www.se.com Schneider Electric 14 2021 Sustainable Development Report 1 Sustainability at the heart of our strategy Importantly, the phased application of reporting requirements, as well as the evolving nature of the regulatory framework means that the KPIs disclosed in this report may evolve as the regulation and its reporting requirements do. A complementary DA defining additional eligible activities for the climate change mitigation objective is also under public consultation at the time of writing, and DAs for the remaining four environmental objectives are expected in 2022. This means that more Schneider activities could be included in the EU Taxonomy reference framework gradually. For instance this may concern Schneider’s offers related to grid reinforcement and smart grid architectures contributing to electrification and decarbonization, products with differentiating green performance (flagged thanks to our Green Premium ™ program) or services that bring benefits for circularity and energy efficiency. Another example is the Group’s industrial automation activities, which can have significant environmental benefits. 1.3.5 Schneider Electric’s support to the EU Taxonomy Schneider Electric has experienced both the value and the challenges of conducting a mapping of green business activities early on. The Group therefore welcomes the European Commission’s work to define a common classification system for sustainable economic activities and believes that the taxonomy can bring greater transparency and reporting alignment among non-financial undertakings. The Group is willing to share its experience in the measurement of revenues contributing to a sustainable world and work collaboratively and constructively with relevant stakeholders to advance the transition to a sustainable and low-carbon economy. In particular, Group experts are contributing to the Platform on Sustainable Finance, an expert group assisting the EU Commission in developing technical criteria. 1.3.6 Turnover derived from Taxonomy- eligible activities under the current EU Climate Delegated Act Schneider Electric identified several business activities that are eligible according to the current EU Climate DA. We provide the list of those activities in our methodological note on page 160. In 2021, the Taxonomy-eligible turnover amounts to 28%, representing EUR 8,032 million out of EUR 28,905 million total revenues. Non-eligible turnover therefore amounts to 72%. This number is based on the first evaluation of the eligibility of Schneider Electric’s activities using two combined approaches, including an offer-based approach (i.e. by nature of technology), whereby each line of business’ products are reviewed against the definition of economic activities as defined in the EU Climate Delegated Acts, and an end-segment approach, whereby the amount of revenues generated from Taxonomy-eligible end- segments (Green Transport and Renewables mainly) for each product line is reviewed. Double-counting between offer-based approach and end-segment-based approaches are then removed before consolidation. 1.3.7 Capital (CapEx) and Operational Expenditure (OpEx) In 2021, Taxonomy-eligible CapEx amounts to 27%, representing EUR 757 million out of EUR 2,764 million. Therefore, the Taxonomy- non-eligible CapEx amounts to 73%. All costs based on IFRS 16 related to long-term leasing of buildings are considered eligible. CapEx related to assets or processes associated with Taxonomy-eligible activities, including Research & Development (R&D) CapEx, were calculated using allocation keys of eligible turnover per business and operations. In 2021, CapEx for eligible individual measures was not evaluated. In 2021, Taxonomy-eligible OpEx amounts to 23%, representing EUR 291 million out of EUR 1,276 million total OpEx (R&D). Therefore, the Taxonomy non-eligible OpEx amounts to 77%. Only non-capitalized costs related to R&D are reported. OpEx related to building renovation measures, short-term leases, maintenance and repair and other expenditures relating to the day-to-day servicing of assets represent less than EUR 116 million and are therefore considered as non-material for Schneider Electric business and excluded from the KPI calculation. Read more on our EU Taxonomy assessment methodology page 216  Spotlight on Sustainability Consulting Schneider’s sustainability consulting business brings together the full portfolio of Schneider Electric solutions to provide unparalleled, end-to-end support to our customers to achieve their net-zero, sustainable transformations, from formulating climate strategy to execution & deployment of sustainability offers. For example, Schneider Electric is helping the VELUX Group, the world leader in roof windows and skylights, to develop a global program to successfully reduce their energy use and scale renewable capacity at each of the company’s factories. The project, which is designed to support VELUX Group in reaching its company carbon neutral goal by 2030 and accelerate its plan to be Lifetime Carbon Neutral, includes the energy assessment of all factory sites resulting in the development and implementation of Zero Carbon Action plans, support of its Energy Excellence program in accordance with ISO50001, improved energy efficiency, expansion of onsite renewable heating and electricity capacity to phase out fossil fuels, and implementation of a global monitoring system through Schneider Electric’s EcoStruxure ™ Resource Advisor to measure and analyze energy usage.