Saint-Gobain // Universal Registration Document 2021

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Financial and accounting information 2021 Consolidated Financial Statements

Climate issues NOTE 3

CO 2 emissions allowances The Saint-Gobain Group was allocated 3.7 million tonnes of greenhouse gas emissions allowances by the European Commission at the end of 2021. These allowances will cover the Group’s actual CO 2 emissions for 2021. As a result, no provision was recorded in this respect in the Group’s financial statements (see note 5.5.4). Sustainable investments, research and development expenditure, and other expenditure aimed at combating climate change and protecting the environment In 2021, the Group set aside €55 million in capital expenditure and €44 million in research and development expenditure to further its environmental CO 2 emissions reduction strategy. Executive Compensation policy In stepping up its commitment to carbon neutrality, the Group increased since 2020 the weighting of CSR objectives in the criteria determining long-term executive compensation plans: CSR objectives now determine 20% of amounts paid out under such plans compared to 15% previously, while CO 2 objectives now account for 10% versus 5% previously (see note 6.2). The consideration of climate change issues did not have a material impact on the judgments made or the key estimates required to prepare the financial statements. The Group will continue to analyze the potential impacts of future changes in regulations related to climate change and the energy transition as part of its commitment to achieve carbon neutrality by 2050.

Given its activities in the renovation market, sustainability is essential in supporting the growth of the Saint-Gobain Group. Sustainability issues are therefore an integral part of the Group’s growth outlook, in line with issues relating to the energy transition. Responding to climate challenges is therefore at the heart of the Group’s strategy, and its net-zero-carbon commitment is taken into account in its financial decisions.

3.1

The commitment to carbon neutrality is at the heart of the Group’s strategy

In line with the Paris Agreement, Saint-Gobain signed the pledge of the UN Global Compact’s “Business ambition for 1.5°C” on September 23, 2019 in New York, thereby affirming its commitment to achieving carbon neutrality (net-zero-carbon emissions) by 2050. In order to achieve this goal by 2050, Saint-Gobain defined a 2030 roadmap in 2020. Besides confirming targets for reducing its environmental footprint by the end of 2025, the roadmap aims for a 33% reduction in CO 2 emissions in absolute terms compared with 2017 for scopes 1 and 2, and a 16% reduction for scope 3. These new reduction targets through to 2030 reflect an acceleration in Group’s ambitions. Its commitment to carbon neutrality places its response to climate change at the heart of its strategy, alongside its range of solutions enabling customers to address the environmental challenges that they face.

3.2

The commitment to carbon neutrality is taken into account when preparing the Group’s financial statements

In line with these commitments and targets, the Group has taken into account climate change and sustainable development issues in its financial statements, mainly in the areas cited below. Basis of measurement applicable to assets The Group’s commitments to carbon neutrality were taken into account when carrying out asset impairment tests and assessing the useful life of its non-current assets (see notes 7.3 and 7.5).

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