GN has set Board-approved science-based GHG emission reduction targets to manage our climate-related impact and risks by decarbonizing in line with the scientific consensus on the urgency of addressing climate change and the degradation of nature. We are committed to reduce absolute GHG emissions (metric tons CO2eq) in Scope 1 and 2 by 80% and in Scope 3 by 25% by 2030 from a 2021 baseline. GN is also committed to reaching net-zero GHG emissions by 2050 at the latest, meaning 90% reduction with neutralization of unabated emissions to reach net zero. These targets cover all GHGs stipulated in the GHG Protocol and all activities in GN’s own operations and value chain globally. Our near-term targets have been set using the Science Based Targets initiative’s (SBTi) Criteria v5.0 with the absolute contraction approach and the cross-sector pathway, which is based on the P1 scenario in the IPCC Special Report on Global Warming of 1.5°C. It has been assumed that GN’s core business activities will not change by 2030. We have aligned our net-zero target to the SBTi’s cross-sector absolute reduction method for long-term targets.

Risks and opportunities have been assessed by looking at our impacts in terms of financial loss or gain and reputational damage or gain. The assessment used our product life cycle assessments (LCA), corporate GHG accounting and publicly available tools, such as the WWF Water Risk Filter and climate impact projections from IPCC AR6. We also looked at historical incidence of extreme weather events and consequent disruption in own operations and supply chain as well as cost variability, and expected changes to, for example, carbon taxes placed on GN goods. Physical and transition risks We applied different climate scenario analysis over the short, medium and long term to identify and assess climate-related acute and chronic physical risks, such as extreme weather events, heat and water stress and sea level rise, as well as transition risks, such as carbon pricing, regulatory change, changing customer behavior, and availability of materials. For climate-related physical risks, geolocations data for our facilities and those of our suppliers was used to assess relevant risks. A high-level qualitative assessment was carried out using the RCP8.5, IEA Net-Zero Emissions by 2050 Scenario (NZE) and IEA STEPS scenarios. The RCP8.5 scenario gives us the likely upper end of risk exposure of the business to climate-related hazards in the future. Here, the Shared Socioeconomic Pathway 3 was chosen to reflect recent trends in international affairs. The IEA’s new Net Zero Roadmap report and IEA’s NZE and STEPS scenario were applied to identify and assess climate-related transition risks and opportunities that GN may face in the future if the world pursues a path to net-zero emissions by 2050 or if climate action is less aggressive and policymaking is assumed to remain as today.