Vestel Elektronik Sanayi ve Ticaret Anonim Sirketi : Integrated Annual Report 2023

A SUSTAINABLE FUTURE WITH ADVANCED TECHNOLOGY

IS POSSIBLE WITH VESTEL

Elektronik Integrated Annual Report 2023

CONTENTS

10 Vestel in a Nutshell

1. Summary Financial and Operational Indicators

1. Shareholding Structure of Vestel Elektronik
2. Competitive Advantages of Vestel Elektronik
3. From Vestel to the Whole World…

1. Message from the Chairman

1. Board of Directors

1. Message from the CEO

1. Senior Management

1. Highlights of 2023

1. Vestel Integrated Business Model

1. Strategic Approach
   36 Materiality Analysis
   44 Sustainability Management
   48 Ethical Principles

1. Global Trends, Risks and Opportunities

1. Evaluation of Product Groups for the Year 2023

1. Financial Performance

1. Technology and Human-Oriented Transformation 79 Production and Innovation Power
   96 Employees
   110 Corporate Citizenship
   112 Supply Chain

1. A Net Zero Company
   117 The Journey to Net Zero
   122 Circular Economy
   125 Water Stewardship

1. Accessible and Smart Solutions that Make Life Easier 127 Products and Solutions Creating Benefits
   136 Quality and Product Safety
   138 Customer Experience
   142 Affiliates

1. Additional Disclosures Required by Legislation

1. Corporate Governance
   156 Risks and Assessment of the Board of Directors
   159 Internal Audit Activities and Internal Control System
   161 Corporate Governance Principles Compliance Statement
   162 Corporate Governance Compliance Report
   168 Corporate Governance Information Form
   174 Structure of the Board of Directors
   175 Duties and Authorities of the Board of Directors
   176 Board Committees
   179 Evaluation of the Board of Directors Regarding the Working Principles and Effectiveness of the Board Committees

1. Annexes
   180 Annex 1: About the Report
   181 Annex 2: Stakeholder Relations
   184 Annex 3: Association Memberships and Supported Initiatives
   185 Annex 4: Integrated Management Systems and Environmental Management
   187 Annex 5: Awards
   189 Annex 6: Performance Indicators
   194 Annex 7: Reporting Principles
   205 Annex 8: UN Global Compact (UNGC) Progress Table
   206 Annex 9: Sustainability Principles Compliance Report
   212 Annex 10: TCFD Index
   213 Annex 11: SASB Index
   214 Annex 12: Limited Assurance Report

1. Financial Reports
   218 Statement of Responsibility for the Annual Report
   219 Independent Auditor's Report on the Annual Report
   221 Statement of Responsibility for Financial Tables
   223 Consolidated Financial Statements and Independent Auditor's Report

1. GRI Content Index

1. Investor Information

IT IS POSSIBLE WITH VESTEL WHY NOT?

With our deep-rooted experience and strong presence in the industry, and a staff of nearly 20 thousand expert employees, we are one of the first brands that come to mind when it comes to reliable products and service.

At Vestel we integrate the power of technology into the entire value chain, carry out product transformations focused on people, and provide next generation products equipped with state-of-the-art technology to our customers to attain a sustainable future. Owing to our strategy centered on the nexus of hardware, design, and software, we attained a steady increase in our brand value and became one of the three most valuable brands in our country. As the top exporter in our industry for a quarter century, we reach more than 160 countries across the world with the technology we produce. We play an important role in Türkiye's economy thanks to our manufacturing capability and contributions to our country's exports. As our accomplishments proliferate, in light of technological advances, we proclaim "A better future is possible with Vestel. Why not?" with our new products, investments, and projects, and we continue our initiatives at full speed.

SUSTAINABLE FUTURE

IS POSSIBLE

WITH VESTEL

Reaching the world with the technology we produce at Vestel City, we play an active role in the proliferation of electric vehicle charging stations in Türkiye and in Europe.

Thanks to our manufacturing capability at our electronics factory, we are adapting to the rapidly changing world and focusing on new areas of production. We position the electric vehicle industry at the top of these areas. We aim to have a say in the future of smart life with our electric vehicle charging stations, battery solutions, mobility and software capabilities. Our new business lines facilitate major reduction in carbon emissions and enable our business partners to support the circular economy.

ENVIRONMENTALLY

FRIENDLY TECHNOLOGY

IS POSSIBLE

WITH VESTEL

We shape all our activities on the basis of sustainability. To this end, we develop solutions geared to more efficient utilization of natural resources.

We integrate our EV chargers with solar panel systems, enabling electric vehicles to be charged with 100% renewable energy. In the short term, we aim to manufacture batteries which are used as backup energy storage. In the medium and long term, we plan to focus on residential, commercial, industrial, and utility-scale energy storage systems. At Vestel, we will continue to work for a sustainable world with our energy efficient products and innovative battery storage solutions.

INVESTMENTS BEYOND

THIS AGE

ARE POSSIBLE WITH VESTEL

We offer our customers comprehensive automotive solutions, encompassing R&D, design, and manufacturing of in-vehicle displays, electronic control units, power electronics and connected vehicle solutions.

All the necessary software and interface designs for our automotive solutions are developed by our expert engineers. Within this scope, we implemented our in-vehicle display solutions for the first time at Togg. We successfully passed the tests on Togg's digital instrument and information displays. Further, we enabled users to control their electronic devices at home through our VeeZy application.

DIGITAL TRANSFORMATION

IS POSSIBLE

WITH VESTEL

While using the state-of-the- art technologies such as artificial intelligence, internet of things, and autonomous systems in our factories, we continue our digital transformation efforts at full speed.

In line with our Smart Life 2030 sustainability strategy, we develop human-oriented ecosystems and innovative business models while undertaking pioneering initiatives. Combining our sustainability approach with the IoT strategy, we proclaim "Smarter life for everyone is possible with Vestel." We provide our customers with a much more comprehensive smart life experience with our Evin Aklı and VeeZy applications.