23 Life Is On | Schneider Electric www.se.com 2021 Trust Report Human rights: • Decent workplace; • Health and safety. Environment: • Pollution and specific substances management; • Waste and circularity; • Energy, CO 2 , and GHG. Business conduct: • Ethical business conduct; • Alert system, protection, and non-retaliation. Offer safety and cybersecurity : • Offer safety; • Cybersecurity and data privacy. 9.2.3 Risk location The Group has studied four areas where risks may occur: • Schneider Electric sites: they have been segmented based on categories that present a specific level of risk. Employees with frequent travels (sales, field services, travelers, audit, top management) have been assessed separately; • Suppliers: the level of risk differs based on the type of process and technologies used, and the Group has therefore segmented the analysis by component category of purchase. The risk level is an average assessment. The geographical location is factored in when selecting suppliers for the audit plan; • Contractors: when implementing a customer project, like building a large electrical system at a customer’s site, Schneider Electric is working with contractors, leveraging their expertise (civil work, electrical contracting, etc.). This “off-site” project work generates a specific level of risk for contractors. A separate “off-site and projects execution” category for contractors has therefore been defined for the assessment. • Local Communities: Schneider Electric has identified two distinct segments: communities located around Schneider Electric sites and communities located around customer projects sites. Communities have been assessed against three risk categories; human rights, environment, and business ethics. 9.2.4 Risk evaluation and scale The evaluation combines the probability of occurrence of the risk, with the seriousness of consequences from the risk. This is an evaluation of risk before impact of mitigation actions. After taking into consideration the impact of these mitigation actions, the level of risk may be significantly reduced. Risks are assessed on the following scale: 1 – Non-existent; 2 – Low; 3 – Medium; 4 – High; 5 – Very high. In this 2021 risk assessment, no “Very high” risk levels were identified. 9.2.5 Key findings In 2021, the Group conducted an update of the risk mapping with key internal experts. No changes were brought to the methodology compared to last year, and the structure of our risk matrix, although it can be further improved and refined, allows to capture the main natures of risk from a Duty of Vigilance point of view. Overview of the main risks and their evolution: • Schneider Electric sites: The COVID-19 pandemic, its social, business, and economic consequences has put significant pressure on teams and individuals. Although the first waves of the pandemic have been weathered, several countries like India or South Africa for example were severely hit. As a result, while some countries were going out of lockdowns and recovering “normal” ways of working, some others were going into confinement and restrictions. Operations were thus disrupted, and the global supply chain had to deal with such complexity country by country. Teams have been resilient, and supported with the implementation of flexible and adaptive ways of working, but the overall long term impact of the situation, although complex to measure, is of fatigue. In this context, measuring the evolution of mental health and psycho-social risks over time is necessary. • Suppliers: Here also, the impact of COVID-19 is probably significant, but the measurement of its consequences over our supply chain will take longer. Our observations are that there has been an increase of pressure in fields such as health and safety (including mental health) due to tensions in the supply chain, and some deterioration of the human rights situation in some geographic areas. • Contractors: As in 2020, the 2021 assessment confirmed external off-site contractors as one area that needs special attention. This is due to the specific nature of project work (civil work, installation, etc.) that implies high labor activity on construction sites. Projects have been under specific pressure, as supply chain disruptions created some periods of slow-down, or even complete halt of on-site works, followed by intense periods of catch-up. This situation increased risks linked to health & safety and human rights, probably augmented by social consequences among the population of contracted workers, and workers working abroad from their own country. • Communities: the assessment work is still ongoing and therefore conclusions are still preliminary. Overall, it seems that communities located around Schneider Electric sites, at least for the largest sites, are not affected, or only marginally affected by Schneider Electric’s presence. This is mostly due to the fact that Schneider Electric’s sites are located in large, already structured industrial areas, or in cities. In regards to customer projects, the assessment shows that there may be some impact on communities. Schneider Electric is usually just one of the suppliers to the customer project, and the impacts are therefore highly variable and linked to the industrial profile of the end- customer. A more detailed evaluation is in progress.