FRIWO : Sustainability report of FRIWO Group 2023

Facts, data, figures.

2023 Sustainability Report

2	FRIWO 2023 Sustainability Report

Contents

4 Foreword

6 1 Sustainability at FRIWO

1. 1.1 What sustainability means to us

1. 1.2 Business model
2. 1.3 Reporting

9 2 Corporate development

1. 2.1 Head office

1. 2.2 History
2. 3 Sustainability management

1. 3.1 Requirements

1. 3.2 Material sustainability topics
2. 3.3 Sustainability organisation

1. 3.4 Market expectations
2. 4 Business areas and products

1. 4.1 Tools

1. 4.2 Industrial
2. 4.3 Medical

13 4.4 E-mobility

17 5 Environment

1. 5.1 Production process
2. 5.2 Energy consumption

1. 5.3 Greenhouse gas emissions
2. 5.4 Water use

1. 5.5 Waste
2. 6 Employees

1. 6.1 Staff development

1. 6.2 Workforce structure
2. 6.3 Education and training
3. 6.4 Competitive pay rate and performance-related pay

1. 6.5 High standards in occupational health and safety

1. 6.6 Workforce diversity
2. 7 Respect for labour and human rights

25 8 Corporate governance

1. 8.1 Compliance and transparency
2. 8.2 Sustainability as a component of risk management
3. 8.3 Stakeholder dialogue
4. 9 EU taxonomy

FRIWO Sustainability Report

3

2023 Sustainability Report

4	FRIWO 2023 Sustainability Report

Foreword

Dear shareholders, dear readers,

FRIWO is an internationally active group of companies with more than 50 years of history behind it. We develop and manufacture power supplies, charging systems and digitally controlled drive solutions. Our product portfolio includes technologically advanced chargers, battery packs and power supplies, plus intelligent components and systems for electric drive systems.

In addition to the high technical quality of our products, FRIWO continues to attach great importance to our corporate responsibility towards nature and society. As a result, sustainability criteria play a key role in determining the character of our products and the production process. FRIWO systems and components provide our customers with a high level of safety, convenience and sustainability potential. The hallmarks of our manufacturing are energy efficiency, carbon intensity and resource efficiency.

A key element of FRIWO's corporate culture is entrepreneurship that takes a long-term view. Innovation and material efficiency make environmentally friendly products economically viable, enhance their competitiveness and help ensure that they're fit for the future. This means offering customers outstanding products, providing employees with the best possible working conditions and opportunities, minimising our impact on the environment, and working to achieve long-term profitability.

But sustainability doesn't just mean offering the right products and services. It also means getting innovations to market at the right moment and correctly reading and understanding trends. Here's an example. India's capital city, New Delhi, has a population of around 18 million people. According to the World Health Organization (WHO) it also has some of the highest levels of air pollution in the world.

Indian politicians have now decided it's time to do something about it. One of the main sources of air pollution in the city is two and three-wheelers. Extremely popular, they are, however, powered by pollutant and CO2-emitting internal combustion engines. The city is therefore aiming to increase usage of zero tailpipe emissions electric motors. Currently, with an estimated 30 million vehicles, the proportion of two and three-wheelers powered by electric drive systems is close to zero. The city would like to increase this proportion to 15 percent by 2027.

In Europe, FRIWO is already one of the leading e-mobility suppliers for this type of vehicle and has carved out a position as a successful system provider, boasting hardware and software expertise for climate neutrality and energy efficiency. In India, FRIWO has a 49.9 percent stake in an e-mobility joint venture established in 2021 with India-based global vehicle manufacturer UNO MINDA Group.

Forewor 5

Over the next few years, industry experts expect to see significant growth in demand for electric two and three-wheelers in India and neighbouring countries. This engagement by the FRIWO Group is part of its strategy to achieve the goals of mitigating climate change and boosting the circular economy through high-performance,environmentally-friendly products produced using sustainable processes.

In tandem with other fields of application for FRIWO products, it is highly likely that the next few years will see further growth in the e-mobility field. With more than 50 years of experience in producing high specification components for electric drives and in providing flexible development services in highly specialised design fields, we have established ourselves as an extremely competitive market player.

Given this, our future prospects are not limited to our excellent chances of achieving profitable organic growth. FRIWO will also enable its customers to develop high performance products and get them to market faster. All of which leads us to believe that the FRIWO Group will continue to be an attractive business going forward.

Rolf Schwirz	Oliver Freund
Chairman of the	Member of the
Executive Board	Executive Board

6	FRIWO 2023 Sustainability Report

1 Sustainability at FRIWO

1.1 What sustainability means to us

Thinking and operating sustainably are key factors for business success. By doing so, FRIWO is discharging its responsibilities towards society and contributing to ensuring that future generations will also be able to enjoy a functioning society, economy and environment.

FRIWO makes a substantial contribution to sustainability by developing and manufacturing high- quality, high-performance components for electrification, thereby reducing greenhouse gas emissions. At the same time, FRIWO is also highly focused on maximising its efficiency in order to minimise energy losses. A future area of focus will be on using recyclable materials.

1.2 Business model

FRIWO is an internationally active, innovative provider of high-performance power supply and drive systems. As well as chargers, battery packs and power supplies, the product portfolio also includes components for electric drive systems. FRIWO offers a full range of powertrain components - from displays and motor controllers to battery packs and control software - from a single source. Plus, in addition to the individual components and solutions in its service portfolio, FRIWO has also established itself as a provider of complete system solutions, boosting its share of added value.

FRIWO electric drive components are primarily deployed in electromobility applications, for example battery-powered electric scooters.

FRIWO products are used in a wide range of fields. A successful presence in the demanding electromobility, mobile power tool and garden tool markets in particular requires many years of charging technology experience and expertise - two areas in which FRIWO is uniquely qualified.

FRIWO boasts particular expertise in power supply solutions for medical technology and health applications and for industrial systems automation.

In terms of manufacturing, FRIWO's strengths include its optimised combination of in-house production and highly reliable suppliers. Most of our manufacturing is carried out in two factories on an industrial estate near Ho Chi Minh City in Vietnam. In pursuit of vertical integration, in addition to the main factory, our Vietnam site currently also hosts three supplier factories producing FRIWO winding materials, cables and stamped plastic and metal parts. From May 1, 2024, as part of the process of making our production base more flexible, winding material and component manufacture will be outsourced to Group Intellect Power Technology Limited (GIPT), based in Hong Kong. GIPT will in future undertake contract manufacturing for FRIWO.

Sustainability at FRIWO	7

The remaining production facilities (but not the site and buildings) in Ostbevern have been sold to Hamburger Beteiligungsgesellschaft Private Assets SE & Co. KGaA, which will also undertake contract manufacturing for FRIWO products manufactured in Europe. The transaction takes effect on March 1, 2024.

FRIWO obtains a small portion of its products from selected contract manufacturers with production sites in China, India and Vietnam.

With advanced development centres, manufacturing and sales organisations in Europe, Asia and North America, FRIWO is present in every major market around the world. The company boasts industry- leading technology expertise. The FRIWO brand stands for innovation, safety, quality and efficiency globally.

1.3 Reporting

The information and data presented here has been structured based on the Global Reporting Initiative (GRI) classification. This report also meets in full the requirements for non-financial statements set out in Sections 315b and c in conjunction with Sections 289b to e of the German Commercial Code (Handelsgesetzbuch, HGB) and in Regulation (EU) 2020/852 of the European Parliament. This means that it includes the information required by the German Non-Financial Reporting Directive Implementation Act (CSR-Richtlinie-Umsetzungsgesetz) on key environmental, social and employee matters, respect for human rights, and anti-corruption and bribery matters.

This sustainability report covers the following Group companies:

• FRIWO AG, Ostbevern, Germany
• FRIWO Gerätebau GmbH, Ostbevern, Germany
• FRIWO Vietnam Co. Ltd., Bien Hoa City, Vietnam
• FRIWO Power Solutions Technology (ShenZhen) Co. Ltd., Shenzhen, China
• FRIEMANN & WOLF INDIA PRIVATE LIMITED, Bangalore, Karnataka, India
• FRIWO North America, Inc., Chagrin Falls, Ohio, USA

FRIWO manages its operational activities through the use of financial metrics and performance indicators. There are no non-financial performance indicators of significant relevance to business operations (Section 289c(3)(5) of the HGB). Consequently, there is no direct relationship between the amounts reported in the consolidated financial statements pursuant to Section 289c(3)(6) of the HGB and the five non-financial aspects set out in Section 289c(2)(1 to 5) of the HGB.

The Supervisory Board has audited the sustainability report (which also represents the consolidated non-financial report for the 2023 financial year for the FRIWO Group and FRIWO AG) and verified that it is lawful, proper and appropriate in accordance with Section 171(1)(4) of the German Stock Corporation Act (Aktiengesetz). In accordance with Section 317(2)(4) of the HGB, the report has been submitted to the auditor, but the content has not been reviewed. FRIWO is committed to transparency for stakeholders. We report on all aspects of our operations and the corporate environment that are relevant to sustainability.

8	FRIWO 2023 Sustainability Report

Non-financial aspect	HGB

Key fields of action

Section

Environmental matters		• Promoting e-mobility	4.4
	Section	• High efficiency and lower	5.2
	energy consumption
	289c(2)(1)
	• Improving the circular	5.1
		economy
Employee matters		• Education and training	6.3
	Section	• Occupational health	6.5
	289c(2)(2)	and safety	6.6
		• Diversity
	Section	• Product quality	4
Social matters	and safety
289c(2)(3)	8.3
	• Stakeholder dialogue
Respect for human rights	Section	• Respect for labour and	7
	289c(2)(4)	human rights
Anti-corruption and bribery	Section	• Compliance management	8.1
• Sustainability in risk	8.2
matters	289c(2)(5)
management

Corporate development	9

2 Corporate development

FRIWO's roots can be traced back to 1884 with the founding of Friemann & Wolf in Zwickau, Saxony, inventor and manufacturer of the gasoline safety lamp for coal mining. Friemann & Wolf was, towards the end of the nineteenth century, one of the first companies in Germany to operate globally. After the Second World War, Friemann & Wolf was re-founded in Duisburg as a mining lamp and mining accessory manufacturer. The company invented the plug-in power supply (initially for cassette recorders) in 1971 and founded FRIWO Gerätebau GmbH as a new business unit. The company's corporate development has been characterised by sustainable organic growth and selected acquisitions.

2.1 Head office

FRIWO's head office is located in Ostbevern (North Rhine-Westphalia) near Münster. Alongside administrative, management and sales functions, the majority of head office activity is concerned with research and development.

In addition, with advanced development centres, manufacturing and sales organisations in Europe, Asia and North America, FRIWO is present in every major market around the world.

The company is ISO 9001 (quality management systems), ISO 13485 (quality management systems for medical devices) and ISO 14001 (environmental management systems) certified.

2.2 History

In 1971, FRIWO invented and developed the world's first plug-in power supply. Roughly ten years later, FRIWO had already become Europe's largest manufacturer of small power supplies and chargers. By 2005, just 34 years after its foundation, FRIWO had already manufactured and supplied a billion power supplies. In 2013, FRIWO's turnover for the first time exceeded €100 million.

Through acquisitions and by opening an advanced manufacturing facility in Vietnam, FRIWO has, over a 50 year period, developed into a software-orientedhigh-tech provider with an international presence. Today, FRIWO offers a full range of electric powertrain components from a single source, including compatible, performance-boosting software. Today, FRIWO also stands for outstanding quality in the medical technology field.