ENVIRONMENTAL
SOCIAL
GOVERNANCEREPORT 2022

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-23

Our purpose
DRIVING CLEANER PERFORMANCEAt Westport Fuel Systems, we aspire to contribute to a world where climate change is
mitigated and global air quality contributes to a healthy society. A world where cleantransportation is accessible and affordable, ensuring everyone can take part in building
sustainable communities for themselves and future generations.
We encourage every member of our organization to make a daily commitment toward
creating transportation solutions that not only enhance the well-being of people andthe environment but also contribute to the prosperity of our communities.
We work with purpose and passion, celebrating diverse perspectives and fostering
inclusive collaboration. Our goals are ambitious, but our team is up to the challengeof living up to our values of integrity, respect, and perseverance. We adhere tocomplex and ever-changing laws, regulations, and requirements that impact ourmarkets, our product offerings, and our compliance efforts.
We consistently help our customers become leaders in affordable, sustainable,
and efficient transportation solutions.
Extraordinary circumstances and uncertainties continue to unfold
globally, yet we remain focused on our commitment to decarbonizing
transportation, cleaning our air, and creating a better future.

Westport Fuel Systems / 2022 ESG Report2

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Table of contents
INTRODUCTIONENVIRONMENTGOVERNANCE

Message to our stakeholders 			4

Decarbonizing transportation			40Corporate governance						812022 ESG performance highlights		

6

Sustainability is affordability			

43Enterprise risk management 				

92About Westport Fuel Systems			

8

Environmental management 			45

Customer Health and safety				92

Our carbon footprint andenvironmental impact					47Cyber and information security				94

Our sites								9Our products							112022 performance					53OUR APPROACH
What we stand for					18ESG governance						19ESG strategy 							21Regulatory environment				23Sustainable Development
Goals (SDGs)							26SOCIAL
Our global workforce 					58Diversity, equality, and inclusion (DE&I)

61

Occupational health and safety 			66

Society								71Responsible sourcing 					74Business ethics 							97Key sustainability policies and standards 		

100

ABOUT THIS REPORTGRI and SASB content index				

106

RELATED PUBLICATIONS● 2022 Annual Report

Stakeholder engagement				27

● Annual Information Form

Materiality assessment				37

● Management Information Circular● Corporate Presentation

Westport Fuel Systems / 2022 ESG Report3Our Approach

Introduction

Environment

SocialGovernance

GRI and SASB index

GRI 2-22

Message to our stakeholders
Dear stakeholders,
We are delighted to present our 2022 ESG report. As with past years,

Cooperation and further advancements in H2 HPDI™
fuel system technology

we invite you to join us in celebrating our accomplishments, initia-

There’s very little in today’s world that can be achieved individual-

tives, and advancements in the realm of sustainable development.

ly. Most of the great accomplishments are born out of teamwork.

At the same time, we maintain an open dialogue about the hurdles

Fighting climate change is a global challenge. That is why at West-

we've overcome and those we foresee in the future.

port Fuel Systems, we focus on meaningful collaborations. In 2022,

OUR MISSION
Our day-to-day business is aligned with the goals of sustainability
which are embedded in our organization’s DNA. Our overarching
principle is to provide the widest possible audience with clean andaffordable transportation solutions. Even though the concept ofaffordability appears purely financial, we view it through the lens ofsustainability. Affordability fuels adoption, facilitating the replacement of high-carbon vehicles with their lower-carbon equivalents
on a global scale. We are committed to enhancing the integrity of
our internal actions for the benefit of our employees, stakeholders,
and the global community.

we continued our search for cost-effective near-zero greenhousegas emissions and solutions by pursuing our hydrogen-fueled internal combustion engine project. In October 2022, together with
our partner Scania AB, we announced impressive results of the H2
HPDI fuel system for heavy-duty transport, producing significant
brake thermal efficiency improvements and demonstrating an affordable pathway to employ a zero-carbon fuel using existing engine architecture, manufacturing infrastructure, and supply chain.
We also started new projects, one of which is our collaboration withJohnson Matthey, a global leader in sustainable technologies, to develop an emissions aftertreatment system for H2 HPDI with the goalof reducing emissions from H2 HPDI combustion. Moreover, we en-

OUR PROGRESS

tered into a partnership with the City of Changzhou, China, to build

In 2022, we advanced our initiatives and targets set in 2020 and

the Changzhou Hydrogen Valley.

2021, which include:

Westport Fuel Systems / 2022 ESG Report

the new hydrogen innovation center and manufacturing facility in

We are committed
to enhancing the
integrity of our internal
actions for the benefitof our employees,
stakeholders, and theglobal community.

4

Our Approach

Introduction

Environment

SocialGovernance

GRI and SASB index

GRI 2-22

Message to our stakeholders
Sustainable low-carbon
transport solutions must beaffordable – cost matters.
This is why we have createda solution using hydrogen, azero-carbon fuel.

requesting them to review our sustainability commitment and

we believe gaseous fuels and our fuel system solutions will occupy

confirm whether they have implemented appropriate policies. On

a significant and expanding position in that diverse future.

the environmental side, we are also in the process of examining
the carbon footprint of our supply chain (scope 3) in a cradle-to-grave approach. We will continue these processes in 2023.

Challenges
The year 2022 was punctuated with global obstacles that still chal-

ESG management improvements
In 2022, we placed great emphasis on developing our governance system by defining a new ESG organizational structure for thecompany and describing in detail the roles and responsibilities atlenge our progress towards ESG goals. One notable hurdle wasthe conflict in Ukraine. This regrettable event not only impacted

ment, cross-functional ESG team, and location representatives.

believe that as an organization we are able to face them and con-

A strong organizational foundation is fundamental to efficiently

tinue to advance our ESG goals and values. In 2022, we saw ourmanaging ESG issues – knowing where we stand supports setting

ability to mobilize internal resources to help Ukrainians by organi-achievable targets.

zing internal charity events. We continue to educate, promote, andlection mechanisms, training modules, procedures, and policies.

Value chain

combustion engine used around the world today, driving cleaner
performance that does not comprimise efficiency. This continues
to be our strategy going forward.
Thank you very much for taking the time to read this report.

Sincerely,

publicly advocate in favor of our alternative solutions, which wehope will raise awareness among citizens, investors, and lawmakers.
Listening to global markets, there is now an undeniably louder

DAVID M. JOHNSON
Chief Executive Officer

voice highlighting the need for a diverse portfolio of options, reco-

2022 we started analyzing a way to spread our ESG values to our

gnizing there cannot be a one-size-fits-all approach to decarbo-

suppliers and ensure they maintain ethical and ESG standards.

nize transportation. Given the variety of technologies and fuels we

At the end of 2022, we conducted a survey among our suppliers

have today, with an expected increase in that variety in the future,

Westport Fuel Systems / 2022 ESG Reportdrogen, a zero-carbon fuel, that utilises the same base internal

shift in the global economy.
However, no matter how great the challenges, at Westport, we

plementing, while building and improving our existing data col-– cost matters. This is why we have created a solution using hy-

our clients and business associates but also caused a significant

each of the three levels of our “ESG pyramid” – i.e., top manage-Thanks to our 2022 initiatives, we are at the advanced stage of im-

Sustainable low-carbon transport solutions must be affordable

5

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-29

2022 ESG performance highlights
Strong ESG practices continue to be
the fabric of our business and areembedded in our decision-making
process.
Sustainability is at the core of
our technology strategy, productportfolio, and operations.

Westport ESG strategy was approved by the Board in early 2021 and is focused on taking concrete steps to ensure that the way
the organization does business has positive impacts throughout the value chain. Since this strategy was adopted, Westport has
already seen progress, including:

1. Cross-cutting and holistic building and maturing of
our corporate governance by implementing policies
approved by the top management, among others:● Code of Conduct● Anti-Corruption and Bribery Policy● Human Rights Policy● Diversity Policy● Whistleblower Policy
2. Implementing and embedding our Code of Conduct
throughout our organization (with 100% of employees
trained) and our suppliers (ESG survey shared with 100%of suppliers).
3. We're working toward further structuring our ESG
governance pyramid, headed by the CEO along witha 10-member ESG Steering Committee. The goal is tooversee core programs and targets while enhancing the
integration of ESG into our company's objectives andprocedures. At the ESG Strategy level, we're developing
initiatives and integrating them within the ESG working
group for practical implementation and data collection.

Westport Fuel Systems / 2022 ESG Report

4. Achieving 44% female representation at the Board level,
well above the 30% target.
5. Helping our customers to be leaders in affordable,
sustainable, and efficient transportation solutions –e.g., further advancing Westport’s HPDI (High Pressure
Direct Injection) technology with both biomethane andhydrogen, delivering industry-leading CO2 reductions
for long-haul, heavy-duty transport, and introducing
impressive engine test results in 2022.
6. Establishing and gaining approval by the Board forspecific plans and activities to strengthen and develop a
safe, diverse, and inclusive culture at Westport.
7. Taking the next steps in our commitment to develop a
Climate Action Plan that will outline our path to net-zero
GHG emissions and align with TCFD recommendations
by starting the Scope 3 emissions calculation.
8. Continuous learning and improving to ensure ourstrategies, activities and reporting are aligned with theneeds and interests of our stakeholder.

6

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-23

2022 ESG performance highlights

E
S
G

starting the Scope 3
emissions calculation

our products reduced CO2
emissions of 1,498,438

7% decrease in Scope 2

54.5% increase in energy

indirect emissions

consumption from solar

tons of CO2

71% of our +900 suppliers„Label of Excellence”

32% global workforce areare local

in gender equality by thefemalereduced emissions byover 89% of total waste

panels

4.8% in Poland
and 12.6% in Italy

4% voluntary turnover rate

17% management are

150% increase in Lost

femaleTime Injuries

from the reported
operating sites is recycled

Piedmont region for the
Italian facility

89% non-employee

100% targeted employees

44% female

further structuring of the

4 years say-on-pay

100% suppliers delivered

directors are independent

trained in Code of Conduct,

representation at the

ESG governance pyramidadvisory

with a ESG survey

including anti-bribery

Board level

Westport Fuel Systems / 2022 ESG Report7Our Approach

Introduction
GRI 2-1

GRI 2-6

Environment

SocialGovernance

GRI and SASB index

GRI 202-2

About Westport Fuel Systems
WESTPORT AT A GLANCE

Westport Fuel Systems Inc. is a globally recognized

our customers — helping to cultivate a cleaner future by
reducing emissions. Therefore, our commitment to social

company, publicly traded on the Toronto Stock Exchange
and NASDAQ under the ticker symbol WPRT. Although
our headquarters are in Vancouver, Canada, we extend
our reach worldwide through operations across Europe,Asia, North America, and South America.

over

70

cleaner performance," shapes our daily operations.
We specialize in the engineering, manufacturing, and

more
than

supplying of alternative fuel systems and components

1,400

responsibility and environmental stewardship is deeply$

embedded within our corporate strategy, informing all

306

countries being
servedOur mission, encapsulated by the phrase "Driving

2022 revenue of
millionWhile some continue to hunt for the next
groundbreaking idea, we at Westport have mastered
the art of turning innovation into practical solutions. As apatents & applications

gas, biomethane/RNG, and hydrogen, as we believe
they serve as superior alternatives to conventional liquid
fossil fuels like gasoline and diesel. These gaseous fuels

regulations, contributing to a greener and cleaner future.

100+

offer undeniable environmental, economic, and energy

us. We strive to pave a viable path toward net-zerogreenhouse gas emissions (GHG). This commitment

and expansive global customer base. The primary23

OEMcustomers

more
than

64

Our path to carbon neutrality ensures our technologies
deliver the necessary performance and fuel efficiency
required by transportation applications, while also
providing environmental benefits to address climatechange and urban air quality issues.
Our expansive network spans over 70 countries, serving

workforce

At Westport, our dedication to a sustainable future drives

specialized engineering skills, market-ready products,

distributors for
our IAM business

1,800+

security benefits.

is evident in our longstanding history of innovation,

leading supplier of advanced fuel delivery components
and systems, we meet and surpass lower emissions

intended for transportation applications. We champion
gaseous fuels such as liquified petroleum gas, natural

our business decisions.

years ofinnovation

customers daily through global transportation brands,
distributors, service providers for the aftermarket, and14

directly to original equipment manufacturers (OEMs)

operatingsites

along with Tier 1 and Tier 2 OEM suppliers. In addition,
we offer delayed OEM (DOEM) options and engineering
services to our customers and partners globally.

measure of our success is the impact we make throughWestport / 2022 ESG Report8Introduction
GRI 2-2

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-6

Our sites
This ESG report covers Westport Fuel Systems Inc., with its head office and principal place of business in Vancouver, British Columbia, Canada, alongside its
legal subsidiaries included in our corporate structure (found in Annual Information Form, pg. 1). On February 7, 2022, we sold 100% of our shares in CWI to
Cummins Inc. along with our interest in the joint venture’s intellectual property.

CORPORATE HEAD OFFICE& TECHNOLOGY CENTERTECHNOLOGY CENTERS

MANUFACTURING / SUPPORT● Vancouver, British Columbia, Canada● Cambridge, Ontario, Canada● Buenos Aires, Argentina● Cherasco, Italy● Calgary, Alberta, Canada● Eindhoven, Netherlands● Gothenburg, Sweden● Albinea, Italy● Brescia, Italy● Cherasco, Italy● Ahmedabad, India● Delhi, India● Słupsk, Poland● Kunshan, China● Changzhou, China (under construction)

Westport / 2022 ESG Report9Introduction
GRI 2-2

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-6

Our sites
Global footprint focused ontechnology development
and manufacturing:

Vancouver, BC
Corporate Head Office
Tech Center

Eindhoven, Netherlands
Production andTech Center

Calgary, AB
Production andTech Center
Cambridge, ON
Tech Center

Cherasco, Italy
Production andTech Center

Gothenburg, Sweden
Support Office
Słupsk, Poland
Production
Albinea, Italy
Production
Brescia, Italy
Production

Delhi, India
Production
Kunshan, China
Support Office
Ahmedabad, India
Production andSupport Office

Buenos Aires, Argentina
Production

Westport / 2022 ESG Report10Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-6

Our products
Westport is driving cleaner performance. We are a global company focused on engineering,
manufacturing, and supplying alternative fuel systems and components for transportation
applications. Our diverse product offering enables the use of alternative fuels, including LPG,
CNG, LNG, RNG/biomethane, and hydrogen, all providing environmental and/or economic
advantages as compared to fossil fuel alternatives.

KEY TERMS 1/2
Liquid petroleum gas (LPG)
Also known as propane, LPG is a clean-burning alternativefuel that’s been used for decades to power light-, mediumand heavy-duty vehicles.
Natural gas

LPG

CNG

LNG

RNG

H₂

A gaseous mixture predominantly made up of methane,
which is readily available and cleaner burning thanconventional gasoline and diesel fuel. Natural gas must becompressed or liquefied for use in vehicles.
Renewable natural gas (RNG)/biomethane

Westport designs, manufactures, develops, validates, certifies, and sells alternative fuelcomponents and systems for:

Known as biomethane in the EU and RNG in North● passenger cars

It drastically reduces carbon emissions over the complete● light-, medium- and heavy-duty commercial vehicles● off-highway applications

America, RNG is made from multiple sources, includingorganic matter such as livestock manure and landfill waste.
fuel cycle (production through combustion), and unlike
conventional natural gas, RNG is not a fossil fuel.
Learn more about how this fuel promotes circularity andadvances net-zero ambitions on page [16].

Westport / 2022 ESG Report11Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-6

Our products
Our product portfolio includes Westport HPDI, a complete fully-OEM-integrated gaseous
fuels system enabling diesel engines to operate with a range of clean-burning fuels including
natural gas, biomethane, hydrogen, LPG, or methanol, without any performance or efficiency
compromises relative to the base diesel engine platform. Moreover, we develop, integrate, andcalibrate monofuel engine management systems for a wide range of OEM-integrated engines.

Our products are sold under a wide range of established global brands:

KEY TERMS 2/2
Compressed natural gas (CNG)
Produced by compressing natural gas, CNG is well suitedfor light-, medium- and heavy-duty vehicles travelling amoderate and long distance between refueling.

Liquefied natural gas (LNG)
Produced by cooling natural gas to turn it into a liquid, LNG
is typically used in heavy-duty vehicles when extended
driving range and fast refueling are required.

Hydrogen (H2)
A carbon-free energy carrier that can be produced fromdiverse resources. Although the market for hydrogen asa transportation fuel is in its infancy, governments andindustry are working toward clean, economic, and safehydrogen production and distribution.

Westport / 2022 ESG Report12Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Game changer. Without the change.
With our recent developments on HPDI technology, including H2 HPDI, we are proud to say that our solutions are a game changer in the green
transportation market. Providing GHG reductions of 20-100% on a well-to-wheel basis while preserving the same performance as a diesel engine, our HPDI
fuel system is an integral part of the full spectrum of measures that the transportation sector will need to combat GHG emissions effectively.

GAME CHANGER

The value proposition for our products
has always been multi-pronged
regardless of the end-use market ortype of system or componentry: it’s
about emissions and operating cost
reduction and ultimately the Total Costof Ownership (TCO) or life cycle cost
reduction. The HPDI 2.0 technology enables
a diesel engine with all the desirable, highefficiency attributes of power, torque, anddurability to operate on a cleaner, lower
carbon fuel. This is driving best-in-class carbon
reductions for engines while also satisfying the
TCO reduction and operational performance
criteria that heavy-duty fleets demand.

Our efforts in green transportation are truly gamechanging, facilitating a significant reduction in CO2emissions, potentially achieving near-zero emissions.

WITHOUT THE CHANGE
This remarkable transformation doesn't compromiseon performance or necessitate a shift in infrastructure.
Our HPDI 2.0 fuel system solutions provide torque,efficiency, and reliability comparable to or exceedingthat of diesel engines. In October 2022, we announced
encouraging test results from an HPDI fuel systemequipped engine powered by hydrogen, as part of ademonstration program with Scania. Scania's 13-litre
CBE1 platform, equipped with Westport’s HPDI fuelsystem and fueled by hydrogen, exhibited a peakbrake thermal efficiency of 51.5% - an impressive
figure, with engine-out NOx emissions comparable toa standard diesel engine.
Westport / 2022 ESG Report

Even though our HPDI technology was originally focused only on transitioning diesel
engines from diesel fuel to natural gas, with the advent of H2 HPDI, we can now goeven further and transition heavy-duty transportation to zero or near-zero carbon
emissions by once again changing the fuel – this time to zero-carbon hydrogen.
Scott Baker, Vice President, Engineering

13

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Game changer. Without the change.

HPDI: COST-effective
HPDI is the most cost-effective way to reduce CO2 in long-haultrucking and other high-load, long-haul applications.

LNG HPDI

H2 HPDI● Same torque, efficiency, and reliability as diesel engines● 20% more power, 15% more torque● 20% CO2 reduction tailpipe● Near-zero CO2 emissions● 100% CO2 reduction with Bio-LNG● Lowest cost to CO2 compliance● No change to vehicle or engine architecture● Preserve existing engine manufacturing

Westport / 2022 ESG Report14

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Zero-emission hydrogen futureWith our goal of enabling vehicles to run on cleaner fuels,
Westport, under the GFI brand, has developed a catalog ofinnovative components for the storage and control of highpressure hydrogen to the vehicle’s power source, whether it’s afuel cell or an internal combustion engine.
Starting with tank valves that mount the solenoid inside thetank to protect it from external impact and risk of corrosion/
environmental exposure, the valves are designed with ahigh level of integrated features to meet vehicle OEM
requirements while maintaining a low profile. Tank
valves can include an electronic shutoff valve, an excess
flow valve, temperature pressure relief device, manualvalve, bleed valve, and temperature and pressure
sensors.
GFI also offers standalone temperature pressure
relief devices that can mount on the tank or be
remotely mounted on the vehicle. Stable delivery
of hydrogen under varying demands and inlet

Westport / 2022 ESG Reportpressure is handled by one of GFI’s highpressure regulators. The two-stage piston
regulator offers a reliable and cost-effective
solution while the piston/diaphragm twostage regulator can offer even greater outletpressure performance and stability.
Additional low-pressure hydrogen components
are also available, including isolation valves andelectronic pressure control valves, which can be
standalone components or integrated in a module
along with the pressure relief valve and filter.
The hydrogen transportation industry initiallydeveloped products at 350 Bar (5,000 psi) but has
moved to 700 Bar (10,000 psi) systems to increase thefuel storage density and increase vehicle range.
GFI has products to meet both system pressure
requirements and continues to develop new innovative 350
Bar and 700 Bar products.

15

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Biomethane today is the path for H₂ tomorrow
Nothing goes to waste: the circularity of renewable natural gas (RNG)/biomethane
Biomethane, in terms of its chemical composition, is indistinguishable fromthe methane that comes from underground; however, unlike methane
derived from fossil sources, biomethane is sourced from organic matterthat society normally throws away such as landfill waste, wastewater fromtreatment plants, and agricultural waste. By using biomethane as a fuel, we
are not only making use of something that would otherwise be disposed of,
but we are also capturing gas that if it was not recovered – or captured– would escape into the atmosphere as methane. The accounting

associated with capturing, processing, and consuming methane as a fueland then converting it through an engine from methane to CO2 results
in a net-zero or sometimes a net-negative CO2 full fuel cycle GHG
contribution. Westport’s LNG HPDI fuel system is on the road in thousandsof trucks today in Europe. When used with LNG, these trucks reduce
emissions by approximately 20%, yet these trucks continue to get cleaner
as the percentage of biomethane used for fuel increases.

RNG

What is important is thatbiomethane is on the road today.

Westport / 2022 ESG Report

16

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-29 GRI 3-1

Our approach
Although our products directly contribute to the green environmental revolution, we knowthat sustainability concerns an entire business. We want to build not only our portfolio
but also our organization on a strong ESG foundation, where human beings are respected,
appreciated, and safe in all areas, where climate change is mitigated, and our market
presence is transparent, fair, and ethical.
Sustainability is a core principle at Westport – it is in our DNA since the beginning of
our operations. It drives our business strategy while keeping us focused on the ESGrelated risks and opportunities that are most important to our long-term success.
We are constantly strengthening our governance practices and management
processes, advancing our stakeholder engagement practices, introducing newprocedures, protocols, and policies, educating our employees, and criticallyverifying our supply chain.
We believe small consistent steps can achieve big changes and positively
impact our customers, employees, and communities around us.

Westport / 2022 ESG Report17

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-23

What we stand for
Our principles and their application in practice make us who we are – innovators, reliable

perseverance. We entrust every employee and member of our global network to build

business partners, and green transformation advocates in the background of being a good

relationships with all our stakeholders and make decisions that honor our values.

and safe place to work. We work every day to design, build, and provide clean transportation
solutions to our customers while embracing our core values of integrity, respect, andOur leading principles articulate our core beliefs and anchor our culture and businessstrategy.

COMMITTED TO INTEGRITYRESPECT

Corporate integrity, personal accountability, and respect for others are the foundation

We empower our people to collaborate and partner, leveraging our diverse globalof our success.

experience and viewing the company in its entirety – internally and externally.

CUSTOMER FOCUS

SUSTAINABILITY

Partnerships and relationships are the pathway to turning our business plan into

We strive to ensure the way we do business has a positive impact on our people,

reality. We share a common objective: to create clean transportation solutions thatthe environment, and the communities in which we work and live.

meet existing and future emissions regulations and targets for GHG reduction.

DELIVERY EXCELLENCE
Our commitment to execution and results fuels our passion to excel and innovate. We
focus investments on what we do best and fuel our growth by optimizing efficiencies
and effectiveness of our processes, workplace, and value chain.

Westport / 2022 ESG Report18

Introduction
GRI 2-13

GRI 2-16

GRI 2-14

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-24

ESG governance
ESG LEADERSHIP AT THE BOARD LEVELSTANDING COMMITTEES● Audit Committee

An effective and accountable governance structure and process is necessary for a robust● Human Resources and Compensation Committee

ESG strategy and performance. The experienced nine-member Board at Westport takes its● Nominating and Corporate Governance Committee

responsibility as stewards seriously and is dedicated to providing strong leadership to support
the company's ESG strategy while ensuring effective corporate governance.

● Technology and Product Strategy Committee

Responsibilities include oversight of the adequacy of management systems to identify
and manage ESG-related risks and opportunities; adoption of appropriate ESG standards;
tracking, monitoring, and disclosure of the company’s ESG performance and oversight ofclimate-related responsibilities; and incorporating ESG considerations into the developmentof business strategies.

BOARD OF DIRECTORS & CEO● Oversight of the organization's strategy and risk
management, including ESG

ESG IN THE STANDING COMMITTEES’ CHARTERS
Assessing environmental and social practices along with understanding the potential impactof ESG issues on the company’s operations and business in both the short and longer term is
an important oversight activity.
Given that ESG is a rapidly evolving area within corporate governance, in 2022, the Board

EXECUTIVE COUNCIL● Takes top-level strategy forward

approved updates to its Charter and Standing Committee Charters to ensure ESG oversightis embedded into regular Board of Director and committee activities so that emerging risks
and trends can be identified and addressed.
For broader information on the specific responsibilities of each Standing Committee, seepage [90] in the Governance section or our 2023 Management Information Circular or our
website.

ESG STEERING COMMITTEE (COMPRISES 10LEADERS - CEO, CFO, EVPs, VPs)
● Reviews ESG management● Agrees to core programs and targets

Westport / 2022 ESG Report19

Introduction
GRI 2-13

GRI 2-14

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-24

ESG governance
NEW ESG GOVERNANCE PYRAMIDThe ESG Steering Committee was formed

TOP MANAGEMENT MEMBERS

in 2021 and is led by our CEO and includes● Monthly meetings

our CFO, key management personnel from● Presentation of the progress of work in
the implementation of the strategy anddiscussing current topics

across our businesses, regions, and functions.
The 10-member committee oversees ESG
management, approves core programs andtargets, and works to integrate ESG into theStrategy

ESG SteerCo
KPIs

MissionFinal Report

Visioncompany’s goals and processes.
To strengthen the commitment and give evengreater prominence to all ESG issues, in 2022,

CROSS-FUNCTIONAL WFS TEAMESG Strategy Group

we have defined a new organizational structure● Working functional meetings● Developing specific initiatives

for the company, describing in detail the roles
and responsibilities at each of the three levels of
our ESG pyramid.

Approach

Activities

Targets

Data Evidence
LOCATIONS REPRESENTATIVES
ESG Working Group● Quarterly meetings● Designated responsible persons for each area
● Collecting data from the locations andassisting in determining and implementing
actions● Speaking partners for the strategic group

Westport / 2022 ESG Report20

Introduction
GRI 2-14

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-24

ESG strategy
ESG PRIORITIES FOR 2023
Approved by the Board in early 2021, our ESG strategy isAt the beginning of 2023, the ESG Steering Committee defined the following as key areas of focus for 2023:

focused on taking concrete steps to ensure that the way
we do business has positive impacts throughout our value
chain. The ESG strategy is embedded into our business strategy
and is informed by external research, materiality assessment

SOCIALoutcomes, and ongoing internal and external stakeholder● DE&I awareness in the organization

engagement. Progress of the activities in each of the areas● Gender equality in compensations

below is outlined in this report.

● Equitable employment and advancement opportunities for all based on: Education,
Generation, Gender, and Differently Abled● Flexible work arrangements● Strong commitment to continuous improvements in Health and Safety

As a next step, activities and plans are being developed on
reducing our collective climate impact while positioning
Westport to set targets supported by appropriate controls andmeasurement.

Westport / 2022 ESG Report

ENVIRONMENTAL

GOVERNANCE● Energy consumption● Environmental Policy● Water consumption● Safety & Health Policy● Fuel consumption● Conflict Minerals Policy & Procedure● Waste disposal and production● Code of conduct for suppliers

21Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

PRINCIPLED GROWTH APPROACH

SOCIETAL IMPACT

Environment

OPERATIONAL IMPACTPRODUCT IMPACT

Climate Action● Develop our Climate Action Plan identifying our path to net zero and aligning environmental disclosures to TCFD recommendations

Safe, Diverse, & Inclusive Culture● Build a safety culture where our employees believe that every workplace incident is preventable and a zero incident rate is achievable
Social● Build a diverse and inclusive workforce
Responsible Sourcing● Strengthen transparency of our 3TG minerals supply chain

Committed to Integrity
Governance● Establish Human Rights Policy at the parent company level, and advance our human rights management and due diligence efforts● Strengthen and unify our Supplier Code of Conduct, integrating critical ESG factors into supplier and third-party contracts

VALUES-BASED LEADERSHIPAND
SOUND RISK MANAGEMENT PRACTICE
Westport / 2022 ESG Report22Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 201-2

Regulatory environment
We adhere to complex and ever-changing laws, regulations, standards, and requirements

we offer, how they contribute to achieving policy goals, and the required policy framework tothat impact our markets, product offerings, and compliance efforts. The transport sector andunlock their full potential.

its green transformation has been in the spotlight of legislators around the world for several
years, which directly affects our day-to-day business. We keep a close eye on these legislative
developments across the world and where possible engage in dialogue about the solutions
NORTH AMERICA●●

California is a historic leader in RNG use

EUROPE

INDIA

●

●

in transport – negative average carbon

to reduce Russian fossil fuels

intensity – driven by the Low Carbon

dependency, including increasing

Fuel Standard regulation

biomethane production withhydrogen production target by 2030

Infrastructure Law and Inflation●

Reduction Act of 2022)

●

share
●

A leader in air pollutant and CO2
emissions regulations for light-,

globally (Hydrogen Strategy)

medium-, and heavy-duty vehicles(Euro 7, CO2 Standards)

Construction of 5,000 biogas/●●

funding●goals, global leadership in terms of

population with 10,000 CNG stations by

LNG vehicles’ adoption, and significant

2028 and 1,000 LNG stations by end ofinvestments in hydrogen●

Supported infrastructure build to reach

Looking into deployment of

1 million H2 vehicles on the road byhydrogen production and refueling2030, with primary focus on medium-

infrastructure, with plans to createand heavy-duty trucks

Pollutant Emissions Standards’Hydrogen Highways’ as part of the

proposals are calling for lower NOx and’National Green Hydrogen Mission’Growth Strategy) and decarbonizing
the heavy-duty transport sector●

Front runner in deploying a hydrogen
refueling stations network since 2013,

Decarbonization challenges lead to

infrastructure to reach 98% of theHydrogen a central pillar to achievecarbon neutrality by 2050 (Greenupgrading facilities with government

alternative fuel vehicles’ deployment

Green Hydrogen mobility corridors and●Building 3,000-4,000 biomethane

investing USD 66 billion (US) in

2024●

Biogas to reduce coal consumption inJAPANrural regions by 50 megatons

Resolute commitment to thedeployment of CNG and LNG stations,

Mandatory targets for alternative fueltop three producers of clean hydrogen

US Clean Trucks Plan and new●

in transport and increasing renewables’

up to 30% of Canada’s energy by

Plans to increase natural gas from 6%

CHINA

biomethane plants

infrastructure, GHG intensity reduction

Clean hydrogen is expected to deliver
2050, making the country one of the●(REPowerEU)

infrastructure, and vehicles (Bipartisan

accelerated deployment of cleaner vehicles, as well as low and zero carbon transport fuels.

to 15% of energy mix by 2030

new plants and 20 million tons

US is supporting investment inclean fuel production, refueling●

Accelerating energy transition

The main geographies in which we operate have macroeconomic policies supporting antargeting 800,000 vehicles and 900
stations by 2030 with support fromJapan’s Hydrogen Industrial Strategy●

Among the most stringent fueleconomy standards globally for lightduty vehicles, with 2030 standards
expanding the scope of covered
powertrains and including theconsidering of well-to-wheel fuelefficiency

GHG emissions from light-, medium-,and heavy-duty vehicles beginning in
2027

Westport / 2022 ESG Report

23

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Strong governmental support for transition to alternative fuels
NORTH AMERICA● California is a historic leader in RNG – negative averagecarbon intensity

CHINA● Supporting investment in clean fuel production,
refueling infrastructure, and vehicles (U.S. Inflation
Reduction Act of 2022)● Building 3,000-4,000 biomethane upgrading facilities● Decarbonization focus leads to investments inhydrogen● Clean hydrogen to deliver up to 30% of Canada's energy
by 2050EUROPE● Accelerating energy transition to reduce Russian fossil
fuels dependency● Biomethane production increasing with new plants● REPowerEU – 20 million tons hydrogen production
target by 2030

INDIA

● Biogas to reduce coal consumption in rural regions by
50 megatons● Supported infrastructure build to reach 1 million H2
vehicles on the road by 2030

JAPAN

● Hydrogen a central pillar to achieve carbon neutrality
by 2050● Investment in hydrogen vehicles and stations; targeting
800,000 vehicles and 900 stations by 2030
● Front runner in deploying a hydrogen refueling stations
network since 2013

● To increase natural gas from 6% to 15% of energy mix by2030● Investing $66 billion (US) in gas infrastructure reaching
98% of the population (>10,000 filling stations)● Construction of 5,000 biogas/biomethane plants

Source: Capital Markets Day Deck - Dec 2022.pptx (sharepoint.com)

Westport / 2022 ESG Report24Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Key heavy-duty vehicle regulations in our core regions
Substituting fossil fuels and accelerating a clean energy transition.
EUROPEAN UNION
2010

CHINA
2010
China IVEuro VI
China V

-15% CO2 fleet emissions
reduction for new-truck sales1

China VI-a
China VI-b

Euro 722030-45% CO2 fleet emissions
reduction for new-truck sales1-2

2030

2012: Stage 1 fuel-consumption(FC) limits for new truck sales

USA
2010

2016: Stage 2, -10-15%
FC reduction3

2010: US 20102014-2018: Heavy-Duty GHG and fuelconsumption Phase 1 standards6

2019: Stage 3, -10-15% FC
reduction vs. Stage 24
2019-2027: Phase 2 standards7
2025: Stage 4, -12-16% FC
reduction vs. Stage 35

2027: Clean Trucks
Plan - Low NOx8

2030
2027-2032: Phase 3 standards92035:-65% CO2 1-2
2040:-90% CO2 1-2

2050

2050

2050

Source: Westport, RBC: 1Base year 2019. 2Proposed. 3Base year 2012; average reduction target over all weight classes. 48 L/100km for GCW>49T tractor-trailers. 440,5 L/100km for GCW>49T tractor-trailers. 5Proposal published in June 2022. 62017: CO2 460 g/bhp.hr - Fuel 4.52
gal/100 bhp.hr for heavy-heavy-duty (HHD) engines in tractors. 72021: Further 2-3% CO2 reduction per year. 2027: CO, 432 g/bhp.hr - Fuel 4.2436 gal/100 bhp.hr for HHD tractors. 8NOx 35 mg/bhp.hr, new HC, PM, CO limits and extended life periods. 9Proposal published in April
2023. No update proposed for engine standards. Targets for Class 8 High Roof Sleeper Cab: 64.3 g/t-mile in 2027-2029 (unchanged), annual reductions of 10%, 11% and 6% resp. for 2030-31-32.

Westport / 2022 ESG Report25

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Sustainable Development Goals (SDGs)
Westport is committed to contributing to the achievement of the United Nations Sustainable

are most relevant to our business. These SDGs serve as a blueprint for our ESG strategy,

Development Goals that aim to end poverty, protect the planet, and improve the lives ofoutlining the key areas where Westport can make a significant impact.

everyone worldwide. Supporting the delivery of the SDGs, we identified eight goals that

EACH SECTION OF THIS REPORT BEGINS WITH THE RELEVANT SDG ICONSSUPPORTING SDGS 7 AND 9 WITH OUR TECHNOLOGYIn October 2021, the United Nations Conference of the Parties Climate Change Conference(COP26) was held in Glasgow, where over 40,000 participants and 120 world leaders

Good health andIndustry, innovation,

well-being

and infrastructure

came together to accelerate actions toward the goals of the Paris Agreement and the
UN Framework Convention on Climate Change. The conference resulted in 39 countries
committing to the Glasgow Climate Pact, aligning themselves to actions that support apathway toward net-zero emissions. This includes a commitment to end new direct public

Gender equality

Responsible consumption
and production

support for the international unabated fossil fuel energy sector, except in limited and defined
circumstances. Westport’s HPDI technology using Biomethane (RNG) or hydrogen aligns
with this commitment, both cost-effective, high-performance solutions to support climate
neutrality in the heavy-duty mobility sector.

Affordable and clean
energyWe are a part of the energy transition, providing solutions to specific sustainability challenges
Climate action

Decent work andPeace, justice, andeconomic growthstrong institutions

Westport / 2022 ESG Report

including climate change mitigation.

26

Introduction
GRI 2-28

GRI 2-29

GRI 2-30

GRI 3-1 GRI 3-3

Stakeholder
engagement

Our Approach

Environment

SocialGRI and SASB index

Governance

GRI 407-1
STAKEHOLDER GROUP

HOW WE ENGAGE

TOP 2022 INITIATIVES/TOPICS

Academia / industry●

Regular dialogue●

associations●

Collaborations with multiple universities, including

initiatives which

Simon Fraser University, University of Alberta, andpromote cleaner

otherstransportation●

1/2

New technology●

Carbon footprint
reduction

Topic-specific conferences and events include Vienna,
COMVEC. We targeted conferences with a strong HD

Through consistent and transparent

trucking presence (OEMs in particular) and focusedcommunication with our stakeholders, weon the hydrogen story, with a subtext that NG HPDI

acquire knowledge, enhance our operations,already addresses the 2025 CO2 targets, and with RNG

and guarantee that our plans, undertakings,●

and disclosures are in accordance with

Customers and OEM●

Distributor network●

Market research●

Responsible sourcing

the requirements and concerns of thosepartners●

Key account●Corporate website●

Human rights

management●

Digital media●

Code of Conduct●

Product safety

Reviews and meetings●

ESG survey●

Carbon footprint●

New productinfluenced by or influencing our enterprise.

●

On the right is a summary of our standard
and the noteworthy ESG issues that piqued
their interest in 2022:

safety initiatives

developments

reductioninteraction methods with significant parties
Employees●

Health and safety●

Union representatives

committees●

Performance feedback●

Townhall meetings●

Internal

processes●●●

communication

Training and●

Health and safety

development●

Cyber security

Product environmental●

Diversity and inclusion●

Code of Conduct●

Organization of

profileInternal ESG survey

Occupational health &●Product safety●

Analysis and education

channels
Government policymakers●

and regulators●

Global monitoring

Participation in expert

of policies andgroups for technicalon how our products

dedicated events ingovernment initiatives

standardization

contribute to theBrussels and Berlin

impacting our sector

and regulatorytransport sector

Policy advocacy anddevelopments

targeted outreach

Westport / 2022 ESG Report●●

Facility visits●

Position papers on key
policy files

27

Introduction
GRI 2-28

GRI 2-29

GRI 2-30

Stakeholder
engagement

GRI 3-1 GRI 3-3

Our Approach

Environment

SocialGRI and SASB index

Governance

GRI 407-1
STAKEHOLDER GROUP

HOW WE ENGAGE

Industry associations●●

Corporate

TOP 2022 INITIATIVES/TOPICS●

Technical working●

New membership in●

Participation inmemberships

groups andseveral global, regional,

European gas mobility

Service on boards ofcommittees

and national hydrogencampaign #Gmobility

industry associations

DrivesEuropeForward

directors and advisoryboards2/2
Shareholders and●investors●

Annual shareholder●

Analyst meetings

meeting●

Press releases

Management-led●

Annual and quarterly●

Overall ESG score
Recognition of climate

Market Day

risk in our financial

meetings, andconference calls

reporting

Capital Markets Day●

Elaborate on strategic
direction at Capitalfinancial reporting and●●performance

investor conferences,
presentations●●●

ESG priorities andperformance

Reporting to SASB and
CDP

Canadian and U.S.
regulatory filings

Local communities●

Community outreach●mechanisms

Emergency response

●

plans

●

Ensuring protection●

Cooperation withof environmental andeducational institutionssocial aspects of theand local sponsorshipcommunityof professional classes

Permanent
cooperation withpeople with disabilities

Media

●

Press releases●

Media releases●

Corporate website/
digital media

Westport / 2022 ESG Report●

Corporate●

spokespeople●

News on how we●

How our work

are progressing ourcontributes to society

missionat large

New product launches

28Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Continued commitment to consistent stakeholders’ engagement
CAPITAL MARKETS DAY
Maintaining regular communication with investors andanalysts is a crucial aspect of our operations. In late 2022,
we conducted both in-person and virtual Capital Markets
Day events to facilitate meaningful interactions between
our company’s management and financial stakeholders.
These events served as platforms to share comprehensive

to ask questions regarding our operations and products.

basis about issues important from the workers’ perspective,

Noteworthy, in 2022, we noticed an increasing number of

we engage in negotiations and consultation on various

ESG-related questions, with a particular focus on the “E”

matters, including collective bargaining agreements, and weissues.

take into consideration their opinions and recommendations.

TOWNHALL MEETINGS
We place great importance on keeping our employees
informed about our activities and initiatives, as well as
fostering open communication with our management. To
achieve this, we regularly conduct townhall meetings where
our CEO and representatives from various departments
share updates on significant news, events, and projects
they have been involved in. These meetings provide
a platform for employees to ask questions, which are

information about our company, including future strategic
initiatives, growth plans, and technology development
programs. Moreover, analysts and shareholders had a chance

Westport / 2022 ESG Report

Our goal is to foster positive and amicable relationships
with the unions, resulting in a constructive engagementthat prevents the occurrence of strikes.

An example of positive
relationships: In our plants in
Italy, 100% of employees arecovered by collective bargaining
agreements.

addressed openly and transparently.

The developed solutions are applicable to all our workforce,

LABOR UNIONS

by collective bargaining, our aim is to be competitive in the

not only employees. For employees who are not covered

We maintain an open dialogue approach with the labor

local market where we have our plants and offices, from a fullunions, in particular in Italy where we employ the largest

compensation perspective and working conditions. Westport

number of employees and our largest facilities are located.

endeavors to do this based on local market data (gathered

Our goal is to collaborate with the unions in the best interest

through local salary guide, published data, professionalof the workers. We keep the unions informed on a regular

networks, recruitment agencies, etc.).

29

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Continued commitment to consistent stakeholders’ engagement

Expanding our reach and raising awareness about our alternative solutions, recently with afocus on hydrogen, is a key priority for us in our mission toward a greener future. To achievethis, we actively participate in numerous prominent industry events worldwide. In 2022 alone,
we took part in over 40 events where we set up exhibit booths, delivered speeches, andserved as sponsors. At select events, we also had the opportunity to showcase our first-of-itskind demonstration vehicle equipped with our revolutionary H2 HPDI fuel system.

HYDROGEN MOBILITY FOR SUSTAINABLE HEAVY-DUTY TRANSPORT
On September 28, 2022, in Brussels, Belgium, to showcase our game-changing technology,"Ecomondo2022 - the Green Technology Expo", Rimini, Italy.

we organized the European Policy Panel event “Hydrogen Mobility for Sustainable HeavyDuty Transport”, which featured the participation of a representative from the European
Commission along with other stakeholders. During this event, we unveiled to an audienceof policymakers and industry representatives our groundbreaking H2 HPDI fuel system forheavy-duty vehicles, which is expected to significantly reduce CO2 emissions in line with thedecarbonization goals of the European Union. To visualize our solution, we also presented ademonstration vehicle outfitted with our H2 HPDI fuel system.

“Hydrogen Mobility for Sustainable Heavy-Duty Transport”, Brussels, Belgium.

Westport / 2022 ESG Report30

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Continued commitment to consistent stakeholders’ engagement

Our technology achieves better
performance than diesel engines,
with near-zero CO2 emissions. By
maximizing the efficiency potential withhydrogen, H2 HPDI fuel systems result
in cost-effective CO2 reductions for fleetsand society. This is why we hope that
the Commission and Member States willprioritize the availability of green hydrogenfor the transport sector in the coming years
and support engine technology advancesthat will be key for the development of thewhole hydrogen transportation market.
David Johnson, CEO, Westport

Westport / 2022 ESG Report31

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

ADVANCED CLEAN TRANSPORTATION (ACT) EXPOThe ACT Expo is the largest Advanced Transportation Technology and Clean Fleet
exposition with over 8,500 attendees, including leading fleets and OEMs. Therewas significant interest at the ACT Expo in 2022 in the H2 HPDI technology andWestport’s other clean transportation technologies, including from the media,
regulators, fleets, and OEMs. The demonstration vehicle outfitted with our H2 HPDI
fuel system was also showcased during the event, marking it as the first of its kind.

IAA TRANSPORTATIONThe IAA Transportation event is one of the world’s most important platforms thathas been shaping the future of the commercial vehicle industry since its inception
in 1897.
At last year’s event, we not only showcased our hydrogen solutions, but also
hosted a press conference, sharing our latest news with the media. Additionally,
Ulf Lundqvist, our director of Business Development, delivered a speech titled “H2
HPDI: a game changer in the hydrogen society,” which generated significant
interest from the audience.

Westport / 2022 ESG Report32

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

2023 Plans
NGV Technical Forum organized by the United States Department of Energy(Downey, California, January 2023)

As we transition into 2023, our commitment remains
steadfast to our mission of promoting understanding of
our revolutionary technologies. To this end, we have actively
participated in, and have also planned engagements inseveral significant events, among others

The International Engine Congress of VDI Wissensforum and ATZlive(Baden-Baden, Germany, February/March 2023)
SIA International Conference: Hydrogen Internal Combustion Engines & Vehicles(Orleans, France, March 2023)
Vienna Motor Symposium(Vienna, Austria, April 2023)
Advanced Clean Transportation (ACT) Expo
(Anaheim, California, May 2023)
Heavy-Duty Diesel Sustainable Transport Symposium(Gothenburg, Sweden, May 2023)
Hydrogen Technology Conference & Expo
(Houston, Texas, June 2023)
Aachen Colloquium Sustainable Mobility(Aachen, Germany, October 2023)

Westport / 2022 ESG Report33

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-28

Industry associations
Being an active member of our industry
ecosystem and policy environment isimportant as we strive toward a cleaner
future. Proactive engagement in industry
associations helps us showcase our solutions
and ensures our views are heard globally. Our
membership in various associations facilitates
and close collaboration with governments andinternational organizations, along with ourparticipation in working groups and expert
panels, contributes to the development ofDavid M. Johnson, CEO, Westport, speaking at the Hydrogentechnical standards and regulations. We

Council CEO event in Washington, D.C., USA in June 2022.

continued our senior leadership roles on the
Boards of Directors of industry associations

HYDROGEN COUNCIL

in many of our core markets, including NGVAIn early 2022, we joined the Hydrogen Council, aEurope, NGV America, and the Canadian

global CEO-level advisory body providing a long-

Natural Gas Vehicle Alliance. To further

term vision of the important role of hydrogenenhance our efforts in advancing hydrogentechnologies in an energy transition to cleaner

solutions, in 2022, we joined prominent

solutions. We see this membership as a natural

national and international NGOs, including

progression given our hydrogen-focused initiatives

the Hydrogen Council, Hydrogen Europe, thethat include our HPDI technology, research, andItalian Hydrogen and Fuel Cell Association

partnerships, which all have the potential to(H2IT), and The Canadian Hydrogen and Fuelplay a key role in the hydrogen pathway toward

Cell Association.

decarbonizing the transportation sector.

Westport / 2022 ESG Report

We are thrilled to join the
Hydrogen Council as asupporting member. The
Hydrogen Council continues
to boost global collaboration
and work within the industry
to scale up hydrogen solutions
for cleaner transportation. We
believe that green hydrogen ininternal combustion engines
and fuel cell vehicles will be
key in decarbonizing transport.
As a global leader in gaseous
fuel solutions, we look forward
to working with the Hydrogen
Council to advance hydrogen’srole in the clean energy
transition.
David Johnson, CEO, Westport

34

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

NGVA EUROPE

THE CANADIAN HYDROGEN AND FUEL CELL

The Natural & bio Gas Vehicle Association (NGVA Europe)

ASSOCIATION (CHFCA)

is a European association that advocates for the use of

We have become an executive member of The Canadiannatural and renewable gas as a transportation fuel. It was

Hydrogen and Fuel Cell Association. CHFCA is a non-profit

established in 2008, and its membership includes companies

organization at the national level that encompasses various

and national associations across the entire gas and vehicle

stakeholders, including industry, academia, and research

manufacturing chain. NGVA Europe facilitates networking

agencies. Their primary goal is to promote the use of clean

opportunities among interested parties to develop commonhydrogen and fuel cell technologies and products as apositions and strategies for expanding the market for natural

means of addressing the most pressing energy challenges

gas transportation systems. Additionally, it gathers, verifies,

facing our world.

and disseminates accurate information on notable market
developments.

Nadege Leclercq, Senior Director for Government Relations and Market
Development, Westport, is Senior Vice President of the Board of

HYDROGEN EUROPE

Directors of NGVA Europe.

In 2022, we also joined Hydrogen Europe, which is aefficiently fuel Europe’s net-zero economy. Additionally,

European association that advocates for the interests of theHydrogen Europe acts as the unified voice of the European

hydrogen industry and its stakeholders while endorsinghydrogen industry via the collaborative efforts of its

hydrogen as a driver toward achieving a zero-emission

members at the European level, and it is an advocate forsociety. Hydrogen Europe’s mission is, among others, tonational, European, and international policies and initiatives

facilitate the adoption of clean hydrogen as an abundantthat bolster the complete advancement of European andand dependable energy carrier and raw material that can

global hydrogen technologies and clean hydrogen markets.

Westport / 2022 ESG Report

35

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

L’ASSOCIAZIONE ITALIANA IDROGENO E CELLE A

Sustainable Energy Transitions” and has four principal

THE ITALIAN ASSOCIATION OF THE AUTOMOTIVECOMBUSTIBILE (H2IT)

goals: Advocacy (ADV), Safety and Business Improvement

INDUSTRY (ANFIA)

Established in 2005, H2IT, which we joined in 2022, is an(SBI), Innovation & Growth (IGO), and Communications &The Italian Association of the Automotive Industry, founded

association that seeks to encourage the development ofAwareness (COM).

in 1912, is a prominent association representing thehydrogen production and utilization technologies andsystems. Its primary objective has been to promote theestablishment of hydrogen infrastructure, support sector
stakeholders, and position Italy as a leader in the global
market.

LIQUID GAS EUROPE
Liquid Gas Europe is a group consisting of national LPG
associations and major LPG suppliers, distributors, andequipment manufacturers. Liquid Gas Europe’s mission is toestablish LPG and renewable LPG as the preferred energyWORLD LPG ASSOCIATION

source in Europe, supporting EU policy goals. They focus

The WLPGA is the global voice of the LPG industry,

on demonstrating the benefits of LPG, representing thepromoting its use for a safer, cleaner, and more prosperous

industry in policy discussions, and collaborating with otherworld. It represents over 300 companies from 125 countries

industries to achieve clean air, decarbonization, and energy

along the LPG value chain and has Special Consultative

efficiency. Liquid Gas Europe is an active EU stakeholder,

Status with the United Nations. The WLPGA’s Three Yearparticipating in consultations and cooperating with a wide

Strategic Review for 2023-2025 focuses on “Solutions forrange of partners.

Westport / 2022 ESG Reportinterests of its 430 associate members. It ensures effective
communication between the Italian motor vehicle industry
and the Public Administration and Italian political bodies
on technical, economic, fiscal, legal, statistical, and qualityrelated issues in the automotive sector to create value for theindustry.

36

Introduction
GRI 3-1

GRI 3-2

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 3-3

Materiality assessment
To help us identify and gauge the ESG topics of greatest importance to Westport and our stakeholders, a formal stakeholder engagement process was completed in 2021 using the “identify,
prioritize, and validate” approach prescribed by the GRI. To support prioritization, we also reviewed shortlisted topics against SASB criteria under the Auto Parts and Electrical & Electronic
Equipment Standards. This process outlined our key material topics, which were subsequently used to build out our ESG strategy. Early in 2022, the topics were reviewed for relevance,
considering factors such as changes to regulatory compliance. This type of review will take place annually.

IDENTIFICATIONPRIORITIZATIONVALIDATION

We benchmarked ourselves against our peer group to

Utilizing internal and external stakeholder surveys (209Following internal management workshops, our material

understand the identified material topics in our industry,

respondents) along with a review of customer-requested

topics include six priority topics that we give a greater

find relevant ESG frameworks and standards, and conduct

ESG surveys in addition to rating agency expectations, we

focus on through concrete activities and plans to reducea review of the regulatory landscape to identify emerging

assessed and prioritized each topic according to its level of

our impact along with setting targets and required

topics. Through this work, we identified and reviewed asignificance to our stakeholders and the overall impact on

measurements. You can find the individual initiatives

list of topics relevant to Westport’s business and operating

Westport’s ability to deliver against its strategy. Through thisrevolving around the defined focus areas throughout thisenvironment, identifying 20 significant topics out of awork, we were able to narrow the list to 11 key topics.

report – see the ESG strategy on page [21] and relevant

potential pool of over 100.

sections.

Each year, our various plants undergo several ESG assessments from the perspectives of customers, banks, and investors, amongst others. We listen to these requests and their scope to verify
topics that are relevant to our stakeholders and address them appropriately in operations, measurements, and reporting. At this time, there are no significant changes in our material topics
from the previous reporting period.

Westport / 2022 ESG Report37

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

While our six priority ESG topics are at the heart of our ESG strategy and are the areas where
we focus our efforts, the other significant ESG topics are managed in the normal course of
our business.

Environment

PRIORITY ESG TOPICSSIGNIFICANT ESG TOPICS● Carbon footprint● Product innovation● Product environmental profile

Social● Occupational health and safety● Labor relations● Diversity, equity, and inclusion● Product safety● Responsible sourcing

Governance● Human rights● ESG governance● Ethics and compliance

The goals of our business are
perfectly aligned with sustainability
from an environmental perspective.
The next layer down is about how
do we do that. And in this regard,
our fundamental target is about
continuous improvement in theway we run our plants, the way wetreat our employees, and how wereport on our efforts, providing moretransparency to the marketplace. The
path to reporting is different for every
business, and we believe that it’s
important to learn from experiences
and mistakes. While it’s crucial tocreate a strong base, it’s also vital tostrive for progress over perfection.
David Johnson, CEO, Westport

Westport / 2022 ESG Report38

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 3-3

Climate change is a global challenge. We understand that to lower
worldwide emissions, time to act is now.

Environment

Westport Fuel/ 2022
Systems
ESG Report/ 2022 ESG Report

Our core principle of driving innovation toward a cleaner tomorrowencompasses protecting the environment. We remain dedicated toboosting our endeavors daily by utilizing research, innovation, technology,
and products to advance cleaner and more affordable transportation
solutions.
As we strive toward becoming environmental stewards, we recognizethat managing and reducing our own carbon footprint is a crucialcomponent of our mission. We stay committed to strategizing,overseeing, monitoring, and evaluating our progress in this field with theobjective of continuously improving.

39

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Decarbonizing transportation
As the world population and demand for goods increase, the transportation industry aims

Industry drivers support the transition to future mobility. A sole focus on electrification

to provide cleaner, more efficient, and affordable transportation solutions. Currently, there

overlooks the fact that the road to decarbonization involves a combination of solutions,are 1.5 billion vehicles on the road, and the industry produces close to 90 million new vehicles

including the use of alternative fuels and hybrids in the near term, and zero-emission

annually.

technologies like battery electric vehicles (BEVs) and hydrogen-powered vehicles in the long

The challenge of decarbonizing the transportation sector, with its need to cost-effectively
replace energy-dense fossil fuels while meeting the industry’s demands, stands out as one ofterm. Affordability, consumer acceptance, vehicle application, and geography will all play arole in determining the mix of solutions.

the most difficult aspects of decarbonization.
The United Nations 2022 Emissions Gap Report (EGR) states “the world is not on track toreach the Paris Agreement goals and global temperatures can reach 2.8°C by the end of the
century.” The 2022 EGR further finds “the world must cut emissions by 45% to avoid global
catastrophe.”¹
The transportation sector plays a crucial role in decarbonization efforts as it is responsible for

24% OF DIRECT CO2 EMISSIONS
from fuel combustion and accounts for

Decarbonization of the transportationindustry can only move as fast as theecosystem allows. With Westport’s
existing technology and manufacturing
infrastructures, we are embarking on apath to hydrogen as the fuel of the future.

10% OF GLOBAL GREENHOUSE GAS EMISSIONS.
In line with the Paris (COP21) and Glasgow (COP26) agreements, there is an urgent need toadopt transportation propulsion technologies that can effectively minimize CO2 emissions
within a shorter timeframe.

¹ UN Environment Programme (October 2022): Emissions Gap Report 2022.

Westport / 2022 ESG Report40

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Vital heavy-duty perspective

CO₂ “savings” that result from using
our systems

Reducing emissions in heavy-duty transport will not be a one-size-fits-all

Westport products sold in 2022

approach. Relying solely on electrification is unlikely to achieve the net-zerotargets set for 2050. While battery electric vehicles (BEVs) have gained

reduced CO2 emissions of 1,498,438 Tons of CO2,

considerable attention, they are not suitable for all transportation segments.

which is equivalent to:

Heavy-duty commercial vehicles such as buses and trucks have relied ondiesel engines for years due to their superior attributes in terms of power
output, efficiency, reliability, durability, and lower total cost of ownership.
Currently, BEVs face limitations in terms of range, battery size, refueling time,
payload capacity, and charging infrastructure making them less favorable
for heavier vehicle applications. In order to address these challenges andRemoving 459,067
gasoline-powered passenger vehicles from service

effectively support decarbonization efforts during this critical transition to azero-carbon economy, alternative fuels and hydrogen are essential.2

Preventing 638,343,732
liters of gasoline from being consumed

Source: https://oee.nrcan.gc.ca/corporate/statistics/neud/dpa/calculator/ghg-calculator.cfm

2 Mumford, Baker & Munshi (January 2022): High Performance Hydrogen Engine Applications Using Westport’s Commercially Available HPDI.

Westport / 2022 ESG Report

41

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Our products are already playing animportant role in reducing carbon intransport and helping to make a clean andprosperous future possible for everyone.
Already today, there are hundreds ofthousands of vehicles operating on ourengine management and fuel supply systems,
fueled by lower carbon LPG, CNG, LNG, and bycarbon-neutral bio-CNG and bio-LNG. Thesevehicles have avoided producing millions of tonsof CO2 equivalents and will continue to do so foryears to come. Our systems are having a tangible
impact on air quality improvement and carbon
reduction now and in the foreseeable future whengreen hydrogen is used with our technologies.
David Johnson, CEO, Westport

Westport / 2022 ESG Report42

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Sustainability is affordability
LPG ANNUAL SAVINGS

The need to move people and freight is driven by an increasing

11.3 KM/YEAR - 13 KM/LT PETROL

global economy – the world needs solutions that are clean,affordable, and scalable. At Westport, our mission is tomake clean and affordable transportation a reality for our€ 700

customers and their customers worldwide.
applications to run on cleaner fuels in a cost-effective manner.
Affordability is key to sustainability as it drives adoption ofcleaner products, helping us achieve sustainability objectives
more rapidly. As a clean technology company, we are committed
to reducing our reliance on fossil fuels such as diesel andgasoline and transitioning to cleaner alternatives like natural gas,
biogas, and hydrogen in an affordable way. By doing so, we areplaying a vital role in moving the world to a better future.

€ 600
Annual cost savings in Euros

Our goal is to enable cars, trucks, and other heavy-duty off-road

€ 500
€ 400
€ 300
€ 200
€ 100
€0

GRI 302-1

GRI 302-3

GRI 302-4

TR-AP-130a.1

GRI 305-1

GRI 305-2

GRI 305-3

GRI 305-4

GRI 305-6

EM-MM-110a.2

EM-MM-110a.1

RT-EE-130a.1

ITALY (€)

NETHERLANDS (€)

POLAND (€)

GRI 305-5

LPG W1 2021

LPG W1 2022

LPG W2 2023

Sources: IHS Markit; Team analysis, Global Petrol Prices.

Westport / 2022 ESG Report

43

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

A partnership in decarbonization
We acknowledge the importance of collaboration in achieving the world’s ambitious

In 2021, we kicked off a research project with Scania AB, a world-leading provider ofemissions reduction goals and achieving net-zero targets. Our business model allows us totransport solutions. As part of this research, we were able to announce world-leadingcollaborate with numerous global manufacturers, aftermarket suppliers, and distributors,

efficiency results for hydrogen-fueled internal combustion engines.

allowing top minds to work together as we continue the journey toward decarbonization.

Utilizing our proficiency in gaseous fuels, we conducted trials of hydrogen utilization in the
new Scania commercial vehicle internal combustion engine using our H2 HPDI fuel system asa cost-competitive pathway to reduce CO2 emissions from transportation. This advancement

In 2022, we achieved the following:of our patented technology can provide an economic, competitive alternative to fuel cells● Successfully demonstrated H2 HPDI to a broad global audience of

while providing a similar greenhouse gas emission reduction profile.

industry participants, OEMs, policymakers, and investors.
● Three projects underway with OEMs to evaluate our H2 HPDI fuel systemon their engine platforms.
● Awarded two programs to develop and supply LPG systems to a global
OEM accommodating several Euro 6 and Euro 7 vehicle platforms.
● Collaborated with Johnson Matthey to develop an after-emissions
treatment for H2 HPDI.
● Expanded our global manufacturing footprint in China, supporting
ongoing and future growth in hydrogen.

Westport / 2022 ESG Report

Through our testing, we achieved

51.5% brake thermal efficiency,
significantly exceeding the long-targeted 50% threshold. Brake thermal efficiency is ameasure of the fuel efficiency of internal combustion engines. The higher the brake thermal
efficiency, the lower the fuel consumption and greenhouse gas emissions.

GRI 302-1

GRI 302-3

GRI 302-4

TR-AP-130a.1

GRI 305-1

GRI 305-2

GRI 305-3

GRI 305-4

GRI 305-6

EM-MM-110a.2

RT-EE-130a.1
GRI 305-5

EM-MM-110a.1

44

Introduction
GRI 3-3

GRI 306-1

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 306-2

Environmental management
Consistent with our strategy, we continue improving our ESG management
approach to build a clear structure both at the local and global levels thatis visible to our stakeholders, including internal management, employees,
financial institutions, customers, and investors. We continue to expand our ESG
committees to prove our commitment in this regard and ensure fluent andeffective information flow.
To accomplish our goals, Westport has dedicated resources at the corporate
level to provide guidance, oversight, and empowerment in a manner thatSłupskrecognizes our evolution from the amalgamation of different companies – eachwith its own unique commitment to environmental responsibility.
Thus, our management approach is always site specific. The corporate levelprovides a foundation, but execution and implementation occurs at the sitewith clear responsibilities assigned to each country, site, and person.
The aim is to have all the sites certified in the environmental scope with ISO
14001 with the initial focus on sites in Italy and Poland, which are our the largest
production sites.

Cherasco

Brescia

Within our management system, monthly KPI meetings occur at the site
level during which we track and govern safety measures. We also measureenvironmental KPI every three months, including energy, waste disposal,
water, etc. With these measures, we define targets every year – e.g., within thecertification program IATF.

Westport / 2022 ESG Report45

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

2023 PRIORITIESOUR CERTIFIED FACILITIESThe focus area for 2023 is environmental management system advancement to close theWhile our baseline environmental performance standard is compliant withgaps we have identified. The certification plans will drive the change through data collection

relevant international, national, and sub-national regulations, we strive tomechanisms and continued commitment to regulatory compliance.

go beyond minimum requirements. To this end, all our primary production
facilities are aiming to become certified.

Environmental focus areas for 2023:● Energy consumption

ISO 14001● Water consumption● Fuel consumption
Italy

Westport Fuel Systems Italia S.r.l.

our code of conduct for suppliers.

Vancouver

Westport Fuel Systems Canada Inc.

In 2023, our primary objective is to establish a robust and efficient organizational

India

Rohan BRC Gas Equipment Private Limited● Waste disposal and production
These focus areas are supported by continually evolving policies andprocedures regarding environment, health and safety, conflict minerals, andmanagement framework at the corporate level, efficiently governing ESG matters inour operational plan. This framework will encompass various aspects, including safety,
environmental issues, and overall quality, ensuring comprehensive coverage of importantfactors in our operations.

PREPARATION PHASE
PolandWestport / 2022 ESG Report

Stako sp. z o.o.

46Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 3-3

Our carbon footprint and environmental impact

Our commitment to decarbonizing the transportation
sector is reflected in our ongoing initiatives to reduce
our carbon footprint. We take full responsibility forminimizing our environmental impact while providing cleantransportation solutions. Guided by our Environmental Policy,
we uphold high standards to protect the environment andlead the way in mitigating the impacts of fuel system research,development, testing, manufacturing, and assembly. Going aboveand beyond mere regulatory compliance, we have obtained ISO
certification and continuously strive for further improvements. We
are dedicated to implementing a Climate Action Plan, aiming fornet-zero GHG emissions and ensuring our disclosures align with therecommendations of the TCFD. See our Environmental Policy.

Westport / 2022 ESG Report47

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

2022 PERFORMANCE
We recognize sustainability is a process, and we strive for continuous improvement. In 2022, we accomplished the following:

Scope 3 emissions measurement

Continuing the collaboration with S&P Global. After identifying Scope 1 and Scope 2 emissions, we started a project to measure our Scope 3
emissions (to be completed in 2Q 2023). Within the project with S&P Global, we will also calculate emission reductions targets using a sector
relevant methodology set forth by the Science-Based Targets Initiative (SBTI). This is another advancement in building the core elements of the
TCFD-recommended climate-related disclosures.

Gap analysis

Within the goal of advancing our environmental management system, we began verifying categories of information for which we have reliable
and complete data while performing a gap analysis outlining missing data. We have identified a range of small projects that once completed
will result in the availability of data and the ability to count impacts across the value chain. In Italy and in cooperation with an external provider,a project was started to gather ESG data from the suppliers.

Global Health, Safety, and

Our Global Safety Committee has become more mature in its operations and impactful throughout the organization. By sharing examples ofEnvironment Committee

good practices, along with information on incidents at our factories, we are raising awareness and building a stronger safety culture within ourorganization. Based on success seen in 2022, we have decided to widen the scope of responsibilities under this group to include environmental
reporting in 2023.

EcoVadis

We participated in the EcoVadis assessment and were awarded a bronze-medal status for our sustainability commitment and results in 2022.
This performance was better than or equal to the score of 50 percent of all rated companies.

Photovoltaic plant expansion

We have set mature investment plans for a photovoltaic plant expansion in Poland. We are now evaluating the costs and possibilities ofin Poland

expanding our solar panel system in Slupsk, Poland. The target is to cover the demand of approximately 30% of energy needs for the entire
facility.

Westport / 2022 ESG Report48

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Small steps also matter
Following our small steps philosophy in 2022, we have implemented a range of small projects
along various sites, among which were:

WASTE MANAGEMENT
Reducing the use of disposable packaging in the Netherlands and Poland.
At our sites in the Netherlands and Poland, we have completely abandoned food and drink
in plastic packaging. The initiative involved heavy cross-cutting and even covered such areas
as sweets for guests, bottled water, paper, and plastic cups for drinks. Instead, reusable cups
and utensils were introduced, and our kitchens were equipped with dishwashers. Thus, at ourfacility in the Netherlands,

we avoided throwing 17,500 disposable cups
into the garbage, while in Poland positive results will be visible during 2023 since this change
was introduced in the second half of 2022.

ENERGY MANAGEMENT
We reduced electricity consumption by installing LED lighting in both the Netherlands andPoland.

Westport / 2022 ESG Report49

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

2023 PRIORITIES AND PERFORMANCE

Energy management initiatives
planned for 2023

● Activate 'stand by' modes on all CNC machines in Brescia.
● Remove the eternit roof and install an insulation board, as well as the replacement of the glazing with honeycomb polycarbonate to increase
thermal efficiency in the production buildings at the Cherasco plant.
● Conduct a feasibility study on energy recovery from engine testing processes at the Cherasco production facility.
● Reduce the bath temperature on tunnel washers to reduce thermal energy consumption at the production facility in Poland.

Investment plans for a photovoltaic

We intend to conduct analyses at the Brescia production site for a photovoltaic plant in Italy. Analyses and discussions are currently underway

plant expansion in Italy

with outside companies about the possibility of expanding the installation so that up to 10% of the total demand can be covered. Furthermore,
a Feasibility Study has been prepared for the construction of a photovoltaic plant with the creation of a covered parking lot in Cherasco.

Decarbonization workshops

In 2Q of 2023, we plan to hold decarbonization workshops with external experts at the Brescia, Cherasco, and Słupsk production facilities to build
action plans to reduce the carbon footprint in Scope 1 and Scope 2. Based on these plans, CO2 reduction targets will be calculated and officiallyannounced.

Westport / 2022 ESG Report50

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Reducing our footprint with alternative energy sources and collaborations
As we continually look to reduce our carbon footprint, many of our facilities are

We are still exploring the possibility of connecting the power generated by the planned solar

exploring alternative energy sources.

installation in Słupsk to a local renewable power and energy cooperative.

In Italy, we have integrated solar energy at our locations, and one
location is capturing methane that would normally be released into
the atmosphere to use it as a renewable energy source.

The Słupsk Bioenergy Cluster links

20 participating businesses and city facilities,

40,000 electricity users, and 120,000 wastewater customers – all this is
In the Netherlands, we are generating more solar power than ourfacility requires. We are transferring our knowledge and success withpart of an innovative renewable energy-sharing and waste-recycling system.

solar to our newly acquired facility in Poland.

This cluster involves multiple stakeholders who generate green energy and exchange it
efficiently through local coordination by municipalities. By connecting to this system, we canuse the excess energy produced during idle times to contribute to the local community’s
needs. This model demonstrates how organizations like Westport can play a role in theenergy transition toward a cleaner world.

Westport / 2022 ESG Report51

Our Approach

Introduction
GRI 3-3

GRI 301-1

GRI 301-2

GRI 306-1

GRI 306-2

Environment

SocialGovernance

GRI and SASB index

SASB: TR-AP-440b.2

Materials and waste management
As part of the ISO certifications, Westport plans to implement tools that will allow an uninterrupted collection ofreliable information on materials used in manufacturing and packaging, as well as production and municipal waste.
Waste disposal and production is an environmental focus area for 2023.

Waste generated in manufacturing plants in Europe and Argentina

LOCATIONTOTAL AMOUNT OF WASTE [TONS]RECYCLED [TONS]% RECYCLED

Argentina

235.72-0.0%

Netherlands

34.43

24.14

70.1%

Italy

1,250.11

298.43

23.9%

Poland26,887.75

24,977.31

92.9%

Sweden

1.24

0.27

21.8%

Total

28,409.25

25,300.15

89.1%

Westport / 2022 ESG Report52

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

2022 performance
Westport is committed to taking responsibility and contributing to the transition toward a low-carbon energy
future. Along with delivering clean transportation solutions to our customers, our focus on reducing our carbon
footprint is a natural step in our efforts to reduce GHG emissions.
Our efforts include reducing our emission footprint through initiatives like integrating solar energy to meet ourelectricity needs (refer to page [56]). We aim to progress toward an economy that is primarily powered by lowcarbon energy sources.

Our production facilities in Poland, Italy,
and the Netherlands generate energy
from on-site solar – 3.0% of energy
consumed in 2022 was coming fromrenewables (on-site solar).
Along with our Environmental Policy, Westport ensures the responsible use of energy and other resources in its
operations and strives to be an environmentally responsible neighbor in the communities where we operate.

Westport / 2022 ESG Report

53

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GHG EMISSIONS (TONS CO2-EQUIVALENT)In 2022, we saw an increase in Scope 1 direct emissions. Compared to 2021, there was a

We succeeded in reducing emissions at our production facilities in Poland and Italy (by 4.5%

14.7% increase in Scope 1 emissions. The reason for the increase in the Scope 1 index is also

and 11.2%, respectively), which are the most significant in the Scope 2 calculation. The Polishrelated to the increased return of employees to stationary formula work after the COVID-19

plant (like most plants in Poland) must use electricity from coal-fired power plants. The

pandemic.

production facility in Italy, however, is the most electricity-intensive, which, with an average

In the Scope 2 emissions, we recorded a decrease of 7.0% compared to 2021, thus close to pre-CO2 emission factor, makes it one of the two largest emitters in the group.

2020 levels.

1.

2020

2021

2022

% CHANGE
2021–2022

Total Scope 1 direct emissions

2,690.33

3,534.07

4,054.87

14.7%

Total Scope 2 indirect emissions

5,028.26

5,428.45

5,050.42-7.0%

Total GHG impact

7,718.59

8,962.52

9,105.29

1.6%

The IEA emission factors used in Scope 2 emission calculations were: (a) 2020 – re-stated and re-calculated using IEA emission factors (2017, 2018), (b) 2021 – stated with IEAemission factors (2019); and (c) 2022 – stated with IEA emission factors (2020).

2. According to the IEA’s reported CO2 emission factors, the countries in which Westport operates are reducing their emission factors yearly, which in turn results in lower indirect
greenhouse gas emissions (Scope 2). Due to an increase in 2022 direct energy consumption (Scope 1) and a decrease in annual revenues, GHG intensity has increased. However,compared to 2019, the last year before the COVID-19 pandemic, a decrease in both direct and indirect energy consumption should be noted.
3. Westport’s annual revenue between 2022 and 2021 decreased by 9%, energy consumption increased by 3.3%, and GHG emissions by 1.6%.
4. Our emission calculation methodology comprises were: (a) utilizing the tools provided by the GHG Protocol to calculate emissions from mobile combustion (Transport_Tool_v2_6) and stationary combustion (Stationary_combustion_tool_(Version4-1)) for our Scope 1 emissions and (b) country-specific emission factors published by the International
Energy Agency (IEA) for our Scope 2 emissions.

Westport / 2022 ESG Report54

Introduction

Between 2021 and 2022, our annual revenue
decreased by 9.1%, but our total energy
consumption increased by 3.3%, which explains
why our energy intensity and GHG emissions
intensity have increased.
Thus, there was a decrease in gross margin andgross margin percentage primarily due to lower
production volumes and higher production costs
incurred for materials, transportation, and energy
caused by the global supply chain shortage,inflation, and labor costs. This was partially offset
by a positive mix impact due to higher sales in theEuropean market.

Our ApproachSocialGHG EMISSION INTENSITY(tons of CO2 emitted
consumed/$M revenue)

0,50

32,0

0,45

28,8

0,40
0,35

0.42
0.37

0.37

25,6
19,2

0,25

16,0

0,20

12,8

0,15

9,6

0,10

6,4

0,05

3,2

0,00

0,00

2022

28.40

22,4

0,30

2021

GRI and SASB index

Governance

ENERGY INTENSITY(thousand GJs energy
consumed/$M revenue)

2020

Westport / 2022 ESG Report

Environment

2020

29.79
26.64

2021

2022

55

Our Approach

Introduction

ENERGY CONSUMPTION

SocialGovernance

GRI and SASB index

Our consumption of NG, which includes consumption data for CNG and city gas, in
2020

2021

2022

% CHANGE
2021–2022

2022 increased by 3.2% compared to 2021 and by 38.9% relative to 2020. Westportbuildings, except for the Vancouver and Swedish facilities, are heated by gas. The
Italian facility uses CNG-powered cars, which account for more than 99% of mobile

Direct energy consumption (GJ)

CNG consumption, with a total of 609.4 GJ.

Natural Gas (NG)41,04955,26157,014

3.2%

Liquified Natural Gas (LNG)

-

453

1,189

162.6%

Liquefied Petroleum Gas(LPG-Propane)

Environment

The reason for the increase in LNG consumption is the disclosure of all emissions
from mobile sources in that year – previously, the production facility in Italy did notreport LNG consumption.

5,071

4,591

5,048

10.0%

Our stationary consumption of LPG decreased in 2022 compared to 2021 due to lessrequired being by OID tests (testing of cars after installation of the system). However,

Renewable Natural Gas(RNG-Methane)

74

42

34

-19.2%

On-site solar electricity

382

1,118

1,728

54.5%

Diesel

2,984

4,580

5,083

11.0%

Gasoline

1,714

2,074

1,927

-7.1%

resulted in a 54.5% increase in consumption.

Net direct consumption

51,274

68,12071,997

5.7%

Our stationary consumption of gasoline decreased by 7.1% in 2022 compared to

new cars with LPG fuel systems. In addition, there was a reduction of the number of“remote” working days due to the easing of the COVID-19 emergency.
We consciously use the increasing amount of clean, renewable solar energy – 2022

2021 due to less requests for tests on a roller bench or engine test room for petrol-

Indirect energy consumption (GJ)

powered vehicles/engines.

Purchased electricity

48,81155,00955,1420.2%

Net indirect consumption

48,81155,00955,142

0.2%

Total energy consumption

100,084

123,129

127,140

3.3%

Total renewable energy
consumption

382 | 0.38%

1,118 | 0.91%

1,728 | 1.36%

54.5%

Total non-renewableenergy consumption

99,702 | 99.62%

Westport / 2022 ESG Report

there was an increase in LPG in mobile consumption in 2022 due to the purchase of

In 2022, diesel consumption increased by 11%. The manufacturing facility in India
sometimes suffers power supply problems, requiring diesel use for heating.
Total energy consumed is 127,140 GJ with 71,997 GJ coming from direct
consumption and 55,142 GJ from indirect consumption – purchased electricity(43.4% of total consumed energy). Approximately 1.4% was renewably generated.
There are currently no energy purchases with renewable energy certificates (RECs)

122,011 | 99.09%

125,412 | 98.64%

2.8%

and Guarantees of Origin (GOs).

56

Introduction

SocialWestport Fuel/ 2022
Systems
ESG Report/ 2022 ESG Report

Our Approach

Environment

SocialGovernance

GRI and SASB index

Our core purpose is to drive the advancement of a cleaner and more
prosperous future for everyone, while making a positive impact on
people’s lives, communities, and the transportation sector. As we strive
toward this goal, we are equally committed to fostering a culture ofsafety and promoting diversity and inclusivity in our workplace toprioritize the well-being of all our employees.
This responsibility also extends to our supply chain by ensuring ourpartners are aligned with our expectations as well as those of ourcustomers – upholding the highest standards of safety and sustainability.

57

Introduction
GRI 2-6

GRI 2-7

GRI 2-8

GRI 202-2

GRI 3-3

GRI 401-1

RT-EE-000.B

Our Approach

Environment

GRI 404-1

GRI 404-3

GRI 404-2

SocialGovernance

GRI and SASB index

Our global workforce
The majority of Westport’s workforce consists of permanent, full-time direct employees who

Our global workforce was on average 1,532 (direct employees) and 1,824 individuals, which

work for 40 hours a week. Any other forms of employment arrangements are reserved forincludes direct employees, individuals contracted directly for twelve months or longer, andspecific cases only, such as seasonal or temporary workers, students, or positions with uniquetemporary or seasonal workers. This is compared to a previous year total workforce of 1,797

requirements.

individuals. The table summarizes our total workforce, including new hire and turnover rates.

NORTH AMERICALATIN AMERICAEUROPEASIA PACIFIC

TOTAL

Total Workforce

235

90

1,372

127

1,824

Total Direct Employees

208

90

1,187

48

1,532

Employees: Males

79%

94%

64%

92%

68%

Employees: Females

21%

6%

36%

8%

32%

New Hires

9

0

66

1

77

New Hire Rate

4.37%

0%

5.59%

2.62%

5%

Total FTE (at December 31st)

220

88

1,194

100

1,602

Total Part-time (at December 31st)

1

0

49

0

50

Most employees are hired locally within greater regional areas or within similar countries.

However, exact quantitative data is currently unavailable. An approach to collecting additional

When hiring for C-suite or positions reporting directly to the C-suite (senior management)

information will be considered for future reporting.

and any Vice President roles, we consider qualified candidates from across the globe.
Westport / 2022 ESG Report58

Introduction

Our Approach

Environment

GovernanceSocialGRI and SASB index

Learning and development
At the heart of our competitive edge and sustainable growth are our employees. We have adiverse team of skilled engineers, manufacturing technicians, and business specialists fromall over the world. We are dedicated to supporting their professional growth and career
aspirations.
Generally, four categories of trainings are offered in Westport to our employees:

The total number of training hours for our direct employees decreased
to 11,646 hours in 2022. An average of● Occupational Health and Safety● Leadership● Functional Skills/Competence Development

7.60

hours per employee● Individual Development needs-based
Where possible, we also listen to the needs of our employees or unions to tailor the process
bottom-up or top-down.

White-collar employee trainings are conducted based on annual
training plans, which are tailored to the business unit’s needs, the competencies matrix, andCompared to 12,131 hours. An average of

7.88

hours per person in 2021.

individual development plans.

Blue-collar employee trainings are based on technical andfunctional requirements, along with compliance with statutory regulations for minimum
training hours. Additionally, blue-collar workers are provided with opportunities to rotate todifferent positions and acquire new competencies.

Westport / 2022 ESG Report59

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

On Executive Leadership development: Westport Ways of Working“PACE” MEANS:
We continued our initiatives to the next phase our Executive Leadership
Development in 2022 – leadership assessments and development planning
using the strategic leadership profile composed of seven leadershipbehaviors that were identified in the previous phase (2021).
In 2022, the focus was on building self-awareness, identifying strengths anddevelopment areas, and creating an individual development action plan
for all direct reports of the CEO. This was accomplished through a 360-degree
feedback & Executive coaching program facilitated by our external
knowledge partner. Each leader had an Executive coach assigned to debriefon the confidential feedback report and facilitate identifying and planningan action plan for development goals. To strengthen the collaboration within
the global teams and develop a unified culture, the PACE framework was
co-created by the Executive team to articulate the ways of working andcollaborating effectively across the company.

P

for Push for clarity

A

for take AccountabilityCfor engage in Courageous conversations

E

for Engage the team

The PACE framework will serve as a tool to guide
employees in the direction of one company culture.

Westport / 2022 ESG Report60

Introduction
GRI 3-3

GRI 405-1

Our Approach

Environment

GovernanceSocialGRI and SASB index

TC-SI-330a.3

Diversity, equality, and inclusion (DE&I)
Encouraging a diverse and inclusive

To improve gender balance, we

culture is essential to our success as

will actively seek diverse candidates

it fosters the exchange of different

from a variety of backgrounds thatperspectives and innovative problem-

are represented and available in thesolving, and enriches our discussions,talent pool from which we hire, based

leading to a broader understandingon job specifications and our DE&I

of customers from various markets

objectives. Management decisions inand enhancing our overall businessterms of compensation, learning andperformance. We acknowledge that thedevelopment, and career advancement

best talent seeks a work environment

are continuously based on meritocracy,

where differences – whether cultural

while giving due consideration from aor opinion-based – are respected andDE&I standpoint. We will promote andvalued.

support a workplace that is respectful,

Our global Diversity Policy sets out

fair, and inclusive for all our employees.

our stance on diversity and provides

Following the Diversity Policy, theguidelines for promoting diversity andNomination and Corporate Governanceinclusion across our organization, starting

Committee of the Board periodicallywith the Board of Directors. The policy

evaluates the size and composition of the

stipulates that all employees must be

Board to ensure it reflects a diverse mix

treated with fairness and respect; follow aof knowledge, experience, education,

zero tolerance for discrimination, bullying,skills, gender, age, ethnicity, andor harassment in the workplace; andgeographic location to meet our Board

comply with our Code of Conduct anddiversity targets.

Respectful Workplace Policy.

Westport / 2022 ESG Report

WORKFORCE GENDER DIVERSITY

2019

2020

35%

65%

2021

36%

64%

Male

2022

31%

69%

32%

68%

FemaleMANAGEMENT GENDER DIVERSITY

2019

83%

2020

17%

82%

2021

18%

86%

2022

14%

83%

17%

61

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

2022 PERFORMANCE

2023 PRIORITIES AND PERFORMANCE

Label of Excellence: After institutional visits and evaluations, our Italian facilities have been

Create DE&I awareness in the organization: To enhance our commitment to DE&I

awarded the "Label of Excellence" by the Piedmont region for its commitment to promoting

principles, in 2023, one of our primary objectives is to conduct awareness trainings

and ensuring the gender equality and the well-being of its employees, recognizing it as one

throughout the entire organization. The program is currently being designed, and surveysof the top companies meeting the relevant requirements. The program is a pilot initiative

will be conducted to determine the starting point and plan the necessary steps. Our ultimate

with a plan to widen it globally across the Westport organization in the following years.

goal is to develop a global project based on best practices from Europe and extend themthroughout the Westport organization, with certifications where feasible. The goal is to train
100% of our workforce in 2023.

The Bloomberg Gender-Equality Index: To better understand how we compare to our

Drive gender equality in compensation treatment: We focus on ‘equality’ in all positions

peers in gender equality, in 2022, we underwent the Bloomberg Gender-Equality Index (GEI)and strive to provide fair and equitable treatment in compensation for comparable roles

assessment for the second time. Our actions have produced favorable outcomes as reflectedacross our organization. We are currently in the process of mapping our pay data to ensure

in an increased score compared to the previous year.

that we have the necessary information to address any existing or potential inequities in the
future. Furthermore, our efforts will prioritize providing equal employment and advancement
opportunities for all individuals, regardless of their education level, age, gender, or disabilities.
Our goal is to develop a set of guidelines for fair and equitable compensation treatment.
Push for equitable employment and advancement opportunities for all: Based on
Education, Generation, Gender and Differently Abled.
Support effective flexible work arrangements: As practically possible, our goal is to promoteand support an engaged, motivated, and productive workforce, through appropriate work
arrangements, including hybrid work models, based on the nature and demands of various
roles in the Westport organization.

Westport / 2022 ESG Report

62

Introduction
GRI 2-20

GRI 2-21

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 202-1

Equality in compensation treatment
The principal rule at Westport is to ensure equitable

BENEFITS

compensation at the market median level for all positions,

Providing appropriate benefits to employees is needed to align with market

throughout different Market Segments/Global Functions,practices, promote wellness, and help for retirement planning. This is why weand subject to affordability. We provide competitive levels

provide a variety of benefits to our employees, which are discretionaryof compensation that meet or exceed local minimum wage

and company funded. The scope depends, for example, on location, position,requirements.

and the tenure of employment. The most common benefits are:

To ensure that our remuneration level helps recruit, motivate,
and retain our employees, we are currently mapping detailed
numerical data to assess and address the issue in an effective
manner. Competitive wages and benefit programs may vary

Full health coverage and insurance

according to country or location, but the general principle is a
guiding principle.

Regular annual assessments

For remuneration policies for our highest governance body, see

Additional health plans with additional

page [89] of this report and our 2023 Management Information

checkups for special category of employees

Circular.
Individual development plans
Short-term incentive bonus plans subject
to local goals and KPIs
Retirement plans with employer
contributions
Long-term incentive / bonus programs

Westport / 2022 ESG Report

63Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

DE&I and well-being initiatives and principles
RETURN FROM MATERNITY LEAVE AND FLEXIBILITYSCHOLARSHIPS

We have introduced a program aimed at supporting new

Since 2022, Westport Italy (our biggest facility) has beenmothers returning to work. The program offers flexible

providing annual scholarships to support the children ofworking hours, allowing mothers returning from maternity

our employees who are pursuing degrees in STEM fields

leave to work reduced hours while receiving full pay. The

at public universities. These scholarships cover the full cost of

program was implemented as an adaptation to the rules intuition for one year. We have plans to expand and develop this

our Italian facility where it is legally required. Furthermore,

and similar programs in the future as part of our commitment to

the program provides the flexibility of remote, hybrid, or

supporting regional equal opportunity committees.

fixed work arrangements.

In 2023, we joined a new initiative organized with local authorities in

We offer white-collar employees at Westport flexible

Italy to promote and encourage girls to pursue technical degrees atworking hours, including flexible start and lunch times.

universities. We also fund scholarships for participants. The goal of thisWe also provide a range of flexible working arrangements,

plan is to increase the number of female students in technical fields andsuch as hybrid and remote work, depending on individual

help them overcome any barriers or challenges they may face. We believe

preferences and work requirements. In 2023, we aimthat promoting gender diversity in technical fields will benefit not only our organization but also contribute to a more

to promote and support flexible work arrangements as

equitable and diverse society. We are committed to supporting and empowering girls and women in pursuing technicalpractically feasible.

education and careers, and we are excited to see the positive impact this plan will have in the years to come.

Westport / 2022 ESG Report64Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

MULTI-CULTURAL POTLUCKIn our Vancouver facility, where we have a high percentage of employees fromdiverse nationalities, we recently organized a lunch event where employees wereencouraged to bring food from their respective cultures. The event was a huge
success with 36 different types of food shared, representing 22 different regions
around the world. We take pride in our diverse community and the event provided agreat opportunity for employees to build relationships, learn about different cultural
backgrounds, and come together for the first time after a challenging period due tothe pandemic.

ANNUAL WORLD OF WHEELS
Also at our Vancouver plant, the third-largest facility in our global organization, we
recently hosted the "World of Wheels" event. The aim of this gathering was for our
employees to exhibit their unique vehicles, including cars, motorcycles, vespas,
bicycles, and more. Over 50% of our Vancouver-based staff members took part inthis event, which provided a much-needed social occasion after a prolonged periodof remote and hybrid work. It was a wonderful opportunity for our employees tocome together and enjoy each other’s company.

Westport / 2022 ESG Report65Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 3-3 GRI 403-1 to 10, RR-FC-320a.1

Occupational health and safety
At Westport, we hold the belief that all workplace injuries can be prevented,
and we have continued to enhance our safety programs by utilizing
a combination of workplace training for hazard recognition, workplaceinspections, and thorough investigations whenever a workplace incident
occurs. Each site focuses on ensuring compliance with safety-related
regulations, which can differ across the world, while aiming to exceed thesestandards. To encourage a culture of safety, employees are urged to reportany safety concerns to their supervisors, managers, or safety committee
members, when applicable.

In 2022, we took the following steps to establish a consistent
approach to health and safety, with the aim of continuallyenhancing our performance in this area:
GLOBAL HEALTH AND SAFETY POLICY
We worked on our Health and Safety Group Policy. This policy will serve to alignall of our jurisdictions with our expectations for health and safety performance.

GLOBAL HEALTH, SAFETY AND ENVIRONMENTCOMMITTEE
Under the leadership and direction of our vice president of Engineering andexecutive vice president of Operations, this committee continues as a platform
to facilitate collaboration and encourage dialogue about workplace bestpractices in health safety, with a focus on continual improvement in our safety
performance. Standardized health and safety metrics are now being used
across all our sites to synchronize reporting and support best-in-industry safety
performance.

Westport / 2022 ESG Report66Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Certification plans
Our goal is to obtain ISO 45001 certifications for our occupational healthand safety systems. We aim to have all our sites certified within the next
two years, with a focus on the largest production sites in Italy (Brescia andCherasco) and Poland.

Other messages during the week-long campaign focusedon recognizing the risks in everyday activities, workplace
support for good mental health, and the importance of being
prepared for emergency situations like extreme weather, medical
emergencies, fire, spills, and earthquakes.

Building a culture of safety
WESTPORT’S FIRST ANNUAL SAFETY WEEKIn early 2022, we launched the Westport’s first Global Safety Week intandem with the North American Occupational Safety and Health (NAOSH)
week. This will be an annual event and has already taken place in 2023.
The intent was to remind our workforce, through an email campaign,
about easy, simple things that can be done every day at work and at home
to improve personal safety as well as the safety of our co-workers, family
members, and the general public.
The inaugural message reminded employees about the importance to“Take Two” minutes to identify potential hazards prior to starting tasks andensuring that effective corrective actions can be implemented to mitigate
the risk of injury or incident.

Westport / 2022 ESG Report67Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Occupational health andsafety management system

Occupational health andsafety risks

All our operating sites have occupational health and safety management systems specific

We manage the prevention and reduction of occupational health andto each site, which comply with jurisdictional requirements at a minimum and often exceed

safety risks in our operations through our occupational health and safety

them based on the level of health and safety risk present. All those systems apply to bothmanagement system and JHSCs. Furthermore, in locations where JHSC isemployees and workers who are not employees but whose work is controlled by the

not available, we manage the prevention and reduction of occupational healthorganization. Importantly, privacy and confidentiality are maintained through all reportingand safety risks in our operations through workplace risk assessments, regularmechanisms. We are seeking ISO 45001 certifications, which covers occupational health andworkplace inspections, incident investigations, and comprehensive training.

safety management systems to be implemented in most of our sites by 2025.
In addition, each of our entities has a formal health and safety policy that outlines theprocedures for identifying occupational health and safety risks, reporting work-related
hazards and dangerous situations, as well as investigating incidents and near-misses.

Joint Health and Safety Committee

OHS training

We have established a formal joint health and safety committee (JHSC) at most of our

Annual training on a variety of occupational health and safety topics occurs

sites to promote occupational health and safety among our workforce, including employees,

throughout the organization, including during employee onboarding andcontractors, and temporary workers. These committees consist of both management andthroughout their role. More frequent or specialized training is available for

employee representatives who work together to address health and safety needs and provide

roles which are identified as higher-risk roles to occupational health and safety

consultation and communication on related matters. 97.98% of our workforce (including

hazards. The cost of all employee training is paid for by Westport and during

employees, contractors, and temporary workers) are covered by a formal, site-based JHSC.

paid working hours.

JHSC are not required for remote workers and those who work in offices with fewer than
20 employees. In these cases, we have processes in place to support direct communication
between employees and management to address any occupational health and safetyconcerns.
Westport / 2022 ESG Report

68Introduction

Our Approach

Environment

GovernanceSocialGRI and SASB index

2022 performance
Reportable Injury RateBY PROACTIVELY IDENTIFYING AND MANAGING RISKS, REVIEWING LEADING PRACTICES,AND INTEGRATING LESSONS LEARNED INTO OUR HEALTH AND SAFETY PLANNING, WE
AIM FOR INCIDENT-FREE OPERATIONS.
With approximately 1,532 employees, reportable injuries increased, from 7 in 2021 to 15 in 2022, and ourrecordable injury rate (RIR) increased, from 0.42 in 2021 to 0.98 in 2022.
In 2022, the method of estimating total hours worked was changed based on the average number of direct
employees, excluding direct contracts and a third party. The increase in injuries and the lower value of hours
worked led to a significant rate increase.
The reason for the increase in the injury rate index may also be related to the increased return of employees to

1.60
1.40

1.42
1.17

1.20

0.98

1.00

0.98

0.80

Work-related injuries are notcurrently tracked for workers
who are not direct employees.

0.60
0.40

As we improve and standardize

0.42

our approach, we will consider

0.20

disclosing this data in future

2018

2019

2020

2021

2022

reporting.

stationary formula work after the COVID-19 pandemic.

There were no fatalities in 2022. Out of 3,064,833.33 total hours worked in 2022, there were 15 reportable

In 2022 WFS initiated a Global Health, Safety & Environment group, comprised of the individuals

injuries. Based on 200,000 annualized working hours, the total recordable injury frequency rate was 0.98. Of

responsible for HSE at each WFS facility, plus the executives responsible for Global Operations andthese 15 reported injuries, 9 occurred at our Italian facility, 4 at our Polish facility, and one each at the India

Global Engineering. The initial focus of this group has been information-sharing between sites,

and Vancouver facilities. All of our other 5 facilities had no Lost Time Injury (LTI). In 2022, there were no related

including lessons learned and root causes. This group noted the increase in lost-time incidents

accidents resulting in property damage. The injuries described above resulted in a total of 222 Lost Time Days,

in 2022 vs. 2021, and has shared lessons learned and root causes for the 2022 incidents (lost-timeof which 139 were in Italy and 83 in Poland.

incidents plus near-misses).
As part of Westport’s continued commitment to health and safety, we are continuing toconsolidate our site-specific safety management activities into a formalized corporate safety
program. Within our company-wide safety program we will standardize HSE incident reporting
company-wide, including tracking and reporting safety incidents by type and cause, so that we
can target mitigating actions at the areas of highest need, and can better identify best practices insafety that we can share with our global workforce.

Westport / 2022 ESG Report69Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Ergonomics improvement

During 2022, we initiated a project aimed at enhancing labor
ergonomics at our plants located in Poland and Argentina. To
accomplish this goal, we conducted training sessions where agroup of a dozen individuals acquired knowledge about themethods of assessing ergonomics. Following the training, weestablished four working groups who conducted ergonomics
audits using appropriate methods and created reports that
included suggestions for improvement.
AS A RESULT OF THIS PROJECT, WE IMPLEMENTED VARIOUS SOLUTIONSTHAT LED TO AN ENHANCED LEVEL OF COMFORT FOR BOTH
PRODUCTION AND OFFICE EMPLOYEES.

Westport / 2022 ESG Report70Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Society
We believe that creating a better future involves not only internal actions but also extends to external initiatives that have a positive impact on society andthe environment. Therefore, we and our employees actively support and organize various charitable initiatives aimed at addressing social concerns andpromoting a better world. We understand the significance of our actions and the impact they can have on the world around us, which is why we take this
responsibility seriously.

Support for Ukraine

In response to the outbreak of war in Ukraine in early 2022, our company took part in various
charitable initiatives. We sponsored a 500km+ ultra cycling marathon for firefighters in Ukraine,
which aimed to collect and donate medical supplies, food, and basic household chemicals.
Additionally, we joined an action to help those affected by the war in Ukraine.
One of our production facilities is located in Poland, a country that plays an important role in thecontext of diplomacy and humanitarian aid. This action was carried out in collaboration with the entire
Westport group and had an international character. Funds were transferred with the assistance of thehumanitarian organization UNICEF. As part of the voluntary action, employees directly donated funds
to the UNICEF account, and the company’s management made a matching contribution.

Westport / 2022 ESG Report71Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Supporting diversity

WE COLLABORATE WITH SUPPLIERS WHO PROVIDEEMPLOYMENT OPPORTUNITIES TO PEOPLE WITHDISABILITIES TO SUPPORT THEIR LIVELIHOOD AND
PROMOTE INCLUSIVITY IN THE WORKFORCE.
Furthermore, in 2022, we communicated to all stakeholders inour supply chain to emphasize our commitment to ethical andsustainable business practices that are inclusive and supportive of
diversity. We shared our Diversity Policy as an attachment and asked
our suppliers to complete a questionnaire confirming their alignment
with the identified values, including our Diversity Policy.

Westport / 2022 ESG Report72

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

United Way Campaign
GRI 2-29

Cooperation with the local
communities

Many of our Canadian employees
actively participated in an annual
United Way workplace fundraising
campaign, which provides
employees with the option to
donate to United Way via onetime financial contributions or via
recurring payroll deductions.

Westport / 2022 ESG Report

This non-profit organization works
to support millions of people acrossall age groups, including children,
youth, seniors, and those facing
social issues such as poverty, mental
health, and food insecurity.

Our commitment is to make a positive impact on
the local communities where we operate, which
includes creating employment opportunities andstriving to minimize any resulting negative impacts.
As part of this commitment, we actively listen to
the feedback we receive from the community.
In February 2022, we received a noise complaint
regarding our Vancouver plant. We immediately
reached out to the individual who reported theissue and were able to efficiently address andresolve the problem. It is worth noting that this was
the only complaint we received about our activities
throughout 2022 regarding our operations all over
the world.

73

Introduction
GRI 2-6

GRI 2-24

GRI 204-1

GRI 3-3

Our Approach

Environment

SocialGovernance

GRI and SASB index

SASB: TR-AP-440a.1 / SASB: RT-EE-440a.1

Responsible sourcing
OUR SUPPLIERS ARE CRUCIAL PARTNERS IN DELIVERING OUR INNOVATIVE
TRANSPORTATION SOLUTIONS FOR A CLEANER WORLD.

The supply chain issues that reverberated around the world as a result of
the COVID-19 pandemic and last year connected with the conflict in Ukraine
impacted nearly every industry including our own, resulting in shortages,
delays, and increased scrutiny on responsible sourcing. The nefarious
elements related to human rights are now exposed to a heightened degree.
As ESG becomes a principal focus for many organizations, our customers
are scrutinizing their supply chains to ensure they have as much visibility as
possible on the provenance of the goods they are purchasing.

As a priority topic identified in our materiality assessment, in part because of the extent towhich we purchase inputs for our final products, we recognized the need to do more work on the
responsible sourcing front. In 2022, supported by management, we reached out to all our suppliers toembed part of our ESG efforts also into our supply chain operations.

Westport / 2022 ESG Report74Introduction

Our Approach

Responsible sourcing
The following is a summary of our 2022 achievements and our priorities
for 2023 toward strengthening our responsible sourcing activities and our
expectations of suppliers.

+900 SUPPLIERS OF MATERIALS71%

OF BUDGET SPENT ON LOCAL SUPPLIERS,

WITH

100%

IN POLAND

AND

>85%

IN CHERASCO AND EINDHOVEN.

Westport / 2022 ESG Report

Environment

SocialGovernance

GRI and SASB index

MANUFACTURINGTOTAL SPEND IN 2022

% OF SPEND WITHOUTFACILITY LOCATION(CUSTOMS FREE) (EURO)CUSTOM DUTY

Brescia

13,807,401

61.34%

Cherasco

65,800,823

85.04%

Eindhoven

9,667,522

86.23%

HPDI

9,852,340

28.35%

Slupsk

14,590,957

100.00%TOTAL (only local suppliers)

113,719,043

71%

MANUFACTURING
FACILITY LOCATIONTOTAL SPEND IN
2022 (EURO)TOTAL SPEND WITH
COUNTRY SUPPLIERS(EURO)% OF SPEND WITH SUPPLIERFROM THE COUNTRY WHERE
PRODUCTION PLANT IS
BASEDBrescia

22,510,868

13,236,826

59%

Cherasco

77,378,457

61,615,00880%

Eindhoven

11,211,291

5,560,799

50%

HPDI

34,749,315

9,563,557

28%

Slupsk

14,590,956

3,168,094

22%

Total spend

160,440,887

93,144,28475

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

2022 PERFORMANCE 1/2

We conducted a ESG supplier survey

to spread Westport commitment to a culture of integrity, ethical, and sustainable business practices to our suppliers, along with asking themto confirm commitment to our values and deploy effective corporate governance and policies. The survey contained such issues as anticorruption, Code of Conduct, diversity, whistleblowing, and human rights. We circulated the survey in December 2022 to all our suppliers as afirst step.

We revised our Terms andin the Capex and material scope to include ESG language, criteria, and expectations, ensuring these expectations would also be embedded

Conditions and supplier contracts

into third-party contracts. In the next step, these experiences will be extended also to services.

We implemented a unified policy

to purchasing with the reference point being our Code of Conduct.

applying ESG criteria

We updated our supplier manual

for additional reporting requirements.

We updated our supplier portal

including the Responsible Minerals Initiative (RMI) template on conflict minerals that facilitates the transfer of information through the supply
chain regarding a mineral’s country of origin and the smelters and refiners being utilized.

Westport / 2022 ESG Report76Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

2022 PERFORMANCE 2/2

We increased engagement with morethat have limited involvement in purchasing and sourcing to understand the training requirements that are needed to fully execute changes.

functions across the organization

We worked with our employees to increase awareness and accuracy of conflict minerals reporting requirements.

We have obtained REACH certification

to identify to customers that we have good materials management in place and are in compliance with the REACH requirements andregulations for each chemical we import, use, or manufacture in our European Union plants.

Our Human Rights Policy

gained maturity.

2023 PRIORITIES AND PERFORMANCE:● Evaluate the ESG supplier survey to plan the next necessary steps in
implementing ESG into our supply chain.
● Unify supplier quality manual to integrate Code of Conduct and ESG
expectations across our supply base.
● Further improve our overall sustainability management systems, whichwere recognized by EcoVadis and other ratings.

Westport / 2022 ESG Report77Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Strengthening our 3TG minerals
supply chain
TO ENSURE RESPONSIBLE SOURCING,WE CONTINUE TO SUPPORT EFFORTS

we support industry efforts to prevent conflict minerals from entering our supply chain

such as the Automotive Industry Action Group’s 2020 to all companies inand protect victims of armed conflict in the Democratic Republic of Congo (DRC) andthe automotive supply chain to achieve a transparent, conflict-free mineralsurrounding countries.

supply chain for the industry. We also work with suppliers to increase

Tin, tungsten, tantalum, and gold (3TG) minerals used in automotive vehicles and parts are
considered conflict minerals because they’re commonly mined in the DRC.

awareness and accuracy of conflict minerals reporting requirements, andthrough our alignment with the Responsible Minerals Initiative (RMI, formerly
the Conflict-Free Sourcing Initiative), we recommend compliance tools andEACH YEAR, WE PERFORM DUE DILIGENCE

back cross-industry efforts to identify and validate conflict-free smelters andto determine whether any products we make or buy contain 3TG minerals and file a reportrefiners.

confirming our compliance with the U.S. Securities and Exchange Commission’s (SEC)
conflict minerals rule.

we plan to launch enhanced due diligence initiatives, leveraging publicly available data

TO STRENGTHEN OUR APPROACH TO RESPONSIBLE
SOURCING, WE INTEND TO:

and materials to determine if there are any reported or presumed infractions linked to our● Continuously improve our conflict minerals reporting.

TO ENHANCE OUR EFFORTS,

existing and potential suppliers. We also aim to include ESG-related terms and conditions in
our supplier contracts.

● Unify supplier quality manual to integrate Code of Conduct and ESG
expectations across our supply base.
● Improve due diligence within our suppliers’ smelters, leveraging support
from the RMI.

Westport / 2022 ESG Report78Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Connecting ESG performance
to corporate financial health

64.2%
ESG assessment conducted by RINA

Westport Italia is a subsidiary of Westport in Italy. In 2022, an ESG assessment was conducted by RINA,
which is an independent entity that offers certification and conformity assessment services to public
and private organizations that are committed to sustainability, environmental protection, and thefight against climate change.
The ESG assessment was carried out through a scoring method, weighted on the applicable businesssector and based on a consolidated set of Global Reporting Initiative (GRI) indicators.
The overall score of 64.2% assigned to Westport Italia was deemed to be at a level where UniCredit
issued refinancing at a lower rate of interest on the condition of mutually agreed upon ESG covenants
and corresponding KPIs.
Although many would agree that organizations with strong ESG performance tend to have lower
risk, the link to financial performance is not always apparent to stakeholders. In this case, however,
it is clear that our ESG performance is recognized not only by regulators, customers, and otherstakeholders but also by financial institutions, who reward businesses like Westport with a lower costof capital. This allows us to grow our business, provide value to our stakeholders, and continue to drivea cleaner, more prosperous tomorrow for all.

Westport / 2022 ESG Report79

GRI 3-3

GRI 202-2

Governance

Westport / 2022 ESG ReportCreating a culture of integrity is only possible when strong and effective
governance is in place. At Westport, good governance has two aspects:
internal and external. First, we want to manage our companies in atransparent and fair way, with no place for malpractice, abuse of power,
or discrimination. Second, as a publicly listed company, we want to bea reliable business partner and member of the capital market. We do
not tolerate any unfair business practices, such as corruption, unfair
competition, insider trading, or money laundering.
By protecting the rights of individuals, managing risk, and consistently
demonstrating ethical and responsible behavior, we establish trust
among our stakeholders as we build a culture of integrity and a dynamic,
successful, ethical, and sustainable business that is in line with our values.

Introduction
GRI 2-9

GRI 2-10

GRI 2-11

GRI 405-1

Our Approach

Environment

SocialGovernance

GRI and SASB index

TC-SI-330a.3

Corporate governanceEvery day, our collective commitment toward the values of integrity, respect,
and perseverance is reflected in our actions. With their vast experience, ourBoard of Directors and its Standing Committees establish the practices andresponsibilities that help the company achieve its goals and maximize
sustainable shareholder value while considering
our responsibilities as a good corporate citizen to all stakeholders.

Elected by Westport shareholders, the Board of Directors is responsible foroverseeing the business and affairs of our company. Governance policies
and practices are consistent with our values, sustainability, and various
rules and requirements applicable to our business.
Westport's current Chair of the Board of Directors is Mr. Daniel Hancock,
who has been an independent Director since 2017.

Board at a glance
GENDER DIVERSITYAVEREGE TENURE

AVERAGE AGE

COMMITTEE CHAIRSNATIONALITYINDEPENDENCE

44%
Women

3.9
Years

63.5
Years

75%
Women

56%
OutsideCanada89%
Independent
Directors

3
4-9 Years
6< 4 Years

Westport / 2022 ESG Report70s
1 person60s
5 people50s
3 people

Canada4 people

Germany
2 peopleUSA
3 people

Independent
8 peopleManagement
1 person81

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Board tenure
Directors are individually nominated and elected annually at Westport
Annual General Meeting of Shareholders. Since 2020, five new Board
members have been appointed. As of March 6, 2023, no Director has
served for more than 10 years, with the average tenure being 3.9 years as ofDecember 31, 2022.
Westport has not established term limits for members of our Board of
Directors, however, we are committed to renewing Board membership ona measured basis. A review and assessment of our Board of Directors
is conducted annually, and Westport periodically reviews and rotates
Board Chair and Committee Chair positions to ensure diversity of views.

89%
of directors are independent

44%

female director representation, exceeding the Diversity
Policy’s 30% minimum and meeting the target
commitment for three consecutive years

Westport / 2022 ESG Report82Introduction
GRI 2-9

GRI 2-10

GRI 2-12

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-17

Board skill diversity
Directors must have an appropriate mix of skills, knowledge,
and experience in business, along with an understanding of theindustry and the geographical areas in which the corporation
operates. The corporation maintains a skills matrix to identify
those areas which are necessary for the Board to carry out its
mandate effectively and to determine the appropriate mix of
Directors on each of the standing committees. The Nominating
and Corporate Governance Committee reviews the matrix
annually to confirm it continues to reflect the most relevant skills,
experience, and competencies.
Our Directors have a strong set of skills and expertise in many
areas. While individual Directors may have significant experiencein multiple areas, for the purpose of simplicity, the following
table identifies only the top five primary areas of expertise as
self-assessed by each nominated Director. The Nominating andCorporate Governance Committee coordinates and oversees anannual self-evaluation process with the Board of Directors.

1 - COMPETENT
Having requisite or adequate ability

2 - PROFICIENT
Depth of understanding of discipline andarea of practice; a thorough competence
derived from training and practice3 - EXPERTA person who has a comprehensive andauthorative knowledge of or skill in aparticular area

Westport / 2022 ESG Report83

WHEATMAN

EILEENSCHALLER

GRI and SASB index
KARL-VIKTORJOHNSON

DAVID

HODGE

Governance

PHILIPHANCOCKDANIEL.

GUGLIELMIN

SocialANTHONY

FORST

RITA

EPRILE

Environment

BRENDA

AREAS OF EXPERTISE

Our Approach
BUCHIGNANI

Director skills matrix

MICHELE

Introduction

ACCOUNTING / AUDIT / FINANCIAL EXPERTISE

Ability to critically read and analyze financial statements, knowledge of accounting
and financial disclosure and reporting processes

CAPITAL MARKETSWork experience involving extensive exposure to public capital markets andinstitutional investors (including financing and funding activities)

C-SUITE LEADERSHIP

Experience as a CEO or executive management position for a large publicly listed orlarge private organization

DIGITAL, TECHNOLOGY, AND INFORMATION SECURITY

Experience in digital technology tools and oversight of information security(including cybersecurity and privacy) and technology risk management programs

ENGINEERING EXPERIENCE

Experience involving development and implementation of technology strategies
including product development, technology/product portfolio management, andR&D

GLOBAL EXPERIENCEManagement or executive experience in a multi-national organization,
understanding of the challenges faced in different cultural, political, or regulatoryenvironments

GOVERNANCE / BOARD

Understanding the requirements of good corporate governance, dynamics, andoperations of a corporate board and the legal and regulatory landscape

MERGERS AND ACQUISITIONS

Experience in mergers, acquisitions, integrations, or other business combinations

Westport / 2022 ESG Report84

WHEATMAN

EILEENSCHALLER

GRI and SASB index
KARL-VIKTORJOHNSON

DAVID

HODGE

Governance

PHILIPHANCOCKDANIELGUGLIELMIN

SocialANTHONY

FORST

RITA

EPRILE

Environment

BRENDA

AREAS OF EXPERTISE

Our Approach
BUCHIGNANI

Director skills matrix

MICHELE

Introduction

MANUFACTURING EXPERIENCE

Experience with direct operations, including operational optimization and direct
responsibilities for workplace health, safety, environmentand financial disclosure,and reporting processes

MARKETING / SALES / BRAND MANAGEMENTManagement or executive experience involving the marketing, sales, and brandingof products

REGULATORY AND LEGAL

Experience in regulatory, legal, and public policy matters including government
relations

RELEVANT INDUSTRY EXPERIENCEManagement or executive experience or relevant education in the company‘s coreindustry for understanding of the company‘s markets, strategy, risk management,
and operations

RISK MANAGEMENT

Knowledge of and experience with internal risk controls, risk assessments, andreporting

STRATEGIC PLANNING AND EXECUTION

Experience with identifying value creation opportunities and development andimplementation of business growth and optimization strategies

SUSTAINABILITY / ESG

Experience with and responsibility for sustainable business practices, including
environmental impacts and assessment and analysis of sustainability metrics

TALENT MANAGEMENT AND COMPENSATION

Experience in leadership continuity, succession planning, diversity and inclusion,compensation programs, and management of compensation-related risks

Westport / 2022 ESG Report85

Introduction

Our Approach

Strategic planning oversight
The Board and executive management dedicate at least one Board meeting per year to
strategic planning to discuss emerging trends, the competitive environment, risk issues
including cybersecurity and corporate social responsibility initiatives, and any significant
business issues and product portfolio adjustments within the context of the corporation’s
strategic direction. Strategic, financial, and capital plans are developed by executive
management and reviewed by the Board for alignment of resource allocation and risk
appetite before approval.

Environment

SocialGovernance

GRI and SASB index

1/yearstrategic planning Board meeting

During the year, the Board monitors executive management’s progress and receives regular
updates from the CEO and other members of the Executive Management team on strategic
developments and performance against the strategic plan, including the oversight of
amendments in light of any new market, regulatory, or competitive conditions.

Succession planning
Our Board periodically evaluates Board succession processes to ensure Directors withstrong and diverse experiences can be attracted and selected for future Board seats.
Moreover, our Board actively monitors our management succession plans and receives
regular updates on human capital management matters. At least annually, the Board reviews
senior management succession and development plans.

Westport / 2022 ESG Report86Introduction
GRI 2-12

GRI 2-14

GRI 2-15

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-19

Role and responsibility of theBoard
A strong ESG strategy and performance requires an effective and accountable

THE BOARD HAS RESPONSIBILITY FOR THE FOLLOWING MATTERS:
executive leadershipand oversightlegal and regulatorycompliancecorporate communications

strategic plan

risk management and internal
controls

annual operating plan andbudgetcorporate governancefinancing activities

oversight of corporate
cultureexecution compensation

sustainability and ESG

major acquisitions anddivestitures

governance structure and process. Our experienced nine-member Board
is committed to nurturing and fostering Westport long-term and ongoingcommitment to environmental stewardship and sustainability for thecreation of long-term shareholder value, as well as effective corporate
governance and strong leadership to support our strategy. Responsibilities
include oversight of the adequacy of management systems to identify andmanage ESG-related matters, including climate strategy and associatedrisks and opportunities; oversight of climate-related responsibilities; adoptionof appropriate ESG standards; the tracking, monitoring, and disclosure of thecompany’s ESG performance; and incorporating ESG considerations into thedevelopment of strategies for the company.
The Audit Committee has primary responsibility for oversight over theadequacy and effectiveness of the reporting systems and related internal
controls, which were developed and implemented by management inconnection with disclosures relating to ESG matters and other non-financial
data included in Westport ESG Reports.

diversity and inclusion

The Board of Directors ensures proper risk management systems are in place to monitor the
integrity of internal controls and critical information systems. Our full Board is responsible for risk
oversight and has designated committees for oversight of certain key risks. The Audit Committee has
the responsibility to review the effectiveness of systems pertaining to financial reporting. Our Board
oversees management as it fulfills its responsibilities for the assessment and mitigation of risks andfor taking appropriate actions.
Westport / 2022 ESG Report87Introduction

Our Approach

Environment

Decisions of the Board andstakeholder engagement
Typically, matters before the Board are decided by a majority vote of the Directors present at the meeting,provided that the minimum quorum is met. Notwithstanding the previous sentence, the approval of any
annual capital and operating budget(s) requires the approval of no less than two-thirds of the members of
the Board.
Consultation between external stakeholders and the Board of Directors occurs both formally and informallyeach year. In addition, institutional holders and analysts can discuss ESG topics with leadership during
quarter results conference calls, at investor conferences, and during scheduled sessions.

SocialGovernance

GRI and SASB index

2/3of the members of the Board is required forthe approval of the budget

Conflict of interest
Directors must avoid conflicts of interest and even the appearance of a conflict of interest. The natureand intent of this conflicting interest will be noted in the minutes of the meeting of the Board. A Director who
discloses a conflict of interest must refrain from taking part in any discussions or voting on any resolution
in this matter. If a significant and persistent conflict exists and cannot be resolved, the Director should
immediately submit their resignation to the Board Chair for consideration by the Board. Directors must
maintain strict confidentiality about all Westport matters. Decisions must be made in good faith and with thelong-term interests of Westport and its shareholders in mind. A Director may not use his or her position as a
Director to make a profit on any transaction even if Westport did not participate in the transaction.
Our Code of Conduct addresses processes and policies for avoiding and managing conflicts of interest.
Conflicts of interest are disclosed for current Directors in each year’s Annual Information Form and for all
Directors up for nomination in our Management Information Circular.

Westport / 2022 ESG Report88Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-19

Remuneration
THE BOARD OF DIRECTORS’ COMPENSATION STRUCTURE AIMS TO ATTRACT AND
RETAIN HIGHLY SKILLED AND EXPERIENCED DIRECTORS,
which is crucial for the long-term success of the company. To achieve this, Directors mustreceive competitive and reasonable compensation. The Board has established that thecompensation of Directors should be in line with that of comparable corporations, taking
into account the required time commitment, responsibilities, and market trends in Director
compensation. The HRC Committee, which is responsible for this matter, evaluates thetime and effort needed to be an effective Director and considers external compensation
consultants’ advice and relevant market data to make recommendations to the Board.

THE BOARD ALSO ENCOURAGES DIRECTORS TO HOLD A SIGNIFICANT OWNERSHIPSTAKE IN WESTPORT.
In 2022, the Board increased the minimum number of shares required to be held by nonemployee Directors. According to the share ownership guidelines applicable to all nonemployee Directors, each Director must acquire Common Shares or Units worth at least fivetimes their annual cash retainer within a five-year period. All non-employee Directors had
their five-year acquisition period reset due to the new share ownership requirement.

For further details, see the 2023 Management Information Circular
Westport / 2022 ESG Report89Introduction
GRI 2-9

GRI 2-13

GRI 2-14 GRI 2-17

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-24

Board committee composition
All Board committees are composed entirely of independent Directors, and each has a

The Board has delegated specific responsibilities to each of its four committees. Our

written charter that is reviewed and reassessed annually by the NCG Committee and posted

Board Committee Charters were updated in 2022 to embed ESG responsibilities for all

on our website.

committees. Any responsibility not delegated to one or more of its committees remains
with the Board of Directors.

AUDIT COMMITTEE●●

Oversight of Westport accounting and financial

TECHNICAL AND PRODUCTCOMPENSATION COMMITTEEGOVERNANCE COMMITTEESTRATEGY COMMITTEE

Primary responsibility for establishing Westport●

Primary responsibility of establishing and●Oversight of responsibilities with respect tocompensation philosophy and principles,monitoring Westport corporate governance

Westport technology and product planningstatements

including designing, developing, andpractices, including assessing the effectiveness ofactivities in order to inform and support Westport

Compliance with legal and regulatory

overseeing the operation of Westport executive

the Board of Directors, the standing committees

overall business strategy

requirements and the promotion of legal andcompensation programand individual Directors, evaluating andResponsible for executive oversight, including

recommending the appointment of Directors,

other trends that could have a significant impact

Oversight of risk identification assessment andgoal setting and performance evaluation for the

succession planning, and reviewing andon Westport technology, product, and overallrisk management processes and the design,

CEO (working with the Board Chair)organizing ongoing Director education, as well as

business strategies

Executive succession planning and review of theoverseeing legal and regulatory compliance andimplementation, and operation of an effective●●

the CEO) and Director compensation

by Westport management, including climaterelated and social risks

shareholder engagement

corporation’s talent development (working withsystem of internal control over financial reporting●

NOMINATING AND CORPORATE

reporting processes and audits of its financial

ethical conduct●●

HUMAN RESOURCES AND●●

Ensuring appropriate mitigation of●●●Reviewing and monitoring specific industry andAssessing the scope and quality of Westporttechnology strategies, intellectual property,

Oversight of the principal policies that guide ourand product portfolio along with reporting tooverall corporate governancethe Board on how such matters impact the

Reviewing and assessing corporate governancedevelopment and implementation of Westport
overall business strategy

Recommend to the Board of Directors thecompensation and talent risk, through review

approval of the audited annual financial

and approval of our compensation policies andissues and policies including ESG-related

statements and related MD&A

practices

matters●

Making recommendations to the Board forOversight of diversity and inclusion policies andhow to approach mitigation of risk or capture

Reviewing and assessing the adequacy of thehuman capital management, including diversity,

identified opportunities

reporting systems and related internal controls

equity, and inclusion initiatives●

Oversight of compliance with our Code of Ethics●●

relating to ESG matters

More information about our governance practices can be found in our 2023 Management Information Circular and on our website.
Westport / 2022 ESG Report90Introduction
GRI 2-17

GRI 2-18

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-20

Among our governance practices:
The Board must have a majority of independent Directors.
As of the date of this report, all Directors except our CEO areconsidered to be independent.
Any new appointees or nominees to the Board of Directors
must have a demonstrated commitment to high personal andprofessional integrity and ethical standards, a favorable recordof accomplishment in general business management, andspecial expertise in areas of strategic interest to our organization.
If a nominated Director fails to achieve a majority of votes fortheir appointment in an uncontested election at AGM, that
nominated Director is required to submit their resignation to
the Board Chair in accordance with Westport Fuel Systems
Majority Voting Policy.
Annual election of Directors including our fourth annual "say-onpay" vote was held at April 6, 2023. Our most recent vote, held at
the 2022 AGM, resulted in 88.46% of voted shares in favor of theresolution accepting our approach to executive compensation.
Although there were no substantive changes to our executive
compensation structure in 2022, in keeping with governancetrends and in the interest of soliciting shareholders feedback, we
continue to offer an annual "say-on-pay" advisory vote.

Westport / 2022 ESG Report

Directors participate in continuous learning activities as part ofthe company’s Continuing Education Program, which is overseenby the NCG Committee. Continuing education covers a range of
topics including best practices in corporate governance, latest
business and product information, cybersecurity, data privacy, and
ESG matters. During 2022, all Directors attended the education
sessions provided.
In addition to continuing education topics addressed within aregular board meeting, at least two separate education sessions
are scheduled within a year. During 2022, all Directors attended theeducation sessions provided by the Corporation.
Westport Fuel Systems has established an annual evaluation
process for the Board, each Board Standing Committee, and each
Board member which is overseen by the NCG Committee.

91Introduction
GRI 205-1 GRI 416

GRI 2-23

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 3-3Enterprise risk management
At Westport, we place a significant emphasis on prioritizing risk management andcontinuously improving in this area to effectively address emerging risks that may affectour business. This has been an important part of Westport ESG strategy. This is why our
Board and its Standing Committees play a key role in oversight of our risk culture, setting the“tone at the top” and holding management accountable for its maintenance of high ethicalstandards and mitigation of risks and for taking appropriate actions.
Our risk ownership culture is ingrained in our three lines of defense approach, withfunctional business units owning their respective risks based on our risk matrix. This matrix isrevisited annually and incorporates a valuation process to prioritize risks.
By adopting a comprehensive approach to risk identification, we aim to gain a deeper
understanding of our vulnerability to potential losses and enhance our ability to effectively
prepare, respond, and mitigate any disruptive incidents that could affect our business
continuity.
Please see "Risk Factors" in our Annual Information Form for 2022 (page 19).

Customer health and safety
The executive-level Product Safety and Compliance Committee, formed in
2020, is responsible for oversight of product safety- and compliance-related risk
assessments, risk acceptance, and risk mitigation efforts, as well as proactive
measures associated with Westport products and services, throughout thecompany, and sold or otherwise provided to third-party customers.

Westport / 2022 ESG Report92Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Additional risk management activities
in 2022 included:

WE CONDUCTED A PRELIMINARY

GLOBAL RISK MATRIX HAS CONTINUEDCONTINUOUS RISK MANAGEMENTGLOBAL COUNTRY RISKTO BE EMBEDDED THROUGHOUT THE

EDUCATIONASSESSMENTORGANIZATION

in early 2022 to support our understanding– to continue driving a culture of risk ownership,– multiple discussions and group meetingsof risks related to countries in which wea global risk matrix was developed to define

were held to align all business unit leaders to

conduct business and to determine any

the severity of risks using various criteria,

consistently evaluate our risks using the same

additional mitigation actions which requireassessing probabilities, and determining theapproach and criteria.

implementation. Our process started with thevelocities of those risks. This matrix enables

completion of a summary analysis to prioritizeconsistent evaluation of risks, which are

the timing of potential future individual country

subsequently consolidated and presented torisk assessments. In addition, we maintainthe Board level on a quarterly basis.

an Internal Controls over Financial Reporting(ICFR) Program which confirms the design andoperating effectiveness of internal controls onan annual basis.

Westport / 2022 ESG Report93Introduction
GRI 418

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 3-3

Cyber and information security
IN 2022, WE CONTINUED TO WORK WITHIN THE MANAGEMENT TASK FORCE ESTABLISHED IN
2020, WHICH RESULTED IN SEVERAL CYBERSECURITY INITIATIVES, INCLUDING:
Completion of our IT disaster recovery initiative for the whole organization, together with

Data security is a critical issue for both us andour customers. The continuous developmentof IT tools, their universal and wide-ranging
application, both in our products and in everyday
work, brings with it many potential risks anddangers. Cybercriminals are using increasingly
innovative and sophisticated ways to access ourdata, which makes building our cyber resilience
an ongoing process.

testing exercise for core mission critical systems.
Completion of the process of creating replication sites for all locations.
Introduction of outsourced Security Operation Centers (SOC) in some of our sites (with therest to come in 2023), including SIEM (Security Information and Event Management), SOAR
(Security Orchestration, Automation, and Response) and SUMO Logic (Real-Time Reporting)– implementation of SOC will allow us to secure, investigate, and respond to any threats andfurther learn from such situations and ensure compliance.
Further progress in building organizational cybersecurity culture through trainings, quarterly
e-mail campaigns, informative templates, etc. (the 2022 completion rate was 85%). No tool, noteven the best one, can provide full security if the human factor is missing. Thus, at Westport Fuel
Systems, we focus on education because we know that, at the end of the day, it is the vigilanceof our employees that protects us best. We concentrate our training on practical and up-todate topics, adapting the content to a changing reality. In 2022, our training concerned inter alia
protection against phishing, security practices during travelling, remote work, connecting to
public wi-fi, and how to deal with suspicious e-mail.

Westport / 2022 ESG Report94Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Protection of customers’ data andprivacy at Westport Fuel Systems
During our day-to-day business, we work with a huge amount of data
coming from our customers, directly or through our brands’ websites. We
take the utmost care to protect them by, among other things, encryption,
restricted access to customers data, and providing our employees with safe
tools and platforms for exchange of information.
Moreover, we protect our customers’ privacy and internal data byfollowing data protection regulations. In our European locations, ourcybersecurity team regularly works with local HR and stakeholders toensure compliance with GDPR. We constantly monitor our digital publicpresence and adjust and update our privacy protocols and procedures
when necessary. In 2022, we engaged an external advisor to help us
assess our compliance with data protection regulations (mostly GDPR inEU) and identify potential gaps in our processes, procedures, and protocols.
We are currently in the process of analyzing the results obtained andimplementing appropriate solutions.

Westport / 2022 ESG Report

In 2022, we received

0

SUBSTANTIATED COMPLAINTS

concerning breaches of customer privacy. We also did not
identify any leaks, thefts, or losses of customer data.

95

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Plans for 2023
In 2023, we plan to focus even more on training initiatives – ourgoal is to achieve

100% rate of completion among employees.
We plan to work further on the newest developments and updates
in our business technology, including protection of passwords, VPN
Global protect, device trust enforcement, e-mail security, and mobile
device management.

OPERATIONAL TECHNOLOGY
Manufacturing automation equipment, programmable logic
controllers
Supervisory control data acquisition devices, internal/external
connectivity to production environment
Smart devices and sensors (network connectivity)

We will continue with certification processes (ISO27001, ISO9001,
ISO21434, and IATF 16949) and meeting our customers’ cybersecurity
requirements.
As a response to growing demand from our customers, 2023 will bealso dedicated to expanding Westport Fuel Systems’ Cybersecurity
Framework and Security Operations Center tools to Operational
Technology (OT) and Electronic Control Units (ECU) environments.
This means focusing on the following areas:

ECU CUSTOMER TECHNOLOGY
In-vehicle ECU connectivity to internal/external networks
Customer and/or vehicle data collection
Remote vehicle diagnostics

Westport / 2022 ESG Report96Introduction
GRI 2-23

GRI 2-24

GRI 2-25

GRI 2-26 GRI 3-3

GRI 205-1

Our Approach

Environment

SocialGovernance

GRI and SASB index

RT-EE-510a.1

Business ethics
CODE OF CONDUCT (CC)Over the past few years – with 2022 not being an
exception – we have worked hard to develop,
update, and fully distribute our Code of
Conduct, so everyone in our organization andbeyond can become familiar with it. Our valuesof integrity, respect, and perseverance guide ourrelationships and interactions with employees,
customers, suppliers, and investors. These values
are fundamental to our business partnerships
and continued success in the marketplace andare a source of pride for our team.

Westport Code of Conduct reflects ourcommitment to a culture of honesty, integrity,
and accountability and outlines the principles
and policies to which all directors, officers,
employees, contractors, agents, and consultants
who act on behalf of Westport Fuel Systems mustcomply. The Code covers all of the crucial aspectsof our operations and provides its readers clear
directions on how to act properly both on day-today work and in suspicious or doubtful situations.

INTEGRITY
INTEGRITYRESPECTRESPECTPERSEVERANCEPERSEVERANCETHE CODE OF CONDUCT CAN BE EASILY DOWNLOADED

on our website at https://wfsinc.com/company/commitment-to-integrity and is available in six language versions.

Westport / 2022 ESG Report97Introduction
GRI 205-2

GRI 205-3

GRI 206-1

RT-EE-510a.2

TR-AP-520a.1

Our Approach

Environment

SocialGovernance

GRI and SASB index

RT-EE-510a.3

Anti-Corruption and Prevention of Bribery

At Westport, we are committed to the prevention of corruption andbribery in the conduct of our global business and to the strict adherence
to applicable anti-bribery laws and regulations of the local jurisdictions inwhich we operate. Every year, we make every effort to educate and raise
the awareness of all our employees and associates about corruption
issues. Through our Anti-Corruption and Prevention of Bribery Policy, we
make a clear statement that any form of corruption is strictly prohibited andcondemned.

In 2022, there wereNO INCIDENTS OF CORRUPTION
in Westport or legal actions taken for bribery or corruption,
anti-competitive behavior, anti-trust, or monopoly activities.

We make sure that all of our employees are aware of potential corruption
risks. For those roles where a higher level of potential exposure tocorruption risk is identified, mandatory training including both structured
classroom and online components are delivered to ensure that directors,
executives, employees, and others acting on the company’s behalf continue
to be aware of and understand corporate policies and procedures specificto anti-corruption and bribery. This training includes the identification of
the roles and responsibilities of key stakeholders, potential red flags, and risk
management techniques, as well as the process to report violations or seek
clarification.

Westport / 2022 ESG Report98Introduction
GRI 205-2

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 404-1

Trainings

CODE OF CONDUCT TRAININGSANTI-CORRUPTION TRAININGS

An active ethics and compliance program includes regular
employee ethics training, Code training, and certifications
by employees. Thus, mandatory training on the Code occurs
annually. All directors, officers, and employees must certify
annually that they have read and understood the Code.

Basic anti-corruption training is a part of annual CoC training – thisensures that every person working with us, regardless of position, has up-todate knowledge on this important subject.

100%
In 2022

Moreover, every year, we provide a specific anti-corruption training toselected employees, which includes an in-depth two-hour training session
for employees within specific higher risk categories.
We ensure that our trainings are as practical as possible. In 2022, werefreshed our anti-corruption training materials and launched an updated
version to selected staff groups in November, with further training tocontinue globally throughout the entire Westport organization in 2023.

of our employees completed the CoC training.

Westport / 2022 ESG Report99Introduction
GRI 2-23

GRI 2-24

GRI 2-27

GRI 3-3 GRI 205-1

Our Approach

Environment

SocialGovernance

GRI and SASB index

SASB: RT-EE-510a.1

Key sustainability policies and standards

RESPECT FOR INTERNATIONALLY RECOGNIZED HUMAN
RIGHTS IS A FUNDAMENTAL VALUE
of Westport and our subsidiaries and affiliates. We respect humanrights and will not knowingly be complicit in human rights abuses
through our activities and value chain. We are committed topreventing, mitigating, and remediating any human rights abuses
that are linked to our business activities, operations, products, andservices.
All of the above commitments are included in our Human Rights Policy,
which we put on paper with the utmost scrutiny in 2021. The Human
Rights Policy, after a set of trainings over the organization, is available
globally for all employees and is part of the onboarding process.

Westport / 2022 ESG Report100Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Key sustainability policies and standards
Our Human Rights Policy and other policies support Westport respect of human rights standards that are contained in thefollowing international treaties:

1.

The International Bill of Human Rights of theUnited Nations (UN)a. Universal Declaration of Human Rights
b. International Covenant on Civil and Political
Rightsc. International Covenant on Economic, Social
and Cultural Rights

2.

The International Labour Organization’s (ILO)
Declaration on Fundamental Principles and Rights at
Work

3.

The United Nations Convention on the Rights of the
Child

4.

The UN Declaration on the Rights of Indigenous
Peoples

OUR SUSTAINABILITY STANDARDS ALLOW US TO CONTINUOUSLY AND FULLY COMPLY WITH
APPLICABLE LAWS AND REGULATIONS.

Moreover, Westport has not paid any significant fines nor was otherwise
sanctioned for non-compliance with environmental laws or regulations inthe social and economic areas during the reporting period.

Westport / 2022 ESG Report101Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

Onboarding of employees and companies
At Westport, we are focused on the growth and development of our team and portfolio of green transport solutions. We
make sure that each and every one of our new employees and any new company that we acquire or establish, from the startof their association with the Westport group, is aware and rooted in our values. In each such case, we carry out intensive
onboarding; however, this process is a continuous “work in progress,” and each year we do our best to improve it.

EMPLOYEESCOMPANIES

During the onboarding phase, each employee must undergo a series of training

The same procedure as described on the left applies to all employees of our new

sessions and certifications on our procedures and policies, including our Codecompanies. We want to ensure that regardless of the location of our operations,of Conduct, Anti-Corruption Policy, Human Rights Policy, Cybersecurity, andwhether in Europe, America, or Asia, our principles are understood and applied

Whistleblower Policy. This is an obligatory step which we never skip.

uniformly. We make no exceptions, especially in important matters such as anticorruption, interactions with public officials, gifts and charity donations policy, humanrights, etc.

IN 2021, WE APPLIED THE ABOVE PROCEDURE AND SUCCESSFULLY INTEGRATED OUR NEWLY ACQUIRED POLISH
COMPANY STAKO SP. Z O.O.
In connection with our planned investment in a global manufacturing facility in Changzhou Hydrogen Valley, China, in 2023
and during next few years, we will work intensely on the full integration of this facility into our group. At this point, all thepeople located in China who are involved on our side in the investment have already been trained.

Westport / 2022 ESG Report102

Introduction
GRI 2-16

GRI 2-23

GRI 2-24

GRI 2-25

GRI 2-26

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 415-1

Key sustainability policies and standards
Our corporate governance encompasses Westport commitment to a culture of integrity, ethical, and sustainable business practices. We believe that effective corporate
governance is vital to the continued and long-term success of Westport Fuel Systems, as well as various stakeholders, be it employees, investors, local communities, and manyothers.
See below a list of our policy commitments for responsible business conduct, based on authoritative intergovernmental instruments for responsible business conduct,
including a strong commitment to respect human rights:

OUR POLICIESCode of Conduct
Anti-Corruption and Prevention of Bribery

OTHER INTERNAL POLICIES:●

Reviewed and accepted by the Board of Directors●

Respectful Workplace Policy●

Annual training with certification●

IT-Information Security Policy●

Applicable also to business relationships,●

Records and Data Retention Policy

communicated through 2022 ESG survey●

Corporate Purchasing Policy●

Due Diligence Handbook●

Meals Gifts and Entertainment Policy

Corporate Governance Committee●

Travel Policy●

Annual training with certification●

Interactions with Government Officials Policy●

Applicable also to business relationships,●

Contract Management Policy

Human Rights Policy
Diversity Policy●

Reviewed and accepted by the Nominating &communicated through 2022 ESG survey

Whistleblower Policy●

Reviewed and accepted by the Audit Committee●

Annual training with certification●

Applicable also to business relationships,
communicated through 2022 ESG survey

Environmental Policy

Westport / 2022 ESG Report●

Reviewed and accepted by the Board of Directors●

Applicable also to business relationships●

Communicated on our website

103

Introduction

Our Approach

Key sustainability policies
and standards

Environment

SocialGovernance

GRI and SASB index

Asking questions andreporting concerns

All our policies have been guided by voluntary principles regarding
business and human rights that are outlined in:

1. The UN Global Compact
2. The UN Guiding Principles on Business and Human Rights: Implementing
the United Nations ‘Protect, Respect and Remedy’ Framework
3. The Organisation for Economic Cooperation and Development (OECD)
Guidelines for Multinational Enterprises
4. The ILO Tripartite Declaration of Principles concerning Multinational

The Whistleblower Policy is in place to enable our employees to resolve
issues within the Company without fear of retaliation.
Furthermore, the Ethics Hotline web portal and phone line are available
24 hours a day, 7 days a week. Trained specialists from an independent
third-party provider of corporate compliance services will answer calls,
document concerns, and forward a written report to Westport for further
investigation.

Enterprises and Social Policy
Website Access - www.westport.ethicspoint.com
For details on approval processes, due-diligence processes, application of the precautionary
principle, communication and enforcement methods, and grievance mechanisms or periodic
audits, please see individual policies, which are available for employees on the intranet andE-mail: alert@wfsinc.com
The Ethics Hotline Details (by region) can be found in the Code of Conduct.

on-site and are subject to trainings and certifications.
For communication of critical concerns, there is also the possibility of
directly contacting the Board at boardchair@wfsinc.com.
During 2022, there were no critical concerns raised.

Westport / 2022 ESG Report104Introduction
GRI 2-2

GRI 2-3

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2-5

About this report
This is Westport Fuel Systems’ fifth annual ESG report, which covers the 2022 calendar yearwith additional indication of some important events and initiatives which took place at thefirst quarter of 2023. Data figures (numbers) cover the calendar year 2022 only.
Unless otherwise noted, the information presented here is as of December 31, 2022, andall amounts are in U.S. dollars. Performance data is company-wide and covers all offices,
production plants, and technology sites where our employees work. It does not include joint
ventures, unless otherwise stated.
The list of entities included in Westport Fuel Systems consolidated financial reporting are also
fully included in this sustainability reporting. The sustainability reporting period aligns withthe financial reporting.
Report content is supported by the findings of a materiality assessment conducted in early
2021, which was still valid for 2022. Westport Fuel Systems did not conduct a new materiality
study for 2022. See page [38] for our process and priority topics.
We have prepared this report in accordance with the 2021 Global Reporting Initiative (GRI)
Universal Standards and have also addressed metrics related to the Sustainability AccountingStandards Board’s (SASB) Auto Parts and Electrical & Electronic Equipment Standards.
Internal reviews and processes are in place to ensure the integrity and the credibility of thedata contained within; however, we have not sought external verification of the ESG Report.

We welcome your questions and feedback on our report or performance.
Please send your questions or comments to sustainability@wfsinc.com.

The report was reviewed and approved by our ESG Steering Committee, which consists ofsenior directors.

Westport / 2022 ESG Report105Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 3-2

GRI and SASB content index
We prepared this report in accordance with the GRI Universal Standards and thePlease visit the GRI website at https://www.globalreporting.org/standards/ for the full list of

Sustainability Accounting Standards Board’s (SASB) Sustainability Accounting Standards fordisclosures and other information on the GRI reporting framework and https://www.sasb.org/

the Auto Parts and Electrical & Electronic Equipment industry classifications. The following

for the full list of disclosures under the Auto Parts and Electrical & Electronic Equipment SASB

index provides readers with references for where they can find information in this report andSustainability Accounting Standards.

other public documents addressing GRI disclosures relevant to our business, which are basedon the materiality assessment conducted by Westport.

REQUIREMENTStatement of use

NOTES
Westport Fuel Systems has reported in accordance with the GRI Standards for the period 1 January 2022 – 31 December 2022. Report contains additional indication of some important events and initiatives which took place at the first quarter of 2023.

GRI 1 used

GRI 1: Foundation 2021.

Applicable GRI sector standards

Not currently available.

Westport / 2022 ESG Report106Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 2 GENERAL DISCLOSURES 2021 | SASB: 000
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)

PAGE(S)OMISSIONThe Organization and its Reporting Practices●

Westport Fuel Systems Inc.

●

1691 W75th Avenue, Vancouver, BC, Canada●

Westport Website – Locations●

2022 Annual Information Form (page 1) – Corporate structure●

ESG Report – About Westport Fuel Systems●

ESG Report – Our sites●

ESG Report – About this report●

2022 Annual Information Form (page 1) – Corporate structure●2022 Annual Report (page 41) – Significant Accounting Policies

2-3 Reporting period, frequency, and contact point●ESG Report – About this report

2-4 Restatements of information●

Information was not restated from the previous reporting period●

We secure external assurance for all financial reporting information as part of our Audited Financial Statements.

●

ESG Report – About this report●

2022 Annual Report (pages 26-29) – Reports

2-1 Organizational details

2-2 Entities included in the organization’s sustainability reporting

2-5 External assurance

89, 10, 105

105

105

Activities and Workers

2-6 Activities, value chain, and other business relationships●

No significant changes from the previous report●

Total average workforce of 1,824 people in 2022●

Total of 14 operating sites as of December 31, 2022●

2022 revenue: $305.7 M USD●

Total market capitalization as of December 31, 2022: ~$406.8 M USD●

ESG Report – About Westport Fuel Systems●

ESG Report – Our products●

ESG Report – Our global workforce●

ESG Report – Responsible sourcing●

2022 Annual Information Form (pages 14-17)●

In 2022, we continued participation in joint venture – Minda Westport Technologies Limited, India with 50% participation.

●

In 2022, our total direct employees was on average 1,532 (in 2021: 1,539).

●

During the reported period, there were the following significant fluctuations in the number of employees:○

8, 9, 10, 11, 12, 58, 74

In Vancouver, the minimum employment was 155 in January 2022, and the maximum was 198 in December 2022. The

Information incomplete

average employment was 177.
○
2-7 Employees

In Poland, the minimum employment was 289 in July 2022, and the maximum was 305 in October 2022. The average

Westport does not have all the required data at the time of publication

employment was 296.

of the ESG Report – lack of information on employees by permanent,
temporary, non-guaranteed hours, employee’ categories breakdown and by●

There were no significant changes in employment at the other locations during the reported period.

●

All above statistics are calculated as head count.

region and by gender.

●

Data regarding Employee Workforce Gender Diversity and Management Gender Diversity are calculated for the total

However, internal activities are underway to provide such data in the future.

58

workforce, including direct employees, individuals contracted directly for twelve months or longer, and temporary or
seasonal workers.

Westport / 2022 ESG Report●

ESG Report – Our global workforce●

2022 Annual Information Form (page 18)

107IntroductionGRI DISCLOSURE

Our Approach

Environment

DISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)

SocialPAGE(S)

Governance

GRI and SASB index

OMISSION

Activities and Workers●

The total number of workers who are not employees was on average 292 in 2022 (in 2021: 258 workers) which includes
individuals contracted directly for 12 months or longer, and temporary or seasonal workers. Of these, 15 were as directcontracts and 277 third-party.

●○
2-8 Workers who are not employees

In India, the minimum involvement of third-party was 41 in December 2022, and the maximum was 89 in April 2022. The
average of third-party was 75.

○

SASB: RT-EE-000.B Number of employees

Information incomplete

During the reported period, there were the following significant fluctuations in the number of third-party workers:

Westport does not have the required data at the time of publication of the58

ESG Report – lack of information on employees by category describing the

In Poland, the minimum involvement of third-party was 28 in June 2022, and the maximum was 57 in January 2022. The

type of work. However, internal activities are underway to provide such data

average of third-party was 40.

in the future.

●

There were no significant changes in workers who are not employees at the other locations during the reported period.

●

All above statistics are calculated as head count.

●

ESG Report – Our global workforce●

ESee response to GRI 2-7●

ESG Report – Our global workforce

58
Governance

2-9 Governance structure and composition

2-10 Nomination and selection of the highest governance body

2-11 Chair of the highest governance body

2-12 Role of the highest governance body in overseeing themanagement of impacts

2-13 Delegation of responsibility for managing impacts

2-14 Role of the highest governance body in sustainability reporting

Westport / 2022 ESG Report●

ESG Report – Corporate governance●

ESG Report – Board committee composition●

2023 Management Information Circular (pages 13-24, 33-36)●

Westport Website – Committee composition●

Westport Website – Committee Charter details●

Westport Website – Board of Directors Charter●

Westport Website – Leadership●

ESG Report – Corporate governance●2023 Management Information Circular – Nomination of Directors (pages 13, 33)●

Westport Website – Board of Directors Charter (pages 2-3)●

Nominating and Corporate Governance Committee Charter●

ESG Report – Corporate governance●2023 Management Information Circular (page 16)●

ESG Report – Corporate governance●2023 Management Information Circular (pages 53-55, 58)●

Audit Committee Charter●

ESG Report – ESG governance●

ESG Report – Board committee composition●

2023 Management Information Circular (pages 19-21)●

Westport Website – Committee composition●

Westport Website – Committee Charter details●

ESG Report – ESG governance●

ESG Report – ESG strategy●

ESG Report – Role and responsibility of the Board●

ESG Report – Board committee composition

type of work. However, internal activities are underway to provide such data●

2023 Management Information Circular (page 56)

in the future.

81, 83, 90

81, 8381

87

19, 20, 90

Information incomplete
Westport does not have the required data at the time of publication of the19, 20, 21, 87, 90

ESG Report – lack of information on employees by category describing the108IntroductionGRI DISCLOSURE

Our Approach

Environment

DISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)

SocialPAGE(S)

Governance

GRI and SASB index

OMISSION

Governance

2-15 Conflicts of interest

2-16 Communication of critical concerns

2-17 Collective knowledge of the highest governance body

2-18 Evaluation of the performance of the highest governance body

2-19 Remuneration policies

2-20 Process to determine remuneration

2-21 Annual total compensation ratio●

ESG Report – Conflicts of interest●

2023 Management Information Circular (pages 29, 34, 56-57)●

2022 Annual Information Form (page 33)●

ESG Report – ESG governance●

ESG Report – Key sustainability policies & standards●

Code of Conduct (pages 7-9) – Asking questions and reporting concerns – the ethics hotline●

Whistleblower Policy●

Westport Website – Ethics Hotline●

During 2022, there were no critical concerns communicated to the highest governance body.

●

ESG Report – Among our governance practices●

ESG Report – Board skill diversity●

ESG Report – Among our governance practices●

2023 Management Information Circular (page 35, 37-43, 59)●

ESG Report – Remuneration●

2023 Management Information Circular (pages 37-45)●

ESG Report – Equality in compensation treatment●

ESG Report – Among our governance practices●

2023 Management Information Circular (pages 37-45)●

ESG Report – Equality in compensation treatment●

Westport does not have the required data at the time of publication of the ESG Report. However, internal activities are

88

19, 10383, 91

91

87, 8963, 91

Information incomplete
63

underway to provide such data in the future.

Westport does not have the required data at the time of publication of the
ESG Report. However, internal activities are underway to provide such datain the future.

Strategy, Policies, and Practices
2-22 Statement on sustainable development strategy

2-23 Policy commitments

2-24 Embedding policy commitments

Westport / 2022 ESG Report●

ESG Report – Message to our stakeholders●

ESG Report – Our purpose●

ESG Report – 2022 ESG performance highlights●

ESG Report – What we stand for●

ESG Report – Enterprise risk management●

ESG Report – Business ethics

2, 7, 18, 92, 97, 100,●

ESG Report – Key sustainability policies & standards

103●2023 Management Information Circular (pages 29-32)●

Code of Conduct●

Human Rights Policy●

Westport Website – Commitment to integrity●

ESG Report – ESG strategy●

ESG Report – ESG governance●

ESG Report – Board committee composition

19, 20, 21, 74, 90, 97,●

ESG Report – Responsible sourcing

100, 103●

ESG Report – Business ethics●

ESG Report – Key sustainability policies & standards

4, 5

109

IntroductionGRI DISCLOSURE

Our Approach

Environment

DISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)

SocialPAGE(S)

Governance

GRI and SASB index

OMISSION

Governance2-25 Processes to remediate negative impacts

2-26 Mechanisms for seeking advice and raising concerns

2-27 Compliance with laws and regulations

2-28 Membership associations●

ESG Report – Key sustainability policies & standards●

2022 Annual Information Form●

Westport Website – Ethics Hotline●

Whistleblower Policy●

Code of Conduct●

ESG Report – Business ethics●

ESG Report – Key sustainability policies & standards●

Westport Website – Commitment to Integrity●

Westport Website – Ethics Hotline●

2023 Management Information Circular (pages 27-30)●

Whistleblower Policy●

Human Rights Policy●

Code of Conduct●

ESG Report – Key sustainability policies & standards●

ESG Report – Stakeholder engagement●

ESG Report – Industry Associations

97, 10397, 103100

27, 34

Stakeholder Engagement

2-29 Approach to stakeholder engagement

2-30 Collective bargaining agreements

Westport / 2022 ESG Report●

ESG Report – Our Approach●

ESG Report – Stakeholder engagement●

ESG Report – 2022 ESG performance highlights●

ESG Report – Cooperation with the local communities●

ESG Report – Stakeholder engagement●

Percentage of Employees Covered by Collective Bargaining by Location○

Argentina		

72.7%

○

Calgary		

0.00%

○

Cambridge

0.00%

○

Italy		

100.0%○

Eindhoven

88.7%

○

India		

0.00%○

Poland		

0.00%○

Sweden		

0.00%○

Vancouver

0.00%		

6, 17, 27, 28, 73

27, 28110

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 3: MATERIAL TOPICS 2021
GRI DISCLOSURE
3-1 Process to determine material topics

3-2 List of material topics

DISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

ESG Report – Our approach●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Materiality assessment●

ESG Report – GRI / SASB index●

There were no significant changes from the previous reporting period.

PAGE(S)OMISSION

17, 28, 37

37, 106

GRI 201: ECONOMIC PERFORMANCE 2016
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

We report on the operating structure of our organization, changes in this structure and our financial and economic
performance primarily through our Annual Reports and Interim Financial Reports. These are posted to the SEC filings site,

3-3 Management of material topics

EDGAR, and the Canadian filings site, SEDAR, and can be found at: https://investors.wfsinc.com/investors/default.aspx●

In addition, in accordance with applicable national regulations, we also fulfill our financial reporting obligations for eachindividual company belonging to Westport group (if required)●2022 Annual Report (pages 36 - 60)

201-1 Direct economic value generated and distributed●

2022 Annual Report (pages 36-37)

201-2 Financial implications and other risks and opportunities due to●

ESG Report – Regulatory Environment

climate change●

2022 Annual Information Form (pages 19-20, 26)●

In India, there is no pension plan, but there are 2 other Social Security Programs, both mandated by law:○

Provident Fund – it is a fund wherein both the Employee and Employer make equal monthly contributions (12% of a
portion of the Employee’s Basic Salary, which would roughly be about 1/3 or 1/4th of the Base Salary of the employee)and○201-3 Defined benefit plan obligations and other retirement plans

Gratuity – book provision of 15 days of Basic Salary per year of service, paid at the time of resignation (after the minimum
eligible years of service) or upon retirement.

●

In Argentina and North America (Vancouver, Calgary, Cambridge), there are no pension plans (neither mandatory nor
voluntary).

●

In Poland, there is no pension plan, but there is Social Security Program run by Government – the program is voluntary, theInformation incomplete
Not all quantitative and descriptive data required by this disclosure 201-3
is available for 2022 and if some are available – it is not for all locations. The
2022 Westport did not analyze this issue in detail and did not collect detailed data from individual locations.
However, internal activities are underway to provide such data in the future.

employee decides whether he/she wants to join it. If he/she joins the program – the employer transfers 1.5% of his/her salaryto the employee's retirement account every month.
201-4 Financial assistance received from government

Westport / 2022 ESG Report●

In 2022, Westport did not receive any financial assistance from governments.

●

Shareholding structure of Westport is void of government presence.

111

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 202: MARKET PRESENCE 2016 | SASB: 000
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

By engaging with our stakeholders on a regular basis, we have identified a list of key initiatives and focus areas for 2022 thatwill enable Westport to effectively address the most significant material topics. In addition, we are working to implement

3-3 Management of material topics

appropriate systems that will help us report in the future the particular data that we were unable to provide this year.
●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Governance202-1 Ratios of standard entry level wage by gender compared to local●

ESG Report – Equality in compensation treatment

minimum wage●

Significant locations include the corporate head office, support offices, production facilities, and tech centers.

27, 37, 80

Information unavailable
63

The quantitative data required by this disclosure 202-1 is not available for2022. However, internal activities are underway to provide such data in the
future.

●Westport defines local communities as those located in greater regional areas or within the same country as the Westport
Information unavailable

hiring office.
202-2 Proportion of senior management hired from the local community●

Significant locations include the corporate head office, support offices, production facilities, and tech centers.

●

ESG Report – About Westport Fuel Systems●

ESG Report – Our global workforce●

ESG Report – Governance●At the time of the publication of this ESG Report, Westport has the data about the number of units produced by productProduct				Number of units●

The quantitative data required by this disclosure 202-2 is not available for2022. However, internal activities are underway to provide such data in the
future.

category only for the manufacturing facility in India, which are the following:

SASB: RT-EE-000.A Number of units produced by product category

8, 58, 80

Zenith MS Regulator		

235,517

VMA 3 Solenoid Valve		

154,263

Final Regulator Assembly		

146,749

Information incomplete/unavailable
For most of our manufacturing plants, the quantitative data required by thisdisclosure RT-EE-000.A is not available for 2022. Not all of the plants havegathered this data in 2022 or the methodology applied was incorrect. The
data is available only for the manufacturing facility in India. However, internal activities are underway to provide such data in the future also for otherremaining locations.

See also Disclosure TR-AP-000.A Number of parts produced
Information incomplete/unavailable●
SASB: TR-AP-000.A Number of parts produced

Presented below is the total volume of main product categories produced at each of our production plants:○

Cherasco: 6.908.937 pcs○

Buenos Aires: 119.393 pcs○

India: 536.539 pcs

For some of our manufacturing plants, the quantitative data required bythis disclosure TR-AP-000.A is not available for 2022. Not all of the plants
have gathered this data in 2022 or the methodology applied was incorrect.
The data is available only for the manufacturing facilities in Cheasco, Buenos
Aires, and India. However, internal activities are underway to provide suchdata in the future also for other remaining locations.
Information unavailable

SASB: TR-AP-000.B Weight of parts produced●

The weight of our total parts produced is currently unavailable.

The quantitative data required by this disclosure TR-AP-000.B is not available for 2022. However, internal activities are underway to provide such datain the future.
Information unavailable

SASB: TR-AP-000.C Area of manufacturing plants●

The area of manufacturing plants is currently unavailable.

The quantitative data required by this disclosure TR-AP-000.C is not available for 2022. However, internal activities are underway to provide such datain the future.

Westport / 2022 ESG Report112

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 204: PROCUREMENT PRACTICES 2016
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

Our suppliers are crucial partners in delivering our innovative transportation solutions for a cleaner world.

●

As a priority topic identified in our materiality assessment, in part because of the extent to which we purchase what we sell,

PAGE(S)OMISSION

we recognized the need to do more work on the responsible sourcing front. In 2022, supported by management, we have
3-3 Management of material topics

reached out to all our suppliers to embed part of our ESG efforts also into our supply chains operations.
●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Responsible sourcing●

ESG Report – Governance●

Westport defines local suppliers in two aspects – as those based in areas that are local to the facility and from where a27, 37, 74, 80

Information incomplete/unavailable
For some of our locations, the quantitative data required by this disclosure

procurement order (issued by a Westport plant) does not incur customs or from the same country where the production
204-1 Proportion of spending on local suppliers

plant is based.
●

Significant locations include the corporate head office, support offices, production facilities and tech centers.

●

ESG Report – About Westport Fuel Systems●

ESG Report – Responsible sourcing

204-1 is not available for 2022. Not all of the plants have gathered this data in
8, 74

2022 or the methodology applied was incorrect. The data is available only for
our facilities in Brescia, Cherasco, Eindhoven, and Slupsk, as well as for our
HPDI brand. However, internal activities are underway to provide such datain the future also for other remaining locations.

GRI 205: ANTI-CORRUPTION 2016 | SASB: 510
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

Our operations are governed by, and involve interactions with, many levels of government in numerous countries. We are
required to comply with anti-corruption and anti-bribery laws, including the Canadian Corruption of Foreign Public Officials

3-3 Management of material topics

Act and the U.S. FCPA, as well as similar laws in the countries in which we conduct business. Our Code of Conduct, Anti-

97

Bribery and Corruption policies and programs mandate compliance with anti-bribery and corruption laws.
●

ESG Report – Business ethics●

In 2022, significant work has been conducted to ensure compliance with legal sanctions in specific high-risk jurisdictions(i.e., Russia), and future country risk assessments are continuously being assessed for prioritization amongst other risk

Information incomplete

management activities.
205-1 Operations assessed for risks related to corruption●

ESG Report – Enterprise risk management●

ESG Report – Business ethics●

ESG Report – Key sustainability policies & standards●

Anti-Corruption & Prevention of Bribery Principles●

Whistleblower Policy

The quantitative data required by this disclosure 205-1, i.e., total number
92, 97, 100

and percentage of operations assessed for risks related to corruption, is notavailable for 2022. However, internal activities are underway to provide suchdata in the future.

Information incomplete
205-2 Communication and training about anti-corruption policies andprocedures●

ESG Report – Responsible sourcing●

ESG Report – Business ethics●

ESG Report – Key sustainability policies & standards

Some of the quantitative data required by this disclosure 205-2, i.e., total
97, 98, 99, 103

number and percentage of governance body members/employees thathave received training on anti-corruption, broken down by region, is notavailable for 2022. However, internal activities are underway to provide suchdata in the future.

Westport / 2022 ESG Report

113

Introduction

Our Approach

Environment

SocialGRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)

PAGE(S)

205-3 Confirmed incidents of corruption and actions taken●

During 2022, there were zero incidents of corruption.

98

SASB: RT-EE-510a.1 Description of policies and practices for prevention●

ESG Report – Business ethicsof: (1) corruption and bribery and (2) anti-competitive behavior●

ESG Report – Key sustainability policies & standards●

In 2022, Westport did not participate in any proceedings associated with bribery or corruption.

SASB: RT-EE-510a.2 Total amount of monetary losses as a result of legal
proceedings associated with bribery or corruption

Governance

GRI and SASB index

OMISSION

97, 100

98

GRI 206: ANTI-COMPETITIVE 2015 | SASB: 520, 510
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

By engaging with our stakeholders on a regular basis, we have identified a list of key initiatives and focus areas for 2022 thatwill enable Westport to effectively address the most significant material topics.

●

We believe in free and open competition and never engage in improper practices that may limit competition. We neverlook to gain competitive advantages through unethical or illegal business practices. Our approach toward fair competition

3-3 Management of material topics

206-1 Legal actions for anti-competitive behavior, anti-trust, andmonopoly practices

is clearly stated in the Code of Conduct.

27,37,97●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Business ethics●

Code of Conduct (pages 18 - 19)●

There were no legal actions taken for anti-competitive behavior, anti-trust, or monopoly activities.

98●

There were no monetary losses as a result of legal proceedings associated with anti-competitive behavior regulations.

98

SASB: TR-AP-520a.1 / RT-EE-510a.3 Total amount of monetary losses asa result of legal proceedings associated with anti-competitive behavior
regulations

GRI 301: MATERIALS 2016 | SASB: 440
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

By engaging with our stakeholders on a regular basis, we have identified a list of key initiatives and focus areas for 2022 thatwill enable Westport to effectively address the most significant material topics.

3-3 Management of material topics●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Responsible sourcing●

ESG Report – Materials and waste management●

Westport does not have the required data at the time of publication of the ESG Report. However, internal activities are27, 37, 52, 74, 97

underway to provide such data in the future.
●

Consistent with the leadership approach taken by our customers, suppliers, and other fellow members of the Automotive
Industry Action Group with respect to “conflict minerals”, we are engaged in an annual process of determining whether
any products which we make or buy contain such “conflict minerals”. We continue to work with our suppliers to increase

SASB: TR-AP-440a.1 / SASB: RT-EE-440a.1 Description of theawareness, and accuracy, of “conflict minerals” reporting requirements and, through our membership in the Responsible

management of risks associated with the use of critical materials

Minerals Initiative (RMI) (formerly the Conflict-Free Sourcing Initiative), support continuing cross-industry efforts to identify

74

and validate conflict-free smelters and refiners.

Westport / 2022 ESG Report●

2021 Conflict Minerals Report●

ESG Report – Responsible sourcing

114

IntroductionGRI DISCLOSURE

Our Approach

Environment

DISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)

SocialPAGE(S)

Governance

GRI and SASB index

OMISSION
Information unavailable

SASB: TR-AP-440b.2 Percentage of input materials from recycled or
remanufactured content●

Data on percentage of input materials from recycled or remanufactured content is currently unavailable. As we expand ourreporting systems, we will consider disclosing in the future.

●

Westport does not have the required data at the time of publication of the52

ESG Report – Materials and waste management

ESG Report. Not all locations collect the required data, so it is not available
in an all-organizational view. However, internal activities are underway toprovide such data in the future.
Information unavailable●
301-1 Materials used by weight or volume

Westport does not have the required data at the time of publication of the ESG Report. However, internal activities areunderway to provide such data in the future.

●

Westport does not have the required data at the time of publication of the52

ESG Report – Materials and waste management

ESG Report. Not all locations collect the required data, so it is not available
in an all-organizational view. However, internal activities are underway toprovide such data in the future.

●301-2 Recycled input materials used

underway to provide such data in the future.
●

Information unavailable

Westport does not have the required data at the time of publication of the ESG Report. However, internal activities are
52

ESG Report – Materials and waste management

Westport does not have the required data at the time of publication of the
ESG Report. However, internal activities are underway to provide such datain the future.

GRI 302: ENERGY 2016 | SASB: 130
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

By engaging with our stakeholders on a regular basis, we have identified a list of key initiatives and focus areas for 2022 thatwill enable Westport to effectively address the most significant material topics.

3-3 Management of material topics●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Environment●

ESG Report – Environmental management●

ESG Report – Our carbon footprint and environmental impact

27, 37, 39, 45, 47

Information incomplete●
302-1 Energy consumption within the organization

Production facilities in Poland, Italy, and the Netherlands generate energy from on-site solar. Total electrical energy
consumed is 56,870 GJ with 1,728 GJ coming from renewables (on-site solar).

●

Westport does not have all required data at the time of publication of the
53-56

ESG Report – 2022 performance

ESG Report. Currently, no quantitative data is available on heating consumption, cooling consumption, steam consumption. However, internal
activities are underway to provide such data in the future.
Information incomplete

SASB: TR-AP-130a.1 / RT-EE-130a.1 (1) Total energy consumed, (2)percentage grid electricity, (3) percentage renewable

Westport does not have all required data at the time of publication of the●

ESG Report – 2022 Performance

53-56

ESG Report. Currently, no quantitative data is available on heating consumption, cooling consumption, steam consumption.
However, internal activities are underway to provide such data in the future.

302-3 Energy intensity

Westport / 2022 ESG Report●

ESG Report – 2022 Performance

55

115

IntroductionGRI DISCLOSURE

Our Approach

Environment

DISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)

SocialPAGE(S)

Governance

GRI and SASB index

OMISSION
Information incomplete
Westport does not have all required data at the time of publication of the302-4 Reduction of energy consumption●

ESG Report – Our carbon footprint and environmental impact●

ESG Report – 2022 performance

ESG Report. Currently, no quantitative data is available on heating con47, 53

sumption, cooling consumption, steam consumption. No quantitative data
is available for the amount of energy consumption reductions achieved as adirect result of initiatives. However, internal activities are underway to provide such data in the future.

GRI 305: EMISSIONS 2016 | SASB: 110, 410
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

By engaging with our stakeholders on a regular basis, we have identified a list of key initiatives and focus areas for 2022 thatwill enable Westport to effectively address the most significant material topics.

3-3 Management of material topics●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Environment●

ESG Report – Environmental management●

ESG Report – Our carbon footprint and environmental impact●

Gross Scope 1 emissions were 4,054.87 tons CO2e.

●

2021 was selected as the base year. The combination of the return of operations in our facilities coupled with the addition of27, 37, 39, 45, 47

the Polish facility, Stako, has resulted in Westport's Scope 2 emissions seeing a significant increase from 2020 to 2021.
305-1 Direct (Scope 1) GHG emissions●

Consolidation includes full data for each location.

●

CO2 emissions were calculated using tools provided by the Greenhouse Gas Protocol, specifically the tool cited from World

54

Resources Institute (2015). GHG Protocol tool for mobile combustion. Version 2.6.

SASB: EM-MM-110a.1 (1) Gross global Scope 1 emissions, (2) Percentage●

ESG Report – 2022 performance●

Gross Scope 1 emissions were 4,054.87 tons CO2e. CO2 emissions were calculated using tools provided by the Greenhouse
Gas Protocol, specifically the tool cited from World Resources Institute (2015). GHG Protocol tool for mobile combustion.

covered under emissions-limiting regulations●

ESG Report – ESG strategy

or plan to manage Scope 1 emissions, emissions reduction targets, and●

ES Report – Environmental management

analysis of performance against those targets●

ESG Report – Our carbon footprint and environmental impact●

Gross Scope 2 emissions were 5,050.42 tons CO2e.

●

Consolidation includes full data for each location.

●

CO2 emissions from use of purchased electricity are calculated using tools provided by the World Resources Institute “CO2

Westport / 2022 ESG Report

54

Version 2.6.

SASB: EM-MM-110a.2 Discussion of long-term and short-term strategy

305-2 Energy indirect (Scope 2) GHG emissions

Information pertaining to the percentage of Scope 1 emissions covered

emissions from purchased electricity (indirect emissions)” https://www.wri.org/working-9- 5-climate-change.
●

See response to GRI 305-1●

ESG Report – 2022 performance

under emissions-limiting regulations is currently unavailable. Identifying
an approach to collecting this information will be considered for futurereporting.

45, 47, 54

53, 54116

IntroductionGRI DISCLOSURE

305-3 Other indirect (Scope 3) GHG emissions

305-4 GHG emissions intensity

Our Approach

Environment

DISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

GHG emissions for Scope 3 are currently unavailable, however, efforts are in place to disclose in the future.

●

ESG Report – Environmental management●

ESG Report – Our carbon footprint and environmental impact●

GHG intensity was 29.79 tons CO2-eq/US$ Million of Revenue including both Scope 1 and 2 CO2 emissions.

●A 2021 baseline was chosen to compare year-over-year emissions reduction. Westport is working to formally identify abaseline year for future reporting.

●

ESG Report – 2022 performance●

In 2022, we saw an increase in Scope 1 direct emissions. Compared to 2021, there was a 14.7% increase in Scope 1 emissions.

SocialPAGE(S)

Governance

GRI and SASB index

OMISSION
Information unavailable

45, 47

Westport does not have the required data at the time of publication of the
ESG Report. However, internal activities are underway to provide such datain the future.

53, 55In the Scope 2 emissions, we recorded a decrease of 7.0% compared to 2021, thus close to pre-2020 levels. In Total GHG
Information incomplete

impact, there was a 1.6% increase in CO2-eq emissions compared to 2021.
●
305-5 Reduction of GHG emissions

305-6 Emissions of ozone-depleting substances (ODS)
SASB: TR-AP-410a.1 Revenue from products designed to increase fuelefficiency and/or reduce emissions

A 2021 baseline was chosen to compare year-over-year emissions reduction. Westport is working to formally identify abaseline year for future reporting.

Westport does not have all required data at the time of publication of the45, 47, 53

ESG Report. Currently, no quantitative data is available for the amount of●

See response to GRI 302-4

GHG reductions achieved as a direct result of initiatives, if any. However,●ESG Report – Environmental management

internal activities are underway to provide such data in the future.

●

ESG Report – Our carbon footprint and environmental impact●

ESG Report – 2022 performance●

Westport does not produce, import, or export ozone-depleting substances (ODS).

●

2022 Fiscal Year Revenue was US$ 305.7 Million (2021: US$ 312.4 Million).

GRI 306: WASTE 2020 | SASB: 150
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

By engaging with our stakeholders on a regular basis, we have identified a list of key initiatives and focus areas for 2022 thatwill enable Westport to effectively address the most significant material topics.

3-3 Management of material topics

306-1 Waste generation and significant waste-related impacts

306-2 Management of significant waste-related impacts

Westport / 2022 ESG Report●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Environmental management●

ESG Report – Materials and waste management●

Westport does not have the required data at the time of publication of the ESG Report. However, internal activities areunderway to provide such data in the future.

27, 37, 45, 52

Information unavailable
45, 52

Westport does not have the required data at the time of publication of the●

ESG Report – Environmental management●

ESG Report – Materials and waste managementin the future.

●

Westport does not have the required data at the time of publication of the ESG Report. However, internal activities are

Information unavailable

underway to provide such data in the future.
●

ESG Report – Environmental management●

ESG Report – Materials and waste management45, 52

ESG Report. However, internal activities are underway to provide such data

Westport does not have the required data at the time of publication of the
ESG Report. However, internal activities are underway to provide such datain the future.

117

IntroductionGRI DISCLOSURE

Our Approach

Environment

DISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)

SocialPAGE(S)

Governance

GRI and SASB index

OMISSION
Information incomplete
Westport does not have the required data of all locations at the time of306-3 Waste generated●

Westport only has data for production facilities located in Europe and the facility located in Argentina.

publication of the ESG Report. The data are available only for the manufacturing facilities in Europe and in Argentina. However, internal activities areunderway to provide such data in the future.
Information incomplete
Westport does not have the required data of all locations at the time of

SASB: TR-AP-150a.1. (1) Total amount of waste from manufacturing, (2)●percentage hazardous, (3) percentage recycled

The total amount of waste was 28,409 tons, of which 25,300 tons was recycled, representing 89.1% of all waste (concerning
only production facilities located in Europe and a facility located in Argentina).

52

publication of the ESG Report. The data are available only for the manufacturing facilities in Europe and in Argentina. Westport does not collect dataon hazardous waste. However, internal activities are underway to provide
such data in the future.
Information unavailable

SASB: RT-EE-150a.1. Amount of hazardous waste generated, percentage
recycled●

Westport does not have the required data at the time of publication of theWestport does not collect data on hazardous waste.

ESG Report. However, internal activities are underway to provide such datain the future.

GRI 401: EMPLOYMENT 2016
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

3-3 Management of material topics

PAGE(S)OMISSION

By engaging with our stakeholders on a regular basis, we have identified a list of key initiatives and focus areas for 2022 thatwill enable Westport to effectively address the most significant material topics.

●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment

27, 37

Information incomplete
401-1 New employee hires and employee turnover●

ESG Report – Our global workforce

58

Westport does not have all required data at the time of publication of the
ESG Report. In particular, there is no breakdown into age groups. However,internal activities are underway to provide such data in the future.
Information incomplete

401-2 Benefits provided to full-time employees that are not provided totemporary or part-time employees●

ESG Report – Our global workforce

58

Westport does not have all required data at the time of publication of the
ESG Report. In particular, there is no division into significant locations ofoperation and full-time employees or part-time / temporary employees.

Westport / 2022 ESG Report118

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 403: OCCUPATIONAL HEALTH AND SAFETY 2018 | SASB: 320
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

By engaging with our stakeholders on a regular basis, we have identified a list of key initiatives and focus areas for 2022 thatwill enable Westport to effectively address the most significant material topics.

3-3 Management of material topics●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Occupational health and safety403-1 Occupational health and safety management system●

ESG Report – Occupational health and safety66403-2 Hazard identification, risk assessment and incident investigation●

ESG Report – Occupational health and safety66403-3 Occupational health services●

ESG Report – Occupational health and safety66●

ESG Report – Occupational health and safety66●

ESG Report – Occupational health and safety66●

ESG Report – Occupational health and safety

66●

Only employees who are remote workers or work at offices with less than 20 total employees are not covered by any JHSC.

403-4 Worker participation, consultation, and communication on
occupational health and safety403-5 Worker training on occupational health and safety403-7 Prevention and mitigation of occupational health and safety
impacts directly linked by business relationships

27, 37, 66

Information incomplete

For employees not covered by a JHSC, there are processes in place to support direct communication to management403-8 Workers covered by an occupational health and safety
management system

regarding occupational health and safety concerns.
●

The occupational health and safety management system is not currently audited or certified externally. We are taking steps

Westport does not have all required data at the time of publication of the66

in the future. In particular, not all of the quantitative data required by thisto improve and standardize our approach to health and safety.
●

ESG Report – Occupational health and safety●

There were no fatalities in 2022.

●

Out of the 3,064,833 total hours worked in 2022, there were 15 reportable injuries. Based on 200,000 annualized working

disclosure 403-8 is available.

Information incomplete

hours, the total recordable injury frequency rate was 0.98. Of these 15 reported injuries, 9 occurred at our Italian facility, 4 at
403-9 Work-related injuries

our Polish facility and one each at the India and Vancouver facilities. All of our other 5 facilities had no Lost Time Injury (LTI).
●

66

Work-related injuries are not currently tracked for workers who are not employees. As we improve and standardize our

SASB: RR-FC-320a.1 (1) Total recordable incident rate (TRIR), (2) Fatality
rate

ESG Report – Occupational health and safety●

Total recordable injury rate in 2022 was 0.98.

●

There were no fatalities in 2022.

●

Work-related injuries are not currently tracked for workers who are not employees. As we improve and standardize ourapproach, we will consider disclosing this data in future reporting.

●

Westport / 2022 ESG Report

ESG Report – Occupational health and safety

Westport does not have all required data at the time of publication of the
ESG Report. However, internal activities are underway to provide such datain the future.

approach, we will consider disclosing this data in future reporting.
●

ESG Report. However, internal activities are underway to provide such data

Information incomplete
66

Westport does not have all required data at the time of publication of the
ESG Report. However, internal activities are underway to provide such datain the future.

119

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 404: TRAINING AND EDUCATION 2016
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

By engaging with our stakeholders on a regular basis, we have identified a list of key initiatives and focus areas for 2022 thatwill enable Westport to effectively address the most significant material topics.

3-3 Management of material topics●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Our global workforce

27, 37, 58

Information incomplete
Not all of the quantitative data required by this disclosure 404-1 is available
404-1 Average hours of training per year per employee●

ESG Report – Our global workforce●

ESG Report – Trainings

58, 99for 2022. In 2022, Westport did not gather required data by gender andemployee category, or the data was collected inconsistently within theorganization.
However, internal activities are underway to provide such data in the future.

404-2 Programs for upgrading employee skills and transition assistance●Trainings that took place in 2022 were largely focused on occupational health and safety, compliance, and business ethics.

programs●

ESG Report – Our global workforce

58
Information incomplete
Not all of the quantitative data required by this disclosure 404-3 is availa-

404-3 Percentage of employees receiving regular performance and●

165 employees, which is 11% of total employees, received regular performance and career development reviews.

career development reviews●

ESG Report – Our global workforce

58

ble for 2022. In 2022, Westport did not gather required data by gender andemployee category, or the data was collected inconsistently within theorganization. However, internal activities are underway to provide such datain the future.

GRI 405: DIVERSITY AND EQUAL OPPORTUNITY 2016 | SASB: 330
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

By engaging with our stakeholders on a regular basis, we have identified a list of key initiatives and focus areas for 2022 thatwill enable Westport to effectively address the most significant material topics.

3-3 Management of material topics

405-1 Diversity of governance bodies and employees●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Diversity, equality, and inclusion●

ESG Report – Diversity, equality, and inclusion●

ESG Report – Corporate governance●

Information on racial/ethnic group representation, employee category, or age group is currently unavailable. As we expand

27, 37, 61

Information incomplete
61, 81

our reporting systems, we will consider disclosing in the future.

SASB: TC-SI-330a.3 Percentage of gender and racial/ethnic grouprepresentation for (1) management, (2) technical staff, and (3) all other
employees

Westport / 2022 ESG Report●Management diversity in 2022 was on average 83% male, 17% female.

●

Global workforce diversity in 2022 was on average 68% male, 32% female.

●

Information on racial/ethnic group representation, employee category, or age group is currently unavailable. As we expand
our reporting systems, we will consider disclosing in the future.

Westport does not have all required data at the time of publication of the
ESG Report. Quantitative data by age group of employees is not available.
However, internal activities are underway to provide such data in the future.
Information incomplete
Westport does not have all required data at the time of publication of the61, 81ESG Report. Quantitative data by racial/ethic group representation and employee categories is not available. However, internal activities are underway
to provide such data in the future.

120

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 407: FREEDOM OF ASSOCIATION AND COLLECTIVE BARGAINING 2016
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

3-3 Management of material topics

PAGE(S)OMISSION

By engaging with our stakeholders on a regular basis, we have identified a list of key initiatives and focus areas for 2022 thatwill enable Westport to effectively address the most significant material topics.

●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment

27, 37

Information incomplete
Some of the data required by this disclosure 407-1, i.e., description of sup407-1 Operations and suppliers in which the right to freedom of
association and collective bargaining may be at risk●

Within our own operations, there are no locations at risk of losing the right to freedom of association and collective
bargaining.

●pliers in which workers’ rights to exercise freedom of association or collecti27, 28

ESG Report – Stakeholder engagement

ve bargaining may be violated or at significant risk, is not available for 2022.
Risks within our supply base are unavailable because they are not currently
reported on. As we expand our reporting systems, we will consider disclosing this in the future.

GRI 415: PUBLIC POLICY 2016
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

Westport has established an Interaction with Government Officials Policy which, among other things, describes
expectations of the business when conducting business with government officials, ensuring compliance with applicable
local, national, and international laws and regulations covering all jurisdictions in which Westport operates.

3-3 Management of material topics

415-1 Political contributions●

This policy was reviewed and implemented through Westport Compliance Committee and is subject to re-review on adefined basis.

●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Key sustainability policies & standards●

Westport has established its Interaction with Government Officials Policy which states that no political contributions are
permitted, which means that total monetary value of political contributions made by Westport equals zero.

27, 37, 100

103

GRI 416: CUSTOMER HEALTH AND SAFETY 2016
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

The executive-level Product Safety and Compliance Committee, formed in 2020, is responsible for oversight of safety- andcompliance-related risk assessments, risk acceptance, and risk mitigation efforts, as well as proactive measures associated

3-3 Management of material topics

416-2 Incidents of non-compliance concerning the health and safety
impacts of products and services

Westport / 2022 ESG Reportwith Westport products and services, throughout the company, and sold or otherwise provided to third-party customers.
●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Enterprise risk management●

In 2022, we did not identify any incidents of non-compliance with regulations and/or voluntary codes concerning the healthand safety impacts of our products and services.

27, 37, 92

92

121

Introduction

Our Approach

Environment

SocialGovernance

GRI and SASB index

GRI 418: CUSTOMER PRIVACY 2016
GRI DISCLOSUREDISCLOSURE RESPONSE (DOCUMENT / URL / DIRECT ANSWER)●

PAGE(S)OMISSION

By engaging with our stakeholders on a regular basis, we have identified a list of key initiatives and focus areas for 2022 thatwill enable Westport to effectively address the most significant material topics.

3-3 Management of material topics●

ESG Report – Stakeholder engagement●

ESG Report – Materiality assessment●

ESG Report – Cyber and information security418-1 Substantiated complaints concerning breaches of customer●

During 2022, there were zero incidents of substantiated complaints received concerning breaches of customer privacy.

privacy and losses of customer data●

ESG Report – Cyber and information security

Westport / 2022 ESG Report27, 37, 94

94

122

wfsinc.com