Snam SpA

Enhancing transparency by disclosing climate-related lobbying activities and assessing their alignment with the objectives of the Paris Agreement. Demonstrating clear commitment to climate goals.

Snam's Board of Directors consider the risks and opportunities associated with climate change as integral part of their accountability and maintain oversight of the company's climate resilience and governance. [...] The Board of Directors plays a central role in overseeing the Snam's commitment to sustainable development throughout the value chain and to the spread and integration of a culture geared towards fighting climate change. To this end, Snam undertakes comprehensive monitoring by the Board of climate change risks and opportunities and activities to ensure the correct management of these issues by the management department when conducting its business. [...] Snam's Code of Ethics[1] which applies to Snam S.p.A. and its direct and indirect subsidiaries and their respective people, provides that the company should promote continuous dialogue with institutions and civil society bodies in all the places where it operates, creating relationships with these entities based on the principles of transparency, proper conduct and loyal collaboration. [...] The revision of the Code is approved by the Board of Directors of Snam S.p.A., at the proposal of the Chief Executive Officer with the agreement of the Chairman, after hearing the opinion of the Internal and Risk Control Committee and the Board of Statutory Auditors. The proposal is made taking into consideration the Stakeholders' evaluation with reference to the principles and content of the Code, promoting active contribution and notification of any deficiencies by the stakeholders. Compliance with the rules of the Code is an essential part of the contractual obligations of all Snam's People pursuant to and in accordance with applicable law. [...] Furthermore, Snam has adopted a specific internal policy regulating in detail the management of relations with the Public Administration. Such policy - that is applicable to Snam S.p.A. and its subsidiaries - is aimed at ensuring that all such relations are conducted in a way which is compatible with the law and with the principles expressed in the Code's of Ethics recalled above. [...] In October 2023 Snam has renewed its internal procedures related to the Relations with Associations. It complies with the internal Compliance Model, such as the application of its own Code of Ethics, the Anti Corruption Management System and the Model 231 pursuant to Italian legislative Decree no. 231/2001. All of Snam's Consolidated Companies have to comply with the above procedure, through the different phases of the process: definition of the budget, evaluation of the membership, payments, and the participation in the association activities. The Group's budget proposal is elaborated consistently with the strategic plan, and proposed to Snam's CEO and Management team. Before being part of an association or other organizations, an evaluation is carried out by the internal competent departments to assess its contribution to reach the strategic goals and its alignment with the climate goals and sustainable principles. An annual monitoring activity is carried out by the competent functions along with the Institutional Affairs function to guarantee the alignment of the association's memberships with the business objectives, including those related to the climate change commitment. When Snam becomes part of an association or coalition, representatives are committed to being active and influential in internal debates, working groups and statutory bodies, that might be relevant for climate and business strategies. We share our vision with other members and always strive to drive the discussion in accordance with our principles. We respect the viewpoints of other members and always comply with any relevant antitrust and competition laws. In case of misalignment we expose our point of view and our disagreement and, in case, we consider to exit from the Association.

The Board of Directors oversees the Group's climate strategy through its Committees. Key responsibilities of the Board include reviewing and approving: - The Strategic Plan, which supports long-term value generation and energy transition scenarios; - The evaluation of strategic risks, including those related to climate change and the energy transition, as well as the effectiveness of corresponding control measures; - The execution and implementation of the Plan; - The definition of Climate change and Energy transition targets; - The definition of Indicators to monitor progress on sustainability and decarbonisation actions (sustainability scorecard); - The Long-term Incentive Plan, which includes climate-related targets; - The Annual Report, including the Consolidated Non-Financial Statement. [...] Snam has established three internal Board Committees, in line with Italian regulations and the Code of Corporate Governance. These committees are responsible for examining, proposing and providing consultation, ensuring regular and timely communication with the Board: the Sustainability and Energy Transition Scenarios Committee, the Control, Risk and Related Party Transactions Committee, and the Nominations and Compensation Committee. Among its main tasks, the Sustainability and Energy Transition Scenarios Committee examines: - Long-term energy transition scenarios underpinning the Strategic Plan; - Energy transition issues, especially those related to the use of environmentally-friendly energy sources and progressive decarbonisation; - The Sustainability Strategy, in particular the status of the Decarbonisation Roadmap vs. the Strategic Plan; - Aspects linked to technological innovation and the circular economy; - Sustainable finance initiatives, including monitoring the Company's position on sustainability issues and its performance in sustainability indices within financial markets; - Policies for integrating environmental, social and governance issues into the business model including ESG risks and CCRM inside the ERM framework; - Sustainability processes and reporting in coordination with the CCR.

Snam's dedication to ethical business conduct includes its approach to lobbying and associations. In 2023, Snam introduced a Climate Lobbying Policy, outlining the principles underlying the Group's climate strategy, advocacy position and affiliations with associations: the six Key Climate Advocacy Drivers

# Transition Plan supported by Governance and Engagement [...] **Board of Directors** Oversees the Group's climate strategy through the work of its Committees [...] **Chairwoman** Plays a connection role between executive and non-executive directors ensuring the effective functioning of board proceedings [...] ###### Sustainability and Energy Transition Scenarios Committee [...] **CEO** Responsible for the internal control and risk management system, including climate change [...] ###### Control and Risk and Related Party Transactions Committee [...] **Sustainability** **Skills** **(incl. Climate** **Change)** [...] ###### Appointments and Remuneration Committee [...] - Remuneration policy, short and long-term incentive plans, performance targets and remuneration guidelines of executives and managers with strategic responsibilities [...] - Performance targets proposal, coordinating with the Sustainability and Energy Transition Scenarios Committee [...] - Long-term energy transition scenarios underpinning the Strategic Plan [...] - Energy transition and Sustainability strategy [...] - Sustainable finance initiatives, and positioning on sustainability KPIs, ratings and indices [...] - Environmental, social and governance policies integrated into the business model [...] - Sustainability processes and reporting in coordination with the CCR [...] ## >150 Meetings with National and Local **Institutions in 2023** [...] ###### Regulator, through consultations and processes [...] **Climate Lobbying Commitment: outlining the principles** underlying the Group's climate strategy, advocacy position and affiliations with institutions [...] ###### European and International Institutions [...] - 10 EU public consultations [...] - >50 meetings with European Institutions, trade associations and think tanks [...] - >100 meetings with members of state and government, diplomatic representatives, authorities, and multilateral organizations

The Board of Directors plays a central role in the pursuit of the company's sustainable success, and in this context defines strategies and objectives of the company and the group upon the proposal of the CEO and monitors their implementation. In its role of overseeing the climate change strategy, which includes the assessment of relevant risks, the planning of sustainability goals and disclosure, the Board of Directors, also through the work of its Committees and namely the ESG and Energy transitions scenarios Committee, in particular periodically reviews and approves: - climate change and energy transition targets, which are an integral part of the corporate strategies included in the annually approved Strategic Plan, and the more detailed indicators created for the timely monitoring of the progress of sustainability and decarbonisation actions (e.g., Scope 1&2 and Scope 3 emissions, progress against announced targets, avoided emissions, alignment of investments with the EU taxonomy and SDGs); - the company's Strategic Plan, which was also drawn up based on the analysis of relevant issues for long-term value generation and long-term energy transition scenarios with the support of the Environmental, Social & Governance and Energy Transition Scenarios Committee; - with the support of the Control and Risk and Related Party Transactions Committee in coordination with the Environmental, Social & Governance and Energy Transition Scenarios Committee, periodically examines and approves the Group's strategic risks, including those related to climate change and energy transition, and the effectiveness of the controls to enable the identification, measurement, management and monitoring of the main business risks, including ESG risks; - the Long-Term Incentive Plan, as mentioned, also includes ESG targets, including a KPI related to the reduction of natural gas emissions consistent with the Strategic Plan guidelines; - institutional reporting including the Half-Yearly and Annual Financial Report (including the Consolidated Non-Financial Statement - NFS), the Sustainability Report and the Climate Change Report. [...] As evidenced above, The BoD takes on a central role in ensuring Snam commitment to pursuing sustainable development along the value chain and ensures the dissemination and integration of sustainability into the corporate culture. From this perspective, the BoD aims to supervise the risks and opportunities, including those associated with climate change, as well as the activities that ensure the correct management of these aspects by management. To do this, Snam has established 3 internal Committees - Remuneration Committee (CNR); Control, Risk and Related Party Transactions Committee (CCROPC); Environmental, Social & Governance and Energy Transition Scenarios Committee (CESG STE) - which carry out investigative, proactive and consultative roles which allow them - through the formulation of proposals, recommendations and also opinions on their part - to adopt decisions on an informed and thorough. Furthermore, the BoD undertakes to integrate sustainability issues into the corporate strategy, including for example decarbonisation, as well as into the short and long-term incentive systems of Directors, Auditors and Managers with strategic responsibilities. [...] The Board of Directors also receives timely information flows from the Environmental, Social & Governance and Energy Transition Scenarios Committee regarding the in-depth studies that the latter carries out on energy transition issues concerning, specifically, the use of resources and energy sources that are compatible with environmental protection and progressive decarbonisation, examining in particular the initiatives undertaken by the company to address the issues posed by climate change, monitoring the roadmap to achieve the goal of carbon neutrality (Scope 1 and 2) for the entire Snam group by 2040, and takes note of the information provided by the Committees and in particular by the Environmental, Social & Governance and Energy Transition Scenarios Committee, pursuant to its Regulations, as part of the information provided to the Board following each Committee meeting. Finally, integrating sustainability into governance also involves periodic communication between the Board of Directors, committees and management, which is essential to ensure that Snam's top management is constantly informed of the guidelines and the risks and opportunities associated with climate change.

Describe the process(es) your organization has in place to ensure that your engagement activities are consistent with your overall climate change strategy[…]Snam's overall climate change strategy is developed considering energy scenarios, in line with EU climate policies (including the proposals under the Fit-for-55 and Hydrogen and decarbonized gas packages, RePowerEU/RePowerEU Plan and the EU Taxonomy of environmentally sustainable activities, EU and national legislative frameworks, the regulatory framework set by ARERA, the National Energy Strategy and the ENTSOG scenarios. The definition of the strategy and reduction targets is based on the results of the analysis of risks and opportunities, including those associated with decarbonization targets. There are several processes ensuring that all the activities (projects, engagement, investments, M&A etc.) carried out by the company are in line with its climate change strategy:
- the drafting of long-term Italian energy scenarios jointly with Terna (policy driven)
- the risks assessment which identifies all the risks linked to climate change and the mitigation actions;
- the materiality analysis, which crosses the company's priorities with the external stakeholders' perspectives.
- the sustainability model, which integrate business and sustainability and includes planning, control and stakeholder engagement (including continuous dialogue also on climate change topics with shareholders).
This model ensures that improvement goals are set for priority topics (e.g. climate change) and that corporate functions, activities and projects are identified, ensuring that these initiatives are implemented, monitored and reported. The Sustainability (SUST) unit acts as a bridge between the management and the Board (through the ESG Committee). Topics and ESG issues addressed in the engagement with policymakers are reported to the CSR unit, that monitors the link between the activity and the company's climate change strategy. Half yearly, the results of sustainability activities and the climate change related performances are submitted to the ESG Committee and subsequently approved. The ESG Committee also analyzes and approves the Climate Change Report drafted according to TCFD recommendations.
In addition, Snam has focused on further strengthening its system to set and monitor sustainability KPIs, set ambitious goals in all ESG areas relevant to its business, and demonstrate them to stakeholders through the development of an ESG Scorecard. In 2021 ESG scorecard has been strengthened and the time horizon of the ESG scorecard has been aligned to that of Strategic Plan (2025).

Describe the process(es) your organization has in place to ensure that your external engagement activities are consistent with your climate commitments and/or climate transition plan?[…]Snam's overall climate change strategy is developed considering energy scenarios, in line with EU climate policies (including the proposals under the Fit-for-55 and Hydrogen and decarbonized gas packages, RePowerEU/RePowerEU Plan and the EU Taxonomy of environmentally sustainable activities, EU and national legislative frameworks, the regulatory framework set by ARERA, the National Energy Strategy and the ENTSOG scenarios). The definition of the strategy and reduction targets is based on the results of the analysis of risks and opportunities, including those associated with decarbonization targets. There are several processes ensuring that all the activities (projects, engagement, investments, M&A etc.) carried out by the company are in line with its climate change strategy: