Schaeffler AG

The Sustainability Committee, which consists of members of the Executive Board and employees of the first management level, adopted seven sustainability targets. [...] The Sustainability Committee meets on a quarterly basis and consists of eight Schaeffler AG Executive Board members, four regional CEOs, and the function heads of departments associated with sustainability. Based on the Sustainability Coordination Council's preliminary work, the Sustainability Committee makes central strategic decisions for sustainable development, sets non-financial group targets, and monitors the progress of the execution programs. [...] The Sustainability, Environment, Health and Safety (SEHS) department – as part of the HR function – is responsible for the group-wide sustainability management. It defines performance indicators, supports execution programs, conducts internal and external sustainability reporting, and organizes and supports dialogues with key stakeholders. [...] In the reporting year, the internal reporting was expanded to include a monthly Sustainability Performance Report, submitted to the Chief Executive Officer, among others. The report provides a summary of current sustainability developments as well as information about various topics, including the status of targets such as the reduction in occupational accidents.

Responsible governance
At the Schaeffler Group, corporate governance stands for responsible and value-based management geared towards long-term value creation. Integrity and compliance are of fundamental importance for company's business dealings. That is why it observes the highest standards, particularly with regard to the prevention of corruption, lobbying, money laundering and economic crime, and the protection of human rights. Other key priorities include data protection and information, cyber, and IT security. To safeguard its values and standards, the company operates a compliance management system (CMS) and has a compliance organizational structure spanning the entire Schaeffler Group.

The Schaeffler Group has also implemented a number of compliance processes, to help employees comply with internal and legal requirements. This includes a systematic, precisely targeted training program to impart the required understanding of compliance issues to Schaeffler employees and managers and make them aware of the compliance risks involved in their everyday work activities. Through webinars and face-to-face training courses and presentations, they are familiarized with the Schaeffler Group code of conduct and relevant Group guideline documents. These online and face-to-face training events were attended by a total of 14,402 employees in 2022. The courses are constantly being further developed and enhanced and tailored to the specific employee tasks.

The Schaeffler location in Berlin coordinates development and communication of company positions regarding political institutions and stakeholders. As a mediator between the Schaeffler Group and politics, the company aims to help create the best possible political, economic, and social conditions. Areas of focus include the climate and sustainability, digitalization, competition, a changing sector, and innovative technologies. [...] The Schaeffler Group is listed in the lobbyist registry for interest groups that interact with the German Bundestag and the German federal government. As a company, the Schaeffler Group provides information about the number of employees and annual expenditure dedicated to lobbying as well as on collaboration with associations, and public grants and funding. The Schaeffler Group is also registered in the Transparency Registry of the State Parliament of Baden-Württemberg and in the lobby registries of the Bavarian State Parliament and the Bavarian state government.

Integrity and compliance are significant cornerstones of the Schaeffler Group's manner of conducting business. Therefore, the company pursues stringent standards, particularly when it comes to preventing corruption, lobbying, money ­laundering and economic crime, observing antitrust and competition law, and protecting human rights. Additional areas of focus include data protection as well as information, cyber, and IT security. To uphold its values and standards, the company maintains a compliance management system (CMS) within the framework of the overarching corporate governance structure, as well as a compliance organization that incorporates the entire Schaeffler Group. The head of this organization is the Group Chief Compliance Officer, who regularly reports to the Chief Executive Officer, the Chairman of the Supervisory Board, and the Chairman of the Audit Committee. [...] To support employees, the Schaeffler Group has introduced a variety of procedures and processes. This includes the Group procedure for compliance with antitrust and competition law, which among other things regulates interaction with competitors (horizontal) and suppliers, customers, and distributors (vertical). Core restrictions prohibit price fixing, agreements on conditions and quantities, and sales area and customer splits, particularly among competitors. A digital Competitor Contacts and Associations Register promotes internal transparency and thus supports the pre-­approval process for competitor contacts. [...] The granting and acceptance of benefits of any kind for the purpose of influencing someone in the public or private sector is prohibited. In the same vein, no donations may be made to political parties, their representatives, politicians, elected officials, candidates for political office, or individual persons. Each donation must comply with applicable laws and the Schaeffler Group's internal rules and requires special permission from the Compliance department.

The Governance, Risk & Compliance Committee (GRCC) is an important part of governance, which began its work at the beginning of 2023 under the supervision of the CEO and CFO. The GRCC provides an overview of the completeness of coverage of relevant governance, risk, and compliance management requirements. It oversees their appropriate, effective, and consistent implementation and coordinates the integrated reporting on this. The GRCC also aims to promote a holistic view of significant risks for the company. [...] The GRCC is supported by the Group Compliance and Risk Council (GCRC). It increases transparency in internal structures, organization, and responsibilities. The Group Chief Compliance Officer of the Schaeffler Group chairs the GCRC, which is made up of those responsible for the relevant governance functions (including compliance, legal, risk management, internal control system, and internal audit). The GCRC is tasked with supporting the Board of Managing Directors in its organizational duties regarding compliance and risk management. The main objectives of the GCRC are to define and delineate responsibilities and interactions and to avoid redundancies. It is also expected to create a consistent and complete view of the risk situation in the divisions, functions, and regions based on a standardized method of assessment and prioritization. Another goal of the GCRC is to develop and monitor risk reduction measures. The Compliance & Risk Working Group provides operational support to the GCRC. This is made up of staff representatives from the functions represented on the GCRC.

Sustainability Management > Strategic Anchoring and Organization > Sustainability Organization GRI 2-12, -13

In fiscal 2022, Vitesco Technologies further evolved its sustainability organization. In September, the company's Sustainability, Security, Safety & Health department was expanded to include Environmental Protection, which until then had been assigned to the Quality & Environment department. Under its new name Sustainability & Security, the department now bundles all key sustainability topics (occupational health and safety, corporate environmental protection, human rights due diligence, climate protection and decarbonization) and coordinates the requisite cross-functional strategy development and implementation. Its responsibilities also include organizing Vitesco Technologies' Sustainability Steering Committee and Sustainability Core Team, as well as the company's sustainability and non-financial reporting.

The Vitesco Technologies' Sustainability Steering Committee chaired by the Chief Human Resources Officer operates at the highest level of management and is comprised of permanent members of management (including the Chief Financial Officer and several heads of business units) as well as in-house experts. It manages and monitors the implementation of the Sustainability Agenda and makes decisions regarding sustainability targets, indicators, projects, and measures. In addition, the committee advises the Sustainability Core Team and the Executive Board and, if necessary, prepares Executive Board decisions. It meets at least four times a year.

At the operational level, a Sustainability Core Team comprised of sustainability experts from various Group functions and business units (e. g., Technology & Innovation, Sales, Purchasing & Supplier Quality Management, and Engineering) is responsible for implementing the Sustainability Agenda along the value chain. In addition to the global Sustainability Core Team, in 2022 Vitesco Technologies established a first country-level Sustainability Core Team in China to implement specific national requirements.

Describe the process(es) your organization has in place to ensure that your engagement activities are consistent with your overall climate change strategy[…]Involvement in policy making processes as affected entity is always based/aligned to the overall corporate strategy including the sustainability strategy and with that the climate strategy.
As a specific example, Schaeffler has established an internal task force on the European Green Deal. The task force aims at the development of aligned positions on the various climate change-related topics under the European Green Deal and to assure consistency of these positions with the overall Schaeffler climate change strategy. The task force consists of representatives from global functions and departments related to the management of climate change related topics. These departments include the central sustainability department, energy management & purchasing, plant management and governmental affairs. The representatives are responsible for communicating the decisions of task force within their respective global functions and departments. Moreover, the positions defined in the task force are to be represented unilaterally within the different working groups of trade associations Schaeffler participates in, and in the engagement with policy makers.
In addition to that, there is a regular exchange between the department governmental affairs and the sustainability department on current and upcoming sustainability and climate related legislation.

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?[…]The corporate strategy includes the sustainability strategy with thorough emission reduction goals