Airbus // Universal Registration Document 2021

Risk Factors / 4 Environment, Human Rights, Health & Safety Risks

be time-consuming and costly, harm the Company’s reputation or require it to enter into licensing arrangements. The Company might not be able to enter into these licensing arrangements on acceptable terms. If a claim of infringement were successful against it, an injunction might be ordered against the Company, causing further losses. There are currently no significant claims of IP infringement pending against the Company. Minor claims and pre-dispute matters commonly settle either without the issuance of formal legal proceedings or during initial proceedings.

In the event the Company is unable to adequately procure and protect critical IP it could potentially not implement its business strategy. The Company has been accused of infringement on occasion and could have additional claims asserted against it in the future. These claims could harm its reputation, result in financial penalties or prevent it from offering certain products or services which may be subject to such third-party IP rights. Any claims or litigation in this area, whether the Company ultimately wins or loses, could

4. Environment, Human Rights, Health & Safety Risks

Climate-Related Risks

The development of future products based on the ZEROe concepts will require significant investments in both products and supporting infrastructure, which could directly impact the operating costs of such a product. The competitiveness of this next generation product will also strongly depend, among other factors, on the evolution of the price of carbon dioxide emissions. It is, therefore, crucial for the Company to account at each step of development for market expectations, while staying affordable for its customers and competitive with regards to competitors’ portfolios. The failure to do so could result in the Company losing market share to competitors, as well as af fecting the Company’s return on investment with regards to future commercial aircraft products. Energy transition : The Company has identified a risk of insufficient availability of low carbon fuels (such as sustainable aviation fuels or hydrogen) and the limited number of innovative certified pathways that may compromise the decarbonisation ambition of the Company and for the whole aviaton sector. Policy and Legal : Aviation is a complex industry, with long product development cycles and where change takes a long time to be implemented. A rapid evolution of climate- related pol icies (such as carbon pr icing pol icies and sustainable aviation fuel policies) and regulatory frameworks (CO 2 standards, sustainable f inance, emissions trading systems, aircraft operation restrictions among others) could generate fast-changing requirements and could obstruct new product development pathways. As aviation is a global industry, policies and regulatory frameworks implemented at regional level rather than international level, or evolving at a different speed depending on the region, would unbalance a competitive level playing field for manufacturers and operators possibly creating market distortion. This could result in a loss of competitiveness for the Company.

Cl imate change may have a major impact on both the Company’s industr ial operations and its upstream and downstream value chain, including aircraft direct operations and the wider air transport ecosystem along with a strong inf luence on regulations and stakeholders expectations. Accordingly, climate-related risks can potentially af fect the Company’s business and competitiveness, its customers and other actors from the aviation industry. The Company categorises its cl imate-related risks and opportunities according to the Task Force on Climate-related Financial Disclosures (“ TCFD ”) recommendations. In particular, risks are sorted into two categories: transition and physical. Transition Risks Technology : The Company has identified the risk of a reduction in the Company’s business, results of operations and financial condition if a competitor brings a lower emission product to the market before it does. Delivering on commitments and potential future requirements to mitigate climate impacts will require significant technological developments for the commercial aircraft sector as well as appropriate infrastructure developments and other ecosystem adaptations. In the event that a competitor or new market participant has access to technological developments unavailable to the Company and is able to place on the market a large passenger aircraft with significantly lower emissions before the Company, climate mitigation requirementsmay push themarket towards competing products until the Company and its partners can develop a competing alternative, which could lead to a temporary loss of market competitiveness and reduced revenue. Market : Changes in societal expectations and growing concerns about climate change may impact market demand for air transport. In particular, a change in certain passengers’ behaviour or their transition to other transport modes could decrease the demand for the Company’s current and future generation of products, causing a loss of revenues.

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Airbus / Registration Document 2021