Closing the loop on fashion.

SUSTAINABILITYREPORT 2023

​ ABLE OFTCONTENTSINTRODUCTION
Closing the loop on fashion
Highlights 2023

Message from the CEO

02

03

05

Environmental savings

06

Our employee values

10

Our people

Recover™ production network
Our product line

07
11

13

The Recover™ process

16

Recover™ integration in the
supply chain

18

Raw Materials

Fiber applications

17

19

OUR SUSTAINABILITY
APPROACH

ABOUT THIS REPORT

Sustainability Approach20

Circular products

22

Our sustainability vision

Responsible production
and supply chain
Agents of change

21

34
42

Reporting standards and scope.
Governance structure
Anti-corruption

62

63

Stakeholder engagement

64

Frameworks and assurance

66

Materiality assessment

65

Sustainability Report | 01

CLOSING
THE LOOPON FASHION

Recover™ is a materials science company thatis reimagining the apparel industry by producing
innovative low-impact, high-quality recycled cotton
fiber and cotton fiber blends. We provide a scaled

solution to a global environmental issue for which ourcustomers are demanding a solution.

VISION& MISSION

We enable large-scale sustainable change in fashion
through business value and inspiration.

WHAT
DEFINES US?

We are a purpose driven company and our purpose

shapes our culture and character and serves as thebasis for how we act and make decisions.

Sustainability Report | 02

HIGHLIGHTS 2023

TEAM GROWTH
One of the most noticeable changes at
Recover™ in 2023 was the growth of our team,with a 38% increase in our workforce as annual

average compared to 2022. We onboarded

many new team members, all incredibly eager
to join in our mission for circularity. Our People& Talent department bet on diversity, witha team of 14 nationalities and highly skilled
personal from all generations.

PARTNERSHIPS
We made important commercial
advances during 2023, completingproduct launches with new brandpartners. We launched the REICONICS
innovative denim project with Evlox
and Jeanologia, made Americanclassics sustainable with Lands’ End,co-created editorial content for the
final consumer with C&A, and more.
We also signed long-term agreementswith new supply chain partners such
as Valdese and Evlox.

RECOGNITION
Recover™ continued to gain recognition
around the globe and build its brandawareness, attaining 238 placements across
97 different media outlets. The company was
also a frontrunner in the industry with twoawards, as we received a Lovie Award for our
website and Just Style Excellence awards
in Business Expansion, Environmental, andInvestments.
We attended numerous industry events,
speaking at 15 conferences and shows
around the world, and exhibited our fiber atvarious trade shows such as Textile Exchange
Conference and ITMA.

Sustainability Report | 03

HIGHLIGHTS 2023

RESPONSIBLE
SOURCING

In 2023, our multidisciplinary teamperformed
Environmental,
Social,Governance (ESG) Assessments on all
our textile waste suppliers in Bangladesh,
where we source most of our waste, toidentify potential improvements. The
corresponding improvement plans weredeveloped and shared with our suppliers,
who have agreed to implement these
improvements during 2024.

R&D INNOVATIONS
Recover™ continued to push the boundaries
of innovation in recycled cotton in 2023,
announcing a new partnership and groundbreaking project with Rieter and Polopique.
The project was created in response to amajor challenge facing the textile industry:
producing fine ring and compact yarns witha higher proportion of mechanically recycled
fibers. By optimizing Recover’s mastery of thelatest recycling technology, Rieter’s expertisein textile machinery, and Polopiqué’s textile
manufacturing proficiency, a high-quality
sustainable solution was created that is both
combed and ring spun. We also continued todevelop both our physical and digital tracer
system to bring the solution to the market.
This tracer solution will allow Recover’s
customers to verify the presence of Recover™
recycled cotton to support making credibleand substantiated sustainability claims about
recycled content.

LOW IMPACT
Recover™, within its commitment toproduce recycled cotton fiber withthe lowest environmental impact, hascontinued measuring not only Scope
1 and 2 but also Scope 3 greenhousegas (GHG) emissions. In November
2023, we signed a Commitment Letter
indicating our dedication to setting
decarbonization
Science-Based
Targets within 24 months. Additionally,in 2023, 64% of Recover’s own
operation’s waste was recycled at its
end-of-life, with less than 3% sent tolandfill.

Sustainability Report | 04

MESSAGE
FROM THE CEO
At the same time, we’ve taken steps to hold ourselvesto the highest standards. We reaffirmed our supportof the Ten Principles of the United Nations Global

Compact in the areas of Human Rights, Labor,
Environment, and Anti-Corruption – applying thiscommitment to our operations while encouraging
it in our value chains (our suppliers, consumers,

communities, and other business relationships).

We also continue to strive to meet our long-term
Recover™ Sustainability Strategy, based on the 17

Sustainable Development Goals set by the United
Nations, whilst delivering the highest level oftransparency on our business impacts.
Dear reader,
As I step into the role of CEO at Recover™, I am

inspired by the passion for circularity and the ability
to make a real, meaningful, and large-scale positivechange for sustainability in the global textile industry.

It is who we are, and this commitment is seen at
all levels across the company. I believe it is up tocompanies like Recover™ to push for continued
circularity and pave the way for constant innovationand improvement. I would also like to take theopportunity to thank Alfredo Ferre and the Ferrefamily for leading and bringing Recover™ to where it istoday. His immense business and product knowledge

has been essential, and I’m honored to continue

Looking toward 2024, we aim to ensure operationaland commercial excellence while continuing toinnovate and lead disruptive change for the appareland textile industries. The urgency for change isbacked by strong political support, and as new

regulations come into effect, Recover™ can help
brands and retailers to successfully navigate theshifting landscape. I believe Recover™ is well-

positioned in the market to be a leader both in theindustry and in the global business world, and we areready to grow fast, but responsibly. Our Bangladeshi
factory is now fully operational and has experienced
remarkable improvements in quality output, quickly

establishing itself as a key player in the country’s
textile industry.

counting on his expertise and getting to work with

Finally, I would like to thank the teams and partners

Sustainability Officer.

represented by the work reflected in this report.

him in his new role as Chief Product, Innovation, and2023 was a challenging year globally, with escalating
geopolitical tensions, devastating natural disasters,

and increasing costs of raw materials and energy,
paired with a slowing in demand. However, in thisreport, you will see how we’ve continued to work
hard to make an impact, not only by keeping end-

whose leadership, dedication, and creativity are
Though there remains much to do, together we cantruly make an impact and I am personally committed
to keeping Recover’s positive momentum going, to
get us closer to achieving our mission.
ANDERS SJÖBLOM

of-life cotton products and waste out of landfills or

incineration but also by partnering with some of theindustry’s biggest names to edge the fashion andtextile industry closer to circularity.

Sustainability Report | 05

ENVIRONMENTAL
SAVINGS

In 2023, from the RCotton produced between our hubs in Spain, Bangladesh,and Pakistan, and the RColorBlend produced between our hubs in Spain and
Bangladesh, we achieved the following environmental savings when comparedwith using conventional alternatives:

WATER

20 245 115 000
liters, equivalent to
8 098 Olympic-sizedswimming pools

GLOBALCARBONEMISSION
19 734 370 kg CO2
eq, equivalent to theannual emissions of
4 385 people

LAND USE

37 113 930 m2,
equivalent to 62.9%of Manhattan

ENERGYEUTROPHICATION

162 153 880 kWh,equivalent to theannual electricity
use of 42 450
people237 448 kg PO43 eq*These savings were calculated using data from our Recover™ LCA Spain verified by EcoReview (2022).
*The savings corresponding to the fiber produced in the hubs in Bangladesh and Pakistan were calculated using
the LCA from our Spanish hub, however in 2024, both Bangladesh and Pakistan will undergo their own LCA.

Sustainability Report | 06

OUR PEOPLE312

TOTAL WORKFORCE[ 31st December 2023 ]Recover™ has grown significantly over the last two years and grew 38% in the past year
alone as an annual average 2023 compared to 2022. In 2022, we opened our hub in
Bangladesh, and since then our global productivity capacity has been increasing.

A DIVERSE COMPANY
We respect and value diversity and our ambition is to build a company with a diverse
workforce. We recognize individuals’ needs and provide a fair and safe environment where
employees feel the freedom to be themselves while feeling included.

We now operate in two countries and have 14 nationalities in the Recover™ team. Overall,our gender ratio is 23.7% women and 76.3% men.

As part of Recover’s commitment to inclusivity, Recover™ in Spain supports the ONCE
Foundation, a non-profit dedicated to hiring individuals with disabilities.

Sustainability Report | 07

OUR PEOPLE

UNITED STATES (0,7%)

SPAIN (28,5%)

BANGLADESH (70,8%)

GEOGRAPHIC
DISTRIBUTIONWOMEN (24%)
MEN (76%)

WOMEN (16%)
MEN (84%)

BGD
GLOBALGENDER RATIOGENDER RATIOBANGLADESHWOMEN (43%)
MEN (57%)

ESP
GENDERRATIO SPAIN

Sustainability Report | 08

OUR PEOPLEBANGLADESH [ 221 ]PRODUCTION [ 144 ]OFFICE [ 77 ]SPECIALISTS [ 144 ]MID - MGMT [14]SPECIALISTS [ 63 ]

21

2

12

123

12

51

SPAIN [ 89 ]PRODUCTION [ 23 ]OFFICE [ 66 ]MID - MGMT [ 5 ]TOP - MGMT [6]MID - MGMT [21]SPECIALISTS [ 39 ]

1

11

25

SPECIALISTS [ 18 ]

5

1

17

5

10

14

UNITED STATES [ 2 ]OFFICE [ 2 ]MID - MGMT [ 1 ]TOP - MGMT [1]11* All data corresponds to the 31st of December 2023.

Top Management: All employees at Director level, with Global responsibility across the organization.

Middle Management: All employees at Management level (managing and/or supervising a team), with Global or Local responsibility.
Specialist: Other employees, including individual contributors, technical profiles, or manual tasks.

GENERATION DISTRIBUTION
5%[ >50 ]

15%
[ 41-50 ]31%[ 31-40 ]49%[ <30 ]

Sustainability Report | 09

OUR EMPLOYEEVALUESWE CARE,WE ARE BRAVE,WE ARE CURIOUS& WE GET IT DONE!
WE CAREWe are committed to fostering a culture of care and respectthat extends to our planet, employees, and society.
We cultivate a transparent, multicultural, and inclusive
environment, anchored by a meaningful purpose.
We pursue excellence in quality while upholding thehighest ethical standards in everything we do.

WE ARE BRAVE
We are brave, passionate, determined, and straightforward.
We feel empowered and highly motivated.

We act with honesty, professionalism, and grit, wepersevere and don’t give up.

WE ARE CURIOUS
We are curious, open, creative, and eager learners.

We act with an innovative mindset and a proactive
approach to customer needs.
We foster a positive culture that embraces learning fromfailure.

WE GET IT DONE
We operate with efficiency and accountability, driven by
performance and results.

We are agile and fast problem solvers, with a growth mindset.
We collaborate and leverage each other’s strengths.

Sustainability Report | 10

RECOVER™
PRODUCTIONNETWORKSPAIN
Recover’s center of innovation is located at the production
facility in Banyeres de Mariola, Spain. Recover™ has
been pioneering sustainable materials at this location

since 1947, and since then the facility has grown toincorporate various factories and a dedicated laboratory.
The laboratory team oversees the implementation of

the quality management system and the quality policy
at Recover™ , guaranteeing a reliable product throughsystematic quality control and improvement.

Our corporate headquarters is located in Madrid, Spain.

PAKISTAN
Recover™ opened its first licensed facility (with partner
ADM) in Pakistan in mid-2022 primarily focused on
supplying recycled cotton to denim factories in theregion.

Sustainability Report | 11

RECOVER™
PRODUCTIONNETWORKBANGLADESH
In 2022, recognizing the need to advance sustainabletextile production in Bangladesh, a country known for

its robust textile manufacturing sector, we officiallyopened our Bangladeshi production hub. The hub wasconstructed in partnership with the conglomerate
Bangladesh

ExportImportCompany

Limited(BEXIMCO) whose commitment to sustainability

coupled with its impressive presence in Bangladesh
made it the perfect partner.
Since

opening,thefactoryhasexperienced

remarkable growth and has quickly established itself
as a key player in the Bangladeshi textile industry.

The factory’s state-of-the-art facilities and laboratory
and its innovative recycling processes have set a

new standard for circular production. Our skilledworkforce in the production hub has been able toestablish our cutting-edge technologies to transformtextile waste into high-quality fiber.

FURTHER EXPANSION
Recover’s global presence is rapidly expanding withadditional locations planned for key textile hubsaround the world.

Sustainability Report | 12

OUR PRODUCTLINESEVERY BATCH OF FIBERPRODUCED IS TESTEDTO ENSURE PHYSICALAND CHEMICAL QUALITY.
Sustainability Report | 13

OUR PRODUCTLINESRCOTTON FIBER 100% RECYCLED
FIBER USING MINIMAL SOLVENTSAND WATER AND IT IS SUITABLEFOR OVERDYEING.
The composition of the final product must include a minimum of 15% RCotton fiber.
Within our RCotton range, we have RPure, RMix and RDenim.

100%
Recycled
cottonRecover™ fiber made from unblended recycled cotton fiber, suitable for overdyeing.

≥90%
Recycled
cotton≤10% otherfibers (polyester,viscose...)Unblended 100% Recover™ recycled cotton fiber from cotton mix textiles. RMix contains traces of other fibers (OF)due to their presence inside the textile waste that we recycle.

Pre- andpost-consumer≥ 80% recycled cotton≤20% otherfibers (polyester,viscose...)Unblended 100% Recover™ recycled cotton fiber from pre- and post-consumer denim. RDenim contains traces ofother fibers (OF) due to their presence inside the denim garments that we recycle.

Sustainability Report | 14

OUR PRODUCTLINESOUR RCOLORBLEND PRODUCTRANGE IS CREATED USING OURHIGHLY VALUABLE PROPRIETARYSYSTEM THAT INCORPORATESALL OF OUR EXPERTISE IN FIBERRECYCLING.

Recover™ recycled cotton fibers are blended with other carriers’ fibers that have been low-impact dyed tocreate new fiber blends, with the desired color and ready to spin.
Within our RColorBlend range we have RBlue and REarth.

52%
Recycled
cotton48%
Recycled
polyester

A vibrant blend of Recover™ recycled cotton and recycled polyester (RPET). Standard blend 52% Recover™ recycled
cotton + 48% RPET.
Custom blends available.

50%
Recycled
cotton50%
Organic
cottonA natural blend of Recover™ recycled cotton and organic cotton, OCS certified (Organic Content Standard).
Custom blends available.

Sustainability Report | 15

THE RECOVER™
PROCESSHOW DO WE ACHIEVE
CIRCULARITY AT
SCALE?
PROCUREMENT OF TEXTILE WASTE

Instead of being sent to landfills or incinerated (energy valorization), textile
waste is repurposed by Recover™ .

TEXTILE WASTE IS CONVERTED TO
RCOTTON
Using optimized mechanical recycling technology, Recover™ converts the
textile waste into RCotton recycled cotton fiber. The process includes cutting
the material into smaller pieces, treating it only with a preparatory anti-static
spray and finally processing them inside the Recover™ recycling machine. The
machine optimization formula proprietary and exclusive to Recover™.
RCotton is primarily used to replace conventional cotton and organic cotton in
textiles.

GLOBAL SUPPLY CHAIN INTEGRATIONThe Recover™ Tech Support team works closely with spinning mills and weavers
to give them best practices and guidance to optimize the quality of the yarn andfabrics produced with Recover™ RCotton.

Sustainability Report | 16

RAW
MATERIALS

PRE-CONSUMER WASTE
Describes material diverted from the waste stream
during the manufacturing process. Also called postindustrial waste.

POST-CONSUMER WASTE
Describes material generated by households or bycommercial, industrial, and institutional facilities in theirrole as end-users of the product that can no longer beused for its intended purpose. This includes returns ofmaterials from the distribution chain.

Source: https://www.acceleratingcircularity.org/primer

Sustainability Report | 17

INTEGRATION IN THE
SUPPLY CHAIN

Recover™ is a nominated supplier capable of integrating into existing
supply chains, garment manufacturers, spinners, and weavers.

01

06

02

05

03
04

01

03

05

Textile waste from
Retailer/ Brand

Textile waste is submitted tobe recycled.

RecoverTM fiber

Low-impact, high-quality
Recover™ fiber is produced,
ready to integrate into the
supply chain.
Custom fabrics

Local weavers create custom
fabric developments, readyto be used for garment
production.

02

04

06

The RecoverTM process

The Recover™ hub uses
its innovative technology toprocess the textile waste clips.
Recycled yarns

Local spinning partners
create new yarns fromRecover™ recycled cotton
fiber.
Recycled low-impact productLocal garment manufacturers
produce finished goods fromthe waste.

Sustainability Report | 18

FIBERAPPLICATIONSFLAT KNITSHOME TEXTILES

DENIM

KNITS

NON-WOVENWOVENUPHOLSTERYACCESSORIESRECOVER™ FIBER CAN BE
USED FOR A BROAD ARRAY OF
APPLICATIONS, MOST NOTABLYGARMENTS, ACCESSORIES ANDHOME TEXTILES.
Sustainability Report | 19

SUSTAINABILITY
APPROACH

As a frontrunner in sustainability and circularity in the textiles industry,
Recover™ is always looking for the next steps to take to achieve its missionof circularity. This mission is the inspiration for the Recover™ Sustainability
Strategy, approved in 2022 and reviewed on an annual basis, supported bythree key pillars: Circular products, Responsible production and supply
chains and Agents of change.

FIRST PILLAR:
CIRCULAR PRODUCTS
2030 objectives:

Recover™ is aligned with Science Based targets and our
products are made with minimal environmental impact.
Recover™ is a zero-waste company.

Recover™ products and practices are aligned with acircular textiles system.

SECOND PILLAR:RESPONSIBLE PRODUCTION& SUPPLY CHAINS
2030 objectives:

Recover™ operates according to the highest environmental
and social standards and is third-party certified.
Recover™ products and supply chains are traceable.

Recover™ supply chains are sustainable and socially just.

THIRD PILLAR:
AGENTS OF CHANGE
2030 objectives:

Recover™ is a leader in transparency.

Recover™ inspires and drives sustainable transformationand leadership within the company community andwider industry.
Recover™ drives iconic & impactful ESG initiatives.

Sustainability Report | 20

SUSTAINABILITY
VISIONWe voluntarily initiated and defined the entire
process to conduct Compliance Assessments under
ESG requirements for all our textile waste suppliersin Bangladesh, and it was also the first year that our
Bangladeshi hub performed the Higg FEM and FSLM
self-assessment to measure the environmental andsocial performance of the facility. In 2024, we aim
to carry out a Life Cycle Assessment (LCA) on the
Recover™ fiber produced in Bangladesh, as well as
in Pakistan.

Circularity is part of our DNA at Recover™ and thisgoes far beyond having a recycled product. It is about
integrating sustainable practices in all aspects of thebusiness, those that impact both people and theenvironment, and ensuring the continued sustainable
development of the company. We are proud to beamong the companies that are truly committed to
improving the environmental and social performanceof our products and operations, as well as that of our
supply chain. These commitments are how we holdourselves accountable, provide us with clear areas
to focus on, and support our drive to be transparent
about our progress.

In this way, we continue to report our progress inthese annual sustainability reports, as well as review
and validate our 2022-2030 Strategic Sustainability

pillars, ensuring that they are up-to-date and still
relevant for our mission and vision. As part ofour membership with Cascale, we also signed a

Commitment Letter indicating that we are commited

to setting science-based targets (SBTs) to reduce
our greenhouse gas emissions within 24 months.

2023 was our first full year of operations at our

hub in Bangladesh, and we continued to focus

on embedding a culture of health, safety, andenvironmental stewardship with our workers there.

In Spain, we mainly focused on implementing further
improvements and best practices, and we verified
both our vFEM and vFLSM scores.. We also continued
to push the boundaries of innovation with numerous
R&D projects, such as increasing the percentage of
Recover™ fiber in the final products and developing
our tracer solution.
To be a sustainability frontrunner means we must be
leaders in disruption, but transforming our industry
from linear to circular can’t be done alone. Recover™
continues to commit to actions that benefit thewider industry, community, and planet, and be partof relevant industry initiatives, organizations, andconversations that aim to drive circularity in textiles.
As well as continuing to work with organizations suchas Cascale, Accelerating Circularity and ReHubs in2023 we joined EuRIC Textiles, which aims to set aframework for many new pieces of legislation that are
currently under development, all intending to change
how we produce and consume textiles.
The new legislations that will come into effect thisyear, as well as the increasingly changing consumer
preferences, are expected to increase the demand
for recycled content in the fashion industry. As ahigh-value, textile-to-textile recycler, Recover™ has
a key role to play in supporting this transition to amore circular fashion system and in 2024 we aim tocontinue supporting brands and retailers in achieving
their goals in terms of GHG reduction, energy andwater use reduction, and supply chain transparency.
ALFREDO FERRE
Chief Product, Innovation and Sustainability Officer

Sustainability Report | 21

CIRCULAR
PRODUCTS[ FIRST PILLAR ]WE AIM TO CREATE PRODUCTS
THAT HAVE MINIMAL IMPACT AND
ARE ALIGNED WITH CIRCULAR
PRINCIPLES.
Sustainability Report | 22

CIRCULAR PRODUCTSOBJECTIVE: RECOVER™ IS
ALIGNED WITH SCIENCE
BASED TARGETS AND OURPRODUCTS ARE MADE WITHMINIMAL ENVIRONMENTAL
IMPACT.

LIFE CYCLE ASSESSMENT (LCA)
A Life Cycle Assessment (LCA) is a scientific method used to measure the environmental footprintof a product. To conduct an LCA, you need data such as energy usage for your manufacturing
and waste processes, and data on your purchased and used raw materials. The result is ameasurement across more than 15 impact categories.

The International Organization for Standardization provides guidelines and requirements for
conducting a Life Cycle Assessment: ISO 14040 and 14044.

Sustainability Report | 23

CIRCULAR PRODUCTS

Spain
In 2022, we conducted a new LCA of Recover’s fiber products in Spain. This is called a ´cradleto-gate´ LCA because it focuses on the material stage of the full lifecycle of the final product. The
methodology and data collection have been executed in accordance with the “PEF Methodology”
version 3.0 based on ISO 14040 and ISO 14044.
To calculate the LCA of Recover’s products across multiple production facilities, we worked with
the Ecochain Helix footprint tool, supported by the Ecochain expert team.
We submitted our LCA results to the Higg Materials Sustainability Index (MSI), a publicly available
online tool that measures and scores the environmental impacts of materials. Apparel, footwear,
and textile industry designers and product developers can use the Higg MSI to assess andcompare the cradle-to-gate impacts of different materials.
Bangladesh and Pakistan
Currently the LCA has been performed in Spain as full implementation of KPI tracking is required
and a minimum of 6 months of ´stable´ data tracking is needed. For each new facility, an LCA mustbe performed as soon as accurate data is available (at least within 2 years of starting operations).
Both LCA’s for the Pakistan and Bangladesh Hubs are planned for 2024.
How do we calculate our savings?
The goal of an LCA is not only to measure and improve, but to support customers and final
consumers to make informed decisions when buying products. To communicate the environmental
advantages of Recover’s products efficiently and appealingly, without sacrificing legitimacy andintegrity, we take great care in calculating savings. To do this, we compare the impacts of ourrecycled products to the environmental impacts of virgin conventional cotto: This is a difficult
task, as the available reference data on the environmental impact of traditionally produced cotton
fibers has a large variability.
Due to this complexity, we commissioned a study to better understand which impact categories
we should focus on, how to ensure we are comparing correctly (apples with apples), and whichreference data to use.
The results of this study are the impact savings of 1 kg Recover™ RPure and RBlue fiber comparedwith conventional alternatives and can be found below.

1 KG OF RECOVERTM
RPURE SAVES:

1 KG OF RECOVERTMRBLUE SAVES:

Water
2 116 liters

Water
1 195 liters

Eutrophication (PO43- eq)
0.0245 Kg

Eutrophication (PO43- eq)
0.019 Kg

Global Warming Potential (CO2 eq)
1.73 Kg

Global Warming Potential (CO2 eq)
6.38 Kg

Energy15.29 kWh

Energy35.57 kWhLand use
3.89 M2

Land use
2.02 M2

Recover’s impact data is compared with EcoInvent 3.8 and Textile Exchange (TE) data.
For all impact categories, except freshwater and climate change, we used the EcoInvent rest-of-world (ROW) datasets for comparison.
These references showed most alignment with other reported figures by Textile Exchange (material snapshots) and data reported by the
Higg Material Sustainability Index. Specifically, for the freshwater-use impact category, the EcoInvent conventional cotton data showedlarge variations, so we chose to use the Textile Exchange global average data as reference values to calculate freshwater savings. This
choice resulted in a more conservative estimate of water savings. For Global warming potential, an average of EcoInvent (ROW) andTextile Exchange global average data was used, which were very similar.

Sustainability Report | 24

CIRCULAR PRODUCTSCONSUMPTIONS
Whilst in our Spanish hub, in May 2023, INYCOM ENERGY performed an energy audit toidentify potential energy consumption improvements. This audit covered diverse areas, such as

illumination, energy management, electricity records, etc. Other improvements include changing
our diesel forklifts to electric.

According to the Aqueduct Water Risk Atlas, Recover™ hubs are in areas identified with water

scarcity risk*, but our process uses minimal water. Our water use is limited to dissolving anantistatic product and a softener to allow for optimal shredding of the textile waste. As water
consumption is so low and we cannot achieve a lower consumption, we have not set any water
reduction target.

ENERGYBANGLADESHIHUB

SPANISHHUB

MADRID
OFFICE

Electricity

3 638 180 kWh (70.53%)

1 398 370 kWh (27.12%)

9 295 kWh (0.18%)

Natural gas

1 133 kWh (0.02%)

--

--

Fuel

28 305 kWh (0.55%)

82 735 kWh (1.60%)--

Fuel and natural gas consumptions are tracked in liters & converted into kWh.
The electricity consumption in our Bangladeshi hub is generated from natural gas.
In 2023, 27.3% of Recover™ global energy consumption had a renewable origin, corresponding to the electricity consumed in our
Spanish hub and Madrid office.

WATER
Water

BANGLADESHIHUB

SPANISH
HUB

611.91 m³ (66.9%)

302.73 m³ (33.1%)*The requirements to be considered as a “heavy water use” according to Higg FEM are to use more than 35m³/day. Recover™ used in
2023, on average, less than 5% of the mentioned 35m³/day per hub location.

Sustainability Report | 25

CIRCULAR PRODUCTS

GLOBAL GREENHOUSE GAS (GHG) EMISSIONS
The apparel sector is responsible for 2-8% of global greenhouse gas emissions and worldwide
consumption of clothing and footwear is projected to rise by 63% - from 62 million tons in 2019
to 102 million tons in 2030. As most of fashion’s emissions are in the supply chain, the majority of
the work needed to deliver the sector’s net-zero goals must happen in production.1
The Recover™ process enables the industry to divert industrial textile waste and end-of-use
garments from landfills and incineration by creating recycled cotton fibers that can replace theneed for virgin cotton. Using Recover™ recycled cotton results in GHG emissions savings in the
raw materials value chain tier, which is a part of Scope 3 emissions for brands and retailers.

Recover™ was already measuring and disclosing its Scope 1 and 2 and, as of 2023, is alsomeasuring its Scope 3 GHG emissions. Calculating the carbon emissions of a business canbe quite a challenge. Especially when you start calculating emissions associated with Scope 3,
the indirect emissions created by activities of suppliers, employees, and investments. For thatreason, we have joined forces with Watershed. Watershed is an enterprise climate platform thatdelivers granular, audit-grade carbon measurement; one-click disclosure and reporting; andreal emission reductions. Their experts are analyzing Recover’s emissions to build a detailed
decarbonization and set ambitious goals in line with the rigorous standards of the Science-Based
Targets initiative (SBTi) in 2025.
1

From Catwalk to Carbon Neutral: Mobilizing Funding for a Net Zero Fashion Industry

Sustainability Report | 26

CIRCULAR PRODUCTSSCOPE 1
Spain + Corporate:
17 tCO2e
Bangladesh:
60 tCO2e

SCOPE 2SCOPE 3

Spain + Corporate:
2 361 tCO2e
Bangladesh:
3 875 tCO2e
Pakistan:
317 tCO2eUS:
1 658 tCO2e

Spain + Corporate:
12 tCO2e
Bangladesh:
2 435 tCO2e

Company
facilities

Purchased electricity,
steam heating andcooling for own use

Capitalvehicules

Investments

LeasedassetsPurchased goodand services

Employeecommuting

Capital goods
Fuel and energy related
activities

Transportationand distribution

Business travels

Transportationand distribution

Upstream Activities

Waste generated
in operations

Reporting company

Franchises

Processing ofsold products

End-of-life
Use of sold treatment of soldproducts
products

LeasedassetsDownstream Activities

Sustainability Report | 27

CIRCULAR PRODUCTS

DECARBONIZATION PLAN
Starting in 2023, Cascale (formerly the Sustainable Apparel Coalition) requires its manufacturer

members to commit to setting Science-Aligned Targets (SATs) as a membership prerequisite.
This initiative aims to drive industry transformation with utmost urgency through collective action.
As a global coalition representing over 50% of apparel, footwear, and textile companies, we playa crucial role in combating the climate crisis. SATs offer a clear roadmap for significantly reducing
greenhouse gas (GHG) emissions.

In compliance with Cascale’s membership requirements, Recover™ signed the Commitment
Letter in November 2023. This letter pledges us to set decarbonization targets aligned with SAT
criteria for Scope 1 and 2 emissions, and include Scope 3 in our decarbonization strategy. This

commitment, endorsed at the CEO level, mandates Recover™ to develop SATs within 24 months
and secure validation from an accredited third-party organization.

Recover™, like Cascale, believes that setting and striving towards science-aligned targets
collectively is essential for the industry to effectively reduce GHG emissions. Science-Aligned
Targets are objective, scientifically-backed goals that reflect our most advanced understandingof the impact of GHG emissions on the climate. Due to ongoing construction at our Bangladeshi
hub, Recover’s GHG emissions baseline will be established in 2024, with reduction targets set
for 2025.

Recover™ is dedicated to joining the increasing number of leading companies committed tosetting emission reduction targets in accordance with the latest climate science to significantly
cut GHG emissions.

Sustainability Report | 28

Recover™ aims to become a zero-waste company, minimizing the generation of waste andmaximizing the recovery of waste produced through our own operations. Following thiscommitment, we are segregating and tracking all the different waste flows in our production hubs
and are identifying and implementing opportunities to reduce and recycle our waste. Furthermore,achieving a zero-waste objective is one of our strategies for reducing our GHG emissions.

WASTE POLICY MANAGMENTDISPOSALRECOVERYRECYCLING

RE-USEIn 2023, the Waste Management Policy was successfully approved by the CEO and published on
our website. To become a zero-waste company it is important to constantly consider our waste
management practices and implement good waste management practices across the entire
organization by establishing the hierarchy of wastes:

PREVENTIONCIRCULAR PRODUCTSOBJECTIVE: RECOVER™ IS A
ZERO-WASTE COMPANYWASTE SEGREGATION
We implement a comprehensive waste segregation system at all our facilities, and we arecommitted to regularly reviewing and improving our waste management practices and identifying
opportunities for optimization and innovation, respecting the hierarchy of wastes:
Waste generated in our own production process

HOW WE SEGREGATE?
Is recycled
2022

2023

33%

64%

Used for energy
valorization
57%

32%

Ends up in
landfill

10%
4%

Sustainability Report | 29

CIRCULAR PRODUCTS

RPARTICLE
RParticle is by far the highest volume by-product of our fiber production. These are small fibers,
generally smaller than 4 mm, which are absorbed by the extraction system across the entire
production process.
During 2023, Recover™ was focused on consolidating recycling options for the RParticle, as weare conscious about its potential added value for different industries. We have enhanced different
research projects for the RParticle, reviewing its commerical potential and also its potential interms of innovation. As we are recyclers of other companies’ textile waste, our objective is also
to recycle our own waste as much as possible, reducing its environmental impact and extending
the lifecycle of the textiles by using them in other sectors such as construction, paper industry,
research or others.
Recover™ has partnered with universities and research institutes to test and develop the
potential high value options for the RParticle produced in our Spanish hub. These include lysine
extraction for the cosmetic and food industries and hydrocar obtention through hydrothermal
carbonization, which can be used in air generator engines or used as an additive which provides
flexibility properties and lower densities in bioplastics.
Meanwhile, in our Bangladeshi hub, we have identified a solution to recycle the white RParticle
material into pillow stuffing.

Sustainability Report | 30

CIRCULAR PRODUCTS

SPAIN
In 2023, Recover™ generated 157 tons of waste in our Spanish
hub. Following our commitment to become a zero-wastecompany, we are segregating and tracking all the different waste
flows and are identifying opportunities to reduce and recycle,
and different ways of waste valorization and recycling. In linewith our zero-waste goal, we performed waste segregation
training to all factory workers, included in our Sustainability
Basics training in July 2023.
0%

34%

19%

27%

22%

0%

100%

4%

29%

0%

100%

45%
30%
63%

48%

48%

END-OF-LIFE
SP 2023

3%

42%

56%

0%

58%

0%

100%

71%

40%

27%

27%

42%
32%

25%

27%
16%

3%

11%

0%

3%

0%

24%

0%

0%

14%

0%

10%

0%

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

RPARTICLE RECYCLEDRECYCLED

ENERGY VALORIZATIONLANDFILLBANGLADESH
In 2023, Recover™ generated 574 tons of waste in our hub in
Bangladesh. Our zero-waste commitment applies to all hubs
and operations of Recover™, starting in our Spanish hub andbeing replicated in our Bangladeshi hub.

END-OF-LIFE
BGD 2023

We performed waste segregation training to all factory workers,
included in our Sustainability Basics training. Our goal is to
educate and train our employees on waste management andrecycling initiatives, and to encourage their active participation.
53%

12%

56%

7%

55%

8%

35%

37%

37%

0%

0%

0%

Jan

Feb

Mar

RPARTICLE RECYCLED

54%

7%

36%

49%

51%

16%

15%

51%

12%
34%

54%

7%

52%

9%

48%

15%

47%

47%

19%

19%

36%

35%

32%

31%

32%

33%

34%

3%

2%

1%

3%

3%

3%

5%

4%

2%

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

RECYCLED

ENERGY VALORIZATIONLANDFILL

In 2023, we have been able to recycle the 100% of the following waste streams: plastic, textile, cardboard and metal, which mainly come frompackaging. With regards to RParticle, some fraction of the RPArticle is recycled and another is used for energy valorization. Finally, a small
percentage from the total is disposed into controlled landfills mainly composed by domestic waste.

Sustainability Report | 31

RECOVER™ CREATES CIRCULAR FASHION
One of the features that makes Recover™ fiber unique is that our tech support team works closelywith spinners and weavers to optimize the quality of the yarn and fabric further down the supply
chain and drives the scaling of circular fashion.
Yarns Approved

Fabrics Approved

138 (Approved 2023)
233 (Pipeline 2024)

43 (Approved 2023)
394 (Pipeline 2024)

RECOVER™ HAS CIRCULARITY AT ITS CORE
98.58% of the purchased materials in weight during 2023 are textile waste or recycled materials(corresponding to our purchases for our hubs in Spain and Bangladesh).

SPAIN

Recycled polyester used for RColorBlend is GRS certified and dyed in GRS and OEKOTEX certified
dyeing houses. The recycled polyester is dyed in GRS and OEKOTEX certified dyeing houses.

BANGLADESHCIRCULAR PRODUCTSOBJECTIVE: RECOVER™
PRODUCTS AND PRACTICESARE ALIGNED WITH A
CIRCULAR TEXTILES SYSTEM.

CATEGORYKG% SUPPLIERS SIGNED CODE
OF CONDUCT

Textile waste

2 930 837.4

100%

Recycled polyester
carrier fibers

78 117.5

100%

Packaging (Plastic
wrap PE, ropes, tape)

--

100%

Chemicals (antistatic& softener)

31 911.0

100%

CATEGORYKG% SUPPLIERS SIGNED CODE
OF CONDUCT

Textile waste

6 634 354.7

100%

Packaging (Plastic
wrap PE, ropes, tape)

42 003.3

100%

Packaging thatincorporates our own
RParticle (up to 25%)

25 507.4

100%

Chemicals (antistatic& softener)

108 065.0

100%* As per Textile Exchange requirements, with the Guarantee of Waste Origin document the supplier gives permission to the Certification Body tovisit their facility to verify their processes.

Sustainability Report | 32

CIRCULAR PRODUCTSSCALING POST-CONSUMER WASTE RECYCLING
As a high-value, textile-to-textile recycler, Recover™ has a key role to play in the transition toa circular fashion system. Recycling of post-consumer textiles is considered by many industry
leaders as the “holy grail”. At Recover™, we face a challenge in securing large volumes of suitablepost-consumer feedstock for our process. The existing textile collector/sorter business models
are tailored to sorting for re-use and downcycling markets. However, high-value recyclers havevery different needs with regards to sorting (composition, color, exclusion of garments with wax
coatings, lurex yarns and so on) and pre-processing (removing rubber prints, care labels, buttons/
zippers, etc.) of post-consumer textiles.
Recover™ is committed to being an agent of change in this area, not only by scaling its own
recycling of post-consumer textiles but also by being part of key industry projects like Accelerating
Circularity Project and the ReHubs initiative that bring together crucial stakeholders.

CIRCULAR DESIGN
Not only do we aim to create products that are aligned with circular principles, but we also
promote circular design practices with our supply chain and brand partners. In 2023, we came
together with YOOX NET-A-PORTER, and The Prince’s Foundation to support The Modern Artisan.
Our Head of Sustainability hosted a seminar for the program’s participating designers, focusedon making tomorrow’s creators aware of the impact of their designs, from the design sketch to its
post-consumer lifespan.
As an active member of the Textiles 2030 initiative, Recover™ also participated in the Design
for Circularity working group, working alongside other businesses and industry leaders to alignon good practice design principles. We also gave talks on Circular Design practice at the Slow
Fashion Conference in Madrid and at the Foro de economía creativa in Valencia.

Sustainability Report | 33

RESPONSIBLE
PRODUCTION &SUPPLY CHAIN[ SECOND PILLAR ]RECOVER™ WORLDWIDEOPERATIONS ARE DRIVEN BY THE
HIGHEST ENVIRONMENTAL AND
SOCIAL STANDARDS.
Sustainability Report | 34

RESPONSIBLE PRODUCTION & SUPPLY CHAINOBJECTIVE: RECOVER™
OPERATES ACCORDING
TO THE HIGHEST
ENVIRONMENTAL AND SOCIALSTANDARDS AND IS THIRDPARTY CERTIFIED.
THIRD-PARTY CERTIFICATIONS & VERIFICATIONS[ Global Recycled Standard (GRS) ]GRS is an international, voluntary standard that sets requirements for third-party certification ofrecycled input and chain of custody. The shared goal of the standards is to increase the use ofrecycled materials. The GRS includes additional criteria for social and environmental processing
requirements and chemical restrictions.
RecoverTM is globally certified under the GRS: All RecoverTM owned and licensed facilities go
through annual GRS audits by third-party certification bodies, in which the chain of custody system
is verified, as well as high standards for environmental, social, and chemical management. In thisway, Recover™ can offer its customers a high-quality recycled and traceable fiber assuring that it
has been processed in environmentally and socially responsible facilities.

[ Organic Content Standard (OCS) ]The OCS from Textile Exchange is an international, voluntary standard that certifies organic input
and chain of custody. The goal of the OCS is to increase organic agriculture production.
RecoverTM Spain is certified under OCS to assure the chain of custody of the organic fiber that isused to blend with recycled cotton for the REarth product that is produced in the Spanish hub.

[ Higg Index ]Developed by Cascale, formerly known as the Sustainable Apparel Coalition, in collaboration with its
300 member companies (apparel, footwear, and textile brands, retailers, manufacturers, sourcing
agents, service providers, trade associations, NGOs and academic institutions), the Higg Index is asuite of tools for the standardized measurement of value chain sustainability.
Cascale has the mission to catalyze collective action toward an equitable and restorative consumer
goods industry, by aligning the global community around shared goals, developing and executing
joint solutions, and leading the acceleration of impact at scale with the strategic partners.
Cascale’s three pillars are Nature Positive Future, Decent Work for All & Combat Climate Change.

Sustainability Report | 35

RESPONSIBLE PRODUCTION & SUPPLY CHAIN

BRAND AUDITS
Every year our Recover™ hubs undergo different audits promoted by our brand partners as partof their Code of Conduct. During these audits many areas of the company are evaluated, such as
working conditions, HSE practices and environmental protection, and they are an important forbuilding trust with our partners and providing full transparency of our practices.

HIGG FACILITY ENVIRONMENTAL MODULE (FEM)
Higg FEM measures the environmental performance of an individual facility, helping manufacturers
find opportunities for improvement and empowering them to manufacture more responsibly.
The FEM assesses environmental impacts such as the environmental management system,
energy consumption, water use, wastewater management, air emissions, waste generation andchemicals.
completed, Higg FEM provides a score and an analysis of the areas for improvement, categorisedby sections. This allows the opportunity to work throughout the year to increase the performance
score next year. The assessment must be carried out over a complete year; thus, in 2023, thedata for the year 2022 has been evaluated.
Spain
FEM assessment using 2022 data. The results were verified through a third-party onsite audit,
obtaining a score of 70%.
It is possible to compare our score through a Benchmarking tool offered by Higg. When selecting
same facility type companies and European countries, the obtained score was 59.94%. Thismeans that Recover’s Environmental Performance is around 10% higher than similar companies
also performing Higg FEM.
Bangladesh
The Bangladeshi hub initiated its production in April 2022. Consequently, the data required forthe 2022 assessment was not yet complete or sufficiently stable to perform the environmental
performance assessment. Therefore, there was no third-party verification for this hub.

Sustainability Report | 36

RESPONSIBLE PRODUCTION & SUPPLY CHAIN

HIGG FACILITY SOCIAL & LABOR MODULE (FSLM)
The Higg FSLM allows facilities to assess conditions for its workers, helping ensure they are
creating safe and fair working conditions. The FSLM assesses performance in several social areas
related to human resources (recruitment, hiring, working hours, wages and benefits, treatment ofworkers and termination). It also reviews the factory’s health and safety performance and the
management systems in place.
Spain
In 2023, our Spanish hub performed the Higg FSLM assessment. The results were verified
through a third-party onsite audit, obtaining a score of 67.8%.
It is important to note that maximum score possible for Recover™ is 80%, as we are evaluating
Level 1 and 2 of the FSLM assessment.
It is possible to compare our score through a Benchmarking tool offered by Higg. When selecting
same facility type companies and European countries, the obtained score was 66.36%. Thismeans that Recover’s Environmental Performance is slightly higher than similar companies also
performing Higg FSLM.
Also, we can compare it to our previous score for the Higg FSLM, which was 66.7%, slightly lower
than the 2023 assessment.
Bangladesh
In order to be aligned with Higg FEM , the Bangladeshi hub was not third-party verification forthis year. Assessment verification and score publication will be available next year, in our 2024
Sustainability Report.

Sustainability Report | 37

RESPONSIBLE PRODUCTION & SUPPLY CHAINOBJECTIVE: RECOVER™
PRODUCTS AND SUPPLYCHAINS ARE TRACEABLE.
Our aim is to have full traceability of all our material inputs, production processes and products.
Due to the nature of the textile waste sector, tracking the origin of the post-industrial textile waste
to the manufacturing facilities where it was generated is challenging. Once the waste is generated,it goes through multiple steps of aggregation and sorting, which often implies mixing the wastefrom different origins. Recover’s first step in ensuring the traceability of the post-industrial textile
waste origins is to work very closely with our direct suppliers and ensure that in the warehouses
where all the textile waste is segregated, the correct work conditions are in place.
Recover™ joined the Circular Fashion Partnership with Global Fashion Agenda, Reverse
Resources, BGMEA and P4G, in early 2021. In this project, we seek to enhance traceability ofour post-industrial waste to the factory of origin via the Reverse Resources platform. In order
to assure the chain of custody of Recover™ recycled fibers along the supply chain, Recover™
is certified under the Global Recycled Standard (GRS), as well as under the Organic Content
Standard (OCS) in the Spanish hub for organic cotton fibers.

THE RECOVER™ TRACER
In 2023, Recover™ continued developing the physical and digital tracer system of our fiber tobecome market ready at a global level. Using a physical tracer will allow Recover’s customers
to verify the presence of Recover™ recycled cotton and support them in making credible andsubstantiated sustainability claims about recycled content.
This traceability assurance will also enable us and our customers to be prepared for the
introduction of the Digital Product Passport (DPP) requirements. The European Commission*
defines the DPP as a tool to provide information about a product’s environmental sustainability. It
is essentially a digital record of a product’s sustainability and circularity information throughout
its lifecycle, from design to end-of-life. The Recover™ tracer, which we aim to adapt to the DPP
system, and the availability of our data, will aid the supply chain in specifying the vital informationneeded for the DPP and prevent a product from going to waste.

*Ecodesign for Sustainable Products Regulation

Sustainability Report | 38

UPSTREAM SUPPLIERS
We aim to build strong and resilient supplier relationships to ensure compliance of our business
partners, and to promote an approach of continuous improvement to achieve best practiceenvironmental and social performance. We seek high sustainability and social standards of our
products and processes, as well as of our whole business and value chain, and we expect thateach individual party involved in our supply chain respects our values and abides by the rules of
our Code of Conduct.
In 2023, our Procurement department approved and implemented the Recover™ Responsible
Sourcing Policy, which covers from the sourcing of new suppliers to the possible termination of
the relationship with a supplier. That said, our aim is to build long-term business relationships
with our suppliers and other business partners through close cooperation and understanding of
the different situations that might arise.

UPSTREAMUNDERSTANDING UPSTREAM &DOWNSTREAMRESPONSIBLE PRODUCTION & SUPPLY CHAINOBJECTIVE: RECOVER™ SUPPLYCHAINS ARE SUSTAINABLE& SOCIALLY JUSTRAW MATERIAL

SUPPLIER

FACTORY

DISTRIBUTIONRETAILCUSTOMERDOWNSTREAM
This Policy accounts for the long process where both Recover™ and the supplier shall work
together building trusted business relations and pursuing corporate compliance according tonational and international standards. The objective of this Policy is to ensure that the supply chain
in which Recover™ operates is in compliance with social (including Human Rights, Labor Rights &Decent Work) and environmental responsibilities, does not engage in any kind of corruption, andis responsible towards all stakeholders.

Sustainability Report | 39

RESPONSIBLE PRODUCTION & SUPPLY CHAIN

Recover™ sets requirements and expectations for our suppliers to ensure that they share ourcommitment to responsible sourcing. Our Recover´s Code of Conduct for Business Partners isincorporated by reference into all our supplier contracts, and we encourage our suppliers to set
expectations in the same way for their own suppliers.

100% of our active suppliers are committed to Recover’s Code of Conduct for Business
Partners, which addresses the following topics:
Prohibition of child and forced labor
Freedom of association and collective
bargaining
Non-discrimination
Health and Safety of the workforce
Decent pay or Living Wage

Regulated employment in accordance withthe laws in force in each territory
Environmental protection in compliancewith local and international legislation
Ethics: any form of corruption, extorsion or
embezzlement is strictly prohibited

Working hours in line with national laws
and benchmark industry standards

Every raw material supplier shall sign our Code of Conduct before starting to work with Recover™.
The Recover™ Procurement team selects suppliers according to the Sustainability Strategy
guidelines as defined by the company, as well as to product specifications that favor the shortest
supply chains. At Recover™, we aspire to reduce our carbon footprint and produce products withminimal environmental impact. Our goal is to achieve the lowest possible footprint while adheringto the highest sustainability standards.
We assess suppliers based on their risk level, and direct them to the most appropriate due
diligence and management process for their risk level. Our due diligence processes address
supplier risks associated with legal compliance, human rights compliance (such as equality, nondiscrimination and diversity, respect for workers’ rights of freedom of association, modern slavery,
child labor and health and safety) and environmental impacts. Based on this risk assessment, weplace our textile waste suppliers as those with the highest risk, due to the nature of the textile
waste sector and also as it is Recover’s main raw material.

Sustainability Report | 40

RESPONSIBLE PRODUCTION & SUPPLY CHAIN

100% of our textile waste suppliers in Bangladesh are assessed under ESG requirements.
During Q4 2023, we accomplished Compliance Assessments for all our textile waste suppliers in
Bangladesh, assessing the following topics:
Quality topics: Policies and certifications
in place

Mechanisms in place to guarantee nodiscrimination, harassment, abuse

Mechanisms in place to guarantee theabsence of child labor and forced labor

Possible disciplinary measures

Health & Safety: Proper construction of
the workshops or factories, emergency
exits, PPEs, HSE Committees, evacuation
procedures

Working hours and wages
Anti-Corruption mechanisms
Environmental responsibility

Freedom of Association respect

No zero tolerance issues were detected during this first round of assessments. Improvement
plans were carefully developed by Recover’s team and shared with our suppliers and accepted.
HSE training and further assessments will be carried out to verify improvements.
A multidisciplinary Recover™ team, comprised of members from Procurement, HSE and
Sustainability, performed the assessments to ensure adequate information was collected. This
team has always stated the collaborative behavior of our suppliers and their willingness toimprove.
In 2023, the Responsible Sourcing Commitee was established at a corporate level and met fourtimes in the reporting year.

DOWNSTREAM SUPPLIERS
The direct downstream suppliers that Recover™ works with are the spinners that develop highquality yarns with Recover™ fiber. As Recover™ produces GRS certified recycled cotton fiber,
the spinners that use our fiber must also be GRS certified. This aligns with Recover’s vision andmission to ensure responsible social and environmental practices and to provide transparency
and assurance for consumer claims regarding recycled content in their products.
Recover™ can state that all the spinners to whom we sold the 98.85% of the fiber we produced
in 2023 are GRS certified. This considers only spinners to whom we sold at least 10 tons of fiber.

Sustainability Report | 41

AGENTSOF CHANGE[ THIRD PILLAR ]WE ACTIVELY SPEARHEADSUSTAINABLE TRANSFORMATIONWITHIN THE TEXTILE AND
FASHION INDUSTRIES.
Sustainability Report | 42

AGENTS OF CHANGEOBJECTIVE: RECOVER™ IS A
LEADER IN TRANSPARENCY

Recover™ strives to meet the 17 Sustainable Development Goals as defined by the United Nations
and participates in several forward-thinking industry initiatives that help drive systemic change
towards a circular fashion industry. We believe that transparency is the principal driver of change
in the industry. Recover™ measures and reports on the requirements for governance, social andenvironmental performance of its fiber products, facilities, and supply chain.
As a sustainable and ethical company, Recover™ is committed to being transparent and clear in
our public messaging. We therefore carefully review our sustainability claims and reassess themon a bi-annual basis. All our claims adhere to regulations and relevant globally accepted industry
guidelines.

Sustainability Report | 43

AGENTS OF CHANGE

Our efforts towards having complete transparency include:
In 2023, we updated the Recover™ impact calculator on our website with ourlatest LCA data so that the consumer can calculate the environmental savings
made from using our fiber.

We published our Sustainability Reports 2021, 2022 and current 2023
with reference to the GRI Standard (Global Reporting Initiative), to provide
transparency on how we contribute or aim to contribute to sustainable
development. Furthermore, we are preparing our reporting requirements toadhere to the Corporate Sustainability Reporting Directive (CSRD). Every six
months, Recover™ also reports under 123 ESG requirements to Goldman
Sachs Asset Management.
Annually, we submit the Communication on Progress (CoP), a requirement
for all UN Global Compact business participants. It comprises 13 governancetopics, 8 human rights topics, 12 labor rights topics, 18 environmental topics,
and 8 anti-corruption topics to be disclosed to the UN Global Compact.

Sustainability Report | 44

AGENTS OF CHANGEOBJECTIVE: RECOVER™
INSPIRES AND
DRIVES SUSTAINABLE
TRANSFORMATION AND
LEADERSHIP WITHIN THE
COMPANY COMMUNITY AND
WIDER INDUSTRY.
Recover™ addresses the need for transparency and increased consumer education andengagement by aspiring to be the voice and leader to the consumer on recycled cotton,
sustainability, and circularity. Within our communications, both on our social media channels, andbrand/retailer collaborations, we engage with consumers to educate them on the consumptive
nature of fashion and the benefits of a circular economy.
We provide a strong Marketing platform to support our partners, and our integrated communications
ecosystem includes all the modern levels of brand communications. We also work with brands
to help them define their messaging so that they can educate their customers on sustainable
matters and position themselves as a recognized positive contributor to the industry.
Recover™ ended 2023 with:

238
097
010

Articles mentioning
Recover™ in 2023
Dedicated coverageby media outlets
Press releases
launched

015
002

Events attended worldwide: Munich
Fabric Start, Sustainable Apparel Forum
Bangladesh, Planet Textiles 2023, andTextiles 2030 ConferenceAwards won: Just Style Excellence Award:
Business Expansion, Environmental, andInvestments. Lowie Award – Website:
Responsible Innovation

Sustainability Report | 45

AGENTS OF CHANGE#COLLABSREICONICS is a recycled denim capsule collection born from a collaborative project between
industry experts Recover™, Evlox, and Jeanologia. By combining expertise from each specialist
business, the project aims to improve circularity in the denim industry, from fiber to finish. The
capsule collection featured 14 styles of denim, all made from up to 32% Recover™ low-impact
recycled cotton fiber.

Sustainability Report | 46

AGENTS OF CHANGE#COLLABS
Lands’ End, the classic American lifestyle brand committed to quality, joined Recover™ to add
a range of timeless sustainable styles. Each piece from this collection includes 20% Recover™
recycled cotton fiber to help close the loop on fashion.

Sustainability Report | 47

AGENTS OF CHANGE#COLLABS
Global lifestyle brand Perry Ellis turned to Recover™ to bring more sustainable denim to consumers
by opting for Recover’s low-impact recycled cotton fiber. Founded on innovation, Perry Ellis isbreaking down the walls of fashion by not only making clothes designed with real life in mind, butalso by making circular fashion more accessible.

Sustainability Report | 48

AGENTS OF CHANGE#COLLABS
European fashion brand C&A launched a new spring/summer 2023 CLOCKHOUSE casualwear
collection made with Recover™, a high-quality recycled cotton fiber produced from textile waste
and made with a minimal environmental impact.

Sustainability Report | 49

AGENTS OF CHANGE

We partner with other committed actors in the industry, developing sustainable and circularsolutions to drive the fashion industry towards a closed-loop system.

In 2023, Recover™ contributed to the following industry projects and associations: Cascale,Textile Exchange, Textiles 2030, Circular Fashion Partnership, Accelerating Circularity, UN Global
Compact, ReHubs, Policy Hub, American Apparel and Footwear Association, Global Fashion
Agenda, World Circular Textiles Day, Observatiorio del Textil y de la Moda, European Recycling
Industries’ Confederation (EuRIC) and Federación Española de la Recuperación y el Reciclaje (FER).

GLOBAL[ Cascale]
Recover™ has achieved the FOUNDATIONAL+ level, thanks to achieving the 2022 membership
requirements. Our Spanish hub has been performing the Higg FEM and FSLM since 2021, and its
score for FSLM was published in our Sustainability Report 2022. Our Bangladeshi hub has performed
the first self-assessment in Cascale’s membership requirements and promotes improvements inall sites in terms of environmental management and working conditions for employees.

[ Textile Exchange]
Textile Exchange is a global non-profit, driving positive action on climate change across the
fashion, textile, and apparel industry. Textile Exchange guides and supports a growing communityof brands, retailers, manufacturers, farmers, and others committed to climate action toward
more purposeful production, right from the start of the supply chain. Recover™ is a longstanding member and supporter of Textile Exchange. In 2021, Textile Exchange honoured ourongoing work as an agent of change and Climate leader in the industry by awarding RecoverTM
with the Ryan Young Climate+ Awards for sustainable textile industry leaders.

[ Textiles 2030 ]Textiles 2030 is WRAP’s award-winning UK-based initiative working to move the UK fashion andtextile industries towards circularity by forming agreements with sustainably minded brands andbusinesses. Initiative signatories, like Recover™, commit to shared sustainability goals to be
met by 2030 – and beyond. In fact, Recover™ is an active member of three of the initiative’s
Working Groups: Design for Circularity, Closing the Loop, and Policy. Working alongside otherbusinesses and industry leaders, we hope to effect real positive[ Circular Fashion Partnership ]The Circular Fashion Partnership is a cross-sectorial project to support the development of
the textile recycling industry in Bangladesh by capturing and directing post-production fashion
waste back into the production of new fashion products. As supporters of the project, RecoverTM
collaborates with brands, manufacturers, NGOs, policy makers and other stakeholders to support
the scale up of circular supply chains in Bangladesh.

[ Accelerating Circularity ]Accelerating Circularity is an action oriented non-profit focused on scaling textile-to-textile
recycling through a collaborative, stakeholder-led approach. The mission is to catalyse new supply
chains and business models to turn spent textiles into mainstream raw materials. Accelerating
circularity is active in both the United States and Europe. Recover™ is part of the Steering
Committee of Accelerating Circularity (EU) and is the recycling partner in two recycling pilots,
one in the US and one in Europe. Both pilots aim to create to new commercial fabrics that include
a combination of post-industrial and post-consumer recycled content.

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AGENTS OF CHANGE[ UN Global Compact ]A voluntary initiative based on CEO commitments to implement universal sustainability principles
and to take steps to support UN goals. As a participant we commit to operate responsibly,
in alignment with universal sustainability principles, take actions to support society, and report to
the UN Global Compact annually on our ongoing efforts. RecoverTM reports to UN Global Compact
on an annual basis to ensure our activities are aligned with the Ten Principles and broader UN
goals.

[ ReHubs ]The goal of ReHubs is to set up an integrated system based on recycling hubs in Europe toupcycle textile waste & industrially scale up the collecting, sorting, processing and recycling of
pre-consumer and post-consumer materials. As part of Business Council, Recover™ was one of
the founding companies of the ReHubs initiative. In this role, Recover™ provided information for
the Techno Economic Study and was a driving force for the launch of the first ReHubs projects.

[ Policy Hub ]The Policy Hub - Circularity for Apparel and Footwear unites the apparel and footwear industry
to develop ambitious policies that accelerate sustainable practices. They gather thetechnical expertise and knowledge from members of their partner organisations: Sustainable
Apparel Coalition (SAC), Global Fashion Agenda (GFA), Federation of European Sporting Goods(FESI), and Textile Exchange. As an active member, Recover™  contributes to policy papers
and public consultations of key EU policies to engage policymakers. Main workstreams we arecontributing are related to Waste (Extended Producer Responsibility, Waste Framework Directive,
Waste Shipment Regulation, End of Waste criteria), Eco-design, Transparency (Substantiating
green Claims, Empowering Consumers), and Due Diligence.

[ American Apparel & Footwear Association (AAFA) ]American Apparel & Footwear Association represent more than 1,000 world famous namebrands, retailers, and manufacturers. AAFA is the trusted public policy and political voice of
the U.S. apparel and footwear industry and helps its members navigate the complex regulatoryenvironment offering opportunities for networking and collaboration. As a member, Recover™
obtains information and insights on US regulation and policy. We can address challenges
through active participation in the different committees like Labelling Team, the Environmental
Committee, or the Customs Team & Trade Policy Committee.

[ Global Fashion Agenda ]Global Fashion Agenda (GFA) is a non-profit organization that promotes collaboration within the
fashion and textiles industry to accelerate sustainable and social advancements and the adoptionof best practices. One of the most important impact initiatives led by Global Fashion Agenda is
the Circular Fashion Partnership, of which Recover™ is a collaborator.

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AGENTS OF CHANGE[ World Circular Textiles Day ]World Circular Textiles Day, which takes place every year on 8 October, has been launchedto celebrate the efforts of a growing community of companies, organisations and individuals
actively working towards a circular textile future. It is a living, breathing time capsule to record
the progress and chart the momentum of circularity in textiles. Recover™ is signatory of World
Circular Textiles Day and contributes insights and learnings in the form of case studies to support
the mapping of the state of circularity in textiles.
th

SPAIN
[ Observatorio Textil y Moda ]The aim of the “Observatorio del Textil y de la Moda” is to activate the transformation of the
textile sector, adding more value to the Spanish textile and fashion industry. Recover™ ispartner of the “Observatorio del Textil y de la Moda” since its creation in 2022. We are Group
leaders of the working group focused on managing the fund calls for Circularity projects, while
actively participating in the other working groups focused on decarbonization, innovation andsustainability.

[ European Recycling Industries’ Confederation ]EuRIC primarily focuses on promoting, representing, and protecting the collective interests ofthe European textile reuse and recycling industry. The members come from various European
countries and are active in the collection, sorting, preparation for re-use, recycling, transportation,and marketing of used textiles, shoes, and accessories. Through this collaboration, Recover™
can play a crucial role in shaping key EU policies and regulations that impact the recycling sector.

[ Federación Española de la Recuperación y el Reciclaje (FER) ]The Spanish Federation of Recovery and Recycling (FER) brings together the interests of thewaste recycling sector and defends them in the different economic, social and environmental
fields at national and international level. Being a member of the FER Association enables
Recover™ to connect with essential stakeholders in the Spanish textile recycling value chain,including collectors, sorters, and other recyclers.

BANGLADESH[ Bangladesh Textiles Mills Association (BTMA) ]BTMA is an organization representing the textile industry in Bangladesh. It serves as a platform or
textile mill owners and stakeholders to address common issues, advocate for policies beneficial
to the industry, and promote the growth and development of the textile sector in Bangladesh. The
textile industry is a significant contributor to Bangladesh’s economy, accounting for a substantial
portion of the country’s export earnings and providing employment to millions of people. BTMA
plays a crucial role in representing the interests of textile mill owners and facilitating dialogue
between the industry and government authorities to address challenges and promote sustainablegrowth.

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AGENTS OF CHANGEOBJECTIVE: RECOVER™
DRIVES ICONIC AND
IMPACTFUL ESG INITIATIVES.
Social Accountability - Global
Recover™ Employee Code of Conduct (CoC)At Recover™, we have embedded respect for human rights in our relevant practices and policies,
including our Employee Code of Conduct. All our factories follow these standards which are
based on the Core Conventions of the International Labor Organization (ILO) as well as the United
Nations Universal Declaration of Human Rights. The CoC was created in 2022 and it is reviewed
every year and approved by the person responsible for the People & Talent department.

Some highlights include but are not limited to:
Strict compliance with all applicable local, regional, national, and international legislation.
Respect cultural and individual diversity and promote inclusiveness, and zero tolerance for any
kind of discrimination, harassment, and violence.
Equal opportunity promotion.
Recognition to associate or organize or to collectively bargain.
Zero tolerance for any kind of corruption.
All employees must have reached the legal working age in each country where we operate.
Wages shall respect the agreements of each sector in each country.
Forced labor is strictly prohibited.
Employees’ safety is always a priority.
Respect for Human Rights in high-risk context with special attention.

Every Recover™ employee has been trained under the Code as part of the onboarding process
when joining the company, and the Code is binding for the whole staff. This Code sets out thestandards of behavior that all employees should adhere to, so that their conduct is consistent
with due respect for applicable laws and regulations, with integrity and transparency, acting withthe prudence and professionalism appropriate to our environmental and social commitment.
The CoC can be found both in English and Bengali in our internal Business Process Management
and our employees have access to it anytime in case they would like to review it. It is reviewed andapproved on an annual basis.
Work from Home Policy
Recover™ has a global Policy and local Policies (Spain: launched in May 2023; Bangladesh:launched framework is based on 3 main pillars: flexible working schedules, work-life balance, andhybrid work from home model.
Training programs
Recover’s learning & development strategy seeks to support professional development andbuild specific skills and capabilities across the company, with a high focus on our scientific andsustainability expertise to be best in class in our sector.

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AGENTS OF CHANGE

In 2023, our training programs at global level were distributed as follows:
52% technical or hard skills: specialized knowledge and expertise required to perform specifictasks. e.g. Chemical Handling Safety
48% cross or soft skills: aptitudes and abilities of an individual that can be used in a variety
of professional situations (particularly in several different jobs, companies or workplaces). e.g.
code of conduct, culture and values.
Corporate Whistleblowing Channel
The Corporate Whistleblowing Channel covers all Recover™ employees, as well as otherstakeholders. The channel ensures that any individual can raise queries and/or doubts about theconstruction or enforcement of the Recover™ Employee Code of Conduct (CoC) and gives noticeof any breaches of the Code, as well as any other internal policy and conduct regulations.
The channel is strictly confidential and secure for the informant. One of Recover’s aims is toensure that the CoC is available to all employees and providers, to ensure that they are awareof their rights and to encourage them to report any discriminative behavior or identify potential
concerns that need to be addressed, by using the whistleblowing channel. The channel falls
under the CoC training and all employees are aware of its objectives and how to use it.

Ethics Committee
The Ethics Committee’s main objective is to guarantee that all employees and suppliers fulfill
the CoC. This committee meets once every quarter to review any topic related to the CoC and
its implications, to discuss any legal requirement that may be within its scope, and to review
reported complaints against the CoC reported through the Corporate Whistleblowing Channel.
Whenever required, the committee will hold additional meetings.
The Ethics Committee is comprised of the following departments: People & Talent, Sustainability
and Finance & Legal.

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AGENTS OF CHANGE

Social Accountability - Spain
Workers’ Committee
In Spain, 100% of Recover™ employees are covered by the Convenio colectivo general de trabajode la industria textil y de la confección.
At the end of 2023, in our Spanish hub, there were elections to create the Workers’ Committee.
The formalization of the committee has been completed following the legal deadlines. The
committee is made up of five workers, including two who are part of the Equality Committee andtwo who are part of the Safety Committee.
Recover™ Equality Committee & Equality Plan
Total gender equality is of the upmost important at Recover™ and we always strive to ensure
equal treatment and access to equal opportunities between women and men throughout theentire organization.
To achieve this, in 2022, Recover™ performed a diagnosis report, with data collection and aquantitative and qualitative analysis, to know the degree of equality between women and men in
the company. In 2024, this report will be updated with data from 2023 and an adjusted gender
pay gap assessment will be performed, that, together with the Equality Plan, will advocate for
equality, foster transparent communication, raise awareness of gender equality issues and tosolve any concerns that might arise on gender discrimination.
Social Accountability - Bangladesh
Participation Committee
The Participation Committee serves as a communication channel between employees and thecompany, in which concerns and potential improvements are shared, decisions are taken, andrequests by the workers can be raised and agreements are reached. Any change in policies isdiscussed, explained to the employees and reviewed how it will affect them. This committee
follows the legality in Bangladesh, as the minutes of the meetings are sent to the Labor office toassure the legal compliance.
Anti-Harassment Committee
The establishment of the Anti-Harassment Committee falls under the Bangladesh Labor Act of2006. Its objective is to prevent and address instances of harassment in the workplace. This
committee works to create awareness about harassment issues, develop policies and procedures
for reporting and addressing harassment, investigate complaints of harassment in a fair andimpartial manner, and take appropriate disciplinary action against perpetrators.
Meetings take place every month to review cases and propose actions. It consists ofrepresentatives from both management and workers, and it hasfive members and it should be
renewed every two years.
*Recover™ respects every employee’s right to freedom of association andcollective bargaining and follows commonly recognized best practices with all
our employees globally. The company also respects all the activities undertaken
by organizations representing employees by the functions and competencies
legally attributed to them, with whom relations shall be maintained based on
mutual respect to encourage open, transparent, and constructive dialogue toconsolidate the objectives of social harmony and occupational stability.

*Recover™ also has a Safety Committee both in Spain and in Bangladesh whichis explained in further detail in the Health and Safety section.

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AGENTS OF CHANGE

Health & Safety: Occupational Health and Safety Management System (OHSMS)
Recover™ implemented a robust and comprehensive Occupational Health and Safety
Management System (OHSMS) consisting of a framework that allows us to identify and control
our health and safety risks, reduce the potential for incidents, help us achieve compliance withhealth and safety legislation, and continually improve our performance. This system encourages
employees to report potential unsafe conditions and the HSE department then evaluates themand implements the corresponding measures. Our OHSMS covers fire and emergency drills, PPEs
(Personal Protective Equipment), distribution records, and safety signage across the company.
To guarantee the fulfillment of the international and local legislation in terms of Health, Safety,
and Environment, we work with the compliance third-party service provider, Red-on-line, at a
global level.
In 2023, we finalized and successfully published on our website our Recover™ Health, Safety,
and Environmental Policy, approved at the CEO level. This policy establishes the premise that
our employees and our partners are our most valuable asset and therefore HSE is a priority at
Recover™.
Towards the end of 2023, the entire organization prepared for the ISO 9001 audit which took
place at the beginning of 2024. The audit serves to certify and properly establish a quality
management system that will also cover HSE procedures and policies. Attaining the ISO 9001
will serve as a precedent for the HSE department to obtain the ISO 45001, which certifies the
Occupational Health and Safety Management System (OHSMS), as well as the ISO 14001, to
certify the Environmental Management System (EMS), both at international levels.
Furthermore, our Madrid headquarters is in an ISO 45001 and ISO 14001 certified building, by
Gmp.

100% OF RECOVER™ EMPLOYEES,
temporary workers, external workers and visitors are covered by our OHSMS

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AGENTS OF CHANGE

Our OHSMS is internally audited periodically, as well as externally, through GRS, Brand/Retailer
audits and government visits, which we undergo every year. It has also been assessed during
the performance of the Higg FSLM (verified in our Spanish hub and first self-assessment in our
Bangladeshi hub).

In both hubs we have established a Safety Committee, as per the law, responsible for promoting

workplace safety and identifying potential hazards. The number of members in the committee isdetermined by the size of the hub.

SAFETY COMMITTEE BANGLADESH

SAFETY COMMITTEE SPAIN

Meeting every 2 months
HSE manager (1)Production workers (3)Meeting every 3 months
HSE manager (1)Production manager (1)Production workers (2)Office workers (2)Additionally, in RBD we have established a Food Committee that guarantees the hygiene of the food served in the facilities and our Participation
Committee covers other HSE topics.

100% of workers at Recover™ have been trained in Health & Safety and Emergencies, always

under the premises of guaranteeing the safety of all workers, collaborators, subcontractors andvisitors. At Recover™ we have our own production centers, and specific induction trainings in
Health & Safety and in emergencies have been developed for all workers.

In Bangladesh, additional trainings are given to assure the health and safety of workers, suchtraining for seasonal fever, conjunctivitis and nutrition. Moreover, for each shift change, production
workers conduct toolbox meetings, which are short training sessions on different Health & Safety
topics to reinforce the induction training and to involve all workers in the worker protection
strategy.

In our Spanish hub, the description of the scope of our OHSMS is provided by an external

prevention service, which includes a risk assessment and preventive measures. Our HSE
department guarantees that these preventive measures are in place. We have implemented aplatform to collect and coordinate the necessary documentation from external workers in termsof HSE.

In Spain, healthcare is guaranteed by the Spanish National Health System and health checks

are annual and voluntary (except for those workplaces whose specific risk is mandatory perlaw). Meanwhile, in our Bangladeshi hub, we have a health department to take care of the wellbeing of our employees, consisting of a doctor and full-time general shift nurse, who attend to all

health-related issues, whether work-related or not. Furthermore, pregnant workers are monitored

exhaustively to guarantee their wellbeing. Our health department offers general checks every
month, as well as a pre-employment health check that guarantees that the new employee is oflegal working age. In 2023, a welfare survey was performed to confirm that workers are provided
with a good working environment, drinking water, clean washrooms and proper dining facilities.

In 2023, Our PPE Policy was finalized and published on our website, which sets the basis for theuse of our PPE in designated areas with strict enforcement and customized PPE solutions for
specific job roles.

In August 2023, in RBD, an Ambient Air Quality Test was performed, and the results for NO2, PM10,
PM2.5, SO2 and NH3 were all acceptable. Meanwhile, in our Spanish hub, the Air Quality Test
was performed in May 2023. As a good practice, the visual inspection positions that were most

exposed to the dust were relocated to less-exposed positions, and this task was substituted by
AI sorting technology. In 2024, we will improve our dust extractors system for better absorption.

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AGENTS OF CHANGE

All injuries and “near misses” are investigated and addressed with the appropriate corrective
actions necessary to prevent future incidents. Regarding absenteeism, the following statistics
have been recorded for the reporting period of January to December 2023:

BANGLADESH

Lost time injuries
Injuries without lost time
Near misses
Lost days
LTIFR
Environmental incidents

SPAIN

4
5
N.R*
43
4.42
0

Lost time injuries
Injuries without lost time
Near misses
Lost days
LTIFR
Environmental incidents

0
1
2
122**
0
0

* Not reported**Corresponding to one accident occurred in 2022
No fatality has been reported since Recover™ opened
Since August 2023 no injury has been reported, and we truly believe that our OHSMS has been properly implemented since then.

At Recover™ we focus on the prevention of accidents thanks to our HSE trainings, risk
assessments and implemented measures. In the case of an accident, the HSE department hasdeveloped a process which includes an initial report from medical personnel, an investigationfrom the HSE manager, an agreement on the measures to take to mitigate potential risks, andalso the guarantee that those measures are properly implemented.
For the suppliers in Bangladesh, the Recover™ Responsible Sourcing Policy and Suppliers
Assessments are to be reviewed and included in the HSE improvement plans, to ensure social
responsibility in our supply chain.
Chemical Management System (CMS) and Chemicals Policy
At Recover™, we have implemented our own Chemical Management System (CMS) with theaim of removing hazardous chemicals from the value chain and focusing on safety, traceability,transparency and continuous improvement. This is also reflected in our Chemicals Policy.
Chemical management requires a systematic approach throughout all production stages,
including the input, chemical usage and handling in facility areas, and the output in our products.
The CMS is also aligned with industry standards that are used to monitor output chemicals thatmight be placed in the value chain and, eventually, reach consumers and or the environment.
Input
Input chemicals and our supply chain shall comply with a series of requirements that includes,
among other, management of information, adherence and compliance with industry Manufacturing
Restricted Substances List, evaluation of suppliers, etc.
In-use chemicals
Recover™ follows strict rules on use, handling, storage and disposal of chemicals. Our teamis being constantly trained on these topics to ensure the safest working conditions for our
employees.
Recover™ proactively monitors the use of chemicals and any wastage produced to reduce its
usage to the unavoidable minimum, and to make sure that any waste generated is properly
handled by approved and recognized waste treatment companies.
OutputAlthough the additives used in production do not pose any risk for humans or the environment,
given the type of raw materials used, Recover™ has systematically implemented a process
to analyze that there are no substances present in our final products that can pose a risk for
consumers and/or the environment.

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AGENTS OF CHANGE

All our batches are being tested in external laboratories recognized with accreditation under ISO
17025:2017 against the AFIRM RSL. This information can be provided upon request to clients.
Recover™ has a zero tolerance with output chemicals which are not in compliance with the AFIRM
RSL or any local restrictions.
Quality Management System (QMS)
In 2023, the Recover™ Quality Policy was reapproved by the executive management team andwas made available internally and externally through our website.
2023 marked a milestone for Recover™ in terms of continuous improvement. During the year, theRecover´s Quality Management System, based on the International Standard ISO 9001:2015, wasimplemented in our manufacturing hubs and headquarters. The focus of our Quality Management
System is customer satisfaction as well as the optimization of processes and continual
improvement.
Furthermore, the ISO 9001 aids a proactive and preventive culture by identifying and analyzing therisks and opportunities that are relevant to the company, or those that may affect the conformityof products and services enhancing the ability to increase customer satisfaction.

All identified risks are evaluated on their potential impact to Recover™ and other interested
parties, considering the likelihood and the severity.
Risks are evaluated and treated by implementing different measures depending on the risk levelto eliminate or minimize its likeliness to occur and/or its consequences.
In February 2024, after being audited by internationally recognized bodies under the ISO 9001,
the completion of the process of external certification was successfully completed demonstrating
Recover’s commitment to client satisfaction and continual improvement.
Mid and long-term plans to upgrade the Quality Management System, including its scope andobjectives, are yet to be defined and will allow Recover™ to move forward in terms of Quality &Environmental Management

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AGENTS OF CHANGE

Madrid office
The Recover™ headquarters is based in Madrid, Spain. These offices are in the GMP building,certified under the strictest environmental and social standards: LEED Platinum, ISO 9001, ISO
14001, ISO 45001.
Travel agency
Our travel agency In Out is committed to improving the environmental, social, and cultural
sustainability of the company. In 2022, they joined the Ciutadà Commitment for Sustainability andthe Barcelona Biosphere Commitment for Tourist Sustainability. This seal recognizes companies
that work on sustainability criteria based on the 17 SDGs set by the United Nations. At In Out, they
promote sustainable tourism that is respectful of our environment.

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ABOUT US

Sustainability Report | 61

This Sustainability report 2023 was published on the 24th of July 2024 and covers the financial
year from the 1st of January 2023 to the 31st of December 2023.
Recover™ is committed to updating and publishing its Sustainability report on an annual basis.
This report provides a comprehensive view of Recover’s approach to sustainability and our
performance in 2023, with a focus on environmental and social issues. It has been preparedwith reference to the Global Reporting Initiative (GRI) Standards. We also report our performanceagainst the Sustainable Development Goals (SDG) by the United Nations.
As a signatory to the United Nations Global Compact (UNGC) we have aligned this report with the
UNGC`s 10 universally accepted principles in the areas of human rights, labor, environment, andanticorruption. The report highlights progress made in 2023 towards these principles.
It includes information related to all of Recover’s manufacturing locations worldwide as wellas our global head office based in Spain and the report has been reviewed and approved by
Recover’s governance body. In 2023, Recover™ appointed PricewaterhouseCoopers as external
auditors for the financial statements of Recover HoldCo and its subsidiaries.
Please contact us with any questions about our sustainability report at
circularity@recoverfiber.com

GOVERNANCE STRUCTURE
Board Members
Olof Persson (Non-Executive Chairman & Independent Director)
Samir Shah (Member)Peter Comisar (Member)
Alfredo Ferre (Member)
Letitia Webster (Member)
Clay Krebs (Member)
Hans Ploos van Amstel (Member)
Global Management Team
ANDERS SJÖBLOM [ SE ]Chief Operating Officer

CHRISTIAN ROTH [ DE ]Chief Commercial Officer

MATTHEW NEVILLE [ UK ]Chief Financial Officer

PERSIO MORASSUTTI [ BR ]SVP Marketing

BORIS MERCIER [ FR ]Chief Product, Innovation &Sustainability Officer

VP People & Talent

ALFREDO FERRE [ ES ]Chief Executive Officer

HELENA DOMÈNECH [ ES ]ABOUT USREPORTING STANDARDS AND SCOPE* This organigram relates to the Recover™ management team as of July 2024.

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ABOUT US

Recover Hold Co. Is the holding company, based in United States. Its subsidiary companies are:Recover Textile Systems, SL is the subsidiary based in Spain.
RBD Fibers Limited is the subsidiary based in Bangladesh.
Recover US OpCo, LLC is the subsidiary based in the U.S.
Recover IPCo, LLC is the subsidiary based in the U.S. (Recover™ trademark ownership)

ANTI-CORRUPTION
We are committed to ensuring that all Recover™ companies meet their legal obligations, prevent,detect and eliminate corrupt practices, and cooperate to reduce opportunities for bribery andcorruption. We always require all our employees to act honestly and with integrity and to follow
the company’s internal Code of Conduct.
Through our Corporate Whistleblowing Channel, the different stakeholders of Recover™
(employees, shareholders, administration, suppliers, customers, communities, etc.) cananonymously raise queries and/or doubts about the construction or enforcement of the Codeof Conduct and give notice of any breaches of the Code as well as any other internal policy
and conduct regulations. All Recover™ employees receive training about the Code of Conduct
when joining the company, which includes details of the Corporate Whistleblowing Channel.
We also expect that all business partners apply the highest ethical standards in their business
relationships and commit to a zero tolerance of corruption.
Code of Conduct
Corruption in any form is not accepted, including bribery, extortion, kickbacks and improper
private or professional benefits for customers, agents, contractors, suppliers or employees ofany such party or government officials. Neither Recover™, nor any of its employees, shall everoffer or accept illegal or unlawful monetary gifts or other forms of remuneration in order to securebusiness related or private benefits, or benefits for customers, agents or suppliers.

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ABOUT US

STAKEHOLDER ENGAGEMENT
Our stakeholders are very important to the success of the company. Understanding and engaging
with them is critical to building our relationships, managing risks, and achieving long-term
success at Recover™.
Stakeholder engagement helps to identify and prioritize stakeholder concerns, understand their
expectations, and involve them in decision-making processes. By engaging with stakeholders,organizations can build trust, reduce conflict, and create more sustainable outcomes.
In order to identify our stakeholders and groups of interest, Recover™ has taken the following
into account:
The effect that our activity has whilst taking social, environmental, and governance aspects
into account.
The needs and expectations of each group, as well as the risks and impacts associated witheach of them.
The definition of adequate channels in each case ensuring a continuous flow of feedback.

Stakeholders
SHAREHOLDERSADMINISTRATION

STAFF

SUPPLIERSCUSTOMERSCOMMUNITY

Sustainability Report | 64

Very highExternal stakeholders

ABOUT US

MATERIALITY ASSESSMENT
Environmental

Governance

3
High

5

Social

1
4

2

6
10
11

14
16

Medium

17

15

12

7
13

9

High

8

Very highInternal stakeholders

1. No Child Labor
2. Safe Conditions at Work
3. No Harassment & Abuse
4. No Forced Labor
5. Equal Pay
6. No Discrimination

7. Payment of Living Wages
8. Socially Compliant Suppliers
9. Effective and Trustworthy Grievances Handling
10. Hazardous Substance Management
11. Reduction and Recycling of Waste
12. Compliance with Regulations and Responsible Practices

13. Traceable Supply Chains
14. Reduce Water Scarcity
15. Environmentally Compliant Suppliers
16. Anti-Bribery and Anti-Corruption
17. GHG Emissions Management

In 2023, we reviewed the material topics resulting from the materiality assessment performed in
2022. As per the Corporate Sustainability Reporting Directive (CSRD), we will perform during thenext 2 years a Double Materiality Assessment in order to consider how our actions impact bothpeople and the planet, as well as how sustainability issues can affect our financial wellbeing.
Following the stakeholder mapping exercise, we identified key areas of concern for the industry,and Recover™ in particular, by reviewing several internal and external documents: the OECD
Guidelines (Organization for Economic Cooperation and Development), as well as the ESG
requirements from Goldman Sachs Investment Management, our Code of Conduct and policies
from our stakeholders. An initial survey was performed to all internal and external stakeholders
with a total of 53 topics that represent potential environmental, social and governance risks. We
obtained a total of 69 replies. The most relevant 17 topics were then surveyed to the organization’s
extended management team and the results are presented in the graph.
Analysis of the results shows that the 9 highest rated topics are social ones. Through some
additional questioning we determined that the reason behind this is connected to the openingof the new hub in Bangladesh and the fact that this country is perceived as a high-risk country
for social issues and that in general, risks associated with human rights are prioritized overenvironmental risks. Finally, we concluded that our stakeholders rated social over environmental
issues, as they perceive that the Recover™ business already directly impacts positively on theenvironment due to our recycled products.
Recover™ is addressing most of the topics included in the top 17 with policies and processes
already in place. In addition, we are ensuring that these topics continue to be part of our long term
ESG strategy, are represented in our 2024 ESG goals, and remain a core focus for our stakeholder
engagement efforts moving forward.

Sustainability Report | 65

ABOUT US

FRAMEWORKS AND ASSURANCEStatement of use: Recover™ has reported the information cited in this GRI content index forthe period of the 1st of January 2023 to the 31st of December 2023 with reference to the GRI
Standards.
GRI1 used: GRI 1: Foundation 2021

GRI
STANDARDSECTIONGRI DISCLOSURE

PAGE

SDG

COMMENTGENERAL DISCLOSURESGRI 2: General
Disclosures2021

1. Theorganizationand its
reportingpractices

2-1 Organizational details

Governancestructure
Recover™
production network

--

--

--

--

2-2 Entities includedin the organization’ssustainability reporting

Governancestructure

--

--

--

--

2-3 Reporting period,
frequency and contact
point

Reportingstandards and
scope

--

--

--

--

2-4 Restatements of
information----

No restatements
have been made----2-5 External assurance----

We have notobtained external
assurance for thisreport.

--2. Activities
and workers

2-6 Activities, value
chain and other business
relationships

Closing the Loopon Fashion
The Recover™
process

SDG 6

--

--

--

2-7 Employees

Our people

SDG 8

All data reported
based on FTE (FullTime Equivalent)
for the period
1-1-2023 to 31-122023----

2-8 Workers who are not
employees

--

SDG 8

4 freelances.
Other possible
profiles are notincluded as
Recover™ has aservice agreement
but without directcontrol on them.

--

3. Governance

2-9 Governance structure
and composition

Governancestructure

--

--

--

--

2-10 Nomination andselection of the highest
governance body----

There are noformalized
processes forthe nominationand selectionof the highest
governance body.

----

2-11 Chair of the highest
governance body

Governancestructure

--

--

--

--

2-12 Role of the highest
governance bodyin overseeing themanagement of impacts

Governancestructure. Quality
Management
System (QMS)----

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ABOUT US----

2-13 Delegation of
responsibility for
managing impacts

Governancestructure

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2-14 Role of the highest
governance body insustainability reporting----

The Sustainability
Report isapproved by the
Chairman of thecompany andpresented
to both the Boardof Directors
and the C-level
directors----

2-15 Conflicts of interest

Anti-corruption

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2-16 Communication ofcritical concerns

Governancestructure

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2-17 Collective
knowledge of the highest
governance body

Governancestructure

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2-18 Evaluation of theperformance of thehighest governance body

Governancestructure

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2-19 Remuneration
policies----

We apply the legal
increases forwages that applyin each country.
Moreover, there
are specific salaryrevisions.

----2-20 Process todetermine remuneration----

We apply the legal
increases forwages that applyin each country.
Moreover, there
are specific salaryrevisions.

----2-21 Annual totalcompensation ratio----

The ratio of
total annualcompensation
for the highestsalary to themedian at global
level, excluding
the highestsalary. Taking
into accountall salaries andincluding trainees,
the ratio is 16.32--

4. Strategy,
policies andpractices2-22 Statement onsustainable development
strategy

Message from the
CEO

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2-23 Policy commitments

Recover™
environmental andsocial standards

SDG 8

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2-24 Embedding policy
commitments

Recover™
environmental andsocial standards

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2-25 Processes toremediate negative
impacts

Whistleblowing
corporate channel

SDG 8

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2-26 Mechanisms forseeking advice andraising concerns

Social
Accountability

SDG 8

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2-27 Compliance withlaws and regulations----

In 2023, there were nocases of number ofsignificant instances of
non-compliance reported.
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ABOUT US----

2-28 Membershipassociations

Objective:
Recover™
inspires anddrives sustainabletransformationand leadershipwithin the company
community andwider industry.

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5. Stakeholder
engagement

2-29 Approach to
stakeholder engagement

Stakeholder
engagement

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2-30 Collective
bargaining agreements

Social
Accountability----

GRI 3: Material
Topics 2021

Disclosures onmaterial topics

3-1 Process to determinematerial topics

Materiality
assessment----

GRI 3: Material
Topics 2021

Disclosures onmaterial topics

3-2 List of material topics

Materiality
assessment

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MATERIAL TOPIC: NO CHILD LABORGRI 408: Child
Labor 2016--408-1 Operations andsuppliers at significant
risk for incidents of childlabor> Recover™
Employee Code of
Conduct & Human
Rights Policy> Objective:
Recover™ supply
chains are
sustainable andsocially just> Materiality
assessment

MATERIAL TOPIC: SAFE CONDITIONS AT WORKGRI 403:
Occupational
Health and
Safety2018--403-1 Occupational
health and safety
management system----403-2 Hazard
identification, risk
assessment, and incident
investigation----

403-3 Occupational
health services

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403-4 Worker
participation, consultation,and communication on
occupational health andsafety------403-4 Worker 4035 Worker training on
occupational health andsafety------403-6 Promotion of worker
health------403-7 Prevention andmitigation of occupational
health and safety
impacts directly linked bybusiness relationships

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403-8 Workers coveredby an occupational healthand safety management
system--Health & Safety:
Occupational
Health and Safety
Management
System (OHSMS)
Objective:
Recover™ supply
chains are
sustainable andsocially justSDG 3, 8----

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ABOUT US----

403-9 Work-related
injuries

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403-10 Work-related illhealth--MATERIAL TOPIC: NO HARASSMENT & ABUSE, NO DISCRIMINATIONGRI 406: Nondiscrimination
2016

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406-1 Incidents of
discrimination andcorrective actions taken

Social
Accountability

SDG 5, 8

No incidents of
discrimination
have beenreported during
the reporting
period.

SDG 8--

MATERIAL TOPIC: NO FORCED LABORGRI 409:
Forced orCompulsory
Labor
2016

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409-1 Operations andsuppliers at significant
risk for incidents offorced or compulsory
laborSocial
Accountability
Objective:
Recover™ supply
chains are
sustainable andsocially justMateriality
assessment

MATERIAL TOPIC: EQUAL PAY
GRI 405:
Diversityand Equal
Opportunity
2016

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405-1 Diversity of
governance bodies andemployees

Social Our people
Governancestructure

SDG 5, 8

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405-2 Ratio of basic
salary and remunerationof women to men

Social Our people
Governancestructure

SDG 5, 8

Average ofmen vs womencorresponding
to the entire year
2023

MATERIAL TOPIC: PAYMENT OF LIVING WAGESGRI 3: Material
Topics 2021--

3-3 Management ofmaterial topics

Recover™
Employee Code of
Conduct & Human
Rights Policy
Objective:
Recover™ supply
chains are
sustainable andsocially just

SDG 8

Average ofmen vs womencorresponding
to the entire year
2023

MATERIAL TOPIC: SOCIALLY COMPLIANT SUPPLIERS
GRI 414:
Supplier Social
Assessment
2016

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414-1 New suppliers thatwere screened usingsocial criteria

Objective:
Recover™ supply
chains are
sustainable andsocially just

SDG 8

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414-2 Negative social
impacts in the supply
chain and actions taken

Objective:
Recover™ supply
chains are
sustainable andsocially just

SDG 5, 8--

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ABOUT US

UN GLOBAL COMPACT PRINCIPLES

PAGE

SDG

COMMENTUN GLOBAL COMPACT PRINCIPLES: HUMAN RIGHTS
Principle 1

Businesses should support and respect theprotection of internationally proclaimed humanrights; and

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Principle 2

make sure that they are not complicit in humanrights abuses.

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UN GLOBAL COMPACT PRINCIPLES: LABOR
Principle 3

Businesses should uphold the freedom of
association and the effective recognition of theright to collective bargaining;

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Principle 4

the elimination of all forms of forced andcompulsory labour;

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Principle 5

the effective abolition of child labour; and

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Principle 6

the elimination of discrimination in respect of
employment and occupation.

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UN GLOBAL COMPACT PRINCIPLES: ENVIRONMENT
Principle 7

Businesses should support a precautionary
approach to environmental challenges;

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Principle 8

undertake initiatives to promote greater
environmental responsibility; and

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Principle 9

encourage the development and diffusion ofenvironmentally friendly technologies.

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UN GLOBAL COMPACT PRINCIPLES: ANTI-CORRUPTION
Principle 10

Businesses should work against corruption in allits forms, including extortion and bribery.

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Sustainability Report | 70

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