, empowering and responsive to future needs.

Environment

The environment is a central pillar of Hager sustainability strategy, guiding our efforts to reduce GHG emissions and minimise the environmental impact of our operations.

Through our Blue Planet Commitment we implement robust action plans to minimise CO₂ emissions, reduce waste and advance circular economy practices across our value chain. We also prioritise eco-design, invest in innovative energy solutions, and leverage digital transformation to optimise resource use and operational efficiency.

By creating long-lasting products, by continuously improving their environmental performance, and by engaging partners and customers on this journey, we strive to enable low-carbon living and support the global climate targets set by the Paris Agreement.

Since 2021 our efforts have been structured and accelerated through our Environmental Sustainability programme, the Blue Planet Commitment, which provides a comprehensive framework to drive progress in this pillar of our E3 approach.

This programme ensures alignment across major environmental initiatives, enabling us to scale impact, track performance and continuously improve.

03.2

E3: alignment with UN SDGs and material topics

The United Nations Sustainable Development Goals (UN SDGs) provide a universal framework for addressing the world’s most urgent environmental, social and economic challenges by 2030. At Hager we recognise that contributing to these global goals is a matter of corporate responsibility, as well as a strategic imperative for long-term business success.

Our E3 framework is deliberately structured to advance progress towards the SDGs most relevant to our business and stakeholders. Through regular updates to our yearly double materiality assessments we have identified the sustainability topics where our operations have the greatest impact and where we are most exposed to financial risks and opportunities. These material topics form the foundation of our E3 strategic priorities.

By mapping our E3 framework to the relevant SDGs and integrating the disclosure requirements of ESRS and GRI standards, we ensure a consistent and transparent approach to sustainability management and reporting. This alignment maximises the effectiveness of our actions, strengthens our contribution to shared global objectives, and supports compliance with the latest regulatory expectations under the CSRD.

Our approach enables us to create value for our stakeholders, benchmark our progress against international standards, and drive continuous improvement in all areas of sustainability.

Alignment of SDGs and our E3 framework

03.3

Sustainability governance

GRI 2-9, 2-13, 2-14 General disclosure
ESRS 2 GOV-1 §22 and
§23 General disclosure

Hager is proud of its long history as a family enterprise. Over 70 years we have taken a flexible approach to the governance of our business, and this has enabled us to respond again and again to a changing world, swiftly and effectively. Adaptable governance structures are essential for success.

Change is still with us, of course. Today’s world is changing perhaps faster than at any point in the history of Hager. To ensure our business is future-ready and well-positioned to shape the electrical world of tomorrow we have established a governance model that ensures a clear and effective transition of strategy and action plans from senior leadership to every employee.

Our E3 framework approach is embedded within this governance framework. This ensures that our decisions and actions consistently reflect our values, support responsible business conduct, empower our people, and promote environmental stewardship across our entire value chain.

03.3.2

Incentive policy

ESRS 2 GOV-3 §29 General disclosure
GRI 2-19 General disclosure

Hager remuneration policy for our highest governance body and senior executives is composed of a fixed salary and variable pay. Our Hager Group Bonus Scheme is a lever for performance, aimed at enhancing both individual and collective performance to accelerate Hager development and growth.

The structure of the scheme is based on the belief that overall performance is a combination of individual performance (achieved through focused objectives, the demonstration of Hager values, and leadership behaviours), and group performance.

The remuneration framework incorporates key performance indicators (KPIs) linked to impact on group financial performance, the group annual business plan and individual objectives. Group objectives encompass three domains: business, customers and employees.

As part of our commitment to responsible growth, sustainability impact has also become a core component of our performance culture. Also, in 2024, 15% of the variable remuneration for the highest governance body and senior executives was directly tied to health and safety metrics in relation to employees and non-employees working at Hager sites.

This reflects our belief that long-term value creation must go hand-in-hand with environmental and social responsibility, aligning leadership incentives with the ambitions of our sustainability strategy.

This year we have updated our remuneration policy to align with our new People Frame framework (see the Employee section of this report for more information).

In evaluating individual performance we place equal importance on both outcomes and the manner in which they are achieved. As part of this approach, all managers are required to set at least one objective focused on behaviour, inspired by the People Frame, which will carry a weighting of 30% in the overall performance assessment.

03.4

Embedding sustainability in daily operations

GRI 2-23 General disclosure
GRI 3-3 Material topics
ESRS 2 SBM-1 §40 General disclosure

At Hager we recognise that achieving meaningful and lasting sustainability impact requires more than ambition – it demands integration. That’s why we are committed to formally embedding sustainability into our daily operations and across our entire value chain. This approach ensures that our sustainability goals are both aspirational and actionable.

Equally important is our collaboration with external stakeholders – suppliers, partners and customers – who play a critical role in amplifying our impact. Through shared standards, transparent practices and mutual commitment we can drive systemic change and accelerate progress toward our collective goals.

For this purpose Hager has developed a comprehensive sustainability policy. This policy is grounded in the outcomes of our materiality assessment, which identifies the most relevant environmental, social and governance topics for our business and stakeholders.

To address these material topics in a structured and accountable way the policy is supported by a set of dedicated charters and declarations. Each document provides clear principles, commitments and guidelines tailored to specific areas of impact, ensuring consistency and alignment across the organisation and our value chain. The framework includes:

• Environment and Energy Charter
• Ethics Charter
• Declaration of Principles on Respect for Human Rights
• Sustainable Sourcing Charter
• Internal Mobility Charter
• Human Sustainability Charter

These policies are endorsed by our Board of Directors and apply to all entities within the scope of our sustainability reporting, and are communicated internally via the Hager Live! platform and document management system.

For suppliers and business partners, adherence to these principles is contractually required via the Supplier Code of Conduct.

These policy commitments (with the exception of our Mobility Charter) apply throughout our operations, value chain and supplier relationships, and are grounded in internationally recognised standards such as the Universal Declaration of Human Rights, ILO Conventions, the UN Guiding Principles on Business and Human Rights, and the OECD Due Diligence Guidance.

We mandate regular risk-based due diligence aligned with the German Supply Chain Due Diligence Act (LkSG), including supplier risk analysis, targeted conflict minerals reporting, preventative measures (like employee training and updated contracts), and formal grievance mechanisms.

Hager applies the precautionary principle through systematic risk assessments, standardised controls, and robust training to proactively prevent harm to people and the environment.

03.5

Sustainable sourcing

GRI 3-3 Material topics
GRI 308-1&2 Supplier environmental assessment
GRI 414-1&2 Supplier social assessment
ESRS 2 BP-2 §10 General disclosures
ESRS G1-2 §15 Business conduct

03.5.1

Our ambition

As part of our long-term sustainability strategy, and in response to increasing regulations (eg CSDDD, LkSG), we aim to reduce supplier-related sourcing risks by 2030. This commitment supports responsible sourcing, supply chain resilience and sustainable growth.

Our programme focuses on two levers: decarbonising the supply chain and upholding ethics and human rights.

Decarbonisation

• Target: 25% reduction in Scope 3 emissions by 2030.
• Action: Request product–level carbon footprints, track supply chain greenhouse gas (GHG) data, and use the results to steer sourcing decisions.

Ethics and human rights

• Target: Every supplier must agree to our Supplier Code of Conduct: Purchasing Conduct, Ethics & Sustainable Sourcing.
• Action: Digital due diligence tools to monitor compliance; issues or violations to be flagged and remedied quickly.

These measures reinforce responsible sourcing², supply chain resilience and long-term growth while meeting the 1,5°C climate ambition articulated in the Paris Agreement. The scope of our risk-based approach for sustainable sourcing practices is direct sourcing operations with a gradual onboarding of the remaining purchasing functions.

03.5.2

Supplier Code of Conduct

GRI 205-2 Anti-corruption

At the heart of our supplier relationships is our Supplier Code of Conduct: Purchasing Conduct, Ethics & Sustainable Sourcing, which translates our E3 principles into clear and actionable requirements for all our partners. This code outlines our expectations for ethical behaviour, social responsibility and environmental care, and serves as the foundation for collaboration and mutual trust throughout our supply network.

The acceptance of our Supplier Code of Conduct is a mandatory step in the supplier onboarding process and is also embedded in our contractual agreements. In 2024, over 75% of 215 targeted suppliers³ have formally committed to our code of purchasing conduct.

03.5.3

Managing supply chain risk: Leveraging AI for real-time ESG risk monitoring

Effective supply chain risk management is crucial for ensuring the integrity of our E3 frame. We use Sphera, an AI-powered ESG and compliance tool, to identify, assess and address human rights, labour and environmental violations within our sourcing activities.

Sphera monitors publicly available data to flag potential ESG risks linked to our tier-one suppliers, who represent more than 90% of our total procurement spend.

When potential violations occur, we apply a structured four-step compliance process:

1. Identification of the violation
2. Risk categorisation (low, medium, high)
3. Corrective action planning
4. Monitoring and closure

This approach ensures a timely response and continuous improvement across our supply chain.

In 2024 our tool monitored 2.075 active suppliers and flagged 61 potential violations. Of these, 56 cases were verified as legitimate, and corrective actions were initiated.

As of this report, 55 cases have been resolved, while one high-impact case remains under active remediation.

Notably, three of the identified cases were classified as high severity. This risk monitoring process ensures timely intervention and reinforces our commitment to responsible sourcing.

03.5.4

Derisking our supply chain: Leveraging EcoVadis IQ Plus

To boost supply chain resilience and uphold our E3 standards we are rolling out data driven tools and partnerships that will support our suppliers in achieving a higher level of ethical and environmental performance.

03.5.4.1

EcoVadis IQ Plus integration

• Strengthens our abstract risk framework with a rigorous, CSDDD – and LkSG – aligned model.
• Assesses every supplier in two respects:
  1. Sustainability risk (environment, labour and human rights, ethics, sustainable procurement) adjusted for industry and country.
  2. Procurement risk (spend, criticality, other internal factors).
• Combines external datasets, live risk scanning, and EcoVadis ratings to classify suppliers from very low to very high risk.

Coverage and results

• 8.600+ suppliers mapped across 54 countries.
• 193 flagged as high risk, giving clear priorities for engagement and corrective action.

Scope of assessment

• Direct sourcing: Raw materials, components, finished goods.
• Indirect sourcing/GRIBS: Operational goods and services.
• Logistics: Transport, storage, distribution.

Through targeted follow ups, collaboration and continuous improvement we are turning these insights into concrete risk mitigation steps and more resilient, responsible supply chains.

Supplier engagement based on EcoVadis IQ Plus

We apply a tiered, risk-based approach to engage suppliers effectively:

• High/very high risk: Prioritised for corrective action plans; persistent non-compliance may lead to contract termination.
• Medium risk: Required to improve based on scorecard results, with ongoing monitoring.
• Low risk: Subject to routine checks and simplified scorecard sharing.

This structure helps us to focus our efforts where risks are highest, while maintaining efficient oversight for lower-risk suppliers.Following the risk mapping of 8.600+ suppliers and 193 high-risk identifications we launched a pilot to test engagement.

By June 2025:

• 30 suppliers were invited to join the EcoVadis scorecard campaign.
• Ten submitted scorecards (one included expert review, two had scope changes).
• Eight are in progress.
• Four declined to participate.

This gives a 61% response rate, slightly above the industry average (46%). We are following up with the remaining eight suppliers to ensure progress.

The pilot highlighted the importance of clear early communication, tailored follow-up based on response status, and having a defined process for non-responders. Feedback from direct and indirect sourcing teams will guide future improvements.

03.5.5

Conflict minerals due diligence

To uphold responsible sourcing we run a rigorous conflict minerals due diligence programme for tin, tungsten, tantalum and gold (3TG). Working with Assent, we map the origin of 3TG in all relevant products and require identified suppliers to submit the Responsible Minerals Initiative Conflict Minerals Reporting Template (CMRT).

This structured approach – transparency, traceability, and joint risk mitigation – meets international due diligence standards, supports upcoming regulations, and strengthens our shared commitment with suppliers to keep conflict minerals out of our value chain.

03.5.6

Supporting local suppliers

GRI 204 Procurement practices

At Hager, supporting local communities is deeply rooted in our identity as a company that has grown from modest beginnings. That’s why we prioritise building strong partnerships with local suppliers in every country in which we operate.

By strengthening local relationships we promote inclusive economic growth, boost community resilience and reduce environmental impact through shorter supply chains. This approach not only enhances our organisational agility but also creates shared value for both society and the environment.

In 2024 approximately 80% of our procurement spend was directed to local suppliers across key markets such as France, Germany, India, China, the UK, Italy, Spain, Switzerland, and Poland.

03.6

Empowering the energy transition through innovation and collaboration

As part of our commitment to shaping the electrical world of tomorrow, Hager continues to innovate at the intersection of sustainability, technology and customer value. In parallel with our partnerships in sustainable sourcing, we are collaborating with important players in the energy transformation, piloting smart, decentralised systems that optimise the integration of systems that are vital for the energy transition.

This includes our collaboration with Audi AG, where we are jointly exploring bidirectional charging—specifically Vehicle-to-Home (V2H) technology. Since 2020, Hager Group and Audi have been testing how electric vehicles like the Audi e-tron can serve as mobile energy storage units, enabling homeowners to store self-generated solar energy and feed it back into their homes when needed. This project leverages Hager’s advanced charging infrastructure and E3/DC’s home power plant technology to improve grid stability, reduce electricity costs, and enhance energy independence.

Similarly, E3/DC, a Hager Group brand, has partnered with Ford Motor Company to bring bidirectional DC charging to Ford’s electric models such as the Explorer and Capri. These vehicles can now act as energy storage extensions for buildings equipped with E3/DC’s energy storage systems. The collaboration enables surplus solar energy to be stored in the vehicle and later returned to the home, supporting grid relief and increasing the use of renewable energy.

The Prosumer Pilot Project in Benfeld is another project, demonstrating how collaborative innovation can unlock cleaner, more resilient energy models for the future.

In 2024, Hager, in close collaboration with Socomec⁴ and Sovec⁵, successfully implemented a pioneering Prosumer Pilot Project at Socomec Innovation Centre in Benfeld, France. This initiative demonstrates our commitment to advancing smart, decentralised energy systems that are both sustainable and resilient.

The Prosumer model, defined under IEC 60364-8-82⁶, transforms commercial buildings into both producers and consumers of energy. By integrating solar generation, electric vehicle charging infrastructure and energy storage into a unified management system, this approach supports optimised self-consumption, peak shaving, energy independence and operational supply continuity.

The Benfeld project serves as a demonstrator for the practical benefits of this model. Throughout 2024 and 2025 the project progressed from installation and commissioning to live operation, testing use cases such as self-consumption, grid reinforcement, peak shaving, and islanding. The insights gained have helped us to better understand system interoperability, grid constraints and user needs, strengthening the readiness of the solution for broader adoption.

This initiative also reflects the strength of a collaborative value chain for sustainability. By aligning the complementary expertise of Hager, Socomec and Sovec we developed a synergistic ecosystem that delivers more than the sum of its parts. Hager contributed to energy management and EV charging solutions; Socomec delivered power storage and analytics capabilities; Sovec supported with electrical installation expertise.

This integrated approach accelerates innovation and ensures that sustainability is embedded across every stage of the value chain whenever possible from design and deployment to operation and optimisation.

Beyond technical implementation, the project serves as a platform for innovation and customer engagement. Through site visits and value proposition testing we are actively shaping a scalable business model that empowers stakeholders, including facility managers, fleet operators and investors, to take an active role in the energy transition.