SUSTAINABILITYREPORTGATES SUSTAINABILITY REPORT 2022

3

TABLE OFCONTENTSINTRODUCTIONENVIRONMENT34

OUR POLICY AND APPROACH TO ENVIRONMENTAL SUSTAINABILITY
CLIMATE, ENERGY, AND AIR EMISSIONSGREENHOUSE GAS EMISSIONSENERGY EFFICIENCY AND CONSUMPTIONWATER STEWARDSHIP AND CONSERVATIONWASTE MANAGEMENTCIRCULARITY, REUSE, AND RECYCLING

36
36
37
38
39
40
41

STEWARDSHIP42

POLICIES AND STANDARDS OF CARE
PRODUCT STEWARDSHIPWORKFORCE HEALTH AND SAFETYEMPLOYEE WELL-BEING
TRAINING AND WORKFORCE DEVELOPMENT
DIVERSITY, EQUITY, AND INCLUSION (DEI)
EMPLOYEE ENGAGEMENTENGAGING WITH OUR COMMUNITIESGATES INDUSTRIAL CORPORATION FOUNDATION

44
45
46
47
48
52
53
53
55

LOOKING AHEAD

56

LETTER FROM THE CEOLETTER FROM THE CSOGATES IN BRIEF
OUR VALUES, MISSION, AND VISIONABOUT THIS REPORTENGAGING WITH STAKEHOLDERS
MATERIALITYPROGRESS AGAINST OUR GOALS

4
6
8
9
10
11
12
13

GOVERNANCE

14CORPORATE GOVERNANCE
ESG AND THE BOARDRISK MANAGEMENTETHICS AND CODE OF BUSINESS CONDUCTSUPPLIER CODE OF CONDUCT AND DUE DILIGENCE
HUMAN RIGHTS
CONFLICT MINERALSCYBERSECURITY AND IT RISK MANAGEMENT

16
17
19
20
21
22
22
23

TECHNOLOGY24

APPENDIX58

TECHNOLOGY AND INDUSTRY ENGAGEMENTTECHNICAL CENTERSGATES ECO-INNOVATION SYSTEMECO-INNOVATION IN ACTION
DIGITAL TRANSFORMATION

26
27
28
29
32

ANNUAL PERFORMANCE INDICATORSUN SDGs TABLEGRI CONTENT INDEXASSURANCE STATEMENTCAUTIONARY STATEMENT

60
64
66
74
76

GATES SUSTAINABILITY REPORT 2022

Introduction

GovernanceTechnology

More than a century ago, Gates operated from asingle location based in Denver, Colorado. Today,
we are 15,000 team members strong, serving
customers in more than 130 countries. Much haschanged since Gates invented the V-belt thatrevolutionized power transmission systems, butwhat has not changed is our ongoing commitment
to all of our stakeholders — customers,
employees, shareholders, and communities.
These stakeholders are integral to what makes
Gates successful, and our strategies are focusedon advancing their priorities.
We view our relationships with customers as
long-term partnerships, with many extending backmultiple decades. We relentlessly focus on serving
these customers with high-quality products built
on differentiated technology to help solve theirmost complex problems across a wide range of
mission-critical applications.

LETTER FROMTHE CEO

Empowered team members are the foundation of
our business, delivering products to ourcustomers, living our corporate culture daily, anddriving our Diversity, Equity, and Inclusion (DEI)
initiatives. In 2022, based on feedback fromacross our organization, we created a DEI Council
that is committed to building Business Resource
Groups, improving education, and supporting DEI
programs. We are active participants in thecommunities in which we live and work, withnumerous examples of our team members
engaging and giving back.
Our team members also worked diligently over the
past year to manage through the ongoing supply
chain volatility as well as inflation that impacted

Environment

StewardshipAppendix5nearly every input into our operations. We
continued to optimize our operations for costsavings and to reduce environmental impact in the
short term, while also staying committed to longerterm decarbonization and waste-reduction targets.
To further advance our sustainability efforts, wecreated and staffed a new role at Gates, adding a
dedicated leader for Environmental, Social, andGovernance (ESG) to accelerate our journey. Our
Board of Directors also has newly definedoversight of all ESG matters, led by the Nominatingand Governance Committee. These actions
reinforce our commitment to meeting the ESG
expectations of our stakeholders, and provide
strong management and governance to ensure ourgoals are met.
On behalf of our company leadership I’d like tothank all of our stakeholders for your continued
support and hope you find the details of ourprogress on ESG in the following pages insightful.
Sincerely,

Ivo Jurek
CEO Gates

GATES SUSTAINABILITY REPORT 2022

LETTER FROM THE CSO

Introduction

GovernanceTechnology

Environment

StewardshipAppendix

7

I am proud of our achievements over the past year and excited for
our future. We made a number of step-function improvements in
our focus and investment around our sustainability initiatives, which
gives me further confidence in meeting our long-term objectives.
In 2023, we make continued progress on each of the four G-T-E-S
pillars we laid out in 2021 — Governance, Technology, Environment,
and Stewardship.
Governance: As Ivo mentioned, we invested in a focusedsustainability team and formalized our Board’s oversight of our ESG
initiatives. Our approach is cross-functional, giving us line-of-sight tothe constantly shifting expectations of our stakeholders, andallowing us to design innovative solutions that address ourcustomers’ — and the world’s — most pressing needs for
decarbonization, mobility, and electrification.
Technology: We continued to invest in our Eco-InnovationTM model todrive product performance and operational improvements throughmaterials science, product design and process engineering andcontinued to make progress towards our mid-term goal of 25%
product vitality.
Environment: We broadened how we view innovation to bettersupport our customers on their ESG journeys. For example, Gates
Carbon DriveTM, the leading belt-drive solution for two-wheelers
provides a cleaner, quieter, lower-maintenance, and more durable
alternative to chain drives, resulting in substantial cost andgreenhouse gas savings over time. These innovative mobility drive
solutions are also highly aligned with the accelerating electrification
trends of eBikes, eScooters, and eMotorcycles.
Stewardship: We drove increased engagement across ourcommunities setting new expectations for leaders to get involved
and give back in our communities, and with our coworkers throughour newly formed DEI Council.
The progress we continue to make is not only evidence of ourunique culture and values, but also proof our investments make forbetter products, a better bottom-line and a better way forward forthe planet.
Sincerely,

Tom Pitstick

Chief Strategy Officer

GATES SUSTAINABILITY REPORT 2022

Introduction

In 1911, Charles C. Gates acquired the Colorado Tire and Leather Company,
located in Denver. A few years later, Gates invented the V-belt, which
revolutionized industrial power transmission. Today, we are a global leader in a
broad portfolio of power transmission and fluid power solutions, withapproximately 15,000 team members and over 100 locations in 30 countries.
Gates Industrial Corporation has introduced countless other innovations in powertransmission and fluid power that have impacted virtually every industry. We
invest continually in research and development, so our products outperform
industry standards and exceed the demanding expectations of our customers. We
invest in our people, encouraging real-world experience to help solve ourcustomers’ diverse challenges of today and anticipate those of tomorrow. Whether
manufacturing original equipment or products in the aftermarket, we help enable
companies in every industry to be more efficient, productive, and profitable.

AT A GLANCEEUROPE, MIDDLE EAST
AND AFRICA
HEADQUARTERSLUXEMBOURG CITY, LUXEMBOURG

DENVER, COLORADOGREATER CHINA
HEADQUARTERS
SHANGHAI, CHINA

EAST ASIA AND INDIA
HEADQUARTERS
SINGAPOREGTESNEW YORK STOCKEXCHANGE (NYSE)$3.55B
2022 SALES

30 100+ ~15,000

COUNTRIESLOCATIONSTechnology

Environment

StewardshipAppendix

9

OUR VALUES,MISSION, AND VISIONGATES IN BRIEF

GLOBAL AND
AMERICAS
HEADQUARTERS

Governance

EMPLOYEESOUR VALUESOUR MISSION

We’ve built our reputation as a leading, global
manufacturer with integrity, a strong sense of
personal responsibility, and a dedication to
working safely. Our five corporate values ofaccountability, collaboration, tenacity, curiosity,and dedication are integral to how we dobusiness. We continue to focus on the wellness of
our team members, the strength of ourpartnerships with customers, suppliers, anddistributors, and the sustainability of ourenvironment. Simultaneously, we embrace thediversity and vitality of our international workforce.

Gates strives to be the best fluid power and powertransmission company in the world, providing
products, services, and solutions that drive
endless possibilities for our customers.

OUR VISION
Gates strives to continually push the boundaries
of materials science to advance the way theworld moves.

GATES SUSTAINABILITY REPORT 2022

Introduction

STEWARDSHIP

EM
PL
O

RS
E
D
OL

EH

Going forward, we will continue to use theseframeworks and engage with our stakeholders toenhance the reporting process, advance ourstrategy, and improve the enterprise value we create.

GOVERNANCE

GTESENVIRONMENTSSTEWARDSHIP: Empower and enhancethe experience of our team members
and communities

M

O

■

Y

C OM

S
EE

CUS
T

ENVIRONMENT: Continuously improvethe environmental sustainability of our
products and operations

11

Our approach showcases a commitment tointegrating sustainability into our corporate
governance, reporting processes, and stakeholder
engagements. At Gates, we believe sustainability
drives value for all our stakeholders, including ourshareholders.

TIE■

Appendix

programs, while also identifying new opportunities
and emerging risks.

I
UN

TECHNOLOGY: Engineer products andprocesses that push the boundaries
of innovation

Stewardship

TECHNOLOGY■

We are monitoring the developments of regulatory
agencies and standards bodies, including thosepromulgated by the International Sustainability
Standards Board (ISSB); the proposed rule by the
U.S. Securities Exchange Commission (SEC) on
climate change; the EU Corporate Sustainability
Reporting Directive (CSRD) and Corporate
Sustainability Due Diligence Directive (CSDDD); andthe UK Streamlined Energy and Carbon Reporting(SECR) requirements.

At Gates, we serve a diverse community of
stakeholders across the globe, such as
shareholders, customers, suppliers, distributors,
civil society organizations, and industry partners.
We garner insights into their unique perspectives
through direct interaction with our teammembers. These stakeholder engagements help
us better understand the benefits that result
from transparency and our sustainability

SHA
R

GOVERNANCE: Conduct business withintegrity and maintain ethical andcomprehensive corporate oversight

Our reporting process takes into account thestandards and guidelines expressed by theInternational Financial Reporting Standards (IFRS)Foundation and its Sustainability AccountingStandards Board (SASB), the Task Force on Climaterelated Financial Disclosures (TCFD), and widelyused reporting practices relevant to our industry
and key stakeholders. Our reporting is also informedby the Global Reporting Initiative (GRI) and UN
Sustainable Development Goals (SDGs) – with its
set of targets and aspirations that Gates cancontribute to and help achieve, working with global
governments, other businesses, and civil society.

RS■

Environment

METhis report is organized according to the Gates
GTES Pillars of Stewardship, defined as:

Technology

ENGAGING WITH
STAKEHOLDERSABOUT
THIS REPORTThis Sustainability Report summarizes Gates’
sustainability activities and performance metrics
for fiscal year 2022 (January 2, 2022 – December
31, 2022). All information has been presented at
the consolidated company level unless otherwise
noted. Any restatements of information fromprevious reporting periods are noted in this report.

GovernanceGATES SUSTAINABILITY REPORT 2022

MATERIALITY
In 2021, Gates conducted an assessment to identify topics ofcorporate and operational priority by short- and long-term
strategic importance. This initial assessment informed strategic
corporate and operational priorities, including:■Corporate Governance and Business Ethics■

Greenhouse Gasses and Air Emissions■■

Energy Efficiency and Clean Energy Utilization
Waste Management and Product Stewardship■

Environmental Policy and Management Systems■

Workforce Health and Safety■

Human Capital Management

We are supplementing these findings with additional
engagements and analyses. We are working to monitor the
impacts concerning climate-related risks and opportunities,
energy supply, human capital management, cybersecurity, andrisks inherent in our supply chains.

Introduction

GovernanceTechnology

Environment

StewardshipAppendix

13

PROGRESS AGAINSTOUR GOALSIn 2020, we established a set of targets to achieve a reduction in
our overall energy consumption, our operational greenhouse gas(GHG) emissions, and our employee safety performance, using
our 2019 results as a baseline.
■

Reduce Total Energy Consumption 20% by 2025■

Reduce Total Operational GHG Emissions 15% by 2025■

Achieve Workforce Lost-Time Incident Rate (LTIR) of 0.25 or lower

While we are making progress against these targets, our results
to date have been impacted by uncontrollable factors such as
supply chain disruptions, tight labor markets, and exceptionallyhigh energy costs. With the guidance of our new sustainability
leader and Sustainability Management Committee, we plan torecalibrate our targets to address outcomes that reflect our
ambition, regulatory developments, advances in technologies, aswell as market expectations.

GATES SUSTAINABILITY REPORT 2022

Introduction

GovernanceTechnology

In this section

Environment

GOVERNANCE
Corporate Governance
ESG and the Board
Risk Management
Ethics and Code ofBusiness Conduct
Supplier Code of Conduct
and Due Diligence

Human Rights
Conflict Minerals
Cybersecurity and IT Risk
Management

GOVERNANCE

StewardshipAppendix

15

GATES SUSTAINABILITY REPORT 2022

Introduction

CORPORATEGOVERNANCE

GovernanceTechnology

Environment

StewardshipAppendix

ESG AND THE BOARD

An integrity-first approach guides every level ofdecision-making at Gates. The Gates Board of
Directors (Board) exercises direct oversight ofstrategic risks to the company. The Board also
exercises oversight of the Company’s ESG andhuman capital management strategies, practices
and policies, including the Company’s reportingon such matters. Our Board helps to ensure that
our well-tested business model, built around
critically important products, can continue todrive success well into the future.
In 2022, the majority of voting power of ourordinary shares is held by investment funds
affiliated with Blackstone Inc., our sponsor. As aresult, until recently, Gates is considered a‘controlled company’ under the New York Stock
Exchange (NYSE) corporate governancestandards and is exempt from certain
independence requirements. Because our Board
believes that independent leadership is
important, it has elected not to take advantageof these independence exemptions.

With the assistance of its three Committees – Nominating and Governance, Audit, and Compensation our Board is responsible for overseeing ESG and human capital management strategies, practices andpolicies. Each Committee is governed by a written charter addressing such Committee’s purpose andresponsibilities and is composed of entirely independent directors.
To assist with this mission, our Board has designated our Nominating and Governance Committee to be
responsible for, among other things:■

Overseeing the evaluation of the Board of Directors and its committees■

Reviewing developments in corporate governance practices and developing and recommending
a set of corporate governance guidelines■

Recommending members for each committee of the Board of Directors; and■Reviewing and monitoring the development and implementation of the goals the Company
may establish with respect to ESG matters

CURRENT BOARD OF DIRECTORS

Our Board is made up of nine directors, eightof whom are independent and three of whom
are women.

89%

INDEPENDENTBOARD DIRECTORS

33

NEIL P. SIMPKINSIVO JUREK

Chair of the Board

Chief Executive Officer

WILSON S. NEELY

MOLLY P. ZHANG

STEPHANIE K. MAINSJAMES W. IRELAND, III

ALICIA L. TILLMANFREDRIK ELIASSON%WOMEN BOARD
DIRECTORSSETH A. MEISEL

17

GATES SUSTAINABILITY REPORT 2022

The Nominating and Governance Committee
reviews and makes recommendations regarding thecomposition and size of the Board in order toensure the Board has the requisite expertise and its
membership consists of persons with sufficiently
diverse and independent backgrounds. The
Nominating and Governance Committee is also
responsible for review and oversight of humancapital management, including Gates’ Diversity,
Equity, and Inclusion (DEI) programs.
The Audit Committee provides assistance to theBoard through oversight of the accounting andfinancial reporting processes; compliance with legal
and regulatory requirements applicable toaccounting and financial reporting processes anddisclosures; and the company’s information
technology security and data privacy programs. The
Audit Committee also oversees the Company’s
Code of Business Conduct and Ethics (Code) andmaterial legal and regulatory policies, including theCompany’s Whistleblower Policy, and reviews
reports and investigations of potential violations
under such policies.
Leadership at the highest level has worked tirelessly
to manage the ESG and economic factors that may
impact the long-term interests of our employees,
customers, communities and shareholders. The
newly formed Sustainability Management
Committee, comprised of cross-functional, senior
managers, meets regularly to discuss strategic
priorities, progress against our goals andcommitments, and emerging sustainability topics.
In 2022, leaders from the Sustainability
Management Committee began meeting with andIntroduction

GovernanceTechnology

Environment

StewardshipAppendix

19

apprising the Nominating and GovernanceCommittee. The work of the Sustainability
Management Committee also supports the Audit
Committee by advising senior management on
financial and regulatory-related disclosures and risk
management. The Sustainability Management
Committee also helps our Enterprise Risk
Committee understand the company’s exposure tocertain climate-related risks such as current andemerging regulations, and energy transition-relatedrisks. These risks are evaluated as part of ouroverall risk management processes.

GATES BOARD OF DIRECTORS
AUDITCOMMITTEEENTERPRISERISK COMMITTEECOMPENSATIONCOMMITTEENOMINATING AND
GOVERNANCE
COMMITTEESUSTAINABILITYMANAGEMENTCOMMITTEERISK MANAGEMENT
We are routinely monitoring policies anddevelopments concerning ESG and climate-related
laws and regulations and new reporting andfinancial disclosure requirements including the
proposed SEC Rule to Enhance and Standardize
Climate-Related Disclosures and the EU’s CSRD
and Carbon Border Adjustment Mechanism(CBAM), among others.

Gates maintains a robust Enterprise Risk
Management (ERM) program, which includes a risk
assessment to identify key enterprise risks,maintaining a risk register to monitor mitigation
actions in response to key risks, on-going dialogue
and collaboration among management to identify
emerging risks, quarterly review of mitigation
actions, and periodic reports to the Audit
Committee and the Board.

The ERM process is directed by a management
committee called the Enterprise Risk Committee,
led by the Chief Financial Officer, Chief Legal
Officer, Chief Accounting Officer, Chief Information
Officer, and Vice President of Global Internal Audit,in coordination with senior functional leadersacross the Company. Certain sustainability-relatedrisks are considered in Gates’ ERM program.

GATES SUSTAINABILITY REPORT 2022

Introduction

Environment

Our supply chain plays an integral role in advancing
our mission and our ability to deliver products thatare safe, innovative, and meet the requirements ofour customers. Gates is committed to high standardsof product quality and business integrity in its
dealings with suppliers.

Compliance and ethics are deeply embedded inour business strategy. Gates team members are
expected to follow both the spirit and letter of ourCode. The Code defines our approach to doing
business the right way and provides resources toaddress compliance and ethics concerns. Our
Code covers a range of topics including businessethics, anti-competitive behavior and anticorruption, gifts and entertainment, conflicts ofinterest, antitrust regulations, and other important
governing principles.

It is vital for all work to be conducted in alignment
with our core values and with consideration forcompliance with our Code. To aid this process, welaunched the “Code on the Go” (COTG) page in our
global employee resources platform for our East
Asian and Indian team members. COTG helps
team members quickly access important policy
content, such as our Code. COTG is a gateway to
all global policies, FAQs and case studies.

Technology

SUPPLIER CODE OF
CONDUCT AND DUEDILIGENCEETHICS AND
CODE OFBUSINESSCONDUCT

Creating a high-integrity culture requires aconsistent approach that establishes complianceas a minimum condition for business success. To
support our compliance commitment, our Legal
Compliance Team maintains corporate policies,
oversees internal investigations, trains oncompliance matters, conducts third-party due
diligence, and supports Gates’ adherence toexport controls and sanctions. Gates continuously
monitors compliance regulations and enforcement
actions to build upon our existing program.

GovernanceWe require that working conditions in the Gates’
supply chain be safe, workers be treated withrespect and dignity, and manufacturing processes beenvironmentally responsible. Our Supplier Code of
Conduct, Human Rights Policy, and Modern Slavery
Act Statement provide another layer of assurance
that co-manufacturers and independent suppliers
are committed to ethical business practices meeting
our expectations. All standard purchasing
agreements require suppliers to comply withapplicable laws and the Supplier Code of Conduct.
COTG will be launched globally to all Gates teammembers through 2023-24, focusing on high-riskcountries first.
We empower team members to share real-lifebusiness compliance scenarios they encounter
without any risk or consequences. The Ethics andCompliance Hotline provides an added safe space
to report activities that are not in alignment withour core values, policies, and regulations. All
incidents are taken seriously, robustly
investigated, and remediated according to ourstandard protocols.
With exceptions for certain types of employment,
100% of global team members completed
certification of reading and acknowledging
compliance with the Code in 2022.

Gates continually evaluates the use of alternative
materials and supply chains to enhance productdesign – and strengthen product and businessresilience - through innovation. A commitment todoing business with integrity extends to the way
Gates sources raw materials. By providing tools andresources to decision makers, we help them makechoices in compliance with responsible sourcing
processes, especially in conflict-affected and highrisk areas. It also assists in the way we approach our
Conflict Minerals Report disclosures, and due
diligence processes to prevent labor and humanrights risks.
More details about our supplier requirements andapproaches are available in the Policies section of
our website.

StewardshipAppendix

21

GATES SUSTAINABILITY REPORT 2022

Introduction

GovernanceTechnology

HUMAN RIGHTS
Gates is committed to upholding the human rights ofall people and treating each individual with dignity andrespect. Gates believes in the principles of equality
and non-discrimination and works to use its influenceand business relationships throughout our value chain
to promote equal opportunity and expression of
fundamental human rights. The Gates Human Rights
Policy and Modern Slavery Act Statement are guided
by the United Nations Guiding Principles on Businessand Human Rights, the International Bill of Human
Rights, and the International Labor Organization’s
Declaration on Fundamental Principles and Rights at
Work. Gates prohibits the purchasing of goods orservices from any supplier found to engage in humanrights violations, including trafficking or the use ofslave labor.

CONFLICTMINERALS
It is Gates’ policy to refrain from knowingly purchasing“conflict minerals” - materials and metals containing
tin, tantalum, tungsten or gold (known as 3TG). In
accordance with the law, our sourcing andprocurement processes ensure we follow reasonable
practices and avoid the procurement of theseminerals from conflict-affected and high-risk areas,such as the Democratic Republic of the Congo (DRC).
Our Conflict Minerals Statement sets forth
requirements for supplier due diligence, risk
assessment exposure, and compliance. Further,Gates supports the Responsible Minerals Initiative(RMI) to help influence smelters’ transparency andconformance with industry best practices.
Gates complies with applicable laws and regulations
related to conflict minerals, including the SEC
reporting requirements. We expect our suppliers tocomply with all applicable laws and regulations
related to conflict minerals.

CYBERSECURITY
AND IT RISKMANAGEMENT
Gates is committed to protecting our employees,
customers, and suppliers against cyber threats.
Leveraging industry standard risk frameworks including the National Institute of Standards andTechnology (NIST), the International Organization forStandardization (ISO), and the Trusted Information
Security Assessment Exchange (TISAX) – we arefocused on cybersecurity risk across theentire company.
Along with a comprehensive process to ensure thetechnology environment is operating and maintained,
our approach to identifying and mitigating
cybersecurity risks is ongoing monitoring of ourtechnology systems and emerging threat types,
including annual third-party testing. Our Audit
Committee receives quarterly updates oncybersecurity risk, and action plans to prevent them.
The 24/7 dedicated cybersecurity team identifies,
protects, detects, and responds to potential threats.
It also takes proactive steps to strengthen our
cybersecurity posture through policies andprocesses, and by increasing security awarenessthroughout the organization.
Our team members take part in mandatory internal
educational programs to ensure continual awarenessof new and emerging threats, including phishing
simulations. In addition, computer-based training isrequired at the time of hire and annually thereafter.
We partner with leading cybersecurity organizations
and industry experts to assess, identify, andstrengthen cybersecurity practices.

Environment

StewardshipAppendix

23

GATES SUSTAINABILITY REPORT 2022

Introduction

GovernanceTechnology

In this section

TECHNOLOGYTechnology and Industry Engagement
Technical Centers

Gates Eco-Innovation System
Eco-Innovation in Action
Digital Transformation

TECHNOLOGY

Environment

StewardshipAppendix

25

GATES SUSTAINABILITY REPORT 2022

Introduction

GovernanceTechnology

TECHNOLOGYAND INDUSTRYENGAGEMENT
The power transmission industry has changed
significantly since the original Gates trapezoidal
pitch products in the 1940s. Advancements inmaterials science, belt construction, and tooth
profiles have facilitated higher performing
industrial drives which have proven to be solutions
for more customers in a variety of applications.
Gates strives to be at the forefront of innovation
at each step along the way.
Engineers who design power transmission or fluid
power systems for industrial equipment face anongoing challenge – adopting new technologies
while ensuring reliability, cost effectiveness, andenvironmental performance. From replacing
outdated roller chains with maintenance-freesynchronous belt drives to designing hose andhydraulic systems that reduce maintenance timeand expense for endusers, Gates utilizes
materials science along with process engineering
to solve the toughest applications.
Commitment to our customers and distribution
partners is a top priority. We value and appreciate
the trust and confidence our customers have in us
to help them realize their ambitious goals brought
to fruition. Gates is a global leader trusted byoriginal equipment manufacturers (OEMs)
worldwide. Our engineers set the bar for reliability
and quality by setting new industry standards as
we exceed existing ones. Our simulation programs
and rigorous testing methods help us engineer
integrated and highly functional systems for OEM
customers and their distributors.
As a worldwide supplier of performance fluid
power and power transmission products, Gates isproud to be recognized for its strict quality
standards. Our facilities achieve the ISO/TS
16949 Technical Specification, which is based on

the ISO 9001:2000 standard and defines thequality system requirements for automotive
suppliers. Our responsibility towards our productquality and environmental stewardship is
manifested in Gates facilities obtaining both ISO
9001 and 14001 certifications. The ISO 14001
standard establishes a coordinated framework ofcontrols to manage environmental protection.
It also covers a wide range of environmental
management topics, including environmental
performance evaluation and auditing.
Gates is a member of industry organizations andassociations around the world to enhance ourunderstanding of the issues and trends relevant
to our products and stakeholders. We actively
engage with our industry partners to learn from- and inform - best practices, and to monitor
technical and performance standards. Further, we
acquire knowledge from our industry associations
to remain aligned with our climate-change
positions and product developments.

TECHNICALCENTERS
Gates Technical Centers support dedicatedengineering teams and technicians to develop
and provide best practices, materials research,and product testing support and training. Ourinnovations and patented intellectual properties
drive competitive advantages and enable
commercial success.
In July 2022, a new Gates Fluid Power TechnicalCenter was established in Izmir, Turkey. This
dedicated facility will provide innovative productsolutions and engineering support for Gates
thermal management hose globally, allowing us
to further advance our penetration on electricvehicle platforms.

Environment

StewardshipAppendix27

Maximize logistics and distribution
efficiency through in-region/for-region
sourcing and manufacturing, lighter-weight
products, and decreased packaging

STAGE 4CUSTOMER USE
Deliver products that exceed customer
expectations while helping to reduce
negative impacts of product applications

STAGE 5
END-OF-LIFE
Extend useful product life and reduce
waste while exploring opportunities toreuse materials

E

USE

TR A

N

E N PRGI OC
NE E S
ER S
IN
G

ER

AT
IO

E N PRGI OD
N E UC
ER T
IN
G

OM

CTURINGUFA

STAGE 3
TRANSPORTATIONAN

Decrease energy usage, waste generation,
and water consumption while improving
processes and throughput

29

M

Gates Eco-Innovation System is defined as innovationin materials science, process engineering, productengineering, and customer experience withconsideration and improvement to one or more stagesof the product lifecycle.

STAGE 2
MANUFACTURING

ECO-INNOVATION
IN ACTION

Appendix

LS
IA E
ER C
AT E N
M SCI

Eco-Innovation builds on its historical foundation with
the inclusion of product lifecycle considerations. Our
engineers focus on process improvements andinnovations to minimize environmental impact from
cradle to grave: beginning with material selection in
the design process, through product manufacturing,transportation, customer use, and concluding with
end-of-life disposition. Each stage offers opportunities
to create value upstream and downstream, helping tominimize our environmental footprint, as well as the
footprints of our suppliers, customers, and end users.

Reduce or eliminate harmful materials
while improving product performance,
efficiency, reliability, durability, andergonomics

Stewardship

DESIGNST

With each new or next-generation product or process
innovation, Gates aims to do more with less andincrease the performance, reliability, durability, quality,
and operational efficiency of legacy materials,
products, and processes. Gates is also investing andgrowing in end markets with positive secular andsustainable trends, namely the electrification oftransportation and micro-mobility.

STAGE 1DESIGNWe address the carbon footprint of our products
and the value chains we serve through theimplementation of life-cycle assessments (LCAs).
We use LCA to calculate the potential
environmental impacts of a growing selection of
our products. By understanding how our products
are used, we can better provide a reduced
carbon footprint in addition to high levels of
performance and durability.

Environment

CU

Gates is constantly pushing the boundaries of productadvancement and driving innovative solutions for ourcustomers. We innovate across four primary areas:materials science, process engineering, productengineering, and customer delivery and experience.
This process delivers premium quality products thatmeet and exceed customer expectations in numerous
mission-critical applications. Our products aredesigned to run longer, increase fuel and energy
efficiency, minimize ecological impacts, and reduce
GHG emissions.

Technology

ER E
OM NC
S T RIE
CU PE
EX

GATES ECO-INNOVATIONSYSTEM

Governance

LIF

Introduction

END-OF-GATES SUSTAINABILITY REPORT 2022

O
N SP

RT

CHAIN TO BELT
Conversion to belt drive systems and synchronous
belts are steadily emerging as the new standard
for power transmission as they deliver improved
safety and quality performance and are costeffective. Unlike chain systems, belt drives do not
require re-tensioning or petroleum-based
lubrication. Users can reduce their operating costs
from converting to belt systems, but also realize
GHG emissions savings over the course of the belt
drives’ usable life.
Gates Poly Chain® belts are safer, longer-lasting,lighter and represent a step change inperformance from traditional roller chains. They
require no lubrication, are virtually maintenancefree, deliver increased uptime and safety. The
lighter weight helps improve ergonomics,
reducing worker fatigue and strain.
Synchronous belt drive systems also
run quietly. By reducing employee
exposure to loud noise, belts

improve operating conditions and create a safer,more pleasant work environment.
Gates belt drive systems are used in industries
such as food processing and pharmaceuticals in
conveyor belts, automation for linear positioning
and lifting, health sciences for fitness and healthappliances and material handling in warehouses.

GATES SUSTAINABILITY REPORT 2022

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GovernanceTechnology

Environment

Stewardship

2022

GATES CARBON DRIVE
15TH ANNIVERSARYGATES LAUNCHES

1986

1942

1911

CO-DEVELOPEDSYNTHETIC RUBBERMASS PRODUCTION

FOUNDEDDENVER, CO2010

INTRODUCEDREVOLUTIONARYPOLY CHAIN
SYNCHRONOUS BELTGATES LAUNCHESCARBON DRIVE
CENTERTRACK™

1917

1980

2006

2007

INVENTED
V-BELTSENGINEERED AND
DEVELOPED BELTS
TO REPLACE CHAINSON MOTORCYCLESPOLY CHAINGT CARBONGATES CARBON DRIVELAUNCHES FIRST BICYCLEBELT DRIVE SYSTEM2012
GATES LAUNCHESCARBON DRIVECRANKSETS

2020
GATES LAUNCHES SIDETRACK

2019

GATES GLOBAL MOBILITY &G-FORCE REDLINE LAUNCHIn 2012 Frank Schneider conquers
Alpe D’huez Megavalanche Cup

MOTO X5 BELTS
Gates belt drive systems are helping to propel arevolution in personal and micro mobility that istransforming how the world gets around on
bicycles, electric bikes, electric motorcycles,
electric scooters, and more. For more than 15
years, Gates Carbon Drive has been a solution for
two-wheelers as a cleaner, quieter, smoother, andmore durable alternative to chain drives. The new,innovative Moto X5 belt is a significant addition to
the Carbon Drive portfolio, offering the core belt
drive benefits but with even quieter performance
than its predecessors.
Gates achieved this breakthrough in belt
technology by combining a high-stiffness, longlasting synthetic compound with proven Gates
carbon-fiber cord reinforcement. The combination
not only provides durability and strength but it also
results in our quietest Carbon Drive belt yet.
Additionally, throughout the life of the vehicle andunder normal operating and maintenanceconditions, Moto X5 is more energy efficient thanchain, which can lead to extended vehicle range.
The Gates Carbon Drive Moto X5 product line isdesigned specifically for mid-motor, sit-down
electric scooters and motorcycles typically found in[1] International Energy Agency, Global EV Outlook (2021).

THERMALPRO
commuting applications in rapidly urbanizing Asianmarkets. According to the International Energy
Agency (IEA)1, new registrations of electric two andthree-wheelers reached over 10 million units in
2021. By 2030, the IEA forecasts that more than
80% of two and three-wheelers sold each year in
China will be electric. As countries around theworld implement sustainable transportation
policies, such as further penetration of zeroemitting electric scooters, Gates solutions are
there to help.

As the transition from internal combustion
engines to electric scooters accelerates incore markets like India, Southeast Asia, andChina, we expect drivetrain noise, efficiency,
and durability to become more important tocustomers. Moto X5 is designed to meet theneeds for quiet, long-lasting, low-maintenance
operation. Congratulations to the effortsof our global R&D teams that made thisbreakthrough possible.

Tom Pitstick
CSO

5
F

Gates has a passion for excellence and developing
high-performance parts to support the latest
technology, including the electrification of mobility.
Our thermal management solutions are essential
to efficient functioning of low-emissions andbattery electric vehicles. Our portfolio of
ThermalPro electric water pumps, electric coolant
valves, and thermal management hoses is theculmination of investment in electronics, software,
motor design, materials science, andcomputational fluid dynamics.
Gates ThermalPro water pumps contain aproprietary mechanical design that isolates theelectronics assembly from potential exposure tocoolant fluids, improving pump reliability
significantly. This technology also improves motor
efficiency, which is important for fully electric
platforms where water pumps can be considerable
consumers of battery range.

2021

2022

GATES MOTO X9 INTRODUCEDGATESLAUNCHES CDC
CENTERTRACK
BELT

Appendix

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GovernanceTechnology

DIGITAL
TRANSFORMATION
Gates continues to adopt new ways of utilizing
digital technology to create a world classexperience for our team members and customers
alike. We enable efficient and touchlessexperiences for our customers to order products
and get up-to-date information on order/shipment
status. In recent years, we have made significant
investments to digitize the business in areas of
e-commerce, mobile apps, and the Internet ofThings (IoT). Such investments support our ability
to provide value when, where, and how it is needed.

GATESCONNECT ECOMMERCE
Gates continues to expand GatesConnect, which is
our modern, user-friendly digital eCommerce portal
offering distributors enhanced self-service
capabilities. In 2022, GatesConnect was launchedto our authorized distributors in Australia. Since
then, we have added features to the portal so ourcustomers in the United States and Australia can
get the information they need faster and easier with 24/7 access. Initially launched as a tool tomake ordering, order tracking, and repeatpurchases effortless, GatesConnect now offers
open order reports, item comparisons, suggestive
search, and a bulk item pricing and availability
feature. We continue listen to the voice of thecustomer, leveraging technology and creating value.

ECRIMP AND CORTEX CRIMPER
SOLUTIONS
Our hydraulic hose crimper solutions are designed
to bring our customers' hose assembly fabrication
into the next generation. The Gates intelligent
Cortex platform combines smart crimper
technology with real-time connectivity, providing
up-to-date product crimp specifications, integrated
Gates eCRIMP settings, and remote support for
ultimate operational efficiency. Our eCRIMP
website and app enables users to accessassembly specifications offline and in real time, sothey can deliver factory-quality hose assemblies
whenever their application demands. A graphicalinterface ensures the selection of correct parts,and frequently-used specs can be saved for quickreference. This eliminates the need for paper,
including previously printed crimp data.
Alongside these benefits, the data and alerts fromthe platform have created new opportunities toconvert customers from older to newer hosemodels like MXT™ and MXG™, which are lighter
weight and more efficient to produce with equal or
better performance.

DESIGN POWER PLATFORM
To help our customers determine the right belt for
their application, we released a new software
platform offering multiple digital design tools for
end-use applications. One of the Gates Design
Power programs is the Design Flex Pro. It makes
things easy to design belt drive systems and tocompare costs. Customers can create multiple
drive design options with cost and drive specifics,
including the part numbers for ease of orderingfrom Gates or our distributors. Importantly, theresults also share energy- and cost-savings
calculations based on customer-configurable inputs.

The Gates Design Power platform allows
customers and our internal experts working
in collaboration with OEM partners to quickly
and easily design the most accurate and robust
application-specific drive systems, saving timeand money.

Tom Pitstick
CSO

Environment

StewardshipAppendix

33

GATES SUSTAINABILITY REPORT 2022

Introduction

GovernanceTechnology

Environment

In this section

ENVIRONMENTOur Policy and Approach toEnvironmental Sustainability

Climate, Energy, and Air Emissions
Greenhouse Gas Emissions

Energy Efficiency and Consumption
Water Stewardship and Conservation

Waste Management
Circularity, Reuse, and Recycling

ENVIRONMENT

StewardshipAppendix

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GATES SUSTAINABILITY REPORT 2022

Introduction

OUR POLICY AND APPROACH
TO ENVIRONMENTALSUSTAINABILITY
Our sustainability efforts are rooted in our
ongoing commitment to our stakeholders andthe environments in which we work and live. We
revisit and refresh our policies and require all
Gates facilities to follow our Global Health,
Safety and Environmental (HSE) Standards andGates HSE Policy.
We follow an Environmental Management
System (EMS) in all our facilities. Our EMS which aligns with the ISO 14001 Environmental

Management Standard - establishes clear roles
and responsibilities, and requires compliance withexternal environmental regulations and internal
standards. We conduct regular environmental
assessments of our facilities to ensure compliancewith our EMS and external regulations. We also
track environmental incidents and performance on
a range of metrics.
In 2022, we had no material environmental finesor reported violations.

CLIMATE, ENERGY,
AND AIR EMISSIONS
Gates is committed to doing business withrespect and consideration for the environment,
including minimizing our contribution to climatechange. We consider climate change issues suchas regulatory changes, chronic and severe
weather-related events and changing consumer
behaviors in our strategy. This includes the trend
towards lower carbon energy and fuel sources,
the procurement of clean electricity supply,
on-site renewable power generation, and the useof biomass for heat and steam.
Energy efficiency is a priority in our business
operations. Through energy efficiency initiatives,
we have identified facilities and manufacturing
processes that will help reduce our energy

consumption. These initiatives allow our teammembers to use their curiosity, collaboration, andtenacity to help us meet or exceed our goal toreduce energy consumption 20% by 2025, basedon a 2019 baseline.
Our strategic planning for carbon and GHG
emissions extends beyond our operations. We
routinely evaluate our risk management systems
and processes for collecting, aggregating, andvalidating energy and emissions-related
information across the organization. We have alsobroadened the scope of our reporting by including
our estimated Scope 3 GHG emissions.

GovernanceTechnology

Environment

Stewardship

GREENHOUSE GASEMISSIONS
Avoiding GHG emissions is part of our strategy for reducing our impact on climatechange and maximizing the efficiency of our operations. Through disclosure, we
account for our direct (Scope 1), purchased energy (Scope 2) and other upstream
and downstream sources (Scope 3) of emissions using the Greenhouse Gas
Protocol, unless required to use other regulatory standards and measurements.
While reducing operational emissions is one of our priorities, we arecollaboratively working with suppliers and other value chain partners to reduce
Scope 3 emissions and our product footprints. We are focused on the efficiencyof our downstream transportation and logistics routes. We will continue to expand
the capabilities of conducting LCAs, analyzing the potential cradle to grave
environmental impacts of our products.
In 2020, we set a goal to reduce our total GHG emissions by 15% by 2025, basedon a 2019 baseline. Compared to 2021, our 2022 direct (Scope 1) GHG
emissions increased by approximately 12%, our indirect emissions (Scope 2)
increased by approximately 3%. Indexed to net sales, our total operationalemissions (Scope 1 + Scope 2) increased by approximately 4%.

Appendix37

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ENERGY EFFICIENCYAND CONSUMPTION
We are committed to optimizing our energy use
and continually improving the efficiency of ouroperations. Beyond reducing energy consumption,
efficiency results in productivity improvements
and extends the life of factory equipment. It alsodelivers significant value for our business throughcost savings. Our customers benefit throughinnovative products with lower emissions that help
meet their sustainability goals.
A variety of measures are deployed to reduce ourenergy consumption and GHG emissions, including
LED lighting, electrical motors and variablefrequency drives, high-efficiency compressors andboilers, improved heating and cooling insulation,
compressed air audits and leak repairs, robust
operating and maintenance standards, andupgrading process control systems. Validating ourenergy efficiency practices, 30% of Gates
manufacturing sites have ISO 50001 certifications
for energy management.

Recently, we initiated a global energy conservation
program for all manufacturing sites. Some program
highlights include:■ Energy reduction goals, specific to each facility■ Energy performance and efficiency metrics

include total consumption and are indexed to
net sales and production volume■ Process and procedural operations have been

improved through the Gates Production System
to optimize shut down procedures, shift andpersonnel planning, and equipment use■ Equipment monitoring and technologies –including energy harmonics and capacitor
banks - are used to maximize energy utilizationand savings

We aim to invest in both renewable and traditionalenergy supplies, working to improve energy
efficiency and facilitate the transition to cleaner
energy. In pursuit of solutions to optimize our utility
services, we use low carbon fuels and renewableelectricity to reduce our GHG and other air
emissions, including on-site renewable power(solar) generation and biomass fueled boilers.
Roof-top solar cells power the LED lighting used at
the car park at our Rayong, Thailand facility.
Replacing the fluorescent lighting fixtures with LED
units saves energy and costs, while enhancing
brightness and safety at the parking lot.
Our Lalru, India plant uses rice husks as a biomass
fuel for the on-site boilers. The steam generation
process is low-carbon and sustainable as theburnt rice husk ash is reprocessed as fuel.

WATER STEWARDSHIPAND CONSERVATION
Water conservation is a key component of oursustainability philosophy. Some of our global
locations operate in water-stressed regions thatare susceptible to drought. While most of ourfacilities are supplied with water from municipal
and third-party sources, a few rely on groundwateror wells. Therefore, our approach emphasizes
reducing freshwater withdrawals, and recycling or
reusing process water. All Gates sites monitor,
report, and have site-based water initiatives aimed
at achieving our goal of reducing water
consumption year-over-year.
Wastewater is also a closely monitored aspect of
our water stewardship. All sites monitor and treat
wastewater, and comply with regulatory
requirements. Sites are required to have awastewater management plan – with an annual
review, plus audits documenting water inputs aswell as discharges of all water leaving the facility.
Audits include an annual gap assessment,
mapping process, and environmental impact
evaluation.

We focus on several key areas of water
conservation:■ Recycling process water■ Identifying water waste; improving efficiencies

to reduce water use■ Utilizing low-flow water fixtures■ Updating water heating and cooling systems

to closed-loop systems as appropriate,
reducing water consumption on average by
9% over older systems■ Upgrades and investments including the

installation of new boilers, cooling towers, andwater conservation processes

39

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41

DIGITIZING MAGAZINES IN MEXICOIn Mexico, our customers and distribution partners
have a long history using printed Gates catalogues andmagazines. To reduce waste to landfill, we switched toa digital format.

WASTE
MANAGEMENT

Going digital provides the opportunity to increase ourvisibility across channels, using videos and othermultimedia links. Collaboration among Gates deMéxico team members also increased, enriching thecatalog and magazine content.

We believe minimizing waste is not just the rightthing to do, it is smart business. We continue toidentify opportunities to address and minimize
waste produced at our sites, saving costs andavoiding environmental impacts from disposition.
Our manufacturing and distribution facilities
worldwide are driven to uphold Gates high-quality
standards and to reduce scrap to help reduce ourwaste footprint.
We strive for zero waste to landfill in ouroperations. As part of our waste management
plan, we monitor more than 60 waste streams
along with their disposition and minimize
production of hazardous waste. We prioritize
recycling and composting options for many of
our waste streams, including packaging andrubber manufacturing scrap.

Scan the code toread the magazineor click here

CIRCULARITY, REUSE,
AND RECYCLING
Minimizing waste and leveraging innovation
contributes to a circular economy. Circularity is atheme that spans the entire lifecycle of Gates
products. We strive to reduce, reuse, and recycle,
exploring ways to use less material, create lesswaste, and maintain durability and dependability
in our manufactured goods. Beyond simply
reducing packaging, we seek solutions to use
reusable containers along with recycled anddegradable packaging.

GATES SUSTAINABILITY REPORT 2022

Introduction

GovernanceTechnology

Environment

StewardshipIn this section

STEWARDSHIPPolicies and Standards of Care

Product Stewardship
Workforce Health and Safety

Employee Well-being
Training and Workforce Development

Diversity, Equity, and Inclusion (DEI)
Employee Engagement
Engaging with our Communities

Gates Industrial Corporation Foundation

STEWARDSHIPAppendix

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Environment

Gates recognizes the importance of helping to build, serve,
empower, and better the communities in which we live and work.
We work together as an organization - and through a variety of
local initiatives - to support community stewardship. With afocus on mental and emotional well-being, social support tools,
and physical and financial wellness, we understand theimportance of investing in the development of our workforce
and recognize social impacts and employee well-being are
critical to the success of our organization.

POLICIES AND
STANDARDS OF CARE

PRODUCTSTEWARDSHIPOur team members are our greatest assets: they make Gates great.
Our goal is to create a positive, healthy work environment where ourpeople come first, and everyone thrives.

Gates engineers products that meet and exceed thegrowing needs and diverse challenges of ourcustomers and end-users. We strive to reduce thenegative environmental impacts of our products,
packaging and end-user applications, while
delivering improved performance and extended
product life. Our products are designed withenvironmental sustainability and safety inmind, aimed at minimizing ecological impacts,
avoidance of pollutants and harmful
chemicals and reducing GHG emissions.

Health, safety, and well-being are communicated to all teammembers through the Code of Business Conduct and Ethics, the
HSE Policy, and the Gates Global HSE Standard. Our team members
are encouraged to take a proactive role in reporting any conditions
they feel are unhealthy, unsafe, or environmentally irresponsible.
As an Equal Opportunity and Affirmative Action Employer, Gates iscommitted to ensuring equal employment opportunities for all job
applicants and team members. Employment decisions are based
upon job-related reasons regardless of gender, race, sex, color,religion, age, disability, pregnancy, citizenship, sexual orientation,
gender identity, national origin, protected veteran status, marital
status or any consideration defined by law. Gates does notdiscriminate or retaliate against applicants who inquire about,disclose, or discuss their compensation or that of other applicants.
Our policies also adhere to applicable labor laws related to thefreedom of association and collective bargaining, and the prohibitionof all forms of forced or compulsory labor.

We and our suppliers are required todeclare information related to raw
materials and ingredients that are
regulated under “Registration,
Evaluation, Authorisation andRestriction of Chemicals” (REACH),“Restriction of Certain Hazardous
Substances” (RoHS) and the Toxic
Substances Control Act (TSCA).

StewardshipAppendix

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47

WORKFORCE HEALTHAND SAFETY
Safety is a mindset at Gates. To protect our teammembers, Gates is committed to continuously
improving safety systems and nurturing a safety
culture. We encourage our team members to play
an active role in preventing and minimizing healthand safety risks. Together we share a vision forzero injuries, cultivating an incident-free workplacethat contributes positively to the lives and wellbeing of our team members.
All Gates facilities are required to comply with theGates Global HSE Standards or local regulations,whichever is stricter. Gates Global HSE Standards
are aligned with ISO 45001. Every site develops
and maintains a risk reduction action plan and an
emergency preparedness plan, which are regularly
tested. Identified risks are evaluated andprioritized for action using globally recognized risk
assessment methodologies such as ISO 12100:
Safety of Machinery, Design Risk Assessment andRisk Reduction.
Gates holds a variety of trainings andcommunications for team members to build
knowledge to reduce injuries at the facilities. Areasof training cover ergonomic risks, first aid,
electrical safety, fire safety, chemical safety, andother focus areas that make team members moreaware and promote a more safe and secure
working environment.
We are also proactive in our efforts to ensure thesafety and health of our team members,
contractors, and visitors to our sites throughvarious safety orientations. Contractors require
verification through the Gates HSE Contractor
Safety Policy, which outlines related site-andcompany-level procedures. This includes workrelated hazards (e.g., working at height or proximity
to hazardous energy equipment) and topics (e.g.,use of personal protective equipment, or PPE), toraise awareness and reduce operational healthand safety incidents.

Our key focus is always on the “proactive” reductionof risk. However, incidents do occur. In theseunfortunate circumstances, we use a thoroughincident investigation and analysis process to
identify all root causes and contributory factors.
Lessons learned are deployed globally across thecompany to target any similar risks and prevent
reoccurrence.
Gates strives to keep its Total Case Incident Rate
(TCIR) below 0.5 and Lost-Time Incident Rate (LTIR)
below 0.25. Our safety, illness and incident figures
are tracked and monitored for each facility: number
and rate of high-consequence work-related injuries,
the number and rate of recordable work-related
injuries, any fatalities that may have been causedby such injuries, the main types of work-related
injuries and the number of hours worked.
Our team members at the Pune, India facility
achieved exemplary health and safety
performance results in 2022, including:■More than 3,000 workdays without
an incident■

Zero severe and recordable injuries■

100% compliance with Gates Global HSE
Standards, and completed a Fire andElectrical Safety audit by an independent
third-party

Additionally, the Pune HSE team improved
ergonomic processes and handling practices,and enhanced safety hazard awareness andsignage throughout the plant.

EMPLOYEE
WELL-BEING
Ensuring we succeed as a business relies on
keeping our team members healthy — bothmentally and physically. This requires striking agood work-life balance and providing resources tomaintain a high level of well-being, especiallyduring difficult times. Many of our initiatives are
structured around the following four key factors:

1

MENTAL AND
EMOTIONAL
WELL-BEING

2

PHYSICALWELLNESS3

SOCIALSUPPORT TOOLS4FINANCIALWELLNESS

Gates offers a robust Team Members Assistance
Program offering a variety of wellness services,
including counseling, lifestyle coaching, andfinancial coaching. During nationwide
observances, such as Mental Health AwarenessMonth, we share resources that provide additional
information about the importance of these events.
The Gates GoodLife program supports our teammembers on their well-being journey. This
dedicated platform distributes information througha monthly newsletter that covers a host of topics,
including the latest research on well-being, recipes
for healthy eating, and recommendations forphysical activities. We also offer numerous
incentives such as fitness class discounts andphone service discounts.

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TRAINING AND
WORKFORCE
DEVELOPMENT
Gates is committed to developing and unlocking
the potential of our people, which is why we makeinvestments in training and professional
development. Our framework supports thedevelopment of leadership and professional skillsin three ways: on-the-job; learning from others;
and participating in formal training programs.
As team members work toward their career goals,
we offer a global mentoring program that
promotes knowledge transfer opportunities. Ourearly career programs develop talent, and our
structured succession planning process identifies
key talent. Production colleagues can also takeadvantage of skills-based training andcertification opportunities.

TALENT DEVELOPMENT
Gates provides the tools and resources for ourteam members to continuously learn and grow.
We have a comprehensive on-demand learning
library that offers a variety of topics and courses
in the areas of business, productivity,
professional development, and language skills
training. Additionally, our leaders work with theirteams to manage career plans - collaboratively
building our technical and leadership talent of
the future.

SUCCESSION MANAGEMENT
The succession management program enables aholistic approach to team member development.
Internal selection/promotions build pipelines oftalent that can be deployed when and where
needed. Ultimately, this program strengthens
leadership continuity in key positions, developing
and retaining intellectual capital for the future.

EAST ASIA AND INDIA MANAGERASSIMILATION WORKSHOPOur Manager Assimilation Workshop was
conducted in connection with leadership teams
across East Asia and India in 2022. Its primary
aim was to educate team members on change
management during the transition to a new
regional organizational model. Centered on
experiential learning, activities took teammembers through a series of subjects – from ajourney of personal comfort zone awareness to awillingness to face new challenges collaboratively.

CORE VALUES WORKSHOPThe Core Values Workshop shares company
beliefs (our vision and what we aspire to be),demonstrates how we conduct business properly(by ethics, compliance, and modeling our corevalues) and tracks results. We believe thisworkshop builds trust and a comprehensive
learning environment that attracts, grows, retains,
and rewards our talent. Utilizing interactive
dialogue and a variety of experiential activities,
this workshop demonstrates for our teammembers behaviors that embody Gates’ values.

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LEADERSHIP EXPEDITIONS
Throughout 2022, our Global Talentteam updated the Gates competencymodel, then branded and built out amulti-level leadership development
program to support leaders at all levels.
Core elements include virtual, selfpaced, instructor-led, or project-basedlearning, plus roundtables, mentoring,and 360-degree assessments. These
programs are expected to launch
globally later in 2023 as part of aphased, multi-year approach.

DISCOVERASCENDEXPLORE

CLIMB

SOAR

Emerging LeadersFirst Time Leaders

Front Line Leaders

Mid-Level Leaders

Executive Leaders

Discover the pathto leadership

Equip yourself for the
ascentExpand yourleadership horizons

Scale to thenext level

Take your leadershipto new heights

Individual contributors aspiring
to become leadersFirst time supervisors& people managers

Experienced Managers
with potential to advance

Sr. Managers /First Time Directors

Directors /Sr. Directors, VPs

EXPLORE PROGRAM
Our Explore Program is designed for our frontline
leaders who play an invaluable role in cultivatinga high-performing, highly engaging culture at
Gates. Participants learn leadership,
management, and critical business skills, as well
as how to prepare for the future. This isaccomplished through an interactive experiential
learning process that covers six distinct modules:■

Foundational leadership skills■

Managing performance skills■

Managing work skills■

Managing your environment■

Preparing for the future■

Critical business skills

GATES GLOBALMENTORING
We believe our people produce
their best work when they feel mostchallenged. At Gates, we seek ways
to develop and grow our teammembers through unique training
and professional development
programs. Above all else, Gates
empowers team members tonavigate their careers.
Our mentoring program promotes adiverse and inclusive culture thatprovides learning, growth andknowledge transfer opportunities
between our mentors and mentees.
The Gates Global Mentorship
Program is a 10-month mentor/
mentee partnership designed tohelp participants cultivate amutually beneficial relationship toaccelerate their careers. Not only does the
program help build new peer relationships, but it
strengthens our corporate mentoring culture.
The program partners experienced Gates teammembers to mentees from across the globe. Pairs
are created by observing what skills a mentee
wants to improve and connecting them with amentor who has an expertise in those areas.
Mentees take responsibility for reaching out andcontinuing the relationship.
The Gates Global Mentoring Program is a great
opportunity for mentors and mentees to share their
wisdom, grow into better leaders, and feel fulfilledin their role. Mentees consistently report feelingmore certain of their career directions, as well as
more engaged at Gates because of the program.
The majority of mentors reported the program
increased their satisfaction at the company.

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EMPLOYEEENGAGEMENT
DIVERSITY,
EQUITY, AND
INCLUSION (DEI)
Gates is committed to a diverse and inclusive
workplace. We strive to foster an environment
where everyone has an equal opportunity to beheard, and where they can contribute theirthoughts and be recognized for their individual
efforts. Team members are engaged through avariety of partnerships and outreach programs toidentify opportunities for meaningful connection.
This engagement will continue in future years andserve as a model to bring positive impacts to thecommunities around us.
As part of our continued efforts to raise awareness on the importance of DEI,
we engage team members and local communities in conversation andthrough trainings and sponsored activities. Our corporate policy also
encourages voluntary identification of pronouns in email correspondence. We
believe an equitable workplace at Gates is cultivated by empowering people
and creating a culture of inclusion.
In 2022, Gates established a DEI Council for its North America workforce.
Comprised of highly accomplished and collaborative team members, thisCouncil fosters an inclusive culture that embraces unique backgrounds,
talents, and perspectives. To drive a multi-year strategy – deliveringawareness and best practices – it consists of three main committees:
Communications, Culture and Branding; Diversity Recruitment; and Careerand Leadership Development. To encourage relationship building – accepting
and respecting individual attributes and experiences - three BusinessResource Groups were also formed for our North American workforce: PanAsian Leaders; LGBTQ+; and Veterans and Veterans' Families.

Engaging and connecting with people at work is important.
At Gates, we believe an engaged workforce is directly linked
to the value we provide to customers and the connections
we create in the communities where we live and operate.
The value of employee engagement can result in higher
productivity and retention rates, improved health and safety
performance, and increased company profitability.

ENGAGING
WITH OURCOMMUNITIES
Gates has a rich and unique legacy in many of thecommunities where we work. We engage with local
governments, other companies and not-for-profit
organizations that serve our communities and residents inareas such as education, health, and employment. Our
corporate foundation supports a range of programs, including
education (in particular, STEM education) and mobility
solutions for underserved populations.
In 2022, we held a virtual Earth Week celebration covering a
number of sustainability themes. Participants received aGates branded reusable shopping bag to minimize the use of
single plastic bags. Team members also received succulents
to brighten up their days and work spaces.

CAREERGOAL
In 2022, Gates participated with the Denver (Colorado)
Scholarship Foundation in an inaugural event called
CareerGOAL. CareerGOAL brought together eighty-five 9th11th grade students from Denver Public Schools for an
immersive experience to build excitement about careers withand the different functions of a manufacturing company.

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Gates recognizes the importance of giving back to
our communities and is proud to support a new
localized charitable giving program called Gates
Gives Back. Gates team members connected with
their communities and nominated a local charity
to receive a $10,000 donation from the Gates
Industrial Corporation Foundation. As part of thisprogram, the chosen charity and local teammembers will share their story of the activities
supporting the local community.

Our offices in Poland have been a beacon of
support for our Ukrainian colleagues and otherrefugee families. At the outset of the conflict, theLegnica office volunteered to support our
Ukrainian workforce and their family members.
Gates provided legal and immigration support.
Gates provided a weekly newsletter with basic
information about legal and medical resources,
education for children, and practical information
about living in Poland.
We established a “Gates for Ukraine” assistanceprogram for Ukrainian family members. In total,

Environment

Gates values community engagement and encourages teammembers to advocate for and participate in causes for which
they are passionate. Through the Gates Industrial Corporation
Foundation, we actively support civic, cultural, health andwelfare initiatives, as well as education programs andscholarships. The Foundation also includes a Matching Gift
Program - U.S. donations are matched dollar-for-dollar.

RESILIENT UKRAINE

A task force was established to implement thecompany’s responses. As a first step, we provided
funding to the German Red Cross to help the
Ukrainian people and the refugees. The Polishgovernment and people have been generous withfood, accommodations, and other basic necessities.

Technology

GATES INDUSTRIALCORPORATIONFOUNDATIONGATES GIVES BACK

Gates hopes for a peaceful resolution between
Ukraine and Russia and an immediate return todiplomacy. The safety and well-being of our teammembers in Ukraine, with whom we have been in
regular contact, is our top priority. Our management
and global workforce demonstrated empathy andsupport for Ukraine through humanitarian
donations, direct financial assistance, andacceptance of war refugees in neighboring
countries. And we continue to provide support.

Governance

110 family members benefited with cashallowances and other donations including food,bedding, clothes, soap and detergents. A “GoodStart at School” drive provided backpacks filledwith school supplies for 50 Ukrainian children.
On the occasion of Women's Day, the Legnica
office organized a cake fair, with all money
collections donated to a food collective supporting
Ukrainian refugees.
Numerous safe meeting places were provided for
Ukrainians in Legnica, catering mostly to womenwith children and seniors. These meeting places
offered Polish language courses, psychologicalsupport, workshops for children and adults, a caféand playroom– all complimentary.
At year-end 2022,
more than $32,000
in employee andcompany matching
donations wereraised for Ukrainian
relief efforts.

In 2022, donations of more than $677,000 (of which$225,000 were matched employee donations) were allocatedto 154 beneficiary organizations. These included charities
and foundations that support healthcare, mental health andwellness, education, social services, food banks, wildlife
conservation and many other impactful causes.
■$200,000 shared by our two Giving Partners, Ronald
McDonald House Charities (RMHC) Global and theDenver Scholarship Foundation■$100,000 was given additionally to RMHC Global forassistance and relief efforts in Ukraine■$83,020 was made available in scholarships for childrenof Gates team members■$25,000 donated to Wish for Wheels

EDUCATION SCHOLARSHIPS
Gates Foundation Scholarships are awarded annually to thequalifying dependents of Gates full-time associates.
Recipients receive $4,000 per year towards four years ofundergraduate studies.

StewardshipAppendix55

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StewardshipAppendix

57

LOOKING
AHEAD
Reflecting on our rich 112-year history, we envision what successlooks like over the next century. We believe our success will depend
largely on our ability to foster curiosity and tenacity to produce
pioneering solutions for power transmission and fluid power. We
believe Gates has significant opportunity to drive growth well into
the future, with sustainability playing a key role in the way weconduct our business.
To remain a pioneer in times of increasingly dynamic and complex
operating environments - with rapidly changing customer needs –we must keep progressing as a company, becoming even moreinnovative, collaborative and eco-efficient. Our team, customers,
shareholders, and suppliers will always be central to our approachand success.
We hope to build on the progress of 2022 by identifying new ways
to embed sustainability into the way we do business. We areconfident that by continuing to work to integrate sustainability wewill realize a wealth of opportunities to grow and strengthen Gates
for years to come. We will also learn from our shortcomings. And welook forward to engaging with our team members, customers,
suppliers, and investors to accomplish our goals.

GATES SUSTAINABILITY REPORT 2022

Introduction

GovernanceTechnology

Environment

StewardshipIn this section

APPENDIX
Annual Performance Indicators
UN SDGs TableGRI Content Index

Assurance Statement
Cautionary Statement

APPENDIX

Appendix

59

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GovernanceTechnology

Environment

StewardshipAppendix

61

ANNUAL PERFORMANCE INDICATORSGOVERNANCEPERFORMANCE INDICATOR

UNIT OF MEASUREMENT

2022

2021

2020

2019

Independence% of total number Directors

89

89

89

88

Diversity (female)% of total number Directors

33

44

44

38

Diversity (minority)% of total number Directors

11

11

13

13

Total Spend on Suppliers Sourced In-Region/For-Region 2% of global supplier spend (US$)

83

84

85

85

Fines or Monetary Resolutions Associated with Anti-competitive Regulations

US$

0

0

0

0

TR-AP-520a.1

PERFORMANCE INDICATOR

UNIT OF MEASUREMENT

2022

2021

2020

2019

SASB - IFRS METRIC CODE 1

Revenues Associated with Energy Efficiency/Emissions Reductions Products 3% of total net sales

4.8

N.R.

N.R.

N.R.

TR-AP-410a.1

Revenues Associated with Energy Efficiency/Emissions Reductions Products 3

US$, millions

171.6

N.R.

N.R.

N.R.

TR-AP-410a.1

Capital Investment in Property, Plant and Equipment

US$, millions

77.6

77.7

58.2

72.1

Percentage of Input Materials from Recycled and Remanufactured Content 4% of total volume input materials

N.R.

N.R.

N.R.

N.R.

Number of Patents Granted during Calendar Year

number

176

219

135

132

PERFORMANCE INDICATOR

UNIT OF MEASUREMENT

2022

2021

2020

2019

Direct GHG Emissions (Scope 1) 5

Thousand metric tons (TMT*) CO2e

108.9

96.9

86.2

92.5

TMT* CO2e

164.6

158.9

170.6

181.5

TMT* CO2e

273.5

255.8

256.8

274.0

Total Operational GHG Emissions Intensity (Scope 1+2)

TMT* CO2e/annual net sales ('000)

0.077

0.074

0.092

0.089

Total Energy Consumption (Scope 1+2) 6

Gigawatt hours (GWh)

971.8

909.8

830.8

894.4

Total Energy Consumption (Scope 1+2) 6

Gigajoules (GJ)

3,498,480

3,275,280

2,990,736

3,219,840

Total Energy Consumption Intensity

GWh/annual net sales ('000)

0.000270.000260.000300.00029

Renewable Energy Consumption

GWh

76.4

72.7

N.R.

N.R.

Board of Directors

SASB - IFRS METRIC CODE 1TECHNOLOGY

TR-AP-440b.2

ENVIRONMENT

Indirect GHG Emissions (Scope 2) 5
Total Operational GHG Emissions (Scope 1+2)

5

SASB - IFRS METRIC CODE 1

RT-IG-410
RT-IG-130a.1 TR-AP-130a.1

EXPLANATORY NOTES:

4

Certain metals used in Gates parts and products are derived from recycled content (e.g., steel and aluminium). However, Gates does notseparately track recycled input materials or remanufactured content, or the revenues attributable to said content.

1

Gates applied the sustainability accounting metrics associated with the Industrial Machinery and Goods (RT-IG) and Auto Parts (TR-AP)
sectors, as defined by the International Financial Reporting Standards (IFRS) Foundation and the Sustainability Accounting Standards
Board (SASB).

5

2

Categorized as direct spend.

Direct and indirect GHG emissions are qualified as either owned or under Gates operational control. Where actual data was not available,
estimates were used. Estimated emissions from the combustion of fuels are based on fuel consumption data and corresponding emissions
factors from: the U.K. Department for Environment, Food & Rural Affairs (DEFRA); the International Energy Agency (IEA); the United Nations
Intergovernmental Panel on Climate Change (IPCC, AR5); and the U.S. Environmental Protection Agency (EPA).

3

For 2022 reporting purposes, Gates interpreted the SASB Design for Fuel Efficiency metric (TR-AP-410.a1) to include our revenues
associated with non-ICE end-use applications such as personal mobility (including bicycles and e-bikes), and automotive and heavy-duty
EV/hybrid end-products.

6

Total energy consumption is the sum of all fuels and biomass consumption, plus purchased power and steam.

Where data is unavailable or was not reported, 'N.R.' is shown.

*This document has been updated to correct a typographical error found on page 60. Previously, the text incorrectly read 'Mmt' (Thousandsof metric tons) which has now been revised to TMT (Thousand metric tons).

GATES SUSTAINABILITY REPORT 2022

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Environment

StewardshipAppendix

ENVIRONMENTPERFORMANCE INDICATOR

UNIT OF MEASUREMENT

2022

2021

2020

2019

SASB - IFRS METRIC CODE 1

Renewable Energy Consumption% of total GWh

7.9

8.0

N.R.

N.R.

RT-IG-130a.1 TR-AP-130a.1

Renewable Electricity Generated

Kilowatt hours (KWh)

242,614

256,740

N.R.

N.R.

Total Waste Volume

Mmt

43.3

37.9

34.8

37.6

TR-AP-150a.1

Total Hazardous Waste Volume

Mmt

0.99

0.73

N.R.

N.R.

TR-AP-150a.1

Waste Recycled% of total waste volume

51.4

62.3

53.1

45

TR-AP-150a.1

Waste to Landfill

Mmt

12.7

7.3

10.1

15.1

Total Water Withdrawals

Million cubic meters

1.82

1.51

1.53

1.59

Total Water Withdrawals Intensity

Million cubic meters/annual net sales ('000)

0.51

0.44

0.55

0.52

Total Wastewater Recycled% of total water withdrawals

11.7

5.5

N.R.

N.R.

PERFORMANCE INDICATOR

UNIT OF MEASUREMENT

2022

2021

2020

2019

SASB - IFRS METRIC CODE 1

Total Number Employees

Number of Full Time Employees (FTE)

15,036

15,077

14,30014,717

RT-IG-000.B

Female Employees% of FTE

25

24

24

25

Executive/VP/Director Level Diversity, Female

%

19

21

21

18

Number of Product Recalls Issued

number0

0

0

0

Manufacturing Sites with ISO 14001 Certification 7

%

100

100

100

100

Employee Voluntary Turnover Rate

%

24.1

30.2

N.R.

N.R.

Lost Time Incident Rate (LTIR)

0.33

0.26

0.23

0.25

RT-IG-130a.1

Total Case Incident Rate (TCIR)

0.74

0.60

0.53

0.57

RT-IG-130a.1

STEWARDSHIP

TR-AP-250a.1

Employee Fatalities

number

0

N.R.

N.R.

N.R.

RT-IG-130a.1

Contractor Fatalities

number

0

N.R.

N.R.

N.R.

RT-IG-130a.1

Total Corporate Income Taxes Paid

Annual US$ (millions)

117.8

83.0

60.4

108.8

411:1

222:1

214:1

366:1

CEO Median Pay Ratio
Median Employee Compensation

Annual US$

35,01539,58335,94028,679Charitable Giving, Gates Industrial Corporation Foundation

Annual US$

677,725

612,677

1,084,981

621,690

EXPLANATORY NOTES:

Where data is unavailable or was not reported, 'N.R.' is shown.
1

Gates applied the sustainability accounting metrics associated with the Industrial Machinery and Goods (RT-IG) and Auto Parts (TR-AP)
sectors, as defined by the International Financial Reporting Standards (IFRS) Foundation and the Sustainability Accounting Standards
Board (SASB).

7All Gates manufacturing facilities have an ISO 14001 certification or conform to an equivalent standard. Of the 72 total Gates properties(manufacturing, office, distribution/warehouse), 59 have ISO or ISO-equivalent certifications or 82% total.

63

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GovernanceTechnology

Environment

StewardshipAppendix

UN SDGs TABLEENVIRONMENTGOVERNACE
SDG, GATES-ALIGNED TARGETS 1

SDG, GATES-ALIGNED TARGETS 1
12.2: Achieve sustainable management and efficiency use of natural resources

16.1: Significantly reduce all forms of violence and related death rates, everywhere

12.4: Achieve the environmentally sound management of chemicals and all wastes throughout their lifecycles

16.2: End abuse, exploitation, trafficking and all forms of violence against and torture of children

12.6: Encourage companies to adopt sustainable practices and integrate sustainability reporting

16.5: Substantially reduce corruption and bribery in all their forms

12.8: Ensure that people have the relevant information and awareness for sustainable development

16.7: Ensure responsive, inclusive, participatory and representative decision-making at all levels
13.2: Integrate climate change measures into national policies, strategies and planning

16.10: Ensure public access to information and protect fundamental freedoms, in accordance with national
and international agreements

15.1: Ensure the conservation, restoration and sustainable use of terrestrial and inland freshwater ecosystems

16.b: Promote and enforce non-discriminatory laws and policies for sustainable development

15.2: Promote the implementation of sustainable management of forests

17.11: Significantly increase the exports of developing countries

15.3: Combat desertification, restore degraded land and soil

17.17: Encourage and promote effective public, private and civil society partnerships

15.4: Ensure the conservation of mountain ecosystems
15.5: Take urgent and significant action to reduce the degradation of natural habitats

TECHNOLOGYSTEWARDSHIP

SDG, GATES-ALIGNED TARGETS 1

SDG, GATES-ALIGNED TARGETS 1

9.2: Promote inclusive and sustainable industrialization and significantly raise industry's share of
employment and GDP

3.6: Halve the number of global deaths and injuries from road traffic accidents

9.4: Upgrade infrastructure and retrofit industries to make them sustainable, with increased
resource-use efficiency

3.8: Achieve universal health coverage and access to quality essential health care services

17.8: Fully operationalize the technology and innovation capacity-building mechanisms and enhance
the use of enabling technology

3.9: Substantially reduce the number of deaths and illnesses from hazardous chemicals and air, water andsoil pollution and contamination
4.4: Substantially increase the number of youth and adults who have relevant skills for employment

ENVIRONMENT
SDG, GATES-ALIGNED TARGETS 1

5.1: End all forms of discrimination against all women and girls

6.2: Achieve access to adequate and equitable sanitation and hygiene for all

5.2: Eliminate all forms of violence against all women and girls, including trafficking and other typesof exploitation

6.3: Improve water quality by reducing pollution, eliminating dumping and minimizing the release of hazardous
chemicals and materials and substantially increasing recycling and safe reuse

5.5: Ensure women's full and effective participation and equal opportunities for leadership at all levels ofdecision-making

6.4: Substantially increase water-use efficiency across all sectors and ensure sustainable withdrawals andsupply of freshwater

10.3: Ensure equal opportunity and reduce inequalities of outcome, and promoting appropriate legislation,
policies action

6.5: Implement integrated water resources management
6.6: Protect and restore water-related ecosystems

10.4: Adopt policies and progressively achieve greater equality

7.2: Increase substantially the share of renewable energy in the global energy mix
7.3: Double the global rate of improvement in energy efficiency
7.b: Expand infrastructure and upgrade technology for supplying modern sustainable energy services

1

The United Nations Sustainable Development Goals (SDGs) is an aspirational framework enabling national governments, civil society
and businesses to identify outcomes and opportunities for collective action, by 2030. The list of SDGs and targets are the most directlyaligned to Gates' core business and impacts.

65

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StewardshipAppendix

67

GRI CONTENT INDEXGRI STANDARDS, 2021 UNIVERSAL STANDARD
GRI 2: GENERAL DISCLOSURES 2021
1. ORGANIZATIONAL DETAILSDISCLOSURE
NUMBERDISCLOSURE TITLEREPORT PAGE
NUMBER

EXTERNAL REFERENCE

2-1

Name of the Organization

Report covergates.com/us/en/about-us.html

2-1

Ownership and legal form

2-1

Location of headquarters

8

gates.com/us/en/about-us/
company-overview.html

2-1

Location of operations

8

gates.com/us/en/
customer-support/locations.html

2-2

Boundary for inclusion

10

2-2

Audited consolidated financial statements or financial information filed on public record

2-3Specify the reporting period

2-3Explanation of approach used for consolidating the financial information

2-3

Whether financial reporting period aligns with sustainability reporting

10

2-3

Date of sustainability report

10

2-3

Point of contact at company

2-4

Restatement of prior period results

2-5

Describe company policy and practice for seeking external assurance

2-5

Whether company's sustainability report is externally assured

COMMENTS

investors.gates.com/financials/
annual-reports/default.aspx

investors.gates.com/financials/
annual-reports/default.aspx

10

investors.gates.com/financials/
annual-reports/default.aspx
investors.gates.com/financials/
annual-reports/default.aspx

Yes. Sustainability reporting aligns with the period of financial
reporting for fiscal year 2022, unless otherwise noted.
investors.gates.com/financials/
annual-reports/default.aspx
investors.gates.com/investor-resources/
investor-contacts/default.aspx

10

No material restatements. This report marks the first time Gates isreporting under the IFRS-SASB sector-specific indicators. Where
prior years data is unavailable, none is shown.

Report Appendix:
Assurance Statement

Gates achieves external assurance for its GHG emissions inventory
and water withdrawals data. Gates does not obtain assurance for its
entire sustainability report.

GATES SUSTAINABILITY REPORT 2022

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GovernanceTechnology

Environment

StewardshipAppendix69

2. ACTIVITIES AND WORKERSDISCLOSURE
NUMBERDISCLOSURE TITLEREPORT PAGE
NUMBER

2-6

Sector(s) business operates in

2-6

Describe its value chain

26

2-6

Other relevant business relationships

26

2-7

Total number of employees

8gates.com/us/en/about-us/
company-overview.html

2-7

Total number of employees, by type, gender and location

Report Appendix:
Annual Performance
Indicators

investors.gates.com/financials/
annual-reports/default.aspx

2-7

Methodologies and assumptions used to quantify employees

2-7

Describe any fluctuation in the number of employees during the reporting period

2-8Total number of workers who are not employees

2-8Methodologies and assumptions used to quantify non-employees

EXTERNAL REFERENCECOMMENTS

gates.com/us/en/industries.html

Gates discloses the number of full-time employees as of the final dayof the reporting period

3. GOVERNANCEDISCLOSURE
NUMBERDISCLOSURE TITLEREPORT PAGE
NUMBER

EXTERNAL REFERENCE

2-9

Governance structure, including committees of highest governance body18

investors.gates.com/governance/
governance-documents/default.aspx

2-9

List the committees of highest governance bodies

investors.gates.com/governance/
governance-documents/default.aspx

2-9

Describe the composition of the highest governance bodies

investors.gates.com/governance/
governance-documents/default.aspx

2-10

Describe the nomination and election processes for the highest governance bodies

investors.gates.com/governance/
governance-documents/default.aspx

2-10

Describe the criteria for nominating and selecting highest governance bodies

investors.gates.com/governance/
governance-documents/default.aspx

2-11

Chair independence

investors.gates.com/governance/
governance-documents/default.aspx

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

investors.gates.com/governance/
governance-documents/default.aspx

2-13

Delegation of responsibility for managing impacts

investors.gates.com/governance/
governance-documents/default.aspx

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

investors.gates.com/governance/
governance-documents/default.aspx

COMMENTSGATES SUSTAINABILITY REPORT 2022

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GovernanceTechnology

Environment

Stewardship

3. GOVERNANCEDISCLOSURE
NUMBERDISCLOSURE TITLEREPORT PAGE
NUMBER

2-15

Describe the processes for the highest governance body to ensure that conflicts ofinterest are prevented and mitigatedinvestors.gates.com/governance/
governance-documents/default.aspx

2-15

Report whether conflicts of interest are disclosed to stakeholders

investors.gates.com/governance/
governance-documents/default.aspx

2-16

Describe whether and how critical concerns are communicated to the highest governance bodyinvestors.gates.com/governance/
governance-documents/default.aspx

2-16

Total number and the nature of critical concerns that were communicated tothe highest governance body during the reporting period

investors.gates.com/governance/
governance-documents/default.aspx

2-17

Describe the collective knowledge, skills and experience of the highest governance bodies

investors.gates.com/governance/
governance-documents/default.aspx

2-18

Describe the processes for evaluating the performance of the highest governance bodyinvestors.gates.com/governance/
governance-documents/default.aspx

2-18

Describe independence of evaluations and any actions taken in response to the evaluations

investors.gates.com/governance/
governance-documents/default.aspx

2-19

Describe the remuneration policies for members of the highest governancebody and senior executives

investors.gates.com/governance/
governance-documents/default.aspx

2-20

Describe the process for designing remuneration policies

investors.gates.com/governance/
governance-documents/default.aspx

2-21

Report on the annual total compensation ratio

EXTERNAL REFERENCE

Report Appendix:
Annual Performance
Indicators

investors.gates.com/sec-filings/
default.aspx see Proxy Filings

EXTERNAL REFERENCECOMMENTS

4. STRATEGY, POLICIES, AND PRACTICESDISCLOSURE
NUMBERDISCLOSURE TITLEREPORT PAGE
NUMBER

2-22

Statement on sustainable development strategy

12

2-23

Describe company's policy commitments for responsible business conduct,
including human rights

2-23

Provide links to policy commitments, if publicly available

18

gates.com/us/en/knowledge-center/resource-library/policies-and-statements.html
see Gates Human Rights Policy and Modern
Slavery Act Statement
gates.com/us/en/knowledge-center/resource-library/policies-and-statements.html

COMMENTS

Appendix71

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StewardshipAppendix73

4. STRATEGY, POLICIES, AND PRACTICESDISCLOSURE
NUMBERDISCLOSURE TITLEREPORT PAGE
NUMBER

2-23

Describe how policy commitments are communicated to workers, business partners,
and other relevant parties

gates.com/us/en/knowledge-center/resource-library/policies-and-statements.html

2-24

Describe how company embeds each of its policy commitments throughout its activities

gates.com/us/en/knowledge-center/resource-library/policies-and-statements.html

2-25

Describe the processes to remediate negative impacts

gates.com/us/en/knowledge-center/resource-library/policies-and-statements.html

2-25

Describe the company's approach to identify and address grievances

gates.com/us/en/knowledge-center/resource-library/policies-and-statements.html

EXTERNAL REFERENCECOMMENTS

Gates employees and outside parties have a variety of ways toseek advice or report their concerns about unethical and unlawful
behavior set forth in the Gates Whistleblower Policy. In addition,
any employee may, in his or her sole discretion, confidentiallyreport to the Audit Committee or General Counsel, openly oranonymously, any Accounting Allegation, Compliance Allegation
or Retaliatory Act by accessing the web portal of Gates’
third party provider atgatescorp.ethicspoint.com

2-26

Describe the mechanisms for seeking advice on implementing policies
and raising concerns about its business conduct

2-27

The total number of significant instances of non-compliance with laws and regulations

Report Appendix:
Annual Performance
Indicators

Gates had no significant instances of non-compliance

2-27

The total number and value of significant fines of non-compliance with laws and regulations

Report Appendix:
Annual Performance
Indicators

Gates had no violations of or fines resultant
from non-compliance

2-28

Participation in industry associations, other membership associations,and advocacy organizations

26

Gates does not make political donations to candidates or advocate
for political causes. Gates is an active member of industry
associations and professional societies.

5. STAKEHOLDER ENGAGEMENTDISCLOSURE
NUMBERDISCLOSURE TITLEREPORT PAGE
NUMBER

2-29

Describe the approach used to engage with stakeholders and how they are selected

11

2-30

Percentage of total employees covered by collective bargaining agreements

EXTERNAL REFERENCECOMMENTSGATES SUSTAINABILITY REPORT 2022

LRQA INDEPENDENTASSURANCE STATEMENTRELATING TO GATES GHG & WATER USE ASSERTION FOR THE
CALENDAR YEAR 2022
This Assurance Statement has been prepared for Gates Corporation in accordance with our contract.

TERMS OF ENGAGEMENTLRQA was commissioned by Gates Corporation (Gates) to provide independent assurance of its
greenhouse gas (GHG) emissions and water inventories (“the Inventory”) for the calendar year 2022 (CY22) against the assurance criteria below to a reasonable level of assurance and materiality of 5% using
LRQA’s verification procedure and ISO 14064 - Part 3 for greenhouse gas emissions. LRQA’s verification
procedure is based on current best practise and is in accordance with ISAE 3000 and ISAE 3410.

Introduction

Technology

Environment

StewardshipAppendix

Based on LRQA’s approach, we believe that Gates has, in all material respects:■

Met the requirements of criteria listed above; and■Disclosed accurate and reliable performance data and information as summarized in Table 1 below.

The opinion expressed is formed on the basis of a reasonable level of assurance and at the materiality of 5%.

Table 1. Summary of Gates Key Data for CY 2022:
SCOPE

CATEGORYQUANTITYUNIT

Scope 1 Emissions

Direct108,939

mt CO2e

Location-Based

164,607

mt CO2eMarket-Based1

164,607

mt CO2e

Biogenic Emissions

Direct Biogenic carbon dioxide (CO2)18,862

mt CO2Other Data

Water Withdrawn

1,816,731

cubic meter

1

Scope 2 Emissions

Note 1: Scope 2, Location-based and Scope 2 Market-based are defined in the WRI/WBCSD GHG Protocol, 2015

• Gates’ reporting methodologies for the selected datasets;• World Resources Institute / World Business Council for Sustainable Development Greenhouse Gas

Protocol: A corporate accounting and reporting standard, revised edition (otherwise referred to as
the WRI/WBCSD GHG Protocol) for the GHG data1.

■ Evaluating the accuracy and reliability of data and information for only the selected indicators listed below:• Direct (Scope 1) and Energy Indirect (Scope 2) GHG emissions; and• Water withdrawn.

Our assurance engagement excluded the data and information of Gates’ suppliers, contractors and any
third-parties mentioned in the Inventory.
LRQA’s responsibility is only to Gates. LRQA disclaims any liability or responsibility to others as explainedin the end footnote. Gates’ responsibility is for collecting, aggregating, analysing and presenting all thedata and information within the Inventory and for maintaining effective internal controls over the systems
from which the Inventory is derived. Ultimately, the Inventory has been approved by, and remains the
responsibility of Gates.
1

https://ghgprotocol.org/

75

LRQA’S OPINION

Our assurance engagement covered Gates’ global manufacturing, warehousing, and distribution center
operations and activities (except offices) and specifically the following requirements:■ Verifying conformance with:

Governance

LRQA’S APPROACH
LRQA’s assurance engagements are carried out in accordance with our verification procedure. The
following tasks were undertaken as part of the evidence gathering process for this assurance
engagement:■

conducting site tours of the facilities and reviewing processes related to the control of GHG
emissions data and records;■

interviewing relevant employees of the organization responsible for managing GHG emissions data
and records;■

assessing Gates’ data management systems to confirm they are designed to prevent significant
errors, omissions or mis-statements in the Inventory by reviewing the effectiveness of data
handling procedures, instructions and systems, including those for internal quality control; and■verifying historical GHG emissions data and records back to source for the calendar year 2022.

GATES SUSTAINABILITY REPORT 2022

Introduction

Technology

Environment

StewardshipAppendix

77

CAUTIONARY STATEMENTLRQA’S STANDARDS, COMPETENCE AND INDEPENDENCE
LRQA implements and maintains a comprehensive management system that meets accreditation
requirements for ISO 14065 Greenhouse gases – Requirements for greenhouse gas validation andverification bodies for use in accreditation or other forms of recognition and ISO/IEC 17021 Conformity
assessment – Requirements for bodies providing audit and certification of management systems thatare at least as demanding as the requirements of the International Standard on Quality Control 1 andcomply with the Code of Ethics for Professional Accountants issued by the International Ethics Standards
Board for Accountants.
LRQA ensures the selection of appropriately qualified individuals based on their qualifications, training
and experience. The outcome of all verification and certification assessments is then internally reviewed
by senior management to ensure that the approach applied is rigorous and transparent.
SignedGovernance

Dated: 05 June 2023

Kate Pagan
LRQA Lead Verifier
On behalf of LRQA, Inc.
2101 CityWest Blvd, Houston, TX 77042
LRQA reference: UQA00002225 / 5665018
LRQA Group Limited, its affiliates and subsidiaries, and their respective officers, employees or agents are, individually andcollectively, referred to in this clause as 'LRQA'. LRQA assumes no responsibility and shall not be liable to any person for any
loss, damage or expense caused by reliance on the information or advice in this document or howsoever provided, unless that
person has signed a contract with the relevant LRQA entity for the provision of this information or advice and in that case any
responsibility or liability is exclusively on the terms and conditions set out in that contract. The English version of thisAssurance Statement is the only valid version. LRQA assumes no responsibility for versions translated into other languages.
This Assurance Statement is only valid when published with the Inventory to which it refers. It may only be reproduced in its
entirety. Copyright © LRQA, 2023.

This Sustainability Report contains forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. In some cases, you can identify these forward-looking statements by the use of words such as“will,” “believes,” “aims,” “strives,” “target,” “may,” “will,” “seeks,” “trends,” “plans,” “estimates,”“anticipates” “hopes” or similar statements or variations of such terms and other similar expressions,which generally are not historic in nature. These statements include, but are not limited to, statements
related to: our ambitions, goals, targets, plans and objectives, including our plans and commitments todecrease greenhouse gas emissions, reduce total energy consumption, reduce work-force lost-time
incidents, reduce water consumption and increase waste diversion from landfills; our expected or desired
progress in the areas of sustainability, corporate governance, product innovation, health and safety, DEI,
and community stewardship; and the expected or desired outcomes and effects of any such actions. We
base these forward-looking statements on management’s current expectations, however we caution that
actual results or outcomes may differ from those expressed in such statements due to a variety offactors. Forward-looking statements are subject to various risks and uncertainties, including, among
others, the risks and uncertainties described under the section entitled “Risk Factors” of the Company’s
Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities andExchange Commission (“SEC”), as such factors may be further updated from time to time in the
Company’s filings with the SEC, which are accessible on the SEC’s website at www. sec.gov. These
factors should not be construed as exhaustive and should be read in conjunction with the othercautionary statements that are included in the Company’s filings with the SEC. Forward-looking
statements contained in this report speak only of as of the date they were made, and the Company
undertakes no obligation to publicly update any forward-looking statement whether as a result of new
information, future developments or otherwise, except as required by law. The numbers and datacontained in this Sustainability Report have not been audited. All references to “material,” "materiality" orassessments related thereto should not be construed as a statement or determination that such items
are material for purposes of U.S. securities laws.

ABOUT THE COVER
To keep demonstrating our commitment with sustainability and adaptability to improve
the quality of life for individuals and communities alike, we created a custom bamboo
bike in collaboration with Bamboocycle, a Mexican company that sources its raw, clean
and renewable materials locally. This collaboration serves as a powerful example of how
we are working to show the diverse image of Gates, creating awareness on ecology,
mobility, quality of life, modernity and a new perspective of the future. By working closelywith creators, we can offer opportunities for them to expand their curiosity and vision,
advancing the way the world moves.
Thanks to the bold and innovative thinking that has always characterized Gates, we havequickly established ourselves as one of the most exciting options among cyclists, andthat's what we were looking for when we found Bamboocycle: a mobility project with theeagerness to promote new alternatives in design and materials, with products createdresponsibly and with passion, and overall, with people determined to transform the future
into a reality.