May 31, 2022

To our stakeholders:

Last year saw the Wieland Group sign the United Nations Global Compact, which pursues the vision of a sustainable and inclusive economy. We actively support the ten principles of the Global Compact in the areas of human rights, labor standards, the environment and the fight against corruption.

Sincerely yours,

Dr. Erwin Mayr
CEO Wieland Group

The Wieland Group rejects any kind of child, forced or compulsory labor. A group-wide policy on human rights due diligence and working conditions will be rolled out in 2022, with a corresponding training program put in place. We are also planning further measures relating to supply chain compliance. An initial risk analysis as part of the compliance risk assessment for majority shareholdings of the Wieland Group will be carried out in the 2022/23 fiscal year.

The sustainability standards for our value added chain are set out in our Supplier Code, which was updated at the beginning of 2021. This contains minimum requirements for compliance with internationally defined human rights based on the fundamental principles of the "Universal Declaration of Human Rights" and corresponding UN documents. Wieland also plans to put a Group-wide procurement policy in place by the end of 2022. This is intended to make a positive contribution to employee rights, statutory environmental obligations and economic justice throughout the supply chain.

Wieland is introducing a global business partner screening tool for all key suppliers from 2022 onwards. This risk and sustainability monitoring is based on the OECD Due Diligence Guidance and the German Act on Corporate Due Diligence Obligations in Supply Chains (Lieferkettensorgfaltspflichtengesetz) for direct and indirect suppliers. This allows us to check the extent to which our suppliers comply with human rights and labor practices, as well as standards of business ethics and environmental standards. In the future, the screening tool is also to be used for assessments based on ESG criteria where applicable.

Within the Wieland Group, the Corporate Functions Human Resources and Legal & Insurance deal with issues relating to human rights and working conditions.
They maintain dialogue with the Sustainability department as part of this process. A Groupwide Compliance Committee consisting of a member of the Executive Board and the Corporate Functions Human Resources, Legal & Insurance and Internal Audit was installed in 2021. The committee further develops the overarching guidelines of our corporate ethics, drives investigations and sanctions misconduct.

The Wieland Group's objective is to use the compliance risk assessment as a due diligence process to enhance the existing protection of human rights within the
Wieland Group. This will enable relevant human rights risks (in accordance with the German Act on Corporate Due Diligence Obligations in Supply Chains) to be systematically identified, assessed and managed. Anyone who would like to report human rights shortcomings or violations within the Wieland Group or at our suppliers can contact our anonymous, independent whistleblower system at any time via our whistleblower hotline (available in various languages).

The Compliance Committee evaluates the reports of our whistleblower system and pursues or sanctions any violations identified. The relevant government authorities are informed if needed. In 2020/21 no internal compliance investigations with reference to human rights needed to be initiated.

How we act in our day-to-day business is guided by the Wieland Group Code of Conduct. It ensures responsible and legally compliant dealings both within the company and with business partners and customers. Our updated Supplier Code contains minimum requirements for compliance with internationally defined human rights based on the fundamental principles of the “Universal Declaration of Human Rights” and corresponding UN documents.

It is our fundamental objective to ensure that our employees receive fair pay that is commensurate with their performance. The basic pay for employees of Wieland-Werke AG in Germany is based on their assignment to a Wieland pay-scale group (WEG), which is based on the collective bargaining agreements with the IG Metall trade union. By adhering to collective bargaining agreements, we ensure transparent and non-discriminatory pay.

In the Code of Conduct, among other things, the Executive Board of the Wieland Group makes an explicit commitment to promoting conduct that complies with the rules and sanctioning any breaches. A Groupwide Compliance Committee consisting of a member of the Executive Board and the Corporate Functions Human Resources, Legal & Insurance and Internal Audit was installed in 2021. The committee further develops the overarching guidelines of our corporate ethics, drives investigations and sanctions misconduct. The Wieland Group rejects any kind of child, forced or compulsory labor. Within the Wieland Group, the Corporate Functions Human Resources and Legal & Insurance deal with issues relating to human rights and working conditions.

An independent whistleblower system, as a component of the Compliance Management System, accepts internal and external reports with regard to cases of discrimination around the clock online or by telephone in ten different languages to date, including German, English and Spanish.

We firmly establish diversity management within our company and make it visible. The management level is committed to promoting diversity in the Wieland Group. The topic of diversity management is firmly established within the Corporate Function Human Resources. An interdisciplinary international team coordinates the targets and measures in close coordination with the Sustainability department. We aim to create a motivating working environment in which employees feel valued and enjoy equal opportunities. We promote diversity and inclusion through training and other measures to raise awareness among the workforce, and offer further programs and measures.

Global coordination for health and safety in the Wieland Group is the responsibility of the Corporate Function Manufacturing Services, which reports directly to the Executive Board. The Health and Safety department is responsible for putting the necessary framework in place to prevent any work-related accidents or illnesses. It also draws up the Group policy on health and safety and sets Group-wide targets. The Wieland Group’s approach to occupational safety applies equally to employees, agency workers and external service providers. Plant managers and executives have overall responsibility for ensuring compliance with applicable laws and our own binding on-site requirements. Representatives from all locations can exchange information in a global Wieland Group network coordinated by the Health and Safety
department. The employee representative body participates, for example, in the quarterly meetings of the health and safety committees at the biggest German sites. Among other things, these committees develop strategies to improve our health and safety performance and organize any required training. Our health and safety management system ensures that we implement new statutory requirements and enhance our own processes on an ongoing basis. The health and safety specialists and the company medical service have extensive expertise in health and safety matters. Annual training is supplemented by briefings on specific hazards. Recurring emergency and evacuation drills are conducted at all sites. This involves all stakeholders concerned.

The Wieland Group Compliance Management System (CMS) is based on the PS 980 standard of the Institute of Public Auditors in Germany (IDW). It applies throughout the Group to all companies in which Wieland-Werke AG holds a direct or indirect majority stake. The Compliance Committee evaluates the reports of our whistleblower system and pursues or sanctions any violations identified. The relevant government authorities are informed if need be. No investigations with reference to incidents of corruption were initiated in 2020/21.

In the year under review, the total workforce employed by the Wieland Group was 15% female. The proportion of women in leadership positions is currently around 14% (FY 2019/20: 12%). In Germany, the Wieland Group employed around 5.3% severely disabled employees in the reporting period. This means that the company has exceeded the statutory quota of 5%. The average age of Wieland employees worldwide was 45 in the year under review. Our workforce includes 63 different nationalities. Detailed information regarding other diversity factors of our management and employees can be found in our COP document (Sustainability Report 20/21).

According to our internal reporting system, all sites are required to report accidents resulting in at least one day of absence (LTI event; LTI = Lost Time Incident) to the Group headquarters within 24 hours. This triggers a Safety Alert with a detailed description of the accident, pictures and immediate measures via our intranet Wieland ONE. A tool that will allow employees to document incidents directly and independently is expected to be available Group-wide by 2023. We encourage all employees to report critical situations in particular (near-miss reporting). The degree of health and safety management system coverage at the production locations in the reporting year was 53%. The aim is to have certified all major production locations throughout the Group to DIN ISO 45001:2018 by 2024.

The Wieland Group is aware of its responsibility for the environment and climate protection. In order to limit its environmental impact, the company places particular emphasis on eco-friendly production. The aim is to avoid water, soil and air pollution, to deal responsibly with waste and contaminated sites, and to promote biodiversity. The company has set its own standards in this regard, some of which go further than the applicable regulations and laws.

The environmental policy according to ISO 14001:2015 is part of our corporate policy and can be found in our Integrated Management System.
Detailed data regarding our environmental footprint, e.g. water consumption, energy consumption, amount of waste produced, (CO2-) emissions to air or water, can be found in our COP document (Sustainability Report 20/21).

The Wieland Group aims to continously improve environmental protection. Therefore, we have set several short- and mid-term targets, such as:
- Introducing a global waste database by 2023
- Developing a group-wide target for air pollution by 2022
- Providing group-wide information on metal emissions in wastewater by 2022
- Reducing Scope 1 and 2 emissions by 42% by 2030
- Reducing Scope 3 emissions by 12% by 2030
- Increasing the share of green power procurement to more than one-third by 2025
- Increasing the share of recycled raw materials in product manufacturing to > 90% by 2030
- Reducing the lead use across the alloy portfolio by 30% by 2030
- Developing a Group-wide concept for environmentally friendly products in accordance with recognized standards by 2023

Responsible procurement of primary raw materials is a key concern for the Wieland Group. This applies in particular to responsible supply chains for the conflict minerals tin, tungsten, tantalum and gold and their ores (cassiterite, columbite-tantalite and wolframite). We use a standardized process for this purpose: the “OECD Due Diligence Guidance for Responsible Supply Chains from Conflict-Affected and High- Risk Areas (CAHRA)”. With the help of the OECD Guidance, risks in the supply chain can be identified and minimized by implementing targeted measures. Wieland also relies on compliance audits performed by the Responsible Mining Initiative (RMI). The RMI is a well-known initiative with a particular focus on social and environmental standards in minerals and metals supply chains. We prefer to work with business partners who comply with RMI requirements. Their (production) sites must either be RMI-compliant themselves or must source their goods directly or indirectly from smelting plants or refiners listed on the RMI’s “Conformant List” or “Active List”. Only smelting plants and refineries that have passed an audit to verify compliance with RMI standards or are currently undergoing an audit are included in these lists. Wieland provides site-specific templates for inquiring customers. Based on OECD Due Diligence Guidance and the EU Conflict Minerals Regulation, Wieland is continuously working to improve its material compliance processes. As part of this process, we released our own Conflict Minerals Policy in 2021.

The Executive Board, together with the Corporate Function Manufacturing Services, is responsible for company-wide environmental management. Operational implementation is controlled via a matrix organization. The Corporate Function Environment is responsible for coordinating environmental management across the Group. The Wieland Group has also appointed local environmental protection officers at various production locations, who are closely involved in site-specific environmental measures. They report to the site managers as well as to the VP Operations of the various Business Units. They also exchange information with the central environmental management team.

We are convinced that the commitment of our employees is crucial when it comes to achieving our environmental protection goals and boosting energy efficiency. As a result, the Wieland Group provides employees with ongoing information on all environmental and energy-related topics and offers them training online and face-to-face training courses. In Germany, more than 200 employees at various levels in the hierarchy completed in-house training on environmental issues. We will offer these training sessions at all of our sites in the future. In the year under review, five trainees at Wieland in Germany also qualified as energy scouts. They are responsible for analyzing the energy consumption of IT equipment, for example, and for proposing specific measures to leverage potential savings, allowing them to support energy management within the Wieland Group.

Effective waste management is another component of corporate environmental protection at Wieland. 100% of the metal waste generated in production can be reused in the company’s own foundries, eliminating the need for external disposal. We aim to use our recycling strategy to continuously expand our capacities for processing recyclable materials. By 2030, we are aiming to increase the proportion of recycled raw materials used in the manufacture of customer products from the current level of 74% (previous year: 74%) to 90%. When it comes to other waste, we follow the principles of “prevention before recycling” and “recycling before disposal”. Wieland-Werke AG reduces the commercial waste by having waste streams such as cardboard sleeves from the rolling mill, polluted waste wood or insulation waste from pipe manufacturing recycled. When delivering our products, we primarily use wooden packaging, which is reused several times as part of a closed-loop process. We use recyclable material for packaging films and straps.

In the reporting year, the Wieland Group made the decision to systematically electrify its production processes, particularly its heating and annealing processes. We will be replacing old equipment step by step, taking advantage of investment cycles. We are also investigating further technological options that will reduce our carbon emissions and are preparing to make corresponding investments. For example, we are planning to connect the Ulm site to the district heating network by 2023. Compared to the current heating supply, which is based on natural gas, district heating only generates around one-quarter of the emissions. At the same time, we also want to generate more renewable energy ourselves. We are currently investing in comprehensive refurbishment of the waterworks in Vöhringen. One water turbine has also undergone a complete overhaul, boosting its efficiency by around 5%. In addition, a 1.5 MWp photovoltaic plant will be built on the plant premises at the Ulm site in two stages in the period leading up to 2023. Efficient energy use in production has been a priority for us for many years now, Corresponding improvements have already been implemented at many production locations to achieve the annual energy savings targets that apply throughout the Group. Following a resolution of the Executive Board, these were increased from 0.4% to 2% p.a. (year-on-year; based on the volume produced) in the reporting year.

As part of Wieland’s sustainability strategy, we develop products with a low ecological footprint for our customers. Apart from increasing the recycling rate of our products, we will be increasingly eradicating alloying elements that are hazardous to health and the environment, and upping the proportion of certified input material. We look at the entire value chain and establish valid standards for responsible production in line with The Copper Mark, as well as the environmental supplier declaration in accordance with ISO 14021. Wieland also plans to put a Group-wide procurement policy in place by the end of 2022. This is intended to make a positive contribution to employee rights, statutory environmental obligations and economic justice throughout the supply chain. We have defined sustainability requirements for our own Business Units in a quest to assess the environmental impact of our business activities. We expect our key suppliers to do the same, which is why we have been surveying our strategic virgin metal and sheet suppliers on sustainability criteria using a standardized questionnaire since the end of 2021. At the same time, Wieland is introducing a global business partner screening tool for all key suppliers from 2022 onwards. This risk and sustainability monitoring is based on the OECD Due Diligence Guidance and the German Act on Corporate Due Diligence Obligations in Supply Chains (Lieferkettensorgfaltspflichtengesetz) for direct and indirect suppliers. This allows us to check the extent to which our suppliers comply with human rights and labor practices, as well as standards of business ethics and environmental standards. In the future, the screening tool is also to be used for assessments based on ESG criteria where applicable.

To manage its environmental issues at its production locations, the Wieland Group has already largely implemented an environmental management system based on the international standard DIN EN ISO 14001:2015. The coverage rate for the reporting year is 82%. The environmental management system is part of an integrated management system comprising ISO 9001 and IATF 16949 (quality management), ISO 14001 (environmental protection management), ISO 50001 (energy management) and ISO 45001 (health and safety management). Further production locations in North America and Asia are to be certified by 2024, establishing international environmental management standards throughout the Wieland Group. In the course of our international expansion, we are also aiming to achieve the corresponding standards for our new locations.

The management systems referred to above allow for systematic improvements in environmental and energy performance at the company‘s production locations in accordance with the required “Plan-Do-Check-Act” control cycle. The continuous development of management processes is reviewed at least once a year in internal and external audits.
Wieland also carries out regular incident and emergency drills in consultation with the responsible authorities, documenting and evaluating their outcome.

No breaches of environmental protection legislation were identified in any of the locations during the reporting period.

For Wieland, combating corruption and anti-competitive behavior is a central element of corporate governance. This is why we make a particular commitment to these topics in our Code of Conduct. We strictly reject any form of corruption, be it active or passive. This Group-wide ban applies not only to members of the government and public officials, but also to business partners and colleagues.

In our view, only responsible governance can safeguard and increase the value of our company. The key instrument used to achieve this is the integrated risk control system, which combines risk management, the internal control system and the Compliance Management System. We are working on the Group-wide standardization of individual management systems and the harmonization of integrative structures on an ongoing basis. How we act in our day-to-day business is guided by the Wieland Group Code of Conduct. It ensures responsible and legally compliant dealings both within the company and with business partners and customers.
The Wieland Group Compliance Management System (CMS) applies throughout the Group to all companies in which Wieland-Werke AG holds a direct or indirect majority stake.

Due to its essential importance, our anti-corruption program, including a dedicated anti-corruption policy, will be rolled out across the Group as part of the Compliance Management System in 2022.

Wieland is aiming to achieve Group-wide certification of the CMS in accordance with ISO 37301 by 2024. The certification process will take the form of a matrix certification in two waves: certification of the parent company and the European companies by 2023 and certification of the non-European companies by 2024.

In the Code of Conduct, among other things, the Executive Board of the Wieland Group makes an explicit commitment to promoting conduct that complies with the rules and sanctioning any breaches. A Groupwide Compliance Committee consisting of a member of the Executive Board and the Corporate Functions Human Resources, Legal & Insurance and Internal Audit was installed in 2021. The committee further develops the overarching guidelines of our corporate ethics, drives investigations and sanctions misconduct.

An independent whistleblower system, as a component of the CMS, accepts internal and external reports around the clock online or by telephone in ten different languages to date, including German, English and Spanish.

We specifically raise awareness among our employees about compliance policies and procedures to avoid corruption. To this end, we offer regular training sessions – for example in the form of e-learning or advanced face-to-face training for individual departments, e.g. on antitrust prevention. Employees as well as members of the management of the Wieland Group have to complete generally binding, up-to-date foundation programs at defined intervals. In order to ensure that the content of the training sessions remains fresh in people’s minds after the training sessions, we publish information, for example on the topics of data protection & IT, export control or antitrust law in sales, on the intranet. In the 2020/21 reporting year, both the Executive Board and the relevant employees underwent basic compliance training on
the Code of Conduct, corruption prevention and antitrust prevention. In the reporting year, corporate policies and procedures regarding the topic of corruption were made available to all employees and the management of the Wieland Group on the intranet.

The Wieland Group Compliance Management System (CMS) is based on the PS 980 standard of the Institute of Public Auditors in Germany (IDW).

The individual Business Units and Corporate Functions are responsible for identifying, documenting and assessing risks and the underlying control processes. In addition, a unit independent of the business area is responsible for controlling the risk management system and the risk control system. This means that the risk situation is always assessed on an up-to-date basis. In addition, internal audits are conducted once a year and on an ad hoc basis to review the implementation and effectiveness of the internal control system (ICS), internal guidelines and compliance regulations. We use the results of these audits to continuously develop our measures. The Executive Board and the Supervisory Board are provided with information on this process both at the annual Audit Committee meeting and in the risk report.

The Compliance Committee evaluates the reports of our whistleblower system and pursues or sanctions any violations identified. The relevant government authorities are informed if need be. No investigations with reference to incidents of corruption were initiated in 2020/21.