Suez : Note on methodology "Evaluation of SUEZ Group 2020 revenue integrated...

Evaluation of SUEZ Group 2020 revenue integrated to the European Taxonomy

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PRESENTATION OF WORK AND NOTE ON METHODOLOGY FOR THE 2020 FISCAL YEAR

"The European Commission's commitment to identifying companies that contribute toward environment and climate protection is of the utmost importance, which is why we expedited the revenue analysis target set by the European reference framework by a year. As such, we can report "green" revenues of almost 75%.

This figure strengthens our resolve to achieve the goals set out in the SUEZ 2030 strategic plan, which require expertise in sustainable development to ensure that 100% of our solutions are sustainable by 2030. Our proactive approach to adopting the European taxonomy is clear evidence of the pioneering role that we play in this area and we plan to continue this work in order to increase this part of our revenue in the years to come.

Our success serves as a signal to all of our stakeholders, especially at a time when our shareholders and investors are looking for a company at the forefront of responsible investment".

Bertrand Camus

SUEZ Chief Executive Officer

Executive summary

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SUEZ, convinced that non-financial Illustrating its commitment to helping the financial community

performance of companies is a powerful lever for the allocation of in 2021, the share of its 2020 revenue qualifying to this capital in favor of environmental transition, strives to provide commitment to engage in dialog with its stakeholders, in line reliable financial and non-financial with its Purpose.

information reflecting its

assess its non-financial performance as well as the objective of climate change mitigation, SUEZ has decided to disclose, framework in general. Publication of this note on methodology illustrates SUEZ's commitment to transparency and its

Considering the evolving character of the European regulatoryenvironmental and societal framework and the various levels of information available

contribution

Since 2008, the Group associates its sustainable development policy with an ESG approach, based on its participation in the most demanding non-financial evaluations and on an open and transparent dialog with its stakeholders. Eager to include its contribution in the most pertinent international reference frameworks, SUEZ has integrated the United Nations Sustainable Development Goals (SDGs) into its latest Sustainable Development Roadmap, while environmental and social indicators are disclosed each year in its integrated report alongside the corresponding reference tags of the Global Reporting Initiative (GRI). This integrated approach has been reinforced in 2020 through the Group's adoption of its Purpose at the Shareholders' Meeting of May 12, 2020.

The adoption by the European Union (EU) of a reference framework aimed at distinguishing the economic activities contributing to meeting the European objectives in the fight against climate change and the implementation of the Paris Agreement stresses the ample scope of these challenges and the ambition of European authorities regarding transparency and sustainable finance. This is why SUEZ supports the European Commission's work to define a set of technical criteria to help private and public operators orient their investments towards projects that support the transition to a sustainable and low-carbon economy1.

In accordance with European Regulation 2020/852 of June 18, 2020 on the establishment of a framework to facilitate sustainable investment within the European Union (EU), in fiscal year 2021 the Group will be subject to the obligation to disclose the part of its revenue, its investment and operating expenses resulting from products or services associated with economic activities considered to be environmentally sustainable according to the classification and criteria defined in the European Taxonomy.

regarding the alignment of the Group's business activities with the Taxonomy criteria, the Group has defined several levels of qualification of its business activities, reflecting its visibility on this regulatory system as of the revenue consolidation date of FY 2020. A business activity may therefore be:

• • Qualified for the reference framework of the European green Taxonomy as specified in the European Regulation of June 2020, or

• • Eligible for the climate change mitigation objective pursuant to the draft Delegated Regulation (Annex I) published in November 2020, or

• • Not identified in the reference framework of the European Green Taxonomy as available on the publication date of this report, or

• • Excluded from the reference framework of the European Green Taxonomy as available on the publication date of this report.

This first evaluation of the qualification and eligibility of SUEZ's business activities has been conducted on the basis of the draft Taxonomy and draft Delegated Regulation (Annex I), available on the revenue consolidation date of FY 2020, through a methodological approach including a detailed analysis of the Group's activities, starting from processes, existing reporting systems and hypotheses formulated with the management. Together they constitute a method whose significant elements - hypotheses and interpretations, clarifications and methodological limitations - are outlined in the note on methodology below. The Group will review this methodology and the figures based on the evolution of the regulations and namely with the publication of delegated regulations in 2021.

1https://ec.europa.eu/info/business-economy-euro/banking-and-finance/sustainable-finance/eu-taxonomy-sustainable-activities_en

The revenue considered for this analysis covers all business activities of SUEZ at December 31, 2020 with the exception of assets held for sale2. The elements presented in this note have been reviewed by KPMG; the limited assurance report is available in section 5.

• • The business activities eligible and qualifying for the six objectives of the European Taxonomy on sustainable activities represent 74% of the SUEZ Group's 2020 revenues selected for this analysis:

  - 65 % has been identified as eligible for the objective of climate change mitigation, and

  - 9% are considered qualified to the other five objectives (adaptation to climate change, sustainable use and protection of aquatic and marine resources, transition to the circular economy, pollution prevention and control, protection and restoration of biodiversity and of ecosystems).

  • • 18% of the analyzed revenue covers business activities whose correspondence or contribution to the Taxonomy reference framework could not be identified by the Group on the basis of information available on the date of consolidation of financial statements.

  • • The business activities excluded from the Taxonomy reference framework by the European Commission represent 8% of the revenue considered; however, the Group considers that these business activities have an environmental benefit that justifies their re-examination and integration in the reference framework (see section 2.2.3).

2 See section 3.2 of this note