Sidenor 2022 Sustainability Report

EU taxonomy The EU Green Deal establishes an ambitious goal of reaching CO 2 neutrality in Europe by 2050. For this purpose, the European Commission defined a series of measures as part of the action plan “Sustainable Finance” in order to channel capital flows towards environmentally sustainable activities. The EU Regulation (EU) 2020/852 (“Taxonomy Regulation”) entered into force on July 12th, 2020, and is a key element of the Deal: it includes a unified and legally binding classification system to classify economic activities as environmentally sustainable (= taxonomy- aligned activities). An economic activity is considered environmentally sustainable if it substantially contributes to one of the European Union’s six environmental objectives, without causing any significant harm to any of the other five objectives. These objectives are the following: Climate change mitigation. Climate change adaptation. The sustainable use and protection of water and marine resources. The transition to a circular economy. Pollution prevention and control. The protection and restoration of biodiversity and ecosystems. As of the date of this report, the European Union has defined technical criteria to assess an economic activity on the basis of the two first objectives only. Evaluation of eligibility The European Commission, in its Delegated Regulation (EU) 2021/2139 supplementing Regulation (EU) 2020/852, establishes the technical screening criteria for defining the conditions under which an economic activity qualifies as contributing substantially to climate change mitigation or climate change adaptation and for determining whether that economic activity causes no significant harm to any of the other environmental objectives. Sidenor: NACE 24.10 code The manufacturing of iron and steel in electric arc furnaces belongs to the eligible activities (defined as activities which might be environmentally sustainable). According to the technical criteria, our activity is deemed to contribute to climate change mitigation if the scrap input in the furnace is not lower than 70% of the production of high allow steel. Sidenor largely complies with this threshold. Sidenor is eligible, as its type of activity is included in EU taxonomy 74 Sustainability Report 2022 | Environmental sustainability