Sustainability
Supplements to theAnnual Report 2023

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Signify Sustainability Supplements 2023

Table of contents
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Data definitions, boundaries, and scope
Methodology for calculation of social impact
Signify additional disclosures
Task Force on Climate-related Financial Disclosures (TCFD)
Task Force on Nature-related Financial Disclosures (TNFD)GRI content index
EU non-financial reporting directive

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Signify Sustainability Supplements 2023

1 Data definitions,boundaries, andscopeThis section sets out the reporting scope andmethodology for Signify's 2023 corporate
and value chain Greenhouse Gas (GHG)
emissions statements as published in thisreport for the year ended December 31,
2023.

GHG accounting and reporting principles
Signify adheres to the five key GHG
accounting and reporting principles of the
GHG Protocol (GHGP) Corporate Accounting
and Reporting Standard:• Relevance - the principle of relevance isused for selecting the appropriate GHG
inventory boundary that reflects thesubstance and economic reality of thecompany’s business relationships,
determined by the characteristics of thecompany, the intended purpose of
information, and the needs of the users.
• Completeness - all relevant emissions
sources within the chosen inventory
boundary need to be accounted for so that
we make sure a comprehensive andmeaningful inventory is compiled.
• Consistency - the consistency principle isto ensure the consistent application of
accounting approaches, inventory
boundary, and calculation methodologies isessential to producing comparable GHG
emissions data over time, to allow trends
analysis and assess the performance of thereporting company. If there are changes in
the inventory boundary, methods, data or
any other factors affecting emission
estimates, they need to be transparently
documented and justified. Signify defines asignificance threshold of 5% forrecalculation, that is a cumulative changeof five percent or larger in the total baseyear emissions (tCO2e), in line with the
Science-Based Targets Initiative (SBTi)

Target Validation Protocol’s threshold ofsignificance.
• Transparency - relates to the degree towhich information on the processes,
procedures, assumptions, and limitations of
the GHG inventory are disclosed in a clear,factual, neutral, and understandable
manner based on clear documentation andarchives (i.e., an audit trail). Signify’s GHG
emissions are assured by an independent
third party on the basis of “Reasonable
Assurance”.
• Accuracy - data should be sufficiently
precise to enable intended users to makedecisions with reasonable assurance thatthe reported information is credible. GHG
measurements, estimates, or calculations
should be systemically, and thequantification process should be
conducted in a manner that minimizes
uncertainty.

Organizational boundaries
In line with the GHGP relevance principle,
Signify follows the operational control
approach and accounts for all of its GHG
emissions from operations over which it or
one of its subsidiaries has operational
control. New acquisitions are incorporated insustainability program and reporting following
our Sustainability Reporting Policy as outlinedin this supplement under Mergers,
acquisitions, divestitures definition.

Operational boundaries
Signify accounts for all of its direct andindirect GHG emissions of Scopes 1, 2, and 3
from operations over which it or one of its
subsidiaries has operational control. It
accounts for all 7 greenhouse gases under
the Kyoto Protocol, namely carbon dioxide(CO2), methane (CH4), nitrous oxide (N2O),

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Signify Sustainability Supplements 2023

hydrofluorocarbons (HFCs),
perfluorocarbons (PFCs), sulphur

Scope 3 - Other indirect emissions, from thefollowing categories that are relevant for

Category 13 – Downstream Leased Assets:
not applicable. According to the GHG

hexafluoride (SF6), and nitrogen trifluoride(NF3), where applicable and expressed in
CO2-equivalent. Signify does not havematerial GHG emissions other than CO2.
Signify does not use biomass or biofuels, thus
does not have material biogenic emissions.
For our 2025 target of doubling the pace of
the Paris Agreement 1.5 degrees pathway todecarbonize our entire value chain, 2019 waschosen as the base year. It is the earliest yearof verifiable emissions data for all categories
of Scope 1, Scope 2, and Scope 3 were data
was available. Scope 2 emission targets havebeen calculated using the market-based
method.

Signify:Category 1 – Purchased goods and services

protocol definition, this category is notapplicable to Signify as Signify does not havedownstream leased assets.

A detailed list of activities in our GHG
inventory is as follows:
Scope 1 - Direct GHG emissions, fromstationary fuel combustion (including naturalgas, diesel, gasoline, propane, LPG, and fueloil), process emissions, and fugitive emissions
from the use of refrigerants.
Scope 2 - Indirect GHG emissions, frompurchased electricity, heat, and steam. Scope
2 GHG emissions are accounted for using
both the location-based method and themarket-based method.

Category 2 – Capital goods
Category 3 – Fuel- and energy-related
activities not included in Scope 1 or Scope 2
Category 4 – Upstream transportation anddistribution

Category 14 – Franchises: not applicable.
According to the GHG protocol definition, thiscategory is not applicable to Signify as Signify
does not have Franchises.

Category 7 – Employee commuting

Category 15 – Investments: not applicable.
According to the GHG protocol definition, thiscategory is not applicable to Signify as Signify
reports emissions from investments (joint
venture) fully in scopes 1 and 2.

Category 8 – Upstream leased assets: not

Avoided emissions

applicable. According to the GHG protocol
definition, this category is not applicable toSignify as Signify does not have upstream
leased assets.

In addition to the reported GHG emissions
from Scope 1, 2, and 3, Signify also reports
the avoided emissions (also known as Scope 4
emissions) to help our stakeholders such as
customers and investors understand theenvironmental benefits associated with
Signify’s energy efficient LED-based lighting

Category 5 – Waste generated in operations
Category 6 – Business travel

Category 9 – Downstream transportation anddistribution
Category 10 – Processing of sold products is
not applicable. According to the GHG
protocol definition, this category is notapplicable to Signify, as Signify does not havesold products that require processing.
Category 11 – Use of sold products
Category 12 – End-of-life treatment of soldproducts

products and solutions.
The avoided emissions are calculated basedon LED-based products replacing less energy
efficient conventional lighting products.
Signify developed the following formula forquantifying avoided emissions:
Avoided emissions = [(weighted average
wattage of conventional - weighted average
wattage of LED)] * weighted average lifetimeof LED * quantity of sold LED * rate of LED
replacing conventional * global average
electricity emission factor• The weighted average wattage of Signify’s
conventional portfolio as benchmark of

•

•

•

•

market reference for conventional lighting
products.
The weighted average wattage of Signify’s
LED-based products as benchmark ofmarket reference for LED-based lighting
products.
The weighted average lifetime hours of
Signify’s LED-based products asbenchmark of market reference for LEDbased lighting products.
The quantity of sold LED refers to the total
products, systems, and services with LED
and Connected LED technologies sold in
the reporting year.
The global rate of LED replacing

Conventional is 71% in 2023. The
breakdown of the lighting market bytechnology replacing technology is Signify’sbest estimate hereof, based on the market
modeling done by the central Market &Competitive Intelligence team.
• The global average electricity emission
factor is from IEA in kg CO2e per kWh forthe reporting year, including emissions
from both total upstream and combustion,
as required by the GHG protocol Scope 3
Calculation Guideline.

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Signify Sustainability Supplements 2023

GHG accounting methodology
This table presents an overview of Signify’s GHG emissions calculation methods for each category. The Global-warming potential values (GWP) of the 100-year GWP of the latest IPCC Assessment
Report (AR5 or AR6) have been used.
Scope

Emissions calculation method and data source

Emission factor source

Scope 1

Scope 1 emissions are calculated based on the purchased quantities of stationary fuels (such as natural gas and diesel) and refrigerants, multipliedby published emission factors from the listed sources. Primary data is used in the calculation for the majority of Signify industrial and non-industrialsites, while extrapolation is made for small sites with a immaterial energy footprint, based on the floor area. Activity data is collected, reported,and validated internally. The data is managed in a digital GHG accounting and reporting platform, which also performs the calculations.

IPCC
EPA Emission Factor
Hub
DEFRA (UK Department
for Environment Foodand Rural Affairs)

Scope 2 Locationbased

Scope 2 location-based emissions are calculated based on the purchased electricity, multiplied by the average electricity grid emission factors at
the national or regional levels. Primary data is used in the calculation for the majority of Signify industrial and non-industrial sites, while
extrapolation is made for immaterial estimation sites as defined in our environmental reporting policy, based on the floor area. Activity data iscollected, reported, and validated internally. The data is managed in a digital GHG accounting and reporting platform, which also performs thecalculations.

IEA
eGRID

Scope 2 Marketbased

Scope 2 market-based emissions are calculated based on the purchased electricity, multiplied by the residual emission factors and the emission
factors associated with the contractual instruments (namely Power Purchase Agreement, renewable electricity contract, bundled and un-bundledenergy attribute certificates). Primary data is used in the calculation for the majority of Signify industrial and non-industrial sites, while
extrapolation is made for small estimation sites as defined in our environmental reporting policy, based on the floor area. Activity data is collected,
reported, and validated internally. The data is managed in a digital GHG accounting and reporting platform, which also performs the calculations.

Green-e Residual Mix
Emission Factors
RE-DISS Residual Mix
Emission Factors

Scope 3Category 1 –Purchased goods
and services

This category includes all upstream (cradle-to-gate) emissions from the extraction, production, and transportation of goods and services
purchased by Signify in the reporting year. A spend-based method is applied to calculate emissions for this category based on Signify’s spend per
sector in the reporting year, multiplied by the upstream supply chain emission factor by sector. The spend data is collected internally from ourfinancial system and is part of our integral financial statement.

EPA Supply Chain GHG
Emission Factors
DEFRA Indirectemissions from supply
chain

Scope 3Category 2 Capital goods

This category includes all upstream (cradle-to-gate) emissions from the extraction, production, and transportation of capital goods purchased by
Signify in the reporting year. A spend-based method is applied to calculate emissions for this category based on Signify’s spend per sector in thereporting year, multiplied by the upstream supply chain emission factors by sector. The spend data is collected internally from our financial system
and is part of our integral financial statement.

EPA Supply Chain GHG
Emission Factors
DEFRA Indirectemissions from supply
chain

Scope 3Category 3 - Fueland energy-related
activities notincluded in Scope 1
or 2This category includes all upstream (cradle-to-gate) emissions from the extraction, production, and transportation of fuels and energy purchased
by Signify in the reporting year, not already accounted for in Scope 1 or 2, including upstream emissions of purchased fuels, upstream emissions ofpurchased electricity, and transmission & distribution (T&D) losses.
An average-data method is applied to calculate emissions for this category. The upstream emissions from fuels are calculated based on thepurchased fuels, multiplied by the upstream emission factors for each fuel type. The upstream emissions from electricity are calculated based thepurchased electricity multiplied by upstream emission factors at the national level. The emissions from the transmission & distribution (T&D) losses
are calculated based the purchased electricity, multiplied by the T&D losses from DEFRA. The purchased fuels and electricity data is collected as
described in Scope 1 and Scope 2.

DEFRA
IEA

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Signify Sustainability Supplements 2023

Scope

Emissions calculation method and data source

Emission factor source

Scope 3This category includes all emissions from transportation and distribution of raw materials, components and finished products purchased by Signify

DEFRA

Category 4 Upstream
transportation anddistribution

in the reporting year between its tier 1 suppliers and own operations, and between own facilities (in vehicles and facilities not owned or controlled
by the Signify).
A distance-based method is applied to calculate emissions for this category, which is done by determining the mass, distance, and mode of each
shipment, and then multiplied by the appropriate mass-distance emission factor per mode of transport. Emissions from transportation anddistribution are calculated per mode of transport, namely ocean transport, air transport, and road transport.
The transportation and distribution mass, origin, and destination data at shipment level is primarily collected internally in our TMS (Transport
Management System). When not available in TMS, we collect transportation and distribution data directly from the logistic service providers. The
transport distance is calculated using the digital GHG accounting and reporting platform based on the origin and destination at shipment level.
It is worth noting that the transportation and distribution data collected (from our internal system and from logistic service providers) does notdifferentiate for upstream and downstream, therefore the emissions from Category 4 (upstream) and Category 9 (downstream) are grouped andreported together in our Annual Report as “Logistics”.

Clean Cargo/Smart
Freight Center

Scope 3Category 5 - Waste
generated inThis category includes all emissions from disposal and treatment of waste generated in our own operations in the reporting year (in facilities not
owned or controlled by Signify).
A waste-type-specific method is applied to calculate emissions for this category, which is done by consolidating mass data for each waste type

EPA WARM (Waste
Reduction Model)
Ecoinvent

operations

and for each waste disposal or treatment method, multiplied by the corresponding emission factors primarily from EPA WARM tool, when notavailable, emission factors from Ecoinvent are used.
The waste types include canteen wastes, electrical and electronics wastes, paper and cardboard, plastics, and wastewater; the waste disposal
and treatment methods include recycling, incineration, and landfill. Waste data is collected, reported, and validated internally. The data is managed
in a digital GHG accounting and reporting platform.

Scope 3This category includes all emissions from the transportation of employees for business-related activities (in vehicles not owned or operated by
Signify), specifically air travel, leased cars, and rental cars in the reporting year.
A distance-based method is applied to calculate emissions for air travel, which is done by consolidating the travelled distances of each haulage
type and then multiplied by the appropriate haulage emission factors. A distance-based method is applied to calculate emissions for rental cars,
which is done by consolidating the travelled distances and then multiplying by the appropriate emission factors. A fuel-based method is applied to
calculate emissions for leased cars, which is done by consolidating the amount of fuel consumed during business travel and applying theappropriate emission factor for that fuel.
The business travel activity data is collected directly from our business travel service providers and validated internally. The data is managed in adigital GHG accounting and reporting platform; where the calculations are also performed.

DEFRA

This category includes all emissions from the transportation of employees between their homes and their worksites the reporting year (in vehicles
not owned or operated by Signify), specifically automobile travel, bus travel and rail travel.
A distance-based average method is applied to calculate emissions for this category, which is done by determining the percentage of employee
commuting modes, the distances of each commuting mode, and then multiplied by the appropriate emission factors.
The total number of employees (FTE) is collected internally from our HR systems and assured externally. The commuting activity data (percentageof employees per commuting mode and travelled distances) are based on assumptions from the EU, as accurate and detailed data is notconsistently available due to, among others, privacy reasons.

DEFRA

Category 6 Business travel

Scope 3Category 7 Employee
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Signify Sustainability Supplements 2023

Scope

Emissions calculation method and data source

Emission factor source

Scope 3This category includes all emissions from transportation and distribution of raw materials, components and finished products purchased by Signify

DEFRA

Category 9 Downstream
transportation anddistribution

in the reporting year between its own operations and customers (in vehicles and facilities not owned or controlled by the Signify).
A distance-based method is applied to calculate emissions for this category, which is done by determining the mass, distance, and mode of each
shipment, and then multiplied by the appropriate mass-distance emission factor for per mode of transport. Emissions from transportation anddistribution are calculated per mode of transport, namely ocean transport, air transport, and road transport.
The transportation and distribution mass, origin, and destination data at shipment level are primarily collected internally from our TMS (Transport
Management System). When not available in TMS, we collect transportation and distribution data directly from the logistic service providers. The
transport distance is calculated using a digital GHG accounting and reporting platform based on the origin and destination at the shipment level.
It is worth noting that the transportation and distribution data collected (from our internal system and from logistics service providers) do notdifferentiate for upstream and downstream, therefore the emissions from Category 4 (upstream) and Category 9 (downstream) are grouped andreported together in our Annual Report as “Logistics”.

Clean Cargo/Smart
Freight Center

Scope 3Category 11 - Useof sold productsThis category includes all the direct use-phase emissions of products that are sold in the reporting year and consume energy (in our case,electricity) over their expected lifetime. This means for sold products that are not energy-consuming, i.e., components, accessories, and lighting
controls, category 11 is not applicable therefore not part of the emissions calculation. The majority (more than 90%) of our value-chain emissions
comes from the indirect emissions of product use, to quantify emissions from Category 11, the following calculation method is used:

IEA∑CO2e (per 12NC) = sold product quantity per country * power * lifetime * CO2e emission factor per country
Where:• Sold product quantity - the total unit of products sold to a specific country in the reporting year at the 12NC level (which is the lowest level ofour product hierarchy with the highest level of resolution), downloaded from our internal financial reporting system and is part of our integral
financial statement;• Power - the externally claimed wattage of each energy consuming product, collected internally from each Signify business unit from their data
management systems or via data sheets; the wattage data is obtained from official technical documents (such as test reports, productspecification sheet, technical data sheet, and packaging information) that are created based on the industrial standards such as the International
Electrotechnical Commission (IEC) Standards;• Lifetime - the externally claimed total use hours of each energy consuming product, collected internally from each Signify business unit fromtheir data management systems or via data sheets; the lifetime data is obtained from official technical documents (such as test reports, productspecification sheet, technical data sheet, and packaging information) that are created based on the industrial standards such as the International
Electrotechnical Commission (IEC) Standards;• CO2e emission factor per country - the CO2e intensity data in kg CO2e per kWh, from IEA for the reporting year, including emissions from both
total upstream and combustion, as required by the GHG protocol Scope 3 Calculation Guideline.

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Signify Sustainability Supplements 2023

Scope

Emissions calculation method and data source

Emission factor source

Scope 3

Uncertainties and assumptions in the calculation of Category 11 emissions

IEA

Category 11 - Useof sold products(cont.)A reliable and in-depth reporting of Category 11 is challenging, especially for Signify with a diverse portfolio covering more than 70,000 uniqueproducts at the 12NC level. We recognize the uncertainty mainly lies in data completeness and data accuracy. To tackle, this, we have set up
governance, processes, systems, and controls within Signify to facilitate the end-to-end process of accounting Category 11 emissions. In terms ofcompleteness, our 2022 and 2023 product data coverage was greater than 95%. Still, there is a small gap in our product data because for somespecial one-off local projects, product technical data is not maintained in a centralized data system. For products where data is not available,
their emissions are extrapolated based on the actual emissions calculated within the same business unit. In terms of accuracy, multi-level control
procedures have been implemented including statistical validation based on mean, medium, most repeated values. Data for sold products iscollected internally and assured as part of the financial statements audit. The data is managed in a digital data warehouse and reported in a
dynamic dashboard.

Scope 3Category 12 - Endof-life treatmentof sold productsThis category includes all emissions from waste disposal and treatment of products sold by the reporting company in the reporting year at the endof their life. A waste-type-specific method is applied to calculate emissions for this category, which is done by consolidating total mass data ofsold products and packaging, their material compositions and the waste disposal or treatment methods, multiplied by the corresponding emissions
factors primarily from EPA WARM tool, when not available, emission factors from Ecoinvent are used. The product end-of-life waste types include
electrical and electronic waste, plastic waste, and glass; the waste disposal and treatment methods include recycling, incineration, and landfill.

EPA WARM (Waste
Reduction Model)
EcoinventThe mass of sold products and packing data are collected, reported and validated internally.

Data definitions and boundaries
1

Brighter lives revenues

Revenues coming from our portfolio which
benefit society focusing on three mainsustainability areas:• Food availability: Lighting designed toenable the production of more and betterquality food, while optimizing the use ofland, water and energy and avoiding
pesticides. It includes all dedicated2horticulture products and systems, alldedicated urban farming products andsystems, all dedicated marine-based andland-based aquaculture products andsystems, all dedicated animal farming
products and systems• Safety & security: Lighting designed tohave a positive effect in reducing crimes

such as burglary and theft in cities andhouses, as well as increasing safety intraffic and protection against cybercrimeand fraud. It includes Interact solution for
cities, System solutions for tunnels,
Outdoor lighting equipped with special
sensors, Emergency lighting and Lifi
systems, Black Light Blue lamps andluminaires• Health & well-being: Lighting designed tosupport health, well-being andperformance of humans through unlocking
the visual, biological and emotional benefitsof light, and lighting designed to support
well-being for wildlife. It includes
EyeComfort, Lighting for well-being,
Tunable products during use phase, Noninvasive health supporting products anddisinfection.

Signify's portfolio of products contributing toBrighter lives revenues continues to grow as
we drive sustainable innovations across thesethree focal areas.
1

Circular revenues

Revenues coming from our circular portfolio
meaning lighting products*, systems andservices that maximize (re)usability,
serviceability, and upgradability and minimizes
value destruction with the aims to preserve
value and avoid waste to landfill. Lighting
solutions contributing to this definition
include:• Serviceable luminaires: luminaire with easily
replaceable (using standard, widely
accessible tools) driver and controls andLED board to facilitate lifetime
prolongation, or designed as circular
economy ready luminaires requiring an EPD

1

Data stems from internal documentation based on the product attributes and is a manual process, therefore, there could be inherent uncertainties within the calculation.

2

Products = light sources, luminaires, control gears, sensors (LED and conventional).

• Circular components: replaceable andrecyclable LED and conventional drivers
and modules, most sensors supporting
system functionality, 3D printed housings• Intelligent assets: lifetime monitoring andpreventive maintenance scheduling• Circular services: services to prolong
luminaire lifetimes and managed services
with end of contract return options

Employee data
The total number of employees comprises all
employees, including from newly acquiredcompanies and temporary employees, but
excludes interns. Social data covers all
employees that have been fully integrated inour system and exclude contingency workers.
The Employee Net Promoter Score (NPS)
survey is performed on a quarterly basis andis calculated through a weighted average for

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the whole year using the respondents andresults. It includes employees with access to

Integrity code

a company email address.

registered via our internet-based reportingand validation tool. Our Ethics line,
www.signify.ethicspoint.com is available to all
employees and outside parties, allowing
concerns to be anonymously registered by
telephone or through an online web form. In
addition, local compliance officers areavailable globally, to register concerns onbehalf of employees. The Integrity code
concerns encompass all concerns registeredin the Ethics line database opened
throughout the financial year.

Environmental data
Environmental data from manufacturing
operations are reported quarterly or halfyearly, according to defined company
guidelines that include definitions,procedures and calculation methods. A
robust system of internal controls has been
implemented to safeguard consistent data
quality. The results are tracked and internallyreported to measure progress against ourprogram targets. Data on operational energy
usage includes energy use frommanufacturing sites and non-industrial sites &excludes transmission losses to the grid.
Most of the environmental data covers areporting period from the 1st of December
2022, until the 30th of November 2023.

Health & Safety
Health & Safety data is reported by sites withmore than 50 FTEs (full-time equivalents) andvoluntarily reported by sites with fewer
employees. Health & Safety data is reported
and validated monthly. The focus of reportingis on work-related injuries and illnesses that
predominantly occur in manufacturing
operations and lead to a recordable injury orillness case. Recordable cases include all
injuries and illnesses sustained at work that
result in medical treatment, restricted work,
lost workdays, or fatality. All injury and illness
cases are reported for staff and contractors
as outsourced workforce. The TRC and LWIC
KPIs refer to all reported cases forpermanent & temporary employees, including
students & interns.

Alleged Integrity code concerns are

Lives Lit and Community support
The Signify Foundation and Signify’s CSR
program focus on lives lit, entrepreneurs
trained and humanitarian lighting. We define
lives lit as the number of people that are
enabled first access to solar lighting (indoor/
outdoor), access to improved lighting (LEDlighting), or access to the benefits of lighting(horticulture, UV-C). The beneficiaries areeither reached directly through provision oflighting products, or indirectly throughsupported partners. For entrepreneurs
trained we count the people who have been
provided with business and/or technical skills
training through our funding support. For
Humanitarian lighting, we count the projects
that have been led during the reporting year.

Living wages
Signify defines a living wage as the grossmonthly wage needed to cover the necessary
living costs of an individual or a family. It is
calculated as the gross income necessary toafford these expenditures. For all countries
examined (Poland, Mexico, Netherlands,
China, the United States of America, andIndia, which represents 70% of theworkforce), Signify used WageIndicator’s
database (date: Q2 2023) to set its baseline.

extent that the integration process of theseventures has sufficiently been finalized.

WageIndicator’s database offers different
variations of family model (individual, with orwithout child, national fertility rate) andemployment rates (full-time, part-time,national employment rate). To perform its
analysis, Signify selected the “Standard
family” Living Wage as we believe it reflects
better the average family composition across
our countries of operation, maintains a stable
method of comparison, and is the
WageIndicator recommended family variation.

Assuming new ventures’ sustainability
reporting and availability of data conform with
Signify requirements, the normative
integration period is two years. Whenever thenormative period is not realistic, we will
deviate and disclose it in our Annual Report.
Divestitures completed before December
31st of the book-year are excluded fromenvironmental and social reporting.

The Standard Familiy Living Wage indicates agross monthly income range for a full-time
equivalent worker at which the total earned
family income is sufficient to cover necessary
costs. The standard family includes two adults
and two children (family 2+2) and the family
employment rate is 1.8, which means one
adult is a full-time worker and the second
adult has a working week of 80% (4 days aweek). Signify uses the lower range of theStandard family model for its analysis. The
reason for the WageIndicator databaseselection was the extensive coverage ofcountries, the sample-method, and theresearch institutes involved with their study,
including Harvard Law School and the
University of Amsterdam. Signify does notindependently validate data from
WageIndicator, thereby causing an inherent
uncertainty regarding the accuracy of thedata. Statements on living wage pertain to all
employee types in all pay grades (including
Cooper but excluding LeiFei and Klite),
including temporary employees, but excludes
interns, international assignees, remote andhomeworkers.

Mergers, acquisitions, divestitures
New Signify ventures are included inenvironmental and social disclosures to the

In case Signify acquires a new manufacturingsite or office (whether it is leased or owned),
Signify has 24 months to ensure the site is
integrated in its sustainability commitments.
According to the GHG protocol, forconsistent tracking of emissions over time,
the base year emissions should berecalculated in case of significant structuralchanges such as acquisitions, divestments,and mergers. We follow the structuralchanges guideline and the SBTi threshold of
5%.

Plastic free packaging
Our plastic free packaging policy aims toeliminate all fossil-fuel based plastics fromour consumer packaging. The scope of the
packaging requirements is applicable for the
packaging components used for Signify
finished products and includes:• Packaging for all newly introduced
products and changes in packaging ofcurrent portfolio transport packaging (e.g.
A-boxes and palette boxes)• Individual product packaging (e.g. boxes,
blisters, and sleeves)• Supportive packaging materials (e.g.
pallets, stretch foil, stowing materials)

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Signify Sustainability Supplements 2023

Sustainable supply chain

Sustainable innovation

Waste to landfill

Women in Leadership

Supplier audits focus on risk suppliers, based

Sustainable innovation comprises all R&D

The amount of waste sent to landfill is% Women in Leadership KPI is the percentage

on identified risk countries, (forecasted)
spend and maturity level. Risk countries for
supply chain management in 2023 can befound on our website. The suppliersustainability performance rate is defined as
the percentage of all active risk suppliers
that have had an audit score of at least 90
out of 100 points in the defined timeframe(yearly or every 3-year based on maturity
level). Suppliers are considered compliant bypassing the audit, resolving identified nonconformities, or are expected to resolve
identified non-conformities within 6 months.
The CDP supply chain results are based on
self-reporting from suppliers. This causes anactivities contributing to our sustainable focal
areas. This means all research and new
development of products, systems, orservices that demonstrate a measurable
positive impact in energy efficiency (10% or
greater), and preferably also in one or moresustainable focal areas: Energy & solar,
Circularity, Packaging, Substances, Weights &materials, Safety & Security, Health & wellbeing, Food availability. Sustainable innovation
spend is the cumulative spending of all R&D
projects contributing to sustainable
innovation.

calculated on a quarterly basis and includes
waste from manufacturing locations withmore than 50 manufacturing FTE andvoluntarily reported by some manufacturing
sites.

of women as a percentage of the total
population in grades H22 and above. It
includes employees with or without a definedend date and international assignees who arein Workday, with compensation grades H22
and above (including EXCO). The source ofdata is Workday. It excludes: contingent
workers; newly acquired companies (e.g.,
Klite), companies not in Workday andcompanies not yet integrated into the Signify
operating model and therefore can not be
considered for KPIs due to missing data
points; employees not in the FTE count (e.g.,interns) and factory and warehouse workers
are excluded as there are no leadership roles

inherent uncertainty of the accuracy of
impacts from their emission reduction
activities.

To achieve “zero (manufacturing) waste tolandfill”, the amount of non-hazardous
manufacturing waste being disposed directly
to landfill should be <1% of total waste. In our
approach to zero, we exclude:• Chemical waste: hazardous/non-hazardous
and other waste classified as hazardous,• One time waste: e.g. demolition,
construction waste,• Regulated waste: if governed by legal
requirements to be landfilled, or the waste
collection and/or treatment company isgoverned by local legal requirements.
The out-of-scope material represents 1.38%
of our total manufacturing waste.

in these groups.

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Signify Sustainability Supplements 2023

2 Methodology forcalculation ofsocial impact

Signify societal impact
At Signify, sustainability is central to ourcompany, strategy, and purpose. Our aim is
to balance economic, social, andenvironmental considerations. We strive tomaximize long-term value-creation along
these three dimensions.
To guide our efforts and measure ourprogress, we have made our approach
towards long-term value creation moretransparent by preparing our Annual Reportin line with key-elements of the International
Integrated Reporting Council’s (IIRC)
Integrated Reporting framework.
At the core of our reporting approach is thevalue creation model, included under section
3 of our Annual Report 2023. This modelshows how our business activities draw on
various financial, environmental, and social
resources that get converted to outputs.
Our activities and their outputs lead tooutcomes in terms of the impact for our
stakeholders and society at large.
By expressing these impacts in monetary
terms, we can better compare the financial,social, and environmental effects of ourbusiness. This enables more effective andefficient decision making and gives a holistic
view on our most prominent risks andopportunities. It also provides furthertransparency to our stakeholders on ourcompany performance.

3

WBCSD Impact Valuation White Paper

Impact Valuation
Impact valuation is a way to identify,
understand, improve, and demonstrate thevalue and cost of our business activities onsociety - such as the cost to society of ouroperational carbon emissions and the value
to society of our tax payments.
To facilitate comparability, the impacts andexternal effects of business activities aremeasured and valued in monetary terms. By
nature, financial, social, and environmental
impacts are positive or negative. By applying
shadow prices to the impacts of activities,
societal costs and benefits are determined.
By publishing the results of our analysis andmethodology, context and underlying
assumptions are made transparent to ourstakeholders. We strive to contribute to a
global shift from traditional reporting to
impact analysis via global standards based on
3

the Impact Valuation Roundtable

Signify societal impact trend
The table below provides an overview of oursocietal impact and the trend over time.
Signify is on a journey to measure all its
business impacts along the economic, social,and environmental dimensions. Where
possible, we aim to extend the scope of ouranalysis on an annual basis as our insights
increase further.

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Signify Sustainability Supplements 2023

Dimension

Indicator

Summarized consideration

Boundary

Environmental impacts

Carbon emissions

Impact on climate due to emitted greenhouse gas emissionsin scope 1, 2 and 3 - business travel and logistics

Own operations

Impact on climate due to avoided greenhouse gas emissions
through our energy efficient LED lamps & luminaires.

Products

Waste disposal

Impact on environment due to waste disposal

Own operations

Biodiversity

Biodiversity and ecosystem services conserved and restored
through carbon offsetting program

Society

Water usage

Impact on water scarcity due to water consumption

Own operations

Injuries & fatalities

Impact on workers & communities due to occupational
injuries and fatalities

Own operations

Training investments

Impact due to training & development of our employees andentrepreneurs trained by the Signify Foundation

Own operations andvalue chain

Salaries & benefits

Impact on economy through remuneration of employees

Own operations

Interest

Impact on economy through interest payments to suppliersof capital

Own operations

Taxes

Impact on economy through tax payments in countries where
we operate

Own operations

Shareholder returns

Impact on economy through total shareholder returnOwn operations

Social impacts

Financial impacts

Methodology for calculating our societal
impactScope of impact analysis
The table above shows which metrics were
included in our analysis to determine societal
impacts.
Detailed considerations
The following section highlights per indicatorthe boundaries to determine shadow prices,
references to the academic sources, and thebase price that was applied.
Environmental impacts
This section explains the different metrics
that were included in determining ourenvironmental impact.

Carbon emissions
Signify reports in line with the Greenhouse
Gas Protocol (GHGP). The market-based
method of reporting is used as a reference
for calculating our carbon footprint.
• Scope 1 – direct CO2 emissions – is basedon direct emissions from our industrial andnon-industrial sites in full.
• Scope 2 – indirect CO2 emissions – isbased on indirect emissions from ourindustrial and non-industrial sites in full.
• Scope 3 – other CO2 emissions related toactivities not owned or controlled by
Signify is based on indirect emissions from
Business travel, Logistics, Product Use.
• Scope 4 – avoided CO2 emissions – isbased on use of our LED lamps & luminaires

replacing less energy efficientconventional lighting products.
When we mention carbon emission, we refer
to our carbon dioxide equivalent emissions
calculations. We convert all Kyoto gasses(CO2, CH4, N2O, HFCs, PFCs, and SF6) into
CO2 emissions while calculating ourenvironmental footprint.
Shadow price considerations: Costs ofchanges in net agricultural productivity,
human health, property, damages fromincreased flood risk due to climate change.
Shadow price sources: EPA’s SC-CO2
S. Dietz et al. (2018), LSE
Base price applied: €119.30 per tonne CO2

Additional information for Scope 4 – Avoided
CO2 emissions
The avoided emissions related to scope 3use phase. To calculate the avoided
emissions from LED lamps & luminaires, thefollowing is determined:• The weighted average wattage of Signify’s
conventional portfolio as benchmark ofmarket reference for conventional lighting
products.
• The weighted average wattage of Signify’s
LED-based products as benchmark ofmarket reference for LED-based lighting
products.
• The weighted average lifetime hours of
Signify’s LED-based products asbenchmark of market reference for LEDbased lighting products.
• The quantity of sold LED refers to the total
products, systems, and services with LED
and Connected LED technologies sold in
the reporting year.
• The global rate of LED replacing
Conventional is 71% in 2023. The
breakdown of the lighting market bytechnology replacing technology is
Signify’s best estimate hereof, based on
the market modeling done by the central
Market & Competitive Intelligence team.
• The global average electricity emission
factor is from IEA in kg CO2e per kWh forthe reporting year, including emissions
from both total upstream and combustion,
as required by the GHG protocol Scope 3
Calculation Guideline.
Formula developed by Signify:
Avoided emissions = [(weighted average
wattage of conventional - weighted
average wattage of LED)] * weighted
average lifetime of LED * quantity of soldLED * rate of LED replacing conventional *global average electricity emission factor

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Signify Sustainability Supplements 2023

Biodiversity and ecosystem services
conserved and restored through carbon
offsetting program
Through carbon offsetting projects, Signify
contributes to conserving and restoring
forests. The ecosystem services these
forests provide are extensive and contributeto enhancing or maintaining the biodiversity inthose areas.
Shadow price considerations: Societal value
produced by conserving and restoring
forests in terms of the following ecosystemservices which these forests provide: food,(fresh) water supply, raw materials, genetic
resources, medicinal resources, ornamental
resources, influence on air quality, climate
regulation, moderation of extreme events,
regulation of water flows, waste treatment/water purification, erosion prevention,
nutrient cycling and maintenance of soil
fertility, pollination, gene pool protection,and opportunities for recreation and tourism.
Shadow price sources: TEEB, 2010, adjusted
for inflation.
Base price applied: €14,934.28 per ha oftropical forests conserved or restored
Waste disposal
Data consists of manufacturing waste that isdelivered for landfill or incineration. Due tothe residual value of recycling, this method ofwaste disposal is excluded from ourcalculations.
Shadow price considerations: Amenity costs(odor, visual impact, noise) and costs fromemissions to air affecting global warming,
health, damage to buildings and materials,
and loss of agricultural production.
Shadow price sources: Liu (2021), adjusted
for inflation.

Base price applied: €17.11 per tonne waste tolandfill, €25.04 per tonne waste toincineration
Water usage
Data consists of water usage in ouroperations, both purchased and extracted
from groundwater wells.
Shadow price considerations: water scarcity
costs, impacting human health, net
agricultural productivity, and environmental
deterioration.
Shadow price sources: To understand waterrelated risks and quantify risks in financial
terms, Signify used the Water Risk Monetizer
tool developed by Ecolab in partnership with
Trucost and Microsoft. Signify calculated thesocietal water price per location of its
operations for the coming 10 years, taking
into account water scarcity levels andsocietal implications of water usage in thoselocations.
Base price applied: €4.27 per m3 water (onaverage)

Social impacts
This section explains the different metrics
included in determining our social impact.
Work-related lost-time injuries
Lost-time injuries are occurrences where theinjured employee is unable to work one ormore days. These work-related injuries andillnesses predominantly occur in
manufacturing operations and Field Services.
All lost-time injury cases are reported for
Signify staff and contractors working under
the supervision of Signify.
Shadow price considerations: Costs of loss ofcurrent and future income, medical costs,
costs for community, incl. lost revenue, social

welfare payments, rehabilitation.
Shadow price sources: National Safety
Council America/NSC (2021), adjusted for
inflation.
Base price applied: €41,799.20 per workrelated lost-time injury
Work-related fatalities
Fatalities are reported for contractors
working under the supervision of Signify andall Signify staff.
Shadow price considerations: Costs of loss ofcurrent and future income, costs forcommunity, incl. lost revenue, social welfare
payments.
Shadow price sources: National Safety
Council America/NSC (2021), adjusted for
inflation.
Base price applied: €1,333,593.67 per workrelated fatality
Learning and development of employees andentrepreneurs
Data covers all employees, including
temporary employees and is based on thelearning and development spent within theorganization as registered through ourcenter of excellence, The Signify Learning
Center of Expertise.
Moreover, we include the investments madeby the Signify Foundation for the trainings ofentrepreneurs, which improves human capitaloutside our organization.
Shadow price considerations: Personal
returns for employees: future wage-increase
due to skill development at Signify. Social
returns include increased productivity andspill-over effects of human capital to othersin the surroundings.

Shadow price sources: Venniker (2000)
Base price applied: €1.11 per €1 spend on
learning and development
Salaries and wages paid to employees
Shadow price considerations: Enhanced
purchasing power positively influences
economic environment.
Base price applied: Cash transfers to
employees (salaries) are reflected at a ratioof 1:1. We assume that every Euro transferred
will be spent and therefore contributes tothe (local) economy. Even if not all of themoney transferred is spent, the assumptionof the 1:1 multiplier is justified due tosecondary and tertiary socio-economic ripple
effects, caused by cash transfers throughenhanced purchasing power.
Financial impacts
Economic impacts quantify the positive
financial externalities of Signify. This consistsof more than our own net profits, as we
contribute to GDP in countries where we
operate. Considering our Gross Value Add,
Signify considers the following categories tobe most relevant due to their direct increasein purchasing power: tax payments forgovernments, interest payments to providersof capital (including pensions interest), andshareholder returns to Signify’s owners(through dividend payments and share buyback).
Signify has reflected these contributions at aratio of 1:1. We assume that every Eurotransferred will be spent and therefore
contributes to the (local) economy. Even if
not all of the money that is transferred gets
spent, the assumption of the 1:1 multiplier isjustified due to secondary and tertiary socioeconomic ripple effects caused by the cashtransfers through enhanced purchasing
power.

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Signify Sustainability Supplements 2023

3 Signify additional
disclosures

Hazardous Substancesand scientific approach to calculate our VOC

The use of hazardous substances andchemicals in Signify’s manufacturing process
is a critical aspect of our operations. We arecommitted to ensuring that our processes
are safe for our employees, and theenvironment. As part of our commitment tosustainability, we have improved our Chemical
Management program to ensure the safe
handling, storage, and disposal of hazardous
substances and chemicals. The program isdesigned to comply with all relevant
regulations and standards, including theEuropean Union’s REACH regulation.

emissions and we included sites until now outof scope. In the 2023 approach, we haveincluded all manufacturing sites in the scopeof reporting and used an improved andautomated Excel tool to track all chemicals
used in our manufacturing process, including
chemicals used in surface treatment
activities such as cleaning, degreasing, precoating and coating, soldering, gluing,
finishing, chemicals used in the maintenanceof equipment involved in the manufacturing
process, chemicals used in painting lines foroutdoor and indoor applications, chemicals
produced in-house and used in the
manufacture of the final product andWith the new chemical management program,we will continue to ensure compliance bycontinuously monitoring the use of chemicals
at our manufacturing sites and actively
phasing out several hazardous substances.
Emissions from mercury
Since 2012 we have dramatically reduced
mercury emissions by changing our
production processes and replacing liquidmercury with solid mercury. In 2021, we
achieved zero mercury emissions from ourmanufacturing process. In 2023, we decided
to discontinue the tracking of mercury
emissions as the transition from conventional
lighting to LED lighting is expected to keep
mercury use at zero levels in the coming
years.
Emissions from volatile organic compounds(VOCs)For years, Signify has been focusing on
improving its operations relating to thecoating of products to reduce the use of
VOCs. In 2023, we developed a more precise

chemicals used in the treatment of waste
streams from manufacturing processes suchas in wastewater treatment plants.
As result we noticed that toluene emissions
have gone up. This increase can be explainedby a combination or our more precise
tracking of emissions and the addition of
more sites that were previously out of scope.
In 2024, we will continue to streamline thechemical management approach to further
reduce our emissions.
Emissions of VOCs (Kg)
2021

2022

2023

823.5

735.91701.59Through sustainable design rules, all new
product developments meet stringent
sustainability criteria before their market
launch. All our products and systems
delivered to countries requiring the CE
marking are compliant with the RoHS
Directive (2011/65/ EU) and REACH (EC

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Signify Sustainability Supplements 2023

1907/2006) Regulation. We require all our
suppliers to communicate all substances inapproach and appropriate actions, whichmight include a product recall, especially in

Zero Waste to landfill

While waste increased slightly in 2023,we willcontinue our efforts to reduce our hazardous

their components and to comply with thestipulations that we have listed in our
Regulated Substance List (RSL), which inmany cases goes beyond legislation. In 2023,
we continued to engage with our suppliers,
further rolling out the publicly available
BOMcheck tool, in which components andsubstances can be registered.

case the health and safety of individuals areof concern. Signify has a robust process inplace to ensure impacted constituents are
informed. In 2023, no product safety issues
were found that resulted in a material fine or
penalty.

We are committed to send zero
manufacturing waste to landfill and keep therecycle rate as high as possible. In 2023, ourfocus has been on driving continuous
improvements and process optimization
across the globe. At the end of the year,
Signify was sending zero waste to landfill
according to its commitment and the final sitefrom a recent acquisition transitioned to zerowaste in Q4.

waste by 5% annually.

Product quality
Signify is strongly committed to responsible
product stewardship. The Signify quality
management system is ISO 9001:2015
certified, covering all business activities.
When it comes to quality, we believe
prevention of defects is better than cure.
This is reflected in our structured approach
towards the selection and qualification of
suppliers, manufacturing, installation anddelivery of our products and services.
Additionally, our employees follow in-person
or e-learning trainings on safety and quality.
As an example, our research anddevelopment employees need to follow amandatory training on Design for safety andthis year, we launched safety awarenesstraining for our business leaders across theorganization. The implementation ofAdvanced Quality methods is leading tohigher maturity levels of products andservices and consequently higher customer
satisfaction.
In line with mandatory legislation all over theworld, Signify is committed to placing only
safe products on the market. In the event
products have been brought to market that
do not meet the essential safety
requirements, Signify takes a systematic

Water
Signify recognizes the growing importance ofwater usage in our operations and everyday
activities. As we continue to expand ourportfolio of LED products, systems andservices, the water intensity of ouroperations and activities continues todecrease. Despite this, one manufacturingsite in India is in an area having extremely highwater stress and might face water scarcity
risks. To analyze and quantify our exposure towater risk, we utilized the open-source
Water Risk Monetizer tool by Ecolab, Trucost,and Microsoft. The results show that 5% of
our global water consumption is located inregions classified as having high-water
scarcity.
While some of our facilities have reuse andrecycling measures in place, we continued to
implement and identify new and more
efficient water saving measures as well as
continuing our transition to technology andbusiness models to have lower a dependency
on water. We continue to aim to reduce ourwater usage by 5% annually. Total water
intake in 2023 was 1,057,890 m3, 9% lower
than 2022 (1,163,961 m3) with 61% of ourwater intake used for domestic purposes.

We improved our practices regarding waste
segregation, waste awareness training andsharing best practices across regions. In
2023, Signify registered 1.67 kilotonnes of

Our recycling programs address waste arisingfrom manufacturing activities, such as glassor canteen waste, as well as from suppliers,
such as packaging materials. 88% of total
waste was recycled in 2023 and wecontinued to recycle 100% of our metal andglass waste. To increase circularity ofmaterials, some locations have begun reusing
cardboard outer packaging from incoming
materials as inner packing on outgoingproducts. Previously, this cardboard material
would have been recycled. For more details
on our commitment scope, please refer tohazardous waste (2022: 1.61 kilotonnes), of
which 46% was recycled.

the data definitions in Section 1 of this
supplement.

Manufacturing waste in kilotonnes
2021

2022

2023

Recycled

38.7 (89%)

37.7 (89)28.1 (88%)

Incinerated

3.8 (9%)3.8 (9%)3.2 (10%)Landfilled

0.9 (2%)0.6 (1.5%)

0.5 (1.5%)

0.4 (0.88%)

0.2 (0.49%)

0.04 (0.12%)

2021

2022

2023

Canteen waste

66 %

72 %

46 %

Chemical waste

36 %

45 %

40 %

Electrical and electronic waste

100 %

99 %

87 %

Glass line rejects

100 %

100 %

100 %

Metal scrap

100 %

100 %

100 %

Paper and cardboard

99 %

97 %

99 %

Plastic waste

81 %

84 %

82 %

In scope of commitments

Recycling rate per waste category

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Signify Sustainability Supplements 2023

4 Task Force on
Climate-related
disclosures(TCFD)The potentially significant impacts of climate

our efforts to further assess our climate-change pose a challenge to the stability andcontinuity of businesses over the short,medium, and long terms. With a global
footprint, Signify’s manufacturing sites andsupply chain are exposed to these physicaland transition risks related to climatechange. On the other hand, the transition toa lower-carbon economy presents climate
related opportunities for Signify’s sustainablegrowth areas based on low-carbon
technological innovation: (1) Climate action,(2) Circular economy, (3) Food availability,(4) Safety & security, and (5) Health & wellbeing.

related risks and opportunities via ourinternal cross-department task force. As
disclosures have evolved, we are now moving
towards aligning with the relevant CSRD ESRS
and we conducted our annual climate risk
assessments in line with the four coreelements of governance, strategy, risk
management, and metrics and targets. This
year’s assessment has resulted in refining
our climate risk mitigation and adaptation
strategy as well as contributed to our climatetransition plan.

Driven by the perceived high magnitude offinancial impacts attributed to climate risks,
the assessment of climate risks becomes
imperative and future-prove. Disclosing
climate-related physical and transition risks
showcases long-term business sustainability.
As a leader in sustainability, Signify iselements will have references to the Annual
Report that provide more details.

committed to improving its global operations
and reducing its emissions over the entire
value chain. This includes understanding therisks posed by climate change and how to
improve business resilience accordingly.
Therefore, it is paramount to assess thepotential impacts of climate related risks andopportunities on our business operations andfinancial performance under different
scenarios. Signify seeks to maintain an
evolving overview of these risks andopportunities over time.
Signify has been reporting its climate-relatedrisks and opportunities in alignment with the
Task Force on Climate related Financial
Disclosures (TCFD) recommendations andguidance since 2018. In 2023, we continued

To avoid repetition between the TCFD and
our Annual Report, each of the core

Governance
Board's oversight of climate-related risks
and opportunities
Our governance is effectively designed to
manage the energy transition strategy andcontinue making significant progress towards
optimizing long-term value through financial,environmental and social resources. The
Supervisory Board, Signify’s highest
governance body, is accountable for climaterelated policies and strategies to combat
climate change as well as the double
materiality assessment, which shows thatclimate action is our most material topic.
The Supervisory Board provides primary
oversight of the delivery of our sustainability
and energy transition strategy. The
Leadership team consisting of Alice
Steenland the Chief Strategy & Sustainability
Officer (CSSO) and Maurice Loosschilder the
Head of Sustainability, provide oversight of

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Signify Sustainability Supplements 2023

the management of climate-related risks andtheir financial impact with the help of theinvestment in climate-related opportunities.
The BoM guides the performance anddrive Signify's performance in the space ofclimate action. Our CSSO oversees strategy

References:• Sections 4.1.1 Sustainability Governance ofAudit committee. Quarterly meetings are heldwith the Leadership Team, Supervisory
Board, Audit Committee, and Board ofManagement (BOM), dedicated to discussing
the company's strategy towards sustainablelong-term value creation. The Audit
committee assists the Board in overseeing
the macro- environment trends and changes,
the impact on the lighting market forecast,the company's financial and sustainability
performance. They also review theperformance of the strategic initiatives andhow these contribute to the company's 5
Frontiers strategy.

oversees the progress against targets andcommitments set out in our sustainability
program, including the ones addressing
climate-related issues, and corrective
actions are taken when necessary.

setting, sustainability budget, and climate
action plans. Our CSSO reports directly to
our CEO and addresses climate-related
issues regularly to the BoM in case of major
capital expenditures, acquisitions, anddivestitures.

the Annual Report 2023
• Section 13.1 - Establish strong risk
management environment of the Annual
Report 2023

Since 2021, the annual risk workshop
identifies the top risks and opportunities tooffer a complete overview of our financial
and non-financial risks and opportunities andimprove the link between sustainability, risk
management, and strategy. In 2022 and2023, the risk mitigation process was further

More information on our Committee’s
activities can be found in the 8.3 “Key
activities of the supervisory board
committees in 2023”.

improved by connecting with relevant
strategic initiatives and follow ups on
progress on a quarterly basis.
Year-round, the Leadership Team ensures
the proper frameworks are put in place toguarantee that the progress on targets andgoals concerning actual and potential
climate-related financial and environmental
risks and impacts are appropriately identified
and assessed. And as part of the monitoring,
they set guidance on how to monitor
quantitatively targets to reduce carbon overthe value chain. Every quarter, Signify's BoM
reviews the processes relating to climaterelate issues together with our CSSO,
including material items, action plans, risk
management plans, sustainability budget, andSignify's Leadership Team, including our BoM,
are incentivized via Long Term Incentives(LTI). The vesting of 25% of the LTI grant isdependent on how well Signify performs on
its (climate-related) sustainability targets.
References:• Section 8 - Supervisory Board report of
the Annual Report 2023

Management's role in assessing and managing
climate-related risks and opportunities
Climate-related risks and opportunities aremanaged the same way as other risks.
Signify’s BoM is responsible for the overallrisk management associated with thecompany's activities. It is assisted by thecompany leadership team, which participateson a quarterly basis in audit risk and control
meetings organized by the Risk Committee,
to identify material risks and review progresson the implementation of risk responses,
including climate-related risks.
Sustainability is at the core of our strategy
and purpose. The executive responsibility forclimate-related issues is assigned to our
CSSO, to ensure the strong linkage andsynergy between the company’s strategy andsustainability commitments, as well as toSignify’s CSSO oversees a multi-discipline
Climate Risk Assessment Taskforce team,consisting of experts in Operations,
Insurance, Risk Committee, Internal Audit,
Sustainability, and Environmental, Health, andSafety (EHS). The Taskforce team is
responsible for the continuous evaluation of
the company’s short-term and long-termclimate-related risks and opportunities. This,as part of Signify’s integral risk management
and business control, contributes tomaximizing climate-related opportunities andimproving our resilience to climate change.
Members of the Board of Management are
eligible for a long-term equity-based
incentive under the Signify Long-term
Incentive Plan (LTI Plan). The objective of thelong-term incentive is to link pay with longterm sustainable value creation. In addition to
the Board of Management, anotherapproximately 700 employees globally are
eligible for participation in a similar long-term
incentive plan. Because of the importance ofsustainability for our long-term value
creation, the vesting of 25% of the annual
long-term incentive grant is dependent on
how well Signify performs on its sustainability
targets, including the targets related toclimate action.

Strategy
Climate-related risks and opportunities
identified and their impact
Risks are assessed and identified annually byconducting the TCFD assessment andreporting the findings in the annual report.
Signify assesses the materiality of climaterelated risks and opportunities based on
their likelihood of occurrence as well as theestimated magnitude of resulting financial
impact. The materiality assessment
performed is substantially similar to thatwhich Signify applies to all business risks andopportunities.
Based on this assessment, the company has
identified the following short/medium/longterm risks.
Transition risks and opportunities
According to the IEA B2DS and the IEA 450
scenario, we are expecting a world withdeeper and wider adaptation of renewableenergy, as well as continuous improvement ofenergy efficiency. The upcoming
environmental regulations and policies are
expected to be more stringent across theglobe, which helps stimulate the transition
toward green and low carbon technology.
This, on the other hand, will increase themarket demand for sustainable products.
The climate-related transition risks assessed
are presented in the below table. In line with
the IEA B2DS and the IEA 450 scenario, we

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Signify Sustainability Supplements 2023

have focused on transition risks relevant for
Signify in the following aspects: policy andIn terms of transition opportunities, we havefocused on the following aspects: resource

term opportunities, we made the following
assumptions:

legal, technology, market, and reputation.
For a few high-priority risks we performed a
regional deep-dive, the results of which are
shown in Figure A.

efficiency, products and services, markets,and resilience. To understand the potential
impact of the short-, medium-, and long-•

Transition risks and opportunities

Policy and legal

Technology

Potential Impact•

No marginal price erosion
Signify maintains its current market sharein the lighting industry
There will be an increased need forlighting based on population increase,urbanization, GDP growth and lighting
market intelligence.

Short term
(2025)

Medium term
(2030)Long term(2050)

Increased pricing of GHG
emission

The broader adaption of GHG pricing, carbon taxes, and trading schemes across theglobe will drive up operational and productions costs.

n

n

n

Change in regulatory
requirement for low-carbon
products

Increased revenue resulting from products and services that fulfill the low-carbon
and energy efficient requirements. This presents opportunity for Signify as we have astrong and differentiating portfolio of energy efficient and low-carbon products.

n

n

n

We anticipate the introduction of more stringent minimum energy performance
Substitution of existing products
standards for lighting products in the coming decade, in which case, the least energy
and services with lower emissions
efficiency products in our portfolio would be phased out and substituted. Therefore,
optionsrevenues from these products would decrease.

n

n

n

On top of the climate crisis, 2023 was also impacted by an energy crisis, making
energy reductions more urgent than ever. As lighting represents around 15% ofEnergy crisis driving demand form
global electricity consumption, the lighting industry will need to speed up adapting toenergy efficient and low-carbonchanging environmental regulations. This presents a large opportunity for Signify.
products
Through its global leadership in energy efficient lighting, Signify’s portfolio is uniquely
positioned to mitigate risks and invest in these opportunities.

n

n

n

MarketReputation

There are varying levels of regulatory
requirements on energy efficiency oflighting products••

Changing customer behavior

Growth in revenue resulting from increased customer awareness regarding climatechange and increase demand for products manufactured by a sustainable company
creating positive environmental and social impact.

n

n

n

Increased cost of raw materials

Signify’s suppliers who operate in regions vulnerable to extreme weather events (e.g.,
floods and hurricanes) could be affected by changes in physical climate parameters,
which may lead to disruption in supply chain and increased cost of raw materials.

n

n

n

Credibility of emissions-related
reporting and disclosure

Signify’s sustainability statements, including all topics related to emissions are audited
by independent third party against Reasonable Assurance. Credibility andtransparency of sustainability reporting has been our strength.

n

n

n

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Signify Sustainability Supplements 2023

Short term
(2025)

Medium term
(2030)Long term(2050)

Transition risks and opportunities

Potential Impact

Resource efficiency

Use of more efficient
production processes, use ofrecycling

Reduced operating costs (e.g., through efficiency gains and cost
reductions). Reduced exposure to GHG emissions and therefore lesssensitivity to changes in cost of carbon. Signify has implemented morethan 200 energy efficiency initiatives in our facilities worldwide andreduce 70% of carbon footprint in last decade.

n

n

n

Increased water pricing due toscarcity

Increased water pricing might drive up production cost in the medium andlong term. Using the Water Risk Monetizer tool by Ecolab, Trucost, andMicrosoft, we assessed our current portfolio of operating manufacturing
facilities, considering different scenarios of risk adjusted pricing forwater. Potential impact on business would be non-significant. Signify has
set a target to reduce 5% of water consumption every year.

n

n

n

n

n

n

n

n

n

n

n

n

n

n

n

n

n

n

Products and services

Development and/or expansion Reputational benefits resulting in increased demand for goods/services.
of low emission goods andIncreased revenues resulting from increased demand for low-carbon
services

products and services. Signify has a strong portfolio and leading market
position of low-carbon and energy efficient products and services.

Development of new products
or services through R&D andinnovation

Increased revenues resulting from increased demand for products andservices that are low-carbon and more energy efficient. Signify is strongin sustainable design and innovation.

Shift in consumer preferences

Increased revenues resulting from increased demand for products andservices that fulfill consumer’s low-carbon preferences. Signify has astrong portfolio, offering a wide range of low-carbon and energy efficient
products, systems and services.

Markets

Access to new markets

As part our strategy, Signify is driving 5 new growth for sustainability
areas to help address the world’s greatest challenges: (1) climate action,(2) circular economy, (3) food availability, (4) safety & security, and (5)health & well-being. Sustainable design and innovation will gain us accessto these markets, resulting in increased revenue.
Use of public-sector incentives Increase revenues from products, systems and services that align with
policy schemes. Signify’s energy efficient and low-carbon offering fit right
into the European Green Deal and the American Jobs Plan.

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Signify Sustainability Supplements 2023

Transition risks and opportunities

Potential Impact

Resilience

Participation in renewableenergy programs and adoptionof energy efficiency measures.

Reduced exposure to future fossil fuel price increases. Reduced
exposure to GHG emissions and therefore less sensitivity to changes incost of carbon. Signify has reduced 77% GHG emissions in its operationsin 2023 and used 100% renewable electricity since 2020.

Development of climate
adaptation and insurance risk
solutions

Increased resilience and reduced exposure to climate risks due to theestablishment of Signify Climate Risk Assessment Taskforce team in
2020. This dedicated multi-discipline Taskforce team consists ofexperts in Operations, Insurance, Risk Committee, Internal Audit,
Sustainability, and EHS. Climate adaptation and insurance risk solutions
are reviewed at least annually.

n High Riskn Medium Riskn Low Riskn High Opportunityn Medium Opportunityn Low Opportunity

Figure A: Transition risks and opportunities at regional level

Short term

Medium termLong term(2025)(2030)(2050)

n

n

n

n

n

n

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Signify Sustainability Supplements 2023

Physical risks
The climate-related physical risks arepresented in the table to the right. We havefocused on assessing physical risks relevant
for Signify’s manufacturing sites andwarehouses/distribution centers, namelyriverine flooding, coastal flooding, drought,
tropical storm, and heatwave. We evaluatedone short-term (2025) and two long-term(2100) scenarios: a below 2°C (SSP1-2.6
scenario – taking the sustainable road), andan above 4°C (SSP5-8.5 scenario – fossil
fueled development path). It is worth notingthat the long-term impact of physical risks is
influenced by climate change and degree of
global warming. In particular, the long-termrisks of riverine flooding, droughts, andShort term
(2025)Long term(2050)<2°C

Long term(2050)>4°C

Riverine flooding might be relevant for 23% of our sites. Due tohigh level of preparedness and high resilience at site level, risk
and exposure are expected to be low in the below 2°C
scenario.

nnnCoastal flooding

Coastal flooding might be relevant for 9% of our sites. Due tohigh level of preparedness and high resilience at site level, risk
and exposure are expected to be low.

n

n

n

Droughts

Droughts might be relevant for 21% of our sites. Due to highlevel of preparedness and high resilience at site level, risk andexposure are expected to the low in the below 2°C scenario.

n

n

n

Heatwaves

Only 6% of our sites might be affected by heatwaves. Due tohigh level of preparedness and high resilience at site level, risk
and exposure are expected to the low.

n

n

n

Tropical cyclones

Tropical might be relevant for 26% of our sites. Overall, a
medium risk level is perceived even in the below 2°C scenario.
For sites that are at higher risk in the long term, we keep
reviewing the risk profile and response plan for mitigation and/or adaptation.

n

n

n

Physical risk

Potential Impact

Riverine flooding

tropical cyclones under the above 4°C
scenario are expected to be significantly
higher than the below 2°C scenarios.
As a result of the 2023 climate-related
physical risk assessment, no risks are
identified as material. The assessment ofphysical risk is conducted on a yearly basis
due to the unpredictability of extreme
weather events, leading to an increased or
decreased level of risks due to climatechange. Nevertheless, Signify is well
prepared for climate-related physical risks
and have a resilient adaptation plan in theform of a cross-functional business
continuity plan. This adaptation plan enables
flexibility in terms production locations,employee working locations, sourcing
options, and transportation options, thereby
minimizing the overall impact of climaterelated physical risks on Signify’s operations
as well as value chain.

n High Riskn Medium Risk

Our business resilience
Mitigating climate related risks at Signify
Sustainability is at the core of our strategy
and purpose. Signify has a robust
sustainability program, Brighter Lives, Better
World, which sets ambitious target forclimate action. Signify is one of the firstcompanies committing to verified ScienceBased Targets in line with the Paris
Agreement 1.5°C pathway to cut GHG
emissions in our operations as well as in ourvalue chain.
Over the past decade, we implemented
hundreds of emission reductions initiatives in
our facilities worldwide, which enabled us toreduce 70% of our gross operationaln Low Risk
emissions. Since 2020, Signify uses 100%
renewable electricity and has invested inthree virtual Power Purchase Agreements(PPAs) to, on one hand, ensure long-termand high-quality renewable energy sourcing,on the other hand, enable the green power
grid transition. Signify has a strong position insustainable innovation and design. Oursustainable innovations continue torevolutionize the lighting industry toward
low-carbon and energy efficiency. In 2023,
we invested EUR 271 million in sustainable
innovation which represents 88% of Signify
R&D expenses. These investments in emission
reduction and sustainable innovation have led
to further improvements in the areas ofenergy efficiency and circular economy,largely improving our resilience to the futurechange of policy and regulations, the futurechange of (low carbon) technology, thefuture change of customer behavior andconsumer preference, the future resourceand energy scarcity; and in the meanwhile,
reduced our exposure to increase cost ofcarbon and fossil energy.
In terms of physical risks, the Climate Risk
Assessment Taskforce team, launched in
2020, has been screening and evaluating
relevant climate-related risks and theirimpacts in details for our sites all over theworld. These risks are reviewed at least once
per year at individual plant, regional, businessgroup and function, or company level. We
continue evaluating those sites at higher riskin the long term, discussing response

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Signify Sustainability Supplements 2023

strategies accordingly, and incorporatingclimate-related risks into company’s overall

enable us to understand our exposure toclimate risks, for the near term and the longcontinuous evaluation the company’s shortterm and long-term climate-related physicalPhysical risks

risk review cycles.

term. This allows us to develop appropriate
resilience framework for our own facilities aswell as our supply chains. For example, in
response to the energy crisis, which is a
climate-related transition risk, we are
exploring alternatives to source cleaner
energy to not only tackle the potential
energy shortage but also reduce emissions in
our operations. In addition, with strong anddifferentiated portfolio of low-carbon andenergy-efficient products, we are adapting
to new market trends that emerged due toclimate change and energy crisis.

and transition risks and opportunities under
difference climate change scenarios, as
illustrated in Figure B. We are proactively
investigating how physical and transition risks
affect our global operations. In response tothese identified risks and opportunities, wedevelop risk adaptation and mitigation
strategies that enhance our operational
resilience, risk management, and financial
planning.

under different climate change scenarios,
namely a short-term scenario, and two longterm scenarios in line with the Shared Socioeconomic Pathways (SSP) described in the
IPCC AR6 report: a below 2°C or SSP1-2.6
scenario – taking the sustainable path, andan above 4°C or SSP5-8.5 scenario – fossil
fueled development path. The SSPs are
narratives describing alternative socioeconomic trends that shape future

Mitigating climate related risks in supply chain
Climate change related physical risks indifferent geographical locations could
potentially interrupt our supply chain andbusiness continuity. Nevertheless, due to ourwide-ranging supply network, these risks arewell monitored and not considered material
at present.
Regular surveys are conducted by Signify toidentify and rank the suppliers based on theirvulnerability to climate related physical andtransition risks. As a result, we developed arobust adaptation strategy (including but notlimited to dual sourcing practices) for our
supply chain. This enables us to respond
appropriately and timely; and prevent
disruptions to our business operations. We
optimize our supply chains for their efficiency
and resilience to climate risk.
We engage with suppliers on a variety ofactivities and training sessions to enhancetheir capability and resilience with regard toclimate change related risks.

Climate change adaptation strategy
Climate related risks and opportunities aretaken into consideration in our business
continuity strategies. In the long term, weare committed to continue deepening ourunderstanding around climate-related risks
and opportunities.
We implement a proactive approach toclimate risk adaptation. The risk andvulnerability assessments carried out by the
Climate Risk Assessment Taskforce team

Climate-related physical risks are assessed

Ultimately, our climate change adaptation
approach improves our resilience to climaterelated risks as well as allows risks oropportunities response plans and strategies
to be developed in a timely matter.
References:• Section 2 CEO Letter of the Annual Report2023• Section 4.4 Better World of the Annual
Report 2023
• Section 5.1 Financial performance of theAnnual Report 2023
• Section 13.5 Climate change of the Annual
Report 2023

Risk Management
Climate-related risks and opportunities
assessment process
Since 2020, the dedicated multi-discipline
Climate Risk Assessment Taskforce team,consisting of experts in Operations,
Insurance, Risk Committee, Internal Audit,
Sustainability, and EHS is responsible for the

Figure B: Signify's climate risk assessment approach

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Signify Sustainability Supplements 2023

scenarios. In line with the latest climate
sciences, the SSPs explore the climate

Transition risks
The Climate Risk Assessment Taskforce teampractice. Our leadership team is responsiblefor identifying the critical business risks andor qualitative aspects and reviewed with theboard of management. On a quarterly basis,

responses of a range of possible futureatmosphere GHG concentrations and analyze
the resulting changes in future global
temperatures compared to pre-industrial
levels.

continuously follows external trends ofmarket (energy crisis), policy, regulations,(low carbon) technology, and customer
preference, in order to identify near-term,
medium-term, and long-term transition risks
in line with the IEA scenarios including the IEA
Below 2 Degrees scenario (IEA B2DS) and the
IEA 450 scenario. Signify's BoM is briefed
each quarter to review the transition risks
and opportunities, as well as the short,medium, and long-term response strategies.

for implementing appropriate risk responses.
We continuously follow external trends todetermine the issues most relevant for ourcompany and where we can have thegreatest positive impact.

risks and controls are reviewed in the audit
risk committees with the Divisions, Market
Groups and specific Functions. As part of theBusiness Continuity plan, we continue
monitoring our exposure to climate-relatedrisks and are working at individual plant levelto mitigate and minimize the impact of thoserisks.

The physical risk assessment approachconsists of three steps: risk mapping, risk
assessment, and risk mitigation. Signify
continues to monitor its exposure to physicalrisks related to climate change and is working
at individual plant level to reduce andmitigate the impact of those risks. The firststep is risk mapping for all our manufacturing
facilities and warehouses/distribution

References:• Chapter 13 of the Annual Report 2023

For risk management, a comprehensive viewof the company’s business strategy andactivities is required. To do so, Signify’s risks
and opportunities are identified, assessed,
managed, and controlled in a structured way,
combining elements of top-down andbottom-up approaches.
For climate-related strategic risks, theFor climate-related compliance risks, we
continuously follow external trends,
especially the development of regulations
and policies focusing on the productenvironmental impact and transition to a netzero economy, and other emerging

centers under different IPCC climate change
scenarios. Site risk mapping identifies, among
others, physical risks related to climate
hazards, such as flooding, heatwaves,droughts, etc. Subsequently, a risk
assessment is performed depending on thegeographical location, the type of activity,

Climate-related risks and opportunities
management process
Climate-related risks and opportunities aremanaged the same way as other risks.
Signify's risk management focuses on thefollowing risk categories: Strategic,
Operational, Compliance, and Financial risks.

company leadership team review the risks
and ranks them based on impact, likelihood,risk criticality and control effectiveness,during the annual risk workshop. Owners are
assigned and accountable for ensuring
adequate risk mitigation and monitoringmeasures are implemented. The outcome of

discussion. Potential risks of non-compliance
are regularly reviewed within Signify atregional, business group, or company level.
This ensures our preparedness against
emerging regulations and policies and ability
to adjust our portfolio.

and financial exposure related to a specificfacility and/or operation. We evaluate theenvironmental, social, and governanceaspects which have the greatest impact on
our business and the greatest level ofconcern to stakeholders along our value
chain. These direct or indirect aspects may
represent opportunities and risks, and thus
influence our ability to create or preserve
economic, environmental, and social value forour stakeholders and for Signify. Assessingthese aspects enables us to understand theirimplications in financial and non-financial
terms, thereby prioritizing risk mitigation andeffectively addressing them in our policies
and programs.

As climate-related risks cuts across all thesefour categories, climate-related risk
management is fully embedded in our risk
management process and recognized at the
management level.

the risk workshop is integrated in thestrategic planning cycle. Each quarter the
key risks are discussed during the audit andrisk committee meetings. Reported risks andopportunities are analyzed for potential
cumulative effects and are aggregated at
Division, Market Group, and company level.

For climate-related financial risks, since2020, the Climate Risk Assessment Taskforce
team has been screening and evaluating
relevant climate-related risks and theirfinancial impacts in details for our sites allover the world. These risks are reviewed atleast once per year at individual plant,
regional, business group and function, or
company level. This improves our resilience
to climate-related risks and allows risks
response plans/strategies to be developed ina timely matter.

Signify’s Business Control Framework (BCF)
sets the standard for risk management andbusiness controls in the company. The
objectives of the BCF are to maintainintegrated management control of thecompany’s operations, in order to ensure theintegrity of the financial reporting andrelated disclosure including disclosure ofclimate-related risks, as well as compliancewith applicable laws and regulations. We
regularly evaluate and improve our BCF toalign with business dynamics and good

For climate-related operational risks, risks
are reviewed on a regular basis as part of thebusiness performance reviews or, for
specific topics, through dedicated risk
committees. In addition, on an annual basis
the top risks are identified by the company’s
leadership team. Relevant risks including
those associated with business opportunities
are prioritized in terms of potential impact
and likelihood, considering quantitative and/

References:• Section 4.4 Better World of the Annual
Report 2023
• Chapter 13 of the Annual Report 2023

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Signify Sustainability Supplements 2023

Metrics and targets
Manage climate-related risks andopportunities and performance against
targets.
Sustainability is at the core of our company
strategy and purpose. Climate action isperceived as the most material topic by ourinternal and external stakeholders as theresult of our 2023 double materiality
assessment. Signify is committed to double
our positive impact on the environment andsociety by the end of 2025. Our climaterelated metrics and targets are provided in
the table.
References:• Chapter 4.4 of the Annual Report 2023

Targets

Baseline year Target year<≡>

Definition

Brighter Lives, Better World 2025 program
Double the pace we achieve the 1.5º degree scenarioof the Paris Agreement (Full scope 1 + 2 +3)

100% Renewable Electricity

2019 (0)2015 (58%)

2025

The cumulative yearly difference between the GHG
emissions of Paris Agreement 1.5°C pathway and the actual
value chain emissions of Signify.

2020
Percentage of electricity from renewable sources.
(100% Achieved)

Approved Science-Based Targets, 1.5º scenario
Reduce by 70% carbon emissions from scope 1 and 2

2015

2030

Reduction of 70% of absolute scope 1 and 2 GHG emissions

Reduce by 30% carbon emissions from scope 3
product use

2015

2030

Reduction of 30% of absolute scope 3 GHG emissions fromuse of sold products

Metrics

2023

Scope 1148

kilotonnes CO2-equivalent

Scope 2 (market based)0

kilotonnes CO2-equivalent

Scope 2 (location based)

129

kilotonnes CO2-equivalent

Scope 3 (indirect emission categories):
Category 1: Purchased good and services

Unitkilotonnes CO2-equivalent683

kilotonnes CO2-equivalentCategory 2: Capital goods

15

kilotonnes CO2-equivalentCategory 3: Fuel-and Energy-related activities, Not included in
Scope 1 or Scope 2

33kilotonnes CO2-equivalentCategory 4: Upstream transportation and distribution, of which:87kilotonnes CO2-equivalent• Air transport

20

kilotonnes CO2-equivalent• Road transport

27

kilotonnes CO2-equivalent• Ocean transport

40

kilotonnes CO2-equivalentCategory 5: Waste generated in operations

9

kilotonnes CO2-equivalentCategory 6: Business travel

13

kilotonnes CO2-equivalentCategory 7: Employee commuting

35

kilotonnes CO2-equivalentCategory 11: Use of sold products

191,779

kilotonnes CO2-equivalent

18

kilotonnes CO2-equivalentCategory 12: End of life treatment and sold products
Operational carbon footprint efficiency

0.37

kilotonnes CO2-equivalent per million-euro sales

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Signify Sustainability Supplements 2023

5 Task Force on
Nature-related
financialdisclosures (TNFD)

For the world to achieve a sustainable future,dependencies, risks, and opportunities and tobusinesses need to address theirdependencies and impact on nature including
biodiversity, ecosystem services, water, andclimate. As well as this over-arching reason
for taking action on biodiversity, a range of
regulatory and policy drivers and market-led
initiatives are compelling companies to better
understand and address their interfaces withnature. These include CSRD (Corporate
Sustainability Reporting Directive), ESRS(European Sustainability ReportingStandards), TNFD (Taskforce on Nature
related Financial Disclosures), along with
European regulation addressing
deforestation (European Deforestation

support us in the development of abiodiversity action plan. Following the TNFD
Locate-Evaluate-Assess-Prepare (LEAP)
framework, the consultancy conducted abiodiversity assessment across our value
chain, including our direct operations(manufacturing sites, offices, and legacy
sites), supply chain partners, commodities,
and production processes, and through theuse of our lighting products.

Regulation [EUDR]), supply chaintransparency (increasing TNFD and CSRD
focus on supply chains) and offshore
sourcing (Carbon Border Adjustment
Mechanism [CBAM]).

risks and opportunities.

In 2022, we assessed the biodiversity impacts

legacy sites) using the WWF Biodiversity andWater Risk Filters which assess a broad rangeof biodiversity indicators at each site todetermine potential site-specific impacts anddependencies on nature. From that 16
priority sites were shortlisted based on theirpotential risk for biodiversity impacts, mainly
through pollution.

of our own operations. Using the Integrated
Biodiversity Assessment Tool (IBAT) we
assessed 175 hectares of land used for
manufacturing operations and found that no
manufacturing sites were operating within
Key Biodiversity Areas (KBAs), or protectedareas (areas of land, freshwater, or sea
legally protected and managed, as least inpart, for nature conservation). A deeper
assessment of 11 sites within two kilometersof KBAs and protected areas examined
potential impacts on land, soil, water, and air,and found no impacts that required mitigation
at that time.
In 2023, we engaged a specialized naturesustainability consultancy to deliver a value
chain assessment of our biodiversity impacts,

The following sets out the key findings on
biodiversity impacts and dependencies,
identifying priority areas for further
investigation, and the associated business

Own operations
We conducted a desk-based screening of
352 Signify sites (including factories,
laboratories, offices, warehouses, shops, andEight sites are considered potential for highrisk given there was reasonable evidence of apotential impact pathway between the site’s
operations and important biodiversity
features within the nearby landscape. The
impacts were potential water and soil
pollution, ground water abstraction, anddisturbances (disturbances can impact
nature through prolonged or excessive noiseor light from operating facilities).

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Signify Sustainability Supplements 2023

While sites reported that they have sufficientenvironmental impact management andgroundwater in basic extractive andprocessing industries pose physical supply

Framework, product Environmental ProductDeclarations [EPDs]). 33% of plastic suppliers

LED’s is greater than any other priority
commodity, and the spend representing 26%

mitigation measures in place, it wasrecommended that for these eight priority
sites a field-based assessment should be
performed to verify the possible impacts
identified through the desk research andreview the mitigations in place. Site-based
assessments will provide useful informationon the potential need for further mitigations
to reduce or more effectively prevent
impacts but also the enhancements that
could be implemented and/or promotebiodiversity on and near the site.

risks beyond our sphere of influence.
Opportunities exist to minimize impacts anddependencies on nature, and mitigate risk, byengaging with key supply chain partners toscale up circular economy and recycling
opportunities, and to increase the use of
viable, sustainable, alternative materials.

stated that they use recycled materials andwe have already actively reduced fossilbased plastic use in packaging and haveminimized landfill to below 1 percent. Anotherarea for significant plastic reduction was
identified in received plastic packaging fromsuppliers.

Fifteen of our largest suppliers for priority
commodities responded to our questionnaire
about sustainable material use, sourcing
practices and biodiversity targets andmetrics as part of this assessment. Increased
and ongoing supply chain engagement will benecessary to fully evaluate how the identified

Recycled material use in the aluminum andsteel supply chain should also be reassessedas the current volumes (10-15% recycled
aluminum and 27% steel scrap) present
opportunities for increased recycling
capacity. Alternative materials made fromsustainably sourced materials were alsoof total spend. In addition, outsourced LED
manufacturers are certainly exposed to all of
the impact and dependency-related risks
identified for other material inputs (batteries,
plastics, aluminum steel, cardboard, andsemiconductors). The extent to which these
upstream suppliers have identified andmitigated nature-related risks is currently
unknown.

nature- related risks are being addressed byindividual suppliers. 47% of suppliers
surveyed in this assessment stated that theyknew nearly all (between 76-100%) of theirtier 2+ suppliers. Further engagement with
suppliers on improving supply chain visibility(e.g., gathering geographic locations ofidentified for further investigation,
particularly where there are limits torecycled content use (e.g., extruded
aluminum). Small markets already exist forsuch products, but demand is currently
consumer driven, and the feasibility of
economic scaling is required.

Supply chain
Owing to the volume of input materials andthe scale of outsourced production, oursupply chain poses significant potential
material impacts and dependencies onnature. Distribution of sourcing across a wide
range of direct (tier 1) suppliers, and limited
visibility of indirect (tier 2+) suppliers adds
further complexity and scale to potential
nature-related issues. Limited transparency
in long supply chains will also likely restrict
our scope of influence in certain areas,
requiring closer supplier engagement andcollaboration to identify and address naturerelated risks and opportunities.
In the production processes and supply of
three products (LED, fluorescent, andincandescent lamps), seven priority
commodities were highlighted due to highimpacts and dependencies on nature:outsourced LED’s, batteries, plastics,
aluminum, steel, cardboard, andsemiconductors. Material water related risks
are present in the upstream production of allcommodities. The upstream consumption ofand reliance on surface water andindirect upstream suppliers and sources oforigin) can allow us to better assess themagnitude and likelihood of physical risks,
and the exposure to reputational andtransitional risks.
There are also areas for optimization inrecycled materials use. At present, the actualand potential use of recycled materials varies
across priority commodities. Recycling among
cardboard suppliers is already mature, and all
surveyed suppliers stated that they use
recycled materials in their supply to Signify.
Signify’s large plastic supply chain (240suppliers) represents a source of transitionalrisks given the growing momentum around
reducing plastic waste (e.g., the Global
Plastics Treaty, Global Biodiversity

Complex goods such as semiconductors have
limited options for recycled inputs andtherefore have greater long-term reliance on
biodiversity and ecosystem services, inparticular rare earth minerals, silica sand andquartz, of which there should be carefulconsideration of long-term availability giventhese are finite natural resources withpotentially significant negative impacts onnature.
Finally, outsourced LED lamp production
presents the largest set of physical andtransition risks. Supply chain transparency
and risk management with outsourced LED
lamp producers should be prioritized. The
number of direct suppliers for outsourced

Products
The evidence base around the impacts ofartificial lighting on biodiversity is growing,
and the awareness of these issues isincreasing globally. Light pollution is alreadyidentified within the Global Biodiversity
Framework (GBF) under Target 7 due to its
potential to disrupt the behavior of wildlife
species, with population-level effects. Such
impacts, along with increased public andpolicy- maker awareness of the issue, poses
potential reputational risks. Further, there
may be future transitional risks if specificlight pollution targets are included in future
iterations of GBF Targets and the related
national-level policies and goals around light
pollution.
In the assessment of product use impacts,
seven priority outdoor settings with thegreatest potential impact on biodiversity
were defined based on a comprehensive
review of artificial lighting and biodiversity
scientific literature, combined with anassessment of the product portfolio. These
were: roads, streets & utility; parks; harbor,
ports & airports; food production;
residential; wildlife, turtle & observatory.

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Signify Sustainability Supplements 2023

It is important to recognize that while theimpact pathways between lighting products

Biodiversity roadmap

and nature can be severe and large in scale,our sphere of influence over the deployment
and use of products is typically limited. There
are also necessary trade-offs where humanhealth and safety requirements preclude theuse of biodiversity-friendly lighting
alternatives.

be taken until 2025 across the three focal
areas of our biodiversity assessment.

Despite these barriers, there areopportunities to leverage our position as aleading lighting solutions provider, and as acompany which is active in the research,development, and deployment of
biodiversity-friendly lighting products.
Commercial considerations around theavailability of low-impact products in highimpact settings (e.g., aquaculture and parks)
may allow us to influence the uptake of
biodiversity-friendly alternative lighting
across a range of use settings. By engaging
with and educating commercial and domestic
customers through consultations andcommunication campaigns, Signify may beable to change practices around light use to
avoid or minimize impact on biodiversity.
Additionally, by supporting research aroundartificial light and the impacts on nature, we
can lead on innovative product development
and contribute to the evidence base to put
forward and support policy initiatives aroundthe use of biodiversity-friendly lighting
products globally.
The outcome of this value chain assessment
has supported the development of ourbiodiversity roadmap to 2025.

The following details the concrete actions to

Own operations• Conduct field-based environmental
assessments for the eight priority sites
identified as potential high-risk due toproximity to nature.
• Launch best practice guidance on
biodiversity for sites and educate our
employees.
• Enhance biodiversity actions at our sites
through habitat creation and reduction oflight disturbance.

Supply chain• Implement monitoring process and datacollection for the largest suppliers withinpotential high-risk commodities.
• Deliver trainings on biodiversity and engage
our Tier 1 suppliers in impact management.
• Explore sustainable alternative materials to
reduce the demand of potential high-risk
commodities.
• Further assess biodiversity and water
scarcity issues for potential high-risk
commodities.

Products• Explore partnerships to fund conservation
efforts with nature-friendly light products.
• Embed biodiversity findings andrecommendations in our commercial
process to support customers in mitigating
impact.

Our roadmap will support us to further
integrate biodiversity actions across all areas

In 2023, we launched our Biodiversity policy
and we continued to contribute toof our business. While the outcome of our2023 double materiality assessment did not
find biodiversity to be a material topic for
Signify, we acknowledge that it is our
responsibility to identify our negative andpositive impacts and to take action forbiodiversity conservation.

biodiversity conservation through two
projects located in China. The Qianbei
Afforestation Project and the Liangdu
Afforestation Project. Through theseprojects we contribute to ensuring that morethan 73,700 hectares of barren land isreforested with native species.

To mitigate potential negative impact on
biodiversity, we already have processes andactivities in place, such as:• Our sustainable supply chain program
which covers, besides other points,
environmental impact and management
systems in our supply base.

Based on our methodology for calculating
societal impact, we created EUR 102 million
for society through these reforestation
projects.

• Our sustainable packaging requirements,
which stand against deforestation ofnatural forests and habitats and promote
the use of sustainable materials.
• Our fossil-based plastic-free packaging
achievement in consumer related
products, which contributes to less plastic
pollution in nature and oceans.
• Our horticulture lighting portfolio, which
contributes to vertical farming to increase
food production while decreasing land use
and the use of fertilizers and pesticides.
• Our light spectrum, which helps maintainingbalanced ecosystem by displaying minimal
attraction for insects, enabling bats tobehave the same way as if it was fulldarkness and preventing lit roads fromacting as borders or obstacles to be
crossed at night.

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6

GRI content index

Signify reports in accordance with GRI and sets the threshold for most material topics as defined by GRI in the top right part of the materiality matrix. The two most material topics above thisreporting threshold are Climate action and Circular Economy. We continue to report on Climate action and Human rights GRI topic specific standards disclosures in the index below and our working
to incorporate Circular economy related topical disclosures in the following year.
GRI SRS

Disclosure requirements

Reference to the Annual Report 2023

GRI 2-1
a. Report its legal name
Organizational details b. Report its nature of ownership and legal formc. Report the location of its headquarters
d. Reports its countries of operations

11 Corporate Governance (a, b)
3.1 Our strategy (c, d)

GRI 2-2
Entities included in
the organization's
sustainability
reportinga. List all its entities included in its sustainability reportingb. If the organization has audited consolidated financial statements or financial information files on public record, specify
the differences between the list of entities included in its financial reporting and the list included in its sustainability
reportingc. If the organization consists of multiple entities explain the approach used for consolidating the information including: i)whether the approach involves adjustments to information for minority interests; ii) how the approach takes into accountmergers, acquisitions, and disposal of entities or parts of entities; iii) whether and how the approach differs across thedisclosures in this Standard and across material topics

4.1 Approach to sustainability
reporting (a)15.6 Notes to the consolidated financial
statements: [3] Information by segment and main
country; [12] Interest in entities (b, c)

GRI 2-3a. Specify the reporting period;

4.1 Approach to sustainability reporting (a, b, c)

Reporting period,
frequency andcontact pointb. Specify the reporting period for its financial reporting and, if it does not align with the period for its sustainability
reporting, explain the reason for this;c. Report the publication date of the report or reported information;d. Specify the contact point for the questions about the report or reported information

January 1 – December 31, 2023 (b)February 27, 2024 (c)Back cover Annual Report 2023 (d)GRI 2-4
Restatements of
information

a. Report restatements of information made from previous reporting periods and explain: i) the reasons for therestatements; ii) the effect of the restatements

Where relevant, restatements have been
disclosed and explained in the Annual Report2023
Sustainability Supplements 2023 – Datadefinitions, boundaries, and scope
4.1 Approach to sustainability reporting

GRI 2-5External assurance

a. Describe its policy and practice for seeking external assurance, including whether and how the highest governancebody and senior executive are involved
b. If the organization’s sustainability reporting has been externally assured: i) provide a link or reference to the external
assurance report(s) or assurance statement(s): ii) describe what has been assured and on what basis including the

18 Combined independent auditor’s report (a, b)

assurance standards used the level of assurance obtained, and any limitations of the assurance process; iii) describe therelationship between the organization and the assurance provider

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Signify Sustainability Supplements 2023

GRI SRS

Disclosure requirements

Reference to the Annual Report 2023

GRI 2-6

a. Report the sector(s) in which it is active

3 Creating long-term value (a, b, c)

Activities, value chain b. Describe its value chain, including: i) the organization’s activities, products, services, and markets served; ii) theand other businessorganization’s supply chain; the entities downstream from the organization and their activities
relationships
c. Report other relevant business relationships
d. Describe significant changes in 2-6-a, 2-6-b, and 2-6-c compared to the previous reporting period

5 Corporate performance (a, b, c)
4.1 Approach to sustainability reporting (d)Sustainability Supplements 2023 - Datadefinitions, boundaries, and scope (a, b, c, d)

GRI 2-7
Employees

a. Report the total number of employees, and a breakdown of this total by gender and by region;b. Report the total number of: i) permanent employees, and a breakdown by gender and by region; ii) temporary
employees, and a breakdown by gender and by region; iii) non-guaranteed hours employees, and a breakdown by genderand by region; iv) full-time employees, and a breakdown by gender and by region; v) part-time employees, and a
breakdown by gender and by region;c. Describe the methodologies and assumptions used to compile the data, including whether the numbers are reported: i)in head count, full-time equivalent (FTE), or using another methodology; ii) at the end of the reporting period, as anaverage across the reporting period, or using another methodology;
d. Report contextual information necessary to understand the data reported under 2-7-a and 2-7-b;e. Describe significant fluctuations in the number of employees during the reporting period and between reporting

4.3.1 Talent & Development (a, b, d, e)
4.3.2 Diversity, equity & inclusion (b, d)Sustainability Supplements 2023 – Datadefinitions, boundaries, and scope (b, c, d)Information not available. As described in the"Sustainability Supplements 2023 – Datadefinitions, boundaries, and scope, ” social data
covers all employees that have been fully
integrated in our systems and excludes
contingent workers. We do not have enough data

periods.

about contingent workers to currently report at
a global level. (b iii)

a. Report the total number of workers who are not employees and whose work is controlled by the organization anddescribe:i) the most common types of worker and their contractual relationship with the organization; ii). the type ofwork they perform;b. Describe the methodologies and assumptions used to compile the data, including whether the number of workers who

Total number of contingent workers in 2023 isincluded in our FTE final numbers (2023: 31,920)
and is 4,332 (a)Sustainability Supplements 2023 – Data

GRI 2-8
Workers who are not
employees

are not employees is reported: i) in head count, full-time equivalent (FTE), or using another methodology; ii) at the end of definitions, boundaries, and scope (a, b, c)
the reporting period, as an average across the reporting period, or using another methodology.
4.3.1 Talent and Development (a, c)c. Describe significant fluctuations in the number of workers who are not employees during the reporting period andbetween reporting periods.
GRI 2-9
Governancestructure andcomposition

a. Describe its governance structure, including committees of the highest governance body;b. list the committees of the highest governance body that are responsible for decision making on and overseeing themanagement of the organization’s impacts on the economy, environment, and people;
c. Describe the composition of the highest governance body and its committees by: i) executive and non-executive
members; ii) independence; iii) tenure of members on the governance body; iv) number of other significant positions andcommitments held by each member, and the nature of the commitments; v) gender; vi) under-represented social groups;vii) competencies relevant to the impacts of the organization; viii) stakeholder representation.

7 Board of Management (a, b, c)
8 Supervisory board (a, b, c)
9 Supervisory board report (a, b, c)
11 Corporate governance (a, b, c) For more onother positions and commitments (iv.): https://www.signify.com/global/ourcompany/investors/
governance/supervisory-board

GRI 2-10
Nomination andselection of thehighest governancebody

a. Describe the nomination and selection processes for the highest governance body and its committees;
9 Supervisory board report (a, b)
b. Describe the criteria used for nominating and selecting highest governance body members, including whether and how 11 Corporate governance (a, b)
the following are taken into consideration: i) views of stakeholders (including shareholders); ii) diversity; iii)
independence; iv) competencies relevant to the impacts of the organization.

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GRI SRS

Disclosure requirements

Reference to the Annual Report 2023

GRI 2-11

a. Report whether the chair of the highest governance body is also a senior executive in the organization;

11 Corporate Governance (a,b)

Chair of the highest
governance bodyb. If the chair is also a senior executive, explain their function within the organization’s management, the reasons for thisarrangement, and how conflicts of interest are prevented and mitigated.

GRI 2-12
Role of the highest
governance body inoverseeing themanagement of
impactsa. Describe the role of the highest governance body and of senior executives in developing, approving, and updating theorganization’s purpose, value or mission statements, strategies, policies, and goals related to sustainable development;b. Describe the role of the highest governance body in overseeing the organization’s due diligence and other processes
to identify and manage the organization’s impacts on the economy, environment, and people, including: i) whether andhow the highest governance body engages with stakeholders to support these processes; ii) how the highest
governance body considers the outcomes of these processes;
c. Describe the role of the highest governance body in reviewing the effectiveness of the organization’s processes as
described in 2-12-b, and report the frequency of this review.

GRI 2-13
Delegation of
responsibility fora. Describe how the highest governance body delegates responsibility for managing the organization’s impacts on the
4.1 Approach to sustainability reporting (a, b)
economy, environment, and people, including: i) whether it has appointed any senior executives with responsibility for the 9 Supervisory Board report (a, b)
management of impacts; ii) whether it has delegated responsibility for the management of impacts to other employees;

managing impacts

b. Describe the process and frequency for senior executives or other employees to report back to the highest
governance body on the management of the organization’s impacts on the economy, environment, and people.

GRI 2-14
Role of the highest
governance body insustainability
reportinga. Report whether the highest governance body is responsible for reviewing and approving the reported information,
including the organization’s material topics, and if so, describe the process for reviewing and approving the information;b. If the highest governance body is not responsible for reviewing and approving the reported information, including theorganization’s material topics, explain the reason for this.

4.1.1 Sustainability governance (a, b)
4.1.4 Materiality assessment (a, b)

GRI 2-15
Conflicts of interest

a. Describe the processes for the highest governance body to ensure that conflicts of interest are prevented andmitigated;b. Report whether conflicts of interest are disclosed to stakeholders, including, at a minimum, conflicts of interest
relating to: i) cross-board membership; ii) cross-shareholding with suppliers and other stakeholders; iii) existence ofcontrolling shareholders; iv) related parties, their relationships, transactions, and outstanding balances.

11.5 Other governance matters - Conflict ofinterests (a)9 Supervisory Board report (b)GRI 2-16
Communication ofcritical concerns

a. Describe whether and how critical concerns are communicated to the highest governance body;b. Report total number and the nature of critical concerns that were communicated to the highest governance bodyduring the reporting period

13.1 Establish strong risk management
environment (a, b)
4.3.5 Business ethics (b)9 Supervisory board report (a, b)
11 Corporate Governance (a,b)
4.1.1 Sustainability governance (c)4.1.4 Materiality assessment (c)GRI 2-17
a. Report measures taken to advance the collective knowledge, skills, and experience of the highest governance body on 9 Supervisory board report (a)Collective knowledge sustainable developmentof the highest
governance body
GRI 2-18
Evaluation of theperformance of thehighest governancebody

a. Describe the process for evaluating the performance of the highest governance body in overseeing the management
Evaluation of the performance of the highestof the organization’s impacts on the economy, environment, and people;
governance body in 2023 was independent.
b. Report whether the evaluations are independent or not, and the frequency of the evaluations;
9 Supervisory Board report (a, b, c)
a. Describe actions taken in response to the evaluations, including changes to the composition of the highest governancebody and organizational practices

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GRI SRS

Disclosure requirements

Reference to the Annual Report 2023

GRI 2-19

a. Describe the remuneration policies for members of the highest governance body and senior executives, including: i)

10 Remuneration report (a, b)

Remuneration
policies

fixed pay and variable pay; ii) sign-on bonuses or recruitment incentive payments; iii) termination payments; iv) clawbacks;v) retirement benefits;
b. Describe how the remuneration policies for members of the highest governance body and senior executives relate totheir objectives and performance in relation to the management of the organization’s impacts on the economy,
environment, and people.

GRI 2-20
a. Describe the process for designing its remuneration policies and for determining remuneration, including: i) whether
Process to determine independent highest governance body members or an independent remuneration committee oversees the process forremuneration
determining remuneration; ii) how the views of stakeholders (including shareholders) regarding remuneration are sought
and taken into consideration; iii) whether remuneration consultants are involved in determining remuneration and, if so,whether they are independent of the organization, its highest governance body and senior executives;b. Report the results of votes of stakeholders (including shareholders) on remuneration policies and proposals, if
applicable.

No policy change in 2023.
10 Remuneration report (a, b)

GRI 2-21

a. Report the ratio of the annual total compensation for the organization’s highest-paid individual to the median annual

Signify uses a different methodology andAnnual totalcompensation ratio

total compensation for all employees(excluding the highest-paid individual);b. Report the ratio of the percentage increase in annual total compensation for the organization’s highest-paid individual
to the median percentage increase in annual total compensation for all employees (excluding the highest-paid individual);c. Report contextual information necessary to understand the data and how the data has been compiled.

therefore will be considered “incomplete”
according to the GRI Standard. Signify applies amethodology to calculate the internal pay ratiothat is IFRS-driven (i.e. linked to Signify’s notes to
the Consolidated financial statements). Signify’s
pay ratio reflects the average total compensationof the total global employee workforce, relative
to the total remuneration package of the CEO,the highest-paid individual.
10.2.10 Signify's internal pay ratio (a, b, c)

GRI 2-22
Statement onsustainable
development
strategya. Report a statement from the highest governance body or most senior executive of the organization about therelevance of sustainable development to the organization and its strategy for contributing to sustainable development.

2 CEO Message (a)

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GRI SRS

Disclosure requirements

Reference to the Annual Report 2023

GRI 2-23

a. Describe its policy commitments for responsible business conduct, including: i) the authoritative intergovernmental

13.1 Establish strong risk management

Policy commitments

instruments that the commitments reference; ii) whether the commitments stipulate conducting due diligence; iii).
whether the commitments stipulate applying the precautionary principle; iv) whether the commitments stipulate
respecting human rights;
b. Describe its specific policy commitment to respect human rights, including: i) the internationally recognized humanrights that the commitment covers; ii) the categories of stakeholders, including at-risk or vulnerable groups, that theorganization gives particular attention to in the commitment;c. provide links to the policy commitments if publicly available, or, if the policy commitments are not publicly available,
explain the reason for this;d. Report the level at which each of the policy commitments was approved within the organization, including whether thisis the most senior level;
e. Report the extent to which the policy commitments apply to the organization’s activities and to its business
relationships;
f. Describe how the policy commitments are communicated to workers, business partners, and other relevant parties.

environment (a, c, d, e, f)
4.1 Approach to sustainability reporting (a, c, d, e,f)
4.3.3 Human rights (b)Sustainability Supplements 2023 (a, b, c, d, e, f)
All policies can be found on our website.

GRI 2-24

a. Describe how it embeds each of its policy commitments for responsible business conduct throughout its activities and4.1.2 Sustainability governance (a)Embedding policy
commitments

business relationships, including: i) how it allocates responsibility to implement the commitments across different levels
within the organization; ii) how it integrates the commitments into organizational strategies, operational policies, andoperational procedures; iii) how it implements its commitments with and through its business relationships; iv) trainingthat the organization provides on implementing the commitments.

13.1 Establish strong risk management
environment (a)Sustainability Supplements 2023 (a)GRI 2-25
Processes toa. Describe its commitments to provide for or cooperate in the remediation of negative impacts that the organization
identifies it has caused or contributed to;

4 Brighter Lives, Better World (a, b, c)
13 Risk factors and risk management (a, b, c)

remediate negative
impactsb. Describe its approach to identify and address grievances, including the grievance mechanisms that the organization
4.1.4 Materiality assessment (d, e)
has established or participates in;
4.3.5 Business ethics (b,c,e)c. Describe other processes by which the organization provides for or cooperates in the remediation of negative impacts
that it identifies it has caused or contributed to;
d. Describe how the stakeholders who are the intended users of the grievance mechanisms are involved in the design,
review, operation, and improvement of these mechanisms;
e. Describe how the organization tracks the effectiveness of the grievance mechanisms and other remediation
processes, and report examples of their effectiveness, including stakeholder feedback.

GRI 2-26
Mechanisms forseeking advice andraising concerns

a. Describe the mechanisms for individuals to: i) seek advice on implementing the organization’s policies and practices forresponsible business conduct; ii) raise concerns about the organization’s business conduct.

13.1 Establish strong risk management
environment (a)4.3.5 Business ethics (a)

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GRI SRS

Disclosure requirements

Reference to the Annual Report 2023

GRI 2-27

a. Report the total number of significant instances of non-compliance with laws and regulations during the reporting

Through our internal audit and compliance

Compliance with laws period, and a breakdown of this total by: i) instances for which fines were incurred; ii) instances for which non-monetary processes, we have determined that Signify has
and regulations
sanctions were incurred;
not had any significant instances of nonb. report the total number and the monetary value of fines for instances of noncompliance with laws and regulations that compliance with laws and regulations during thewere paid during the reporting period, and a breakdown of this total by: i) fines for instances of non-compliance with laws reporting period. (a, b, c, d).
and regulations that occurred in the current reporting period; ii) fines for instances of non-compliance with laws andregulations that occurred in previous reporting periods;
c. describe the significant instances of non-compliance;
d. describe how it has determined significant instances of non-compliance.
GRI 2-28
Membershipassociations

a. Report industry associations, other membership associations, and national or international advocacy organizations inwhich it participates in a significant role.

Sustainability Supplements 2023 - GRI content
index (a)GRI 2-29
Approach toa. Describe its approach to engaging with stakeholders, including: i) the categories of stakeholders it engages with, andhow they are identified; ii) the purpose of the stakeholder engagement; iii) how the organization seeks to ensure

4.1.4 Materiality assessment (a)stakeholder
engagement

meaningful engagement with stakeholders.

GRI 2-30
Collective bargaining
agreements

a. Report the percentage of total employees covered by collective bargaining agreements;
b. For employees not covered by collective bargaining agreements, report whether the organization determines theirworking conditions and terms of employment based on collective bargaining agreements that cover its other employees
or based on collective bargaining agreements from other organizations.

GRI 3-1
a. Describe the process it has followed to determine its material topics, including: i) how it has identified actual andProcess to determine potential, negative and positive impacts on the economy, environment, and people, including impacts on their humanmaterial topics
rights, across its activities and business relationships; ii) how it has prioritized the impacts for reporting based on theirsignificance;b. Specify the stakeholders and experts whose views have informed the process of determining its material topics.

88.4% (a) Effective December 31, 2023. Excludes
interns and Signify Employment Scheme
employees.
The payment terms and conditions are
determined by Signify Rewards team which
reviews benchmarks to determine the salarylevels, and budgets for salary raises, Long Term
Incentive’s lease car conditions, holiday
entitlements and other benefits. Employees haveto follow guidelines, procedures which areapplicable to all employees and which are being
set and arranged based on legal requirements aswell as via specific agreements with works
councils (where applicable). (b)4.1.4 Materiality assessment (a, b)

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Signify Sustainability Supplements 2023

GRI SRS

Disclosure requirements

Reference to the Annual Report 2023

GRI 3-2

a. List its material topics;

4.1.4 Materiality assessment (a, b)

List of material topics b. Report changes to the list of material topics compared to the previous reporting period.

Signify reported its first double materiality
assessment, therefore the methodology is notcomparative with that reported in 2022. The
following are no longer material in 2023: Businessethics, Social impact of light, Innovation,
Operational excellence, Geopolitical instability,
Responsible packaging, Hazardous substances,
Biodiversity and Water usage. (b)GRI 3-3Management ofmaterial topics

a. Describe the actual and potential, negative and positive impacts on the economy, environment, and people, including
impacts on their human rights;
b. Report whether the organization is involved with the negative impacts through its activities or as a result of its
business relationships, and describe the activities or business relationships;
c. Describe its policies or commitments regarding the material topic
d. Describe actions taken to manage the topic and related impacts, including: i) actions to prevent or mitigate potential

3.2 Our impact (a, b, e)
10.2.5 Long-term equity-based incentive
13.5 Key risks (a, b, c, e)
4 Brighter Lives, Better World (d)4.1.1 Materiality assessment (f)Sustainability Supplements 2023 – Data

negative impacts; ii) actions to address actual negative impacts, including actions to provide for or cooperate in theirremediation; iii) actions to manage actual and potential positive impacts;
e. Report the following information about tracking the effectiveness of the actions taken: i) processes used to track theeffectiveness of the actions; ii) goals, targets, and indicators used to evaluate progress; iii) the effectiveness of theactions, including progress toward the goals and targets; iv) lessons learned and how these have been incorporated into
the organization’s operational policies and procedures;
f. Describe how engagement with stakeholders has informed the actions taken (3-3-d) and how it has informed whether
the actions have been effective (3-3-f).

definitions, boundaries, and scope (f)GRI 302-1
Energy consumption
within theorganizationa. Total fuel consumption within the organization from non-renewable sources, in joules or multiples, and including fueltypes used.
b. Total fuel consumption within the organization from renewable sources, in joules or multiples, and including fuel types
used.
c. In joules, watt-hours or multiples, the total: i) electricity consumption, ii) heating consumption, iii) cooling consumption,iv) steam consumption
d. In joules, watt-hours or multiples, the total: i) electricity sold, ii) heating sold, iii) cooling sold, iv) steam solde. Total energy consumption within the organization, in joules or multiples.
f. Standards, methodologies, assumptions, and/or calculation tools used.
g. Source of the conversion factors used.

4.4.1 Climate action (a, b)(c) i) 262,924 MWh; ii) 1,614 MWh iii) Not
applicable and iv) 0 MWh(d) 0, Signify does not sell energy.
(f) Signify reports actual energy consumption
data based on invoices.
(g) None, Signify reports energy consumption
absolute values.
Sustainability Supplements 2023 - Datadefinitions, boundaries, and scope (f,g)

GRI 302-2
Energy consumption
outside of theorganizationa. Energy consumption outside of the organization, in joules or multiples.
b. Standards, methodologies, assumptions, and/or calculation tools used.
c. Source of the conversion factors used.

Not applicable as Signify does not have energy
consumption outside of its organization.

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GRI SRS

Disclosure requirements

Reference to the Annual Report 2023

GRI 302-3

a. Energy intensity ratio for the organization.

4.4.1 Climate action. Signify reports operational

Energy intensityb. Organization-specific metric (the denominator) chosen to calculate the ratio.
c. Types of energy included in the intensity ratio; whether fuel, electricity, heating, cooling, steam, or all. d. Whether theratio uses energy consumption within the organization, outside of it, or both.

energy intensity which includes stationary fuels,
electricity, heating and steam. (a,b, c)
Sustainability Supplements 2023 - Datadefinitions, boundaries, and scope (a,b,c)

GRI 302-4
Reduction of energy
consumption

a. Amount of reductions in energy consumption achieved as a direct result of conservation and efficiency initiatives, injoules or multiples.
b. Types of energy included in the reductions; whether fuel, electricity, heating, cooling, steam, or all.
c. Basis for calculating reductions in energy consumption, such as base year or baseline, including the rationale forchoosing it.
d. Standards, methodologies, assumptions, and/or calculation tools used.

4.4.1 Climate action (a)Sustainability Supplements 2023 - Datadefinitions, boundaries, and scope (b, c, d)

GRI 302-5
Reductions in energy
requirements ofa. Reductions in energy requirements of sold products and services achieved during the reporting period, in joules ormultiples.
b. Basis for calculating reductions in energy consumption, such as base year or baseline, including the rationale for435 million MWh (a)Sustainability Supplements 2023 - Methodology
for calculating societal impact, based on Signify

products andserviceschoosing it.
c. Standards, methodologies, assumptions, and/or calculation tools used

scope 4 methodology, the reduction in energy
consumption of sold LED and connected LED
products in 2023 compared to conventional
lighting products. (b, c)

GRI 305-1
Direct (Scope 1) GHG
emissionsa. Gross direct (Scope 1) GHG emissions in metric tons of CO2 equivalent.
b. Gases included in the calculation; whether CO2, CH4, N2O, HFCs, PFCs, SF6, NF3, or all.
c. Biogenic CO2emissions in metric tons of CO2- equivalent.
d. Base year for the calculation, if applicable, including: i) the rationale for choosing it; ii) emissions in the base year; iii)
the context for any significant changes in emissions that triggered recalculations of base year emissions.
e. Source of the emission factors and the global warming potential (GWP) rates used, or a reference to the GWP source.
f. Consolidation approach for emissions; whether equity share, financial control, or operational control.
g. Standards, methodologies, assumptions, and/or calculation tools used.

4.4.1 Climate action (a, b, d, e, f)
Not applicable as this data is not material for
Signify (c)GRI 305-2
Energy indirect(Scope 2) GHG
emissionsa. Gross location-based energy indirect (Scope 2) GHG emissions in metric tons of CO2equivalent.
b. If applicable, gross market-based energy indirect (Scope 2) GHG emissions in metric tons of CO2equivalent.
c. If available, the gases included in the calculation; whether CO2, CH4, N2O, HFCs, PFCs, SF6, NF3, or all.
d. Base year for the calculation, if applicable, including: i) the rationale for choosing it; ii) emissions in the base year; iii)
the context for any significant changes in emissions that triggered recalculations of base year emissions.
e. Source of the emission factors and the global warming potential (GWP) rates used, or a reference to the GWP source.
f. Consolidation approach for emissions; whether equity share, financial control, or operational control.
g. Standards, methodologies, assumptions, and/or calculation tools used

4.4.1 Climate action (a, b, d, e, f)
Sustainability Supplements 2023 - Datadefinitions, boundaries, and scope (g)

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GRI SRS

Disclosure requirements

Reference to the Annual Report 2023

GRI 305-3

a. Gross other indirect (Scope 3) GHG emissions in metric tons of CO2 equivalent.

4.4.1 Climate action (a, b, d, e, f)

Other indirect (Scope b. If available, the gases included in the calculation; whether CO2, CH4, N2O, HFCs, PFCs, SF6, NF3, or all.
3) GHG emissions
c. Biogenic CO2emissions in metric tons of CO2equivalent.
d. Other indirect (Scope 3) GHG emissions categories and activities included in the calculation.
e. Base year for the calculation, if applicable, including i. the rationale for choosing it; ii. emissions in the base year; iii. thecontext for any significant changes in emissions that triggered recalculations of base year emissions.
f. Source of the emission factors and the global warming potential (GWP) rates used, or a reference to the GWP source.
g. Standards, methodologies, assumptions, and/or calculation tools used.

Not applicable as this data is not material for
Signify (c)Sustainability Supplements 2023 - Datadefinitions, boundaries, and scope (g)GRI 305-4
GHG emissions
intensitya. GHG emissions intensity ratio for the organization.
b. Organization-specific metric (the denominator) chosen to calculate the ratio.
c. Types of GHG emissions included in the intensity ratio; whether direct (Scope 1), energy indirect (Scope 2), and/or
other indirect (Scope 3).
d. Gases included in the calculation; whether CO2, CH4, N2O, HFCs, PFCs, SF6, NF3 or all

4.4.1 Climate action (a, b, d, e, f)
Sustainability Supplements 2023 - Datadefinitions, boundaries, and scope (g)GRI 305-5

a. GHG emissions reduced as a direct result of reduction initiatives, in metric tons of CO2 equivalent.

4.4.1 Climate action (a, b, d, e, f)

Reduction of GHG
emissionsb. Gases included in the calculation; whether CO2, CH4, N2O, HFCs, PFCs, SF6, NF3 or all.
c. Base year or baseline, including the rationale for choosing it.
d. Scopes in which reductions took place; whether direct (Scope 1), energy indirect (Scope 2), and/or other indirect(Scope 3).
e. Standards, methodologies, assumptions, and/or calculation tools used

Sustainability Supplements 2023 - Datadefinitions, boundaries, and scope (g)GRI 305-6
a. Production, imports, and exports of ODS in metric tons of CFC-11 (trichlorofluoromethane) equivalent.
Emissions of ozoneb. Substances included in the calculation.
depleting substances c. Source of the emission factors used. d. Standards, methodologies, assumptions, and/or calculation tools used.
(ODS)

Not applicable as emissions from ODS are notmaterial for Signify.

GRI 306-7
Nitrogen oxides(NOx), sulfur oxides(SOx), and othersignificant air
emissionsa. Significant air emissions, in kilograms or multiples, for each of the following: i) NOX ii) SOX iii) Persistent organic
42 tonnes CO2e for N2O, others are not material
pollutants (POP) iv) Volatile organic compounds (VOC) Emissions from NOX and SOX are at nonmaterial levels for Signify.
for Signify (a)24 v) Hazardous air pollutants (HAP) vi) Particulate matter (PM) vii) Other standard categories of air emissions identified in Sustainability Supplements 2023 - Data
relevant regulations
definitions, boundaries, and scope (b, c)b. Source of the emission factors used.
c. Standards, methodologies, assumptions, and/or calculation tools used

GRI 406-1
Incidents of
discrimination andcorrective actions
taken

a. Total number of incidents of discrimination during the reporting period.
b. Status of the incidents and actions taken with reference to the following: i) Incident reviewed by the organization; ii)
Remediation plans being implemented; iii) Remediation plans that have been implemented, with results reviewed throughroutine internal management review processes; iv) Incident no longer subject to action

This topic is covered under the Signify Integrity
Code and Supplier Sustainability Declaration, ourcode of conduct for suppliers.
13.1 Establish strong risk management
environment
Signify Integrity code
4.3.5 Business ethics, discrimination incidents areincluded under human resources (a,b)

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37

Signify Sustainability Supplements 2023

GRI SRS

Disclosure requirements

Reference to the Annual Report 2023

GRI 407-1

a. Operations and suppliers in which workers’ rights to exercise freedom of association or collective bargaining may be This topic is covered under the Signify Integrity

Operations andsuppliers in which theright to freedom of
association andcollective bargaining
may be at risk

violated or at significant risk either in terms of: i) type of operation (such as manufacturing plant) and supplier; ii) Code and Supplier Sustainability Declaration, ourcountries or geographic areas with operations and suppliers considered at risk.
code of conduct for suppliers.
b. Measures taken by the organization in the reporting period intended to support rights to exercise freedom of 13.1 Establish strong risk management
association and collective bargaining.
environment - Signify Integrity code
4.3.3 Human rights, Supplier Sustainable
Performance (a, b)

GRI 408-1
Operations andsuppliers at
significant risk forincidents of childlabor

a. Operations and suppliers considered to have significant risk for incidents of: i) child labor; ii) young workers exposed tohazardous work.
b. Operations and suppliers considered to have significant risk for incidents of child labor either in terms of: i) type ofoperation (such as manufacturing plant) and supplier; ii) countries or geographic areas with operations and suppliersconsidered at risk.
c. Measures taken by the organization in the reporting period intended to contribute to the effective abolition of childlaborThis topic is covered under the Signify Integrity
Code and the Supplier Sustainability Declaration,
our code of conduct for suppliers
4.3.3 Human rights, Supplier Sustainable
Performance (a,c)
4.3.3 Human rights, Responsible Mineral Sourcing(b)Supplement to GRI Content Index 2023
GRI Standard 102-8

GRI Standard 401-1

GRI Standard 405-1: Workforce gender breakdown 2023

Contract type by gender in % in 2023

Turnover rate by management level in %of total employee base

Share of women in total workforce (as % of total workforce)

Permanent
FemaleMale
Not disclosed

98%
98%
100%

Temporary

Percentage

2%
2%

Staff

—%

Professional

22.41%

Mid-level professional

3.87%

Senior-level professional

1.47%
0.23%

Contract type by geography in % in 2023
Permanent

Temporary

Europe96%

4%

Leadership

Americas100%—%

Turnover rate by gender

Rest of the
world

98%

2%

Time schedules by gender in % for 2023

72%

Female

47%

Male

53%

Not disclosed

0.01%

Full-timePart-time

Female96%

4%

Under 30

41%

Male

98%

2%

30-50

46%

Not disclosed

80%

20%

Over 50

13%

Turnover rate by age group

Share of women in all management positions, including junior, middle and top
management (as % of total management positions)Share of women in junior management positions, i.e. first level ofmanagement (as % of total junior management positions)Share of women in top management positions, i.e. maximum two levels awayfrom the CEO or comparable positions (as % of total top management
positions)Share of women in management positions in revenue-generating functions(e.g. sales) as % of all such managers (i.e. excluding support functions suchas HR, IT, Legal, etc.)
Share of women in STEM-related positions (as % of total STEM positions)

40%

27%

29%

29%

20%
41%

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38

Signify Sustainability Supplements 2023

GRI Standard 415-1: Public policy•

Signify actively engages with governmentalorganizations, emphasizing the environmental
and socioeconomic benefits of energy
efficiency, the potential of connected LED
lighting and joining public debates addressing
sustainability issues. We share updates on
initiatives and developments in this area on
our website and in our Press Releases.
As formalized in our Integrity Code, Signify
adopted a policy of prohibition ofcontributions, in money or in kind, to politicalparties, political organizations or individuals
engaged in politics. Signify takes part inindustry associations and coalitions forsustainable growth and we share ourcontributions. The total contributions andexpenditures amounted EUR 3.19 million in
2023.

•

World Economic Forum which engages
the foremost political, business, culturaland other leaders of society to shape
global, regional and industry agendas(EUR 0.36 million).
Lighting Europe to engage on Lighting
Industry Standards (EUR 0.24 million).

At Signify we address the following main
issues with our contributions andexpenditures:• Signify considers climate action a key focus
area. Moving towards renewable energy
and focusing on energy efficiency (total ofcontributions and expenditures of EUR 0.41
million).
• Within our industry we engage withassociations to develop uniform standards
in lighting technology and connectivity(total of contributions and expenditures of
EUR 2.75 million).

The largest contributions and expenditures
are made by Signify to:•

The National Electrical Manufacturers
Association ‘NEMA’ to develop
performance standards and promote
product interoperability to increase
market demand, while improving safety
to mitigate risks (EUR 0.48 million).

Type of trade organization

Industry Associations

Geographic
scope

GlobalSpend( € millions)

Focus of membership (non-exhaustive)

2.51

Sustainable innovation in the industry,
climate action, scaling up action on the
UN SDGs, common standards.
Carbon pricing, sustainable cities,

Coalitions for sustainable growth

Global0.68

Political contributions

Global0

standards for impact measurement, UN
SDG contribution.

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39

Signify Sustainability Supplements 2023

7

EU Non-Financial Reporting Directive(NFRD)

Category

Criterion

Company business model

Description

Diversity

Policy description
KPI / result
Policy description

Social matters

KPI / result
Risk

Reference to the Annual Report 2023
3 Creating sustainable long-term value
5 Corporate performance
4.3.2 Diversity, equity & inclusion
7 Board of management
8 Supervisory board
4.3 Brighter Lives
4.3 Brighter Lives
13 Operational risks

Policy description
4.4 Better World
Environmental matters

KPI / result
Risk

Human Rights

Policy description

4.3.3 Human rights

KPI / result

4.3.3 Human rights
4.3.5 Business ethics

Risk

4.3.3 Human rights

Policy description
Bribery and corruption

4.4 Better World
13 Climate risk

KPI / result
Risk

13.1 Establish strong risk management environment
4.3.5 Business ethics
13.1 Establish strong risk management environment
13.1 Establish strong risk management environment
13.3 Risk assessment and control<≡>

Signify N.V.
High Tech Campus 48
5656 AE Eindhoven
The Netherlands
E-mail: sustainability@signify.com
www.signify.com
Dutch Chamber of Commerce
registration no. 65220692
VAT NL8560.25.823.B.01