FY 2023
Message from the Chief Executive Officer 1 1 Business model 2 2 Sustainability strategy 2024-2030 4 2.1 Cybersecurity at the service of sustainability 4 2.2 Strategy development process 5 2.3 Strategic pillars 6 2.4 Interaction between the sustainability strategy and the business model 6 2.5 CyberESG Initiative 6 3 Sustainability governance framework 7 3.1 Mission 7 3.2 Scope and objectives 7 3.3 Governance Structure 8 3.4 Membership requirements for the CyberESG community 9 4 Analysis of material Impacts, Risks and Opportunities (IROs) 10 4.1 Process for analysing double materiality 10 4.2 Key ESG-related risks and opportunities identified 12 5 Exclusive Networks’ sustainability commitments 14 6 Environmental Information 15 6.1 Governance of environmental questions 15 6.2 Reporting on the Green Taxonomy regulation 15 6.3 Climate Change 27 6.4 Resource use and circular economy 35 7 Social and societal information 36 7.1 Company Workforce 36 7.2 Governance of social issues 39 7.3 Social Dialogue and Engagement 41 7.4 Ensuring fair and attractive remuneration and benefits 43 7.5 Career and Skills Development 44 7.6 Human and labour rights commitments 48 7.7 Diversity, Equity and Inclusion (DE&I) 49 7.8 Health and Safety 52 7.9 Consumers and end-users 54 8 Corporate culture and business conduct policies 60 8.1 Compliance governance and organisation 60 8.2 Ethics, prevention and the fight against corruption 61 8.3 Transparency and the fight against tax evasion 65 8.4 Export Controls 66 9 Methodological note 68 9.1 Scope of consolidation 68 9.2 Preparation and compilation of this Statement of non-financial performance 68 9.3 Correspondence table with Articles L. 225-102-1 and L. 22-10-36 of the French Commercial Code 70 9.4 GRI correspondance table and alignment with SDGs 71 9.5 SASB correspondance table 74 10 Opinion of the independent notified body 75 APPENDIX 1 77
Message from the Chief Executive Officer Message from the Chief Executive Officer At a time when sustainability initiatives are shaping the future, cybersecurity is a crucial pillar in securing these efforts. Exclusive Networks shares the belief that the security and resilience of digital infrastructure are paramount to the success of global sustainability initiatives. These include: protecting the data integrity of smart city projects. The latter are expected to attract a global investment of $2.57 trillion by 2025, according to Grand View Research(1); the reliability of energy transitions, with cybersecurity proving to be a key enabler of the integration of renewable energy sources, according to the International Energy Agency(2); and protecting SMBs, which are the victims of 43% of global cyberattacks. However, 60% of victims cease their activity within six months(3). Cybersecurity is crucial to promoting social equity and business continuity. This understanding is at the heart of our sustainability strategy for 2024-2030. Our strategy combines our deep expertise in cybersecurity with our commitment to environmental and social responsibility. It includes improving our operations, partnering with our supply chain to expand our impact, and helping to advance the digital ecosystem as a whole. At the heart of our strategy is our commitment to nurturing and guarding the future of cybersecurity. We are committed to training the next generation of cybersecurity experts, providing comprehensive training and development programmes within our Exclusive Academy. We also invest in the personal development of our employees through targeted training in cybersecurity, sustainability and leadership. With a focus on both career development and personal skills, we promote employees who are not only competent but also deeply aligned with our sustainability values. Our strategy is aligned with global sustainability frameworks such as the Global reporting Initiative (GRI), the United Nations Sustainable Development Goals (SDGs), the Sustainability Accounting Standards Board (SASB) and the Corporate Sustainability reporting Directive (CSRD), demonstrating our holistic approach to sustainability and underscoring our commitment to transparency and accountability. Our adherence to the Science-Based Targets initiative (SBTi), the EcoVadis Bronze rating and participation in the Carbon Disclosure Project (CDP) are a testament to our ongoing sustainability efforts. These achievements, while significant, are just a beginning. We are driven by the immense potential of our journey towards a sustainable and secure digital future. Together with our partners, employees and stakeholders, we are enthusiastically exploring these opportunities, guided by our shared values and a vision of a world where sustainability and cybersecurity go hand in hand. (1) Report: Smart Cities Market Size Worth $2.57 Trillion by 2025 | Grand View Research, Inc. (2) Report: Net Zero by 2050: A Roadmap for the Global Energy Sector, IEA 2021. (3) 2023 Cybersecurity Almanac: 100 Facts, Figures, Predictions, and Statistics (cybersecurityventures.com). 1 2023 Sustainability Report Exclusive Networks SA
Business model 1 Business model A Global Cybersecurity VISION A fully reliable digital world, made more secure by the most innovative technologies Sector TRENDS A $50 bn accessible market growing by 92% in 4 years High needs for cybersecurity: a strategic risk, rising number of attacks Increasingly complex range of products and solutions RESOURCES Experts > Over 2,658 employees • 22.1% of engineers • 41.5% of sales • 44% women / 56 % men Intellectual capital Unique knowledge of cybersecurity solutions • A single robust governance system bringing together experienced experts Exclusive Training Centres (ETCs) • Delivering worldwide technical education and accreditation Relational capital Worldwide scale, local implementation • 40+ warehouses • 4 main logistic centres • Trusted relationships with more than 20,000 reseller partners • (Local) resellers reach a global customer base • (Local) vendors reach a global customer base Natural capital • Climate plan • Focus on the circular economy Financial capital • Strong balance sheet • Company listed on Euronext CAC Small, CAC Mid&Small, CAC All-tradable and MSCI Global Small Cap Index DIVERSIFIED VENDORS, emerging, established THOUSANDS OF ORGANIZATIONS to protect RESELLER PARTNERS: consulting, systems integrators, managed services providers UNIQUE POSITIONING in a complex ecosystem Take advantage of the underlying growth of our vendors and the wider Cybersecurity market in current geographical regions Extend the geographical coverage of our partnerships with our existing vendors 5 STRATEGIC PILLARS 2 2023 Sustainability Report Exclusive Networks SA #WeAreExclusive
Business model specialist SUSTAINABLE GROWTH GROSS SALES (€bn) 2019 2.4 2020 2.9 2021 3.3 2022 4.5 2023 5.1 20ACQUISITIONS in 10 years INCLUDING INGECOM AND CONSIGASin 2023 31% CAGR between 2013 and 2023 Strong track record of profitable growth For our employees • 31 employees in the Rise Up Top Talents programme • 10 hours of training per employee • Strong engagement 71% • 4.7 years average tenure For our customers and partners • 170 Countries served • 1,500 tonnes of freight transported • 20,000 tickets in Europe • 11,000 partners and customer trained in cybersecurity • Ethical audits performed on 100% of our high-risk third parties For society and the planet • 14.3% reduction in Scope 3 emissions per revenue unit compared to 2022: (174 ktCO2e/€ billion) to (149 ktCO2e/€ billion) • 18% of our electricity comes from renewable energy • Our carbon commitments: -40% reduction by 2030 in scopes 1 and 2 • A first intake of 20 students at the Exclusive Academy For our shareholders • 20 years of profitable growth • Global coverage and extension of business lines thanks to 20 acquisitions in 10 years • Asset-light model: >124% in 2023 • Partner of choice in our ecosystem: >> Accelerate marketing capacity >> Boost development of partners, of all types (GSI, SI, VAR, MSSP, etc.) Be the most trusted digital infrastructure specialist and the gateway to the most innovative cybersecurity technologies. MISSION IMPACTS & ACHIEVEMENTS €5.145 bn Gross sales 25% Hardware 49% Software 26% Support & Maintenance €186 M Adjusted EBIT 39.7% Operating leverage €254 M Operational Free Cash-Flow adjusted FINANCIAL PERFORMANCE 2023 Enter into new partnerships with cybersecurity solutions providers to complement the solutions offered in our portfolio Pursue our external growth strategy with targeted acquisitions Develop our services range to strengthen our value offering and boost customer loyaltys 3 2023 Sustainability Report Exclusive Networks SA
Sustainability strategy 2024-2030 Cybersecurity at the service of sustainability 2 Sustainability strategy 2024-2030 Exclusive Networks is committed to a transformative sustainability strategy that links cybersecurity to ESG (Environmental, Social and Governance) topics. The approach is built on a multi-faceted analysis involving, among others, stakeholder engagement, risk assessment and strategic business considerations. 2.1 Cybersecurity at the service of sustainability Exclusive Networks’ expertise in cybersecurity is a cornerstone of its sustainability strategy. It secures key growth areas for the global economy in general and more specifically for major sustainability projects and initiatives such as smartification (the digitisation and connectedness of things and organisations), the energy transition and cloud adoption. Cybersecurity protects and enhances social equity and ensures that the advancement of technology does not come at the expense of the environment. Cybersecurity securing sustainability CYBERSECURITY SUSTAINABILITY SMARTIFICATION By 2030, the TAM* value across industries for IoT suppliers could reach the range $625B to $750B SOCIAL EQUITY(2) 43% of cyber attacks target SMBs, of which 60% of victims go out of business within six months. ENERGY TRANSITION(3) $4 trillion/year by 2030 to reach net zero emissions by 2050 CLOUD ADOPTION(1) Only 20 to 30% of Industries are using Cloud regularly and at scale * TAM: target addressable market (1) Article Mckinsey : Cybersecurity for the IoT: How trust can unlock value, 17 April 2023 (2) Cybersecurityventures.com (3) Report: Net Zero by 2050: A Roadmap for the Global Energy Sector, IEA 2021 4 2023 Sustainability Report Exclusive Networks SA #WeAreExclusive
Sustainability strategy 2024-2030 Strategy development process 2.2 Strategy development process The strategy has been developed through a rigorous process that integrates, among other things, material issues for the Group, elements of international frameworks (GRI, SASB for example) and sustainability best practices, the particularity of Exclusive Networks’ field of activity, risks and market opportunities. This holistic approach ensures the strategy is aligned with our central goal of securing a sustainable and equitable future. Sustainability Strategy Competition Material topics Compliance & Regulation Business Inputs Strenghts & Positioning Sustainability Frameworks Purpose Reputation & Risks SUSTAINABILITY STRATEGY We Secure a Sustainable & Equitable Future Partner with Supply Chain Advance the Ecosystem Reduce our Carbon footprint Attract and Retain Talent Bridge Cybersecurity and Sustainability Train our resellers on CyberESG Partner with our vendors on shared goals Continue to ensure the integrity of our Business Partners Embed cybersecurity in the sustainability agenda Train Cybersecurity experts of the future Partner with non-profit organizations to promote cyberESG Improve our Operations 5 2023 Sustainability Report Exclusive Networks SA
Sustainability strategy 2024-2030 Strategic pillars 2.4 Interaction between the sustainability strategy and the business model 2.3 Strategic pillars Improve our Operations Partner with Supply Chain Advance the Ecosystem We aim to create more efficient and lower carbon-emitting operations, while fostering an environment where talent thrives and sustainability is a shared goal. Our strategy is extended to include our supply chain partners, with whom we aim to co-create a more sustainable and resilient network. We are committed to promoting the integration of cybersecurity into the sustainability agenda, recognising its pivotal role in ensuring a safer and greener future. 2.5 CyberESG Initiative The CyberESG initiative underpins the strategy with four key programmes: certification: empowering Employees with Knowledge that combines cybersecurity and sustainability; partner: enabling resellers to adopt and promote sustainable practices; podcast: sharing insights and fostering discussion on sustainability efforts through engaging conversations with industry leaders; and snippets: raising awareness and engaging a wider audience through pedagogical content on social media and blogs. Each pillar of the strategy is mapped out to Exclusive Networks’ material issues (refer to the sustainability commitment table 5). This mapping directly influences the Group’s sustainability commitments and actions, such as improving its employee engagement rate and reducing greenhouse gas (GHG) emissions, while monitoring progress with clear and quantifiable objectives. For each commitment, specific actions to be taken have been defined, such as the implementation of energy management systems and circular procurement strategies. Ambitious targets for 2023 and beyond have been set, with progress markers to clarify our commitment. 6 2023 Sustainability Report Exclusive Networks SA #WeAreExclusive
Sustainability governance framework Scope and objectives Exclusive Networks is committed to securing a sustainable and equitable future, delivering long-term value to its stakeholders. This involves embedding sustainability into every facet of its operations and culture, underscoring its commitment to responsible and ethical business practices. 3 Sustainability governance framework Exclusive Networks presents a comprehensive governance framework to guide the implementation and monitoring of its sustainability strategy for the 2024-2030 period. This governance framework is designed to closely align with the Group’s objectives and sustainability commitments, ensuring an integrated approach at all levels of the organisation. 3.1 Mission 3.2 Scope and objectives Exclusive Networks’ governance framework encompasses all sustainability initiatives within Exclusive Networks with the main objectives of: aligning with global sustainability standards; defining clear roles and responsibilities; establishing measurable sustainability goals and performance indicators; ensuring accountability and transparency in sustainability reporting; and promoting stakeholder engagement and drive continuous improvement. 7 2023 Sustainability Report Exclusive Networks SA
Sustainability governance framework Governance Structure Sustainability Governance Structure Decision-making, Validation of strategy and initiatives Deliberation on strategic direction, Policy development, IROs and material topics Implementation and management of sustainability initiatives across geographies and departments Ensures compliance with reporting standards and effective communication Ensures the proper transmissions of information across geographies and departments Boards of Directiors Deliberation Reporting Sustainability Committee Sustainability Working Group Sustainability Management Sustainability Reporting Team Sustainability Champions Board of Directors The Board of Directors decides on all decisions relating to the Group’s strategic orientations, which include the Group’s societal and environmental aspects. It ensures that they are implemented by the Executive Committee. The Chief Executive Officer is a member of the Sustainability Committee (see below), facilitating a flow of information and ensuring strategic alignment at the highest level. Sustainability Committee (SSC) This committee includes the Chief Executive Officer, members of the Executive Committee and key stakeholders to be determined by the Committee. This Committee will focus on strategic direction, policy development and decision-making, including the validation and recommendation of Impacts, Risks and Opportunities (IROs) and material topics. This Committee will support the culture of impact in the workplace by inviting the Group’s employees to contribute to sustainability initiatives, sponsoring some of these initiatives and leading by example where possible. 3.3 Governance Structure The effectiveness of the 2024-2030 sustainability strategy is provided by a governance structure to be implemented in the first quarter of 2024. This organisation is supported and approved by the Company’s Board of Directors, which is essential for integrating sustainability into its core processes. This structure includes several key instances covering all geographies: 8 2023 Sustainability Report Exclusive Networks SA #WeAreExclusive
Sustainability governance framework Membership requirements for the CyberESG community The Chair of the SSC provides overall leadership for sustainability efforts. This role involves chairing SSC meetings, setting the agenda for sustainability discussions, and ensuring decisions are aligned with both our sustainability goals and the overall corporate strategy. Sustainability Working Group (SWG) The working Group is made up of an operational team drawn from various business units and geographies. This Group is responsible for the implementation and management of sustainability initiatives. The Head of the SWG plays a crucial role in managing the day-to-day execution of sustainability initiatives, including coordinating efforts across different business units, ensuring that initiatives are implemented effectively and aligning efforts with the strategic directions provided by the SSC. The Head of the SWG also serves as a liaison between the SSC and the operational teams, ensuring that feedback and perspectives from the field are incorporated into strategic discussions. Sustainability Department It provides coordination and advice for both the SSC and SWG Groups. Sustainability Reporting Team (SRT) Specialised in data collection, analysis and preparation of sustainability reporting, this team will ensure compliance with reporting standards and effective communication. It is formed by: a project manager (PM), who is responsible for overseeing the collection, analysis, and reporting of sustainability-related data. He/she will ensure effective coordination and communication between different internal and external stakeholders, consistency with the management report, compliance with international reporting standards and timeliness. By providing accurate and timely data, the PM enables informed decision-making and helps track progress towards our sustainability goals; a project specialist who will support the drafting of the report and the verification of the various sections and the coordination with the reporting agency; and a Sustainability Leader who will bring his/her expertise in sustainability, verify alignment with the various international sustainability standards and establish the methodology for data collection and calculation of indicators. Sustainability Champions Sustainability Champions, corresponding between sustainability initiatives and different geographies and departments. Sustainability Champions will be required to have completed in-house training on sustainability topics and achieved a minimum of Level 1 CyberESG certification. The assignment of responsibilities between different Groups and individuals within the organisation is designed to leverage diverse expertise and facilitate cross-functional collaboration, ensuring that sustainability is integrated into all aspects of business operations. All levels supporting the Board of Directors are members of the CyberESG Community. 3.4 Membership requirements for the CyberESG community Members are required to: Pass at least Level 1 of internal sustainability training, which covers the basic principles and practices of sustainability. Participate regularly in strategic meetings and reviews. Act as sustainability champions within their respective departments via LinkedIn and internal communication channels (newsletters, Teams, Slack, and emails). 9 2023 Sustainability Report Exclusive Networks SA
Analysis of material Impacts, Risks and Opportunities (IROs) Process for analysing double materiality 4 Analysis of material Impacts, Risks and Opportunities (IROs) 4.1 Process for analysing double materiality Stakeholders As part of its materiality analysis work, the Group has established a matrix of relevant stakeholders. These include, within the meaning of the Corporate Sustainability reporting Directive (CSRD), those affected by the Group’s activities as well as those interested in the Group’s sustainability information (investors, regulators, suppliers, etc.). In terms of granularity, the entire value chain of the Company and associated stakeholders was taken into consideration. The different time horizons (short, medium and long term) were also taken into account. Stakeholders Mapping End-users Government Regulators Industry Raters Start-ups Schools & Universities Resellers Vendors Investors Employees IMPACT ON EXCLUSIVE NETWORKS HIGH LOW LOW HIGH IMPACT ON STAKEHOLDERS Selection of Issues and Double Materiality In 2022, Exclusive Networks produced, for the first time, its materiality matrix in non-financial matters, in collaboration with an independent consulting firm. The firm worked with a panel of internal qualified individuals from various departments (CSR, finance, risk) to identify and prioritise the most significant sustainability issues for the Group and its stakeholders. The 4 main issues identified at the end of this first exercise were as follows: 1. the ability to attract and retain talent, as well as the lack of skilled human resources; 2. bribery and corruption and other regulatory compliance issues; 3. cybersecurity; and 4. the ability to reduce the environmental footprint. 10 2023 Sustainability Report Exclusive Networks SA #WeAreExclusive
Analysis of material Impacts, Risks and Opportunities (IROs) Process for analysing double materiality In 2023, the work carried out was revised and improvements were made to the materiality matrix, in particular by aligning material issues with the Sustainability Accounting Standards Board (SASB) methodology. This approach has made it possible to refine the nomenclature and align with the best practices recommended by the SASB. The results of this work were presented to stakeholders for validation. The 13 SASB Challenges for Exclusive Networks’ sector are: environmental footprint of physical infrastructure; data privacy and freedom of expression; product Safety; data security; employee diversity and inclusion; recruiting and managing a global, diverse, and skilled workforce; workforce diversity and engagement; product lifecycle management; supply chain management; material sourcing; professional integrity; intellectual property protection and competitive conduct; and managing systemic risks from technological disruptions. This reflection on the material issues was then revised to develop the double materiality matrix based largely on the regulatory framework of the CSRD directive. The intention is to prepare for the full application of the Directive for the financial year 2025. Thus, we have aligned the titles of our challenges with those recommended in the CSRD’s European Sustainability reporting Standards (ESRS) nomenclature for a better transparency and understanding of our challenges. The sustainability issues selected are analysed from the perspective of double materiality (financial materiality and impact materiality). This principle is a central element of the European regulator’s approach to structuring future sustainability strategies. It involves thinking about the issues in terms of risks and associated opportunities. The issues selected for the materiality matrix cover all the themes listed by the ESRS standards, delegated acts of the CSRD. These generic themes have been translated into a list of some twenty qualified issues for the Group. The tradeoffs related to this selection from a more exhaustive list of issues are documented. For each of the issues, the Group’s impacts (actual or potential, positive or negative), as well as the risks and opportunities that affect or could affect it have been identified. At the identification stage, issues that have already materialised as well as emerging issues and more prospective issues have been considered. These different horizons fed the initial reflection: they did not, however, intervene in the listing. This approach has made it possible to enrich the Group’s sustainability strategy, as detailed in section 3.2, by considering the impacts, risks and opportunities identified. CSRD issues selected 16 issues were selected for the double materiality matrix (according to the CSRD classification), ranked below according to the 3 dimensions of ESG: dimension E (2 issues = 6 sub-issues) climate Change (ESRS-E1-Issue); circular Economy (ESRS-E5-Issue). dimension S (8 sub-sub-issues) key issue: Own workforce (ESRS-S1) social Dialogue (ESRS-S1-Sub-sub-issue); work-Life Balance (ESRS-S1-Sub-sub-issue); health & Safety (ESRS-S1-Sub-sub-issue); gender Equality and Equal Pay for Work of Equal Value (ESRS-S1- Sub-sub-issue); training and Skills Development (ESRS-S1- Sub-SubIssue); diversity (ESRS-S1-Sub-sub-issue); privacy (ESRS-S1-Sub-sub-issue); key issue: Consumers and End-Users (ESRS-S4); privacy (ESRS-S4-Sub-sub-issue). the G-Dimension (2 sub-issues) vendor Relationship Management Including Payment Practices (ESRS-G1-Sub-issue); corruption and Bribery (ESRS-G1-Sub-iss.ue) CSRD issues not considered CSRD issues (included under issues and sub-sub-issues) were not included in the double materiality analysis for the following reasons: due to the lack of a direct link with the Group’s activity, the ESRS-E2 (Pollution), ESRS-E3 (Water and Marine Resources), and ESRS-E4 (Biodiversity and ecosystems) issues; for their limited impact on the Group (and vice versa): the issues not mentioned above, such as: ESRS-S2 (Workers in the Value Chain) and ESRS-S3 (Affected Communities). 11 2023 Sustainability Report Exclusive Networks SA
Analysis of material Impacts, Risks and Opportunities (IROs) Key ESG-related risks and opportunities identified In the following graphic, we offer a representation of Exclusive Networks’ sustainability issues. To simplify reading, identification and comparisons, we have opted for the titles of the issues as mentioned in the ESRS: Double Materiality Matrix IMPACT MATERIALITY (IMPACT ON PEOPLE & ENVIRONMENT) HIGH LOW LOW HIGH FINANCIAL MATERIALITY (FINANCIAL RISKS & OPPORTUNITIES) Corruption & Bribery G1 Management of relationship with suppliers G1 Circular economy E5 Climate change E1 Pivacy S1/S4 • Health & Safety • Gender equality and equal pay • Work-life balance • Social dialogue • Training and skills development • Diversity Own workforce S1 4.2 Key ESG-related risks and opportunities identified The main environmental, social, human rights and corruption risks linked to the main challenges identified above: CHALLENGES IMPACTS RISKS OPPORTUNITIES Climate change E1 The Group’s ability to reduce its carbon Direct and indirect consumption of fossil fuels for logistics, transport, and the use of cybersecurity equipment by end-users. Carbon tax Low-carbon trajectory. Energy price increase Possible economic gains associated with energy sobriety. restrictive regulatory framework Switch to electric or hybrid vehicles. Switch to renewable energy for the use of electricity. Improve energy efficiency in operations. Implement energy management systems Circular Economy E5 The Group's ability to reduce its carbon Regulatory shift towards more e-waste requirements Positive reputational impact The Group's ability to reduce its e-waste Build customer loyalty through (Takeback) CyberCircular Programme Supporting communities 12 2023 Sustainability Report Exclusive Networks SA #WeAreExclusive
Analysis of material Impacts, Risks and Opportunities (IROs) Key ESG-related risks and opportunities identified CHALLENGES IMPACTS RISKS OPPORTUNITIES Privacy S1 (Own workforce) Loss of employee trust Breach of personnel data leading to legal consequences Implementing and promoting robust privacy protections can enhance reputation and position Exclusive Networks as a leader in data privacy and security. Privacy S4 (Consumers and end-users) Breach of customer data resulting in loss of trust, financial penalties, and reputational damage. Implementing and promoting robust privacy protections can enhance reputation and position Exclusive Networks as a leader in data privacy and security. Health and safety S1 Employees working in warehouses can be exposed to occupational injuries damage to its reputation and operational difficulties Gender equality and equal pay S1 Social malaise Loss of business continuity and reputational risks strengthen expertise within teams, as well as an increased capacity for innovation. Work-life balance S1 Absenteeism and workplace accidents Increase in turnover Positive contribution to the employer brand. Social dialogue S1 Social malaise Loss of business continuity and reputational risks Internal cohesion Training and skills development S1 Developing sustainable and ethical supply chains can create shared value, resilience against disruption, and strengthen the company’s ESG profile Loss of innovation capacity and competitiveness Maintenance of differentiating know-how and interpersonal skills Diversity S1 Unattractiveness and reputation of the company Strengthen expertise within teams, as well as an increased capacity for innovation. Corruption and bribery G1 Legal penalties, loss of business and reputational damage due to engaging in or being a victim of corruption and bribery Establishing a reputation for high ethical standards can differentiate Exclusive Networks from competitors and build trust with partners and customers Supplier relationship management G1 Vendor-related disruptions or unethical practices that reflect negatively on Exclusive Networks Developing sustainable and ethical supply chains can create shared value, resilience against disruption, and strengthen the company’s ESG profile 13 2023 Sustainability Report Exclusive Networks SA
Exclusive Networks’ sustainability commitments Key ESG-related risks and opportunities identified 5 Exclusive Networks’ sustainability commitments Pillars of our strategy Material Topics ESRS Mapping* Our Commitments Actions Progress 2022 2023 Improve our operations Comprehensive Talent Management * ESRS : Social Dialogue, Balance between professional life and Privacy, Health & Safety, Gender Equality and Gender Equality Remuneration for work of equal value, Training and development of Skills, Diversity S1 Increase our employee engagement rate from 71% to 77% by 2025, base year 2022 Develop a Performance Culture built on : Clear recognition based on employees’ performance Leaders Education Feedback culture and proper onboarding 72 % 71 % Increase the % of women in senior management roles from 34% to 40% by 2025, base year 2022 Monitor the Diversity ratio for Management roles 34% 38% Ethics * ESRS : Corruption & Bribery G1 Train 100% of employees on DE&I, Sustainability and Ethics by 2025, base year 2023 Implement trainings and certification Programmes NA D&I : 84% Ethics: 100 % Sustainabiliy: NA Cybersecurity * ESRS : Privacy S1 S4 Reduce our Cyber Exposure Score from Medium to Low by 2025 Additional SOC reporting to address vulnerabilities Weekly meetings to identify vulnerabilities Collaboration with Digital Workplace team Medium Low Energy Management/ Scope 1-2 * ESRS : Climate change E1 Reduce absolute Scopes 1 & 2 GHG emissions by 40% in 2030 , base year 2022 Switch to Electric or Hybrid of Vehicles, Switch to Renewable Energy of Electricity use Upgrade in Energy efficiencies in operations Implement Energy Management Systems Baseline Scope 1 : -5% Scope 2 : +10% Partner with supply chain Product Lifecycle Management * ESRS : Circular Economy E5 Recycle 100% of end-oflife products by end of 2030, base year 2024 Circular Procurement Strategies NA NA Energy Management/ Scope 3 * ESRS : Climate change E1 Reduce Scope 3 emissions per unit of revenue value added by 33% in 2030, base year 2022 Supplier Engagement for Sustainable Practices Optimize Logistics Product Redesign for Efficiency Remote Working and Public Transport Incentives Baseline (174 ktCO2e/ Billion €) -14,3% (149 ktCO2e/ Billion €) Export Control * ESRS : Management of Relationship with Suppliers G1 Ensure the integrity of 100% our Business Partners by 2023 Digital Partner Onboarding mandatory NA 100 % Advance the ecosystem Human Resource Adequacy and Capability * ESRS : Training & Skills Development S1 Reduce the skills gaps in the cybersecurity sector Exclusive Academy Programme training and certification of partners and customers 11,163 trainees 12,138 trainees 14 2023 Sustainability Report Exclusive Networks SA #WeAreExclusive
Environmental Information Reporting on the Green Taxonomy regulation 6 Environmental Information 6.1 Governance of environmental questions Exclusive Networks is committed to embedding environmental governance in the core of its overall sustainability strategy. This governance is supported by the decision-making and implementation bodies of the ESG strategy. 6.2 Reporting on the Green Taxonomy regulation Context Exclusive Networks, a global leader in cybersecurity and cloud solutions, is committed to a sustainability approach that aligns with the most demanding international standards. In this context, the Group follows the regulatory requirements for the disclosure of information related to the European Union’s Green Taxonomy, an ambitious initiative aimed at standardising the classification of economic activities according to their contribution to environmental sustainability. This approach not only accurately and transparently measures the share of activities aligned with sustainability goals, but also guides investment decisions towards more environmentally friendly practices. Although the Group is highly committed to a sustainability approach that aims to support international commitments, and in particular European ones, its activities are not included in the scope of the taxonomy. Indeed, they are not among the sectors with the largest environmental footprint, nor do they directly contribute to reducing this footprint. On the other hand, when the Group incurs capital or operating expenses, it considers whether or not they are aligned with the green taxonomy criteria. It should be noted that to date, the Group’s efforts to limit its footprint, for example the replacement of its vehicle fleet or the switch to renewable energies, are not covered by this regulation. For the second year, an assessment of the eligibility of all the Group’s consolidated activities was carried out on the basis of: 1. Delegated regulation 2023/2486 of 27 June 2023; and 2. an analysis of all activities within its various consolidated entities (interviews conducted by the Sustainability Department with the Finance Department, the Operations Department and the Strategy Department). By integrating the rigorous criteria of the Green Taxonomy into its operations, Exclusive Networks is firmly committed to achieving the objectives of the European Green Deal, and actively contributes to the fight against climate change. In the following sections, it will detail the key performance indicators that the Group will use to assess and communicate alignment with the Green Taxonomy, underlining the continued commitment to a more sustainable and responsible economy. Revenue Indicator As described in the business model presented see above in section 1, the Exclusive Networks group is a global cybersecurity specialist that markets a wide range of services and products to its partners and end customers. These activities are not listed in the annexes to Delegated regulation (EU) 2023/2486 of 27 June 2023 as contributing substantially to the six environmental objectives (CCM, CCA, WTR, EC, PPC, BIO), either by virtue of their SIN Code or by virtue of their description. As such, they are not eligible. For the year 2023, the share of the Exclusive Networks group’s revenue from services or products related to economic activities aligned with the Taxonomy is 0%. 15 2023 Sustainability Report Exclusive Networks SA
Environmental Information Reporting on the Green Taxonomy regulation Share of turnover from products or services associated with Taxonomy-aligned economic activities – information for the year 2023 Financial year 2023 2023 Substantial Contribution Criteria Economic Activities (1) Code (a) (2) Turnover (3) Proportion of Turnover, year N (4) Climate Change Mitigation (5) Climate Change Adaptation (6) Water (7) Pollution (8) Circular Economy (9) Biodiversity (10) OBJ X.X Currency % Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) A. Taxonomy-eligible activities A.1. Environmentally sustainable activities (Taxonomy-aligned) Activity 1 % Activity 1 (d) % Activity 2 % Turnover of environmentally sustainable activities (Taxonomy-aligned) (A.1) 0€ 0% % % % % % % Of which Enabling € % % % % % % % Of which Transitional € % % A.2 Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (g) EL ; N/EL (f) EL ; N/EL (f) EL ; N/EL (f) EL ; N/EL (f) EL ; N/EL (f) EL ; N/EL (f) Activity 1 (e) % Turnover of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) 0€ 0% % % % % % % A. Turnover of Taxonomy eligible activities (A.1+A.2) 0€0%%%%%%% B. Taxonomy-non-eligible activities Turnover of Taxonomy-non-eligible activities 1,559 M€ 100 % Total (A. + B.) 1,559 M€ 100 % 16 2023 Sustainability Report Exclusive Networks SA #WeAreExclusive
Environmental Information Reporting on the Green Taxonomy regulation DNSH criteria (‘Does Not Significantly Harm’)(h) Garanties minimales (17) Proportion of Taxonomy aligned (A.1.) or eligible (A.2.) turnover, year N-1 (18) Category enabling activity (19) Category transitional activity (20) Climate Change Mitigation (11) Climate Change Adaptation (12) Water (13) Pollution (14) Circular Economy (15) Biodiversity (16) Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T Y Y Y Y Y Y Y % Y Y Y Y Y Y Y % E Y Y Y Y Y Y Y % T Y Y Y Y Y Y Y 0% Y Y Y Y Y Y Y % E Y Y Y Y Y Y Y % T % 0% 0% Proportion of turnover from products or services associated with Taxonomy-aligned economic activities per environmental objective – disclosure covering year 2023 Proportion of turnover/Total turnover Taxonomy-aligned per objective Taxonomy-eligible per objective CCM 0% 0% CCA 0% 0% WTR 0% 0% CE 0% 0% PPC 0% 0% BIO 0% 0% 17 2023 Sustainability Report Exclusive Networks SA
Environmental Information Reporting on the Green Taxonomy regulation Capital Expenditure (Capex) Indicator The Capex to be considered corresponds to new acquisitions of property, plant and equipment and intangible assets during the year, before depreciation, amortisation or revaluation. Thus, the new rights of use of the leased properties are taken into account as soon as the leases are signed, and not the financing terms. Capital expenditures also include new assets resulting from business combinations completed during the year. For 2023, the amount of these capital expenditures amounts to €16.3 million for the Exclusive Networks group, broken down as follows: intangible assets: €2.0 million for IT developments; property, plant and equipment: €5.4 million, corresponding to demonstration and office equipment; and right of use: €8.9 million for new leases and vehicle leasing contracts. Eligible capital expenditure is the following: related to potentially sustainable activities; part of a plan to make an activity sustainable or expand such an activity; and related to economic activities referred to as “eligible individual measures” in the Taxonomy to reduce the Company’s environmental footprint, such as expenses related to premises, vehicles and data hosting. Within the meaning of Delegated regulation (EU) 2023/2486 of 27 June 2023, as the activities of the Exclusive Networks group are not considered to contribute substantially to the six environmental objectives (CCM, CCA, WTR, EC, PPC, BIO), they are not eligible as such. Therefore, only capital expenditure under individual measures can be taken into account. As the Exclusive Networks group did not incur any capital expenditure for the year 2023 under these individual measures, the share of the Group’s Capex relating to eligible economic activities and consequently aligned with the Taxonomy is not significant. 18 2023 Sustainability Report Exclusive Networks SA #WeAreExclusive
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Environmental Information Reporting on the Green Taxonomy regulation Share of Capex from products or services associated with taxonomy-aligned economic activities – information for the year 2023 Financial year 2023 2023 Substantial Contribution Criteria Economic Activities (1) Code (a) (2) CapEx (3) Proportion of CapEx, year N (4) Climate Change Mitigation (5) Climate Change Adaptation (6) Water (7) Pollution (8) Circular Economy (9) Biodiversity (10) OBJ X.X Currency % Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) A. Taxonomy-eligible activities A.1. Environmentally sustainable activities (Taxonomy-aligned) Activity 1 % Activity 1 (d) % Activity 2 % CapEx of environmentally sustainable activities (Taxonomy-aligned) (A.1) 0€ 0% % % % % % % Of which Enabling € % % % % % % % Of which Transitional € % % A.2 Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (g) EL ; N/EL (f) EL ; N/EL (f) EL ; N/EL (f) EL ; N/EL (f) EL ; N/EL (f) EL ; N/EL (f) Activity 1 (e) % CapEx of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) 0€ 0% % % % % % % A. CapEx of Taxonomy eligible activities (A.1+A.2) 0€0%%%%%%% B. Taxonomy-non-eligible activities CapEx of Taxonomy-non-eligible activities 16 M€ 100% TOTAL (A. + B.) 16 M€ 100% 20 2023 Sustainability Report Exclusive Networks SA #WeAreExclusive
Environmental Information Reporting on the Green Taxonomy regulation DNSH criteria (‘Does Not Significantly Harm’)(h) Garanties minimales (17) Proportion of Taxonomy aligned (A.1.) or eligible (A.2.) CapEx, year N-1 (18) Category enabling activity (19) Category transitional activity (20) Climate Change Mitigation (11) Climate Change Adaptation (12) Water (13) Pollution (14) Circular Economy (15) Biodiversity (16) Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T Y Y Y Y Y Y Y % Y Y Y Y Y Y Y % E Y Y Y Y Y Y Y % T Y Y Y Y Y Y Y 0% Y Y Y Y Y Y Y % E Y Y Y Y Y Y Y % T % 0% 0% Proportion of CapEx from products or services associated with Taxonomy-aligned economic activities per environmental objective – disclosure covering year 2023 Proportion of CapEx/Total CapEx Taxonomy-aligned per objective Taxonomy-eligible per objective CCM 0% 0% CCA 0% 0% WTR 0% 0% CE 0% 0% PPC 0% 0% BIO 0% 0% 21 2023 Sustainability Report Exclusive Networks SA
Environmental Information Reporting on the Green Taxonomy regulation Operating Expense (or OPEX) Indicator OPEXs to consider include: related to eligible activities; part of a plan to expand an activity or make an activity sustainable; and related to economic activities referred to as “individual measures” in the Taxonomy to reduce the Company’s environmental footprint, such as expenses related to premises, vehicles and data hosting. Not all operating expenses are to be taken into account. Only R&D costs, building renovation costs, short-term lease charges, maintenance, servicing and repair costs of assets as well as any other direct expenses related to the routine maintenance of tangible assets necessary for their proper functioning are to be considered. For the full year 2023, operating expenses amounted to €353.5 million for the Exclusive Networks group, broken down as follows: personnel costs: €199.6 million; asset depreciation: €73.1 million; and other current and non-recurring operating expenses: €80.8 million, of which €26.6 million correspond to external expenses. The Exclusive Networks group’s business model is essentially based on human resources. As a result, operating expenses consist mainly of personnel costs, asset depreciation, and other operating expenses such as rent, travel, marketing and advertising expenses, which do not fall within the scope defined in the Taxonomy. In addition, the Group does not have any expenses related to Research and Development. Within the meaning of Delegated regulation (EU) 2023/2486 of 27 June 2023, as the activities of the Exclusive Networks group are not considered to contribute substantially to the six environmental objectives (CCM, CCA, WTR, EC, PPC, BIO) they are not eligible. Therefore, only operating expenses that fall within the scope of individual measures can be taken into account. As the Exclusive Networks group did not incur any operating expenses for the year 2023 under these individual measures, the share of the Group’s OPEX expenses relating to eligible economic activities and consequently aligned with the Taxonomy is not significant. 22 2023 Sustainability Report Exclusive Networks SA #WeAreExclusive
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Environmental Information Reporting on the Green Taxonomy regulation Share of OPEX for products or services associated with Taxonomy-aligned economic activities – information for the year 2023 Financial year 2023 2023 Substantial Contribution Criteria Economic Activities (1) Code (a) (2) CapEx (3) Proportion of OpEx, year N (4) Climate Change Mitigation (5) Climate Change Adaptation (6) Water (7) Pollution (8) Circular Economy (9) Biodiversity (10) OBJ X.X Currency % Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) Y ; N ; N/EL (b) (c) A. Taxonomy-eligible activities A.1. Environmentally sustainable activities (Taxonomy-aligned) Activity 1 % Activity 1 (d) % Activity 2 % OpEx of environmentally sustainable activities (Taxonomy-aligned) (A.1) 0€ 0% % % % % % % Of which Enabling € % % % % % % % Of which Transitional € % % A.2 Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (g) EL ; N/EL (f) EL ; N/EL (f) EL ; N/EL (f) EL ; N/EL (f) EL ; N/EL (f) EL ; N/EL (f) Activity 1 (e) % OpEx of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) 0€ 0% % % % % % % A. OpEx of Taxonomy eligible activities (A.1+A.2) 0€0%%%%%%% B. Taxonomy-non-eligible activities OpEx of Taxonomy-non-eligible activities 353.5 M€ 100% Total (A. + B.) 353.5 M€ 100% 24 2023 Sustainability Report Exclusive Networks SA #WeAreExclusive
Environmental Information Reporting on the Green Taxonomy regulation DNSH criteria (‘Does Not Significantly Harm’)(h) Garanties minimales (17) Proportion of Taxonomy aligned (A.1.) or eligible (A.2.) OpEx, year N-1 (18) Category enabling activity (19) Category transitional activity (20) Climate Change Mitigation (11) Climate Change Adaptation (12) Water (13) Pollution (14) Circular Economy (15) Biodiversity (16) Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T Y Y Y Y Y Y Y % Y Y Y Y Y Y Y % E Y Y Y Y Y Y Y % T Y Y Y Y Y Y Y 0% Y Y Y Y Y Y Y % E Y Y Y Y Y Y Y % T % 0% 0% Proportion of OpEx from products or services associated with Taxonomy-aligned economic activities per environmental objective – disclosure covering year 2023 Proportion of OpEx/Total OpEx Taxonomy-aligned per objective Taxonomy-eligible per objective CCM 0% 0% CCA 0% 0% WTR 0% 0% CE 0% 0% PPC 0% 0% BIO 0% 0% 25 2023 Sustainability Report Exclusive Networks SA
Environmental Information Reporting on the Green Taxonomy regulation Legend (a) The Code constitutes the abbreviation of the relevant objective to which the economic activity is eligible to make a substantial contribution, as well as the Section number of the activity in the relevant Annex covering the objective, i.e.: P Climate Change Mitigation: CCM P Climate Change Adaptation: CCA P Water and Marine Resources: WTR P Circular Economy: CE P Pollution Prevention and Control: PPC P Biodiversity and ecosystems: BIO For example, the Activity «Afforestation» would have the Code: CCM 1.1 (b) P Y - Yes, Taxonomy-eligible and Taxonomy-aligned activity with the relevant environmental objective; P N - No, Taxonomy-eligible but not Taxonomy-aligned activity with the relevant environmental objective; P N/EL – not eligible, Taxonomy non-eligible activity for the relevant environmental objective (c) Where an economic activity contributes substantially to multiple environmental objectives, non-financial undertakings shall indicate, in bold, the most relevant environmental objective for the purpose of computing the KPIs of financial undertakings while avoiding double counting. In their respective KPIs, where the use of proceeds from the financing is not known, financial undertakings shall compute the financing of economic activities contributing to multiple environmental objectives under the most relevant environmental objective that is reported in bold in this template by non-financial undertakings. An environmental objective may only be reported in bold once in one row to avoid double counting of economic activities in the KPIs of financial undertakings. This shall not apply to the computation of Taxonomy-alignment of economic activities for financial products defined in point (12) of Article 2 of Regulation (EU) 2019/2088. Non-financial undertakings shall also report the extent of eligibility and alignment per environmental objective, that includes alignment with each of environmental objectives for activities contributing substantially to several objectives, by using templates in sheets CA (2), CapEx (2), and OpEx (2) (d) The same activity may align with only one or more environmental objectives for which it is eligible. (e) The same activity may be eligible and not aligned with the relevant environmental objectives. (f) P EL - Taxonomy eligible activity for the relevant objective; P N/EL - Taxonomy non-eligible activity for the relevant objective (g) Activities shall be reported in Section A.2 of this template only if they are not aligning to any environmental objective for which they are eligible. Activities that align to at least one environmental objective shall be reported in Section A.1 of this template. (h) For an activity to be reported in Section A.1 all DNSH criteria and minimum safeguards shall be met. For activities listed under A2, columns (5) to (17) may be filled in on a voluntary basis by non-financial undertakings. Nonfinancial undertakings may indicate the substantial contribution and DNSH criteria that they meet or do not meet in Section A.2 by using: a) for substantial contribution - Y/N and N/EL codes instead of EL and N/EL; and b) for DNSH – Y/N codes. In addition, in response to Article R. 225-105 of the French Commercial Code and for the 2023 financial year: the Exclusive Networks group’s strategic orientations in terms of social, societal and environmental responsibility are determined by the Board of Directors, on the proposal of the Executive Committee; Deployment is carried out locally at the country level; the Exclusive Networks group has no provisions or guarantees for environmental risk; and the resources devoted by the Group to the prevention of environmental risks and pollution are not significant as it does not represent a substantial subject of the sector of activity. 26 2023 Sustainability Report Exclusive Networks SA #WeAreExclusive
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