Climate change

 

Material impacts, risks, and opportunities and their interaction with strategy and business model (SBM-3)

Climate change and its impact on NORMA Group

Climate change affects NORMA Group’s own operations as well as the upstream and downstream value chain. The impacts and risks identified in connection with climate-related issues influence the business model and corporate strategy. In particular, the new legal requirements, such as stricter emission regulations and the technological shift toward alternative drive technologies such as hybrid, electric, and hydrogen drives, represent key framework conditions that influence NORMA Group’s product development.

In particular, new legal requirements such as rising CO₂ prices, the introduction of the Carbon Border Adjustment Mechanism (CBAM) and the technological shift toward alternative drive technologies (e.g., hybrid, electric, and hydrogen drives) represent key framework conditions that influence NORMA Group’s product development.

NORMA Group has a negative impact on climate change and energy supply through its production processes, supply chains, and the geographical location of its production sites, as these activities generate emissions and some sites are located in areas exposed to climate risks. NORMA Group is responding to these challenges with various measures, including the use of renewable energies, the expansion of charging infrastructure for electric vehicles, and improved energy and water management. These initiatives help to mitigate the negative impacts. At the same time, the products and solutions have a positive impact in that NORMA Group’s products contribute to the reduction of CO₂eq and pollutant emissions by being used in vehicles, other technologies, and areas of application that enable sustainable mobility and energy supply.

The negative impacts on climate change notably include greenhouse gas emissions in Scope 1 and 2 as well as in the entire upstream and downstream value chain (Scope 3). These emissions are long-term and irreversible and have a global impact on the environment and society.

In response to the impacts of climate change, NORMA Group is focusing on innovative technologies, more efficient production processes, and more environmentally friendly products in order to unlock new market potential and secure its long-term competitiveness. These ambitions are set out in the sustainability goals, for example. NORMA Group contributes to the impacts of climate change through its own activities and business relationships (e.g., through suppliers).

The main climate-related risks are physical risks (e.g., extreme weather events) and transition risks (e.g., regulatory requirements, CO₂ pricing, PCF requirements). Both types of risk can have a significant impact on NORMA Group’s financial, earnings, and liquidity position. In addition, a climate risk and vulnerability analysis was carried out in financial year 2024. Further information can be found in the section IMPLEMENTATION OF THE CLIMATE RISK AND VULNERABILITY ANALYSIS.

For the risks identified as material, there were no material actual financial effects on NORMA Group’s financial position, earnings position and cash flows in the financial year.

 

Policies related to climate change mitigation and adaptation (E1-2)

NORMA Group is aware of the positive and negative impact of its actions on climate change as well as the associated risks and opportunities. Negative impacts on the climate result, among other things, from production processes and the transportation of NORMA Group’s products, which generate GHG emissions. Selected NORMA Group production sites are also located in climate risk areas. By providing innovative solutions and products, NORMA Group contributes to the direct reduction of customers’ emissions and thus has a positive impact on the climate. Potential risks of climate change for NORMA Group include environmental disasters that may jeopardize the supply chain or production processes, possible fines, reputational damage, and retrofitting measures required as a result of climate change.

In 2018, NORMA Group developed an environmental concept that is continuously being developed further as part of the environmental strategy to expand and strengthen its environmental management activities and to manage the material impacts and risks. The concept relates to NORMA Group’s own operations and the upstream value chain, but not to the identified impacts and risks along the downstream value chain. The focus is on climate, water, and waste generation. The first level focuses on managing the Company’s own processes, the second comprises impact measurement along the entire value chain, and the third addresses pilot projects. This three-stage approach allows NORMA Group to focus on processes that can be directly influenced while addressing the impacts along the supply chain and in the use phase of the products.

NORMA Group has defined and implemented principles for its environmental management system. In addition, regular exchanges are held with relevant stakeholder groups during the financial year in order to take their concerns on environmental issues into account.

In addition, NORMA Group sets ambition levels, monitors their achievement, and reports on them to local, regional, and global management. Another focus is on the continuous improvement of environmental management systems, with the ambition to reduce water and energy consumption, reduce the carbon (CO₂) footprint, use resources more efficiently, minimize waste, and prevent pollution. Promoting environmental awareness among employees is also a key concern, which is implemented through cooperative leadership and effective communication. NORMA Group attaches great importance to communicating its environmental objectives and actions clearly and transparently to its stakeholders, for example through the Supplier Code of Conduct. Under the Supplier Code of Conduct, NORMA Group requires its suppliers to, among other things, maintain an effective environmental policy, comply with required environmental permits, properly treat wastewater and solid waste, monitor and control air emissions, minimize waste and promote recycling, and produce in an environmentally responsible manner to avoid harmful environmental impacts. Responsibility for the environmental management systems and the associated issues relating to climate, water, and waste management at the individual production sites lies with the Environment, Occupational Health and Safety department, which is represented at all production sites. At a global level, this department reports to the Chief Operating Officer. NORMA Group has established an environmental management system at each production site to ensure that environmental incidents are prevented or, in the event of an incident, effectively managed and their impacts adequately addressed. NORMA Group has laid down the principles for its environmental management system in a global environmental guideline. The guideline from financial year 2020 was replaced by a new guideline in financial year 2025 and approved by the Chief Operating Officer and the Vice President for Quality, Environment, Occupational Health and Safety. The policy is publicly available on the website for potentially affected stakeholders.

The new policies focus on reducing negative impacts and risks in the environmental area. As part of this, NORMA Group is committed to increasing resource efficiency. Climate change adaptation, the management of physical climate risks, and the use of renewable energies are not currently covered by the policies.

 

Actions and resources in relation to climate change policies (E1-3)

In financial year 2025, NORMA Group implemented a site-specific resource efficiency program aimed at continuously reducing energy consumption and greenhouse gas (GHG) emissions. As part of this program, heating systems were replaced in certain areas and production processes were optimized through the use of new machinery and equipment. These actions relate to emissions within our own operations and include the reduction of Scope 1 and Scope 2 emissions.

In financial year 2025, Energy Attribute Certificates (EACs) were acquired for all NORMA Group production sites – with the exception of the sites in Mexico and one site in the United Kingdom. EACs were purchased for a site in France, which cover more than two thirds of the electricity consumption there. By using these certificates, we can reduce our reported CO₂ emissions and ensure that the electricity used in our production processes comes from renewable energy sources. EACs therefore make an important contribution to the decarbonization of our electricity consumption.

A project to determine the product carbon footprint (PCF) was launched to expand the data collection processes. In addition, the data collection of Scope 3 emissions was further developed. These actions are part of the development of a long-term roadmap for decarbonizing the value chain. NORMA Group also counters the risk of extreme weather events through preventive actions such as the selective use of cooling systems, water tanks, and the use of insurance in the area of building protection. Regular auditing in accordance with ISO 14001 means that certain actions must be implemented and progress made as part of the audit in order to obtain certification. These certifications are available at 92% of the production sites. At NORMA Group’s largest production site in Maintal, ISO 50001 certification is regularly carried out in addition to ISO 14001 certification. ISO 14001 certification demonstrates that an environmental management system has been implemented to minimize environmental impacts and ensure compliance with legal requirements. ISO 50001 certification confirms systematic energy management aimed at the continuous improvement of energy efficiency and the reduction of energy-related emissions.

Minor investments were made for the above-mentioned actions. The actions contribute to achieving NORMA Group’s climate goals and at the same time strengthen the Company’s resilience.

GHG emissions are reduced by implementing additional actions such as the use of green energy. The amount of green energy provided by the existing plants amounted to 2025 4,673MWh.

 

Transition plan for climate change mitigation (E1-1)

NORMA Group is currently working on a transition plan for climate protection, which has not yet been finalized in financial year 2025. There were no material current or planned operating expenses or capital expenditures related to the transition plan for climate protection.

 

Targets related to climate change mitigation and adaptation (E1-4)

NORMA Group is committed to continuously reducing its environmental footprint. In the area of climate change, a specific target was derived that aims to systematically manage climate-related impacts, risks, and opportunities. The central objective was to reduce greenhouse gas (GHG) emissions by implementing targeted measures. For financial year 2025, a total of 1,000 tons of GHG emissions were avoided. This target was relevant to remuneration and related to NORMA Group’s production sites and distribution centers and included both Scope 1 and Scope 2 (market-based) emissions. The calculation of emission avoidance is independent of the respective implementation date of the actions within the financial year and is calculated for the year as a whole. The targets set serve to continuously reduce emissions and have evolved over time, which makes comparisons difficult. This approach is part of the strategic focus on increasing resource efficiency in the long term. This goal was achieved at the end of financial year 2025.

The goals for reducing greenhouse gas emissions are not scientifically sound, not compatible with limiting global warming to 1.5°C, and were adopted together with the Supervisory Board. In addition, no other stakeholders were involved in the goal-setting process.

NORMA Group aims to achieve its goal of reducing greenhouse gas emissions by implementing energy efficiency actions at the individual sites as part of the resource efficiency program. NORMA Group aims to reduce its negative impact in this way.

NORMA Group is currently establishing appropriate processes to develop and implement goals with regard to the impacts and opportunities related to climate change. Therefore, the goal for financial year 2025 is an interim goal that supports NORMA’s overall level of ambition to counteract climate change while allowing time to develop a long-term roadmap. A new goal to avoid a total of 700 tons of GHG emissions was set for financial year 2026. This goal relates to NORMA Group’s production sites and includes both Scope 1 and Scope 2 emissions (market-based).

In addition, a further goal in the area of energy consumption was defined for financial year 2026. Accordingly, the energy consumption of NORMA Group’s production sites and distribution centers is to be limited to a maximum of 103.0kWh per EUR thousand of sales.

 

Metrics related to climate change mitigation and climate change adaptation (E1-5)

 

Energy consumption and energy mix (E1-5)

NORMA Group’s energy consumption in financial year 2025 was as follows:

NORMA Group generated a total of 29,499MWh of energy in financial year 2025. Of this, 24,827MWh comes from non-renewable resources and 4,673MWh from renewable sources.

The energy data required for this is systematically recorded at all NORMA Group sites. The data is based on information from external sources such as energy source delivery volumes from the respective energy suppliers and internal measurement data. If no actual data is available at the time of the survey, NORMA Group uses extrapolation logic to a limited extent. The estimates mainly relate to office space and logistics centers rented by NORMA Group from third parties. In such cases, direct access to billable consumption values is not possible. To obtain an approximate indication of energy consumption, specific energy consumption per square meter is determined separately for office and logistics space. This specific consumption value is based on a mathematically calculated reference site for office and logistics centers. The applicable figure is 0.16MWh per square meter for office space and 0.02MWh per square meter for logistics centers. The consumption values of the sites without directly billable energy consumption are determined and reported on the basis of these parameters. The estimate includes a share of 0.92% of total energy consumption.

 

Energy intensity based on net sales revenue

The calculated energy intensity of NORMA Group corresponds to the total energy consumption in relation to net sales revenue from activities in high climate impact sectors. NORMA Group assumes that all operations fall into these high climate impact sectors, as it does not operate any activities in non-climate impact sectors. The following high climate impact sectors were identified: Manufacture of plastic products (C222000), manufacture of plastic plates, sheets, tubes, and profiles (C222100), manufacture of fabricated metal products (C250000), surface treatment and heat treatment; mechanical n.e.c. (C256000), surface treatment and heat treatment (C256100), manufacture of screws and rivets (C259400), manufacture of other fabricated metal products n.e.c. (C259900), manufacture of other parts and accessories for motor vehicles (C293200), water supply (E360000), wastewater disposal (E370000), construction of roads (F421100). On this basis, energy intensity is calculated using total energy consumption and net sales revenue. The amount of net sales revenue from activities in climate-intensive sectors amounts to EUR 1,082.752 million and can be found in the information from the annual financial statements in the sections CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME and DISCONTINUED OPERATION. We take Group sales revenue including discontinued operations into account here.

 

Gross Scopes 1, 2, 3, and Total GHG emissions (E1-6)

There were no material changes within NORMA Group and its upstream and downstream value chain during the reporting period.

NORMA Group’s GHG emissions are shown in the following table.

NORMA Group calculates and records its greenhouse gas balance in accordance with the Greenhouse Gas (GHG) Protocol initiative. Scope 1 and Scope 2 emissions for all sites worldwide and Scope 3 emissions along the entire value chain are taken into account. There is no operational control beyond the financial scope of consolidation.

The emission factors from “UK Government GHG Conversion Factors for Company Reporting” (DEFRA) are used for Scope 1 emissions and those published by the VDA (German Association of the Automotive Industry) for emission factors in the fuels sector.

Scope 2 emissions can be calculated in two ways: location-based and market-based. In the location-based calculation methodology, energy consumption is calculated using average country-specific emission factors from the International Energy Agency (IEA). In the market-based calculation method, emissions are calculated using individual emission factors of the energy supply companies themselves. If there is no emission factor for market-based approaches, the location-based emission factors are used based on the requirements of the GHG Protocol. This methodology is intended to ensure that all relevant emissions are recorded and calculated correctly.

The value of the market-based Scope 2 GHG gross emissions in financial year 2024 was revised due to an adjustment to the calculation formula. In addition, the green electricity contract valid in 2024 for one of our production sites was not included in the original calculation. For financial year 2025, the market-based gross Scope 2 GHG emissions amount to 34,577tCO₂eq (2024: 35,594tCO₂eq) according to the new calculation method. According to the old calculation method, the market-based gross Scope 2 GHG emissions for financial year 2024 amount to 30,794tCO₂eq. The deviation between the original and the updated calculation in 2024 amounts to 4,800tCO₂eq. The adjusted calculation methodology is already applied in financial year 2025 and ensures a consistent and methodologically comparable approach.

For Scope 3 emissions, different sources of emission factors are used depending on the category, including factors from the IEA, Sphera Managed LCA Content Databases, and Supply Chain Greenhouse Gas Emission Factors v1.4 by NAICS-6. Greenhouse gas emissions include CO₂, CH₄, N₂O, HFCs, PFCs, SF₆, and NF₃. NORMA Group’s methodology and assumptions for calculating emissions are based on specific scaling and calculations. The emission factor for N₂O is calculated on the basis of combustion. The basis for calculating emissions is therefore the emission factor per unit of fuel. The same applies to CH₄ and CO₂, scaled from sample measurements by chimney sweeps. HFCs and PFCs are calculated on the basis of the solvent content in operating materials. In addition, the Emission Trading Scheme is not relevant for NORMA, as confirmed by consultation with regional directors.

NORMA Group has identified its significant Scope 3 categories based on the criteria of the GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standards. The following categories were identified as significant:

 

Cat. 1 – Purchased goods and services

 

Cat. 2 – Capital goods

 

Cat. 3 – Fuel and energy-related emissions

 

Cat. 4 – Upstream transportation and distribution

 

Cat. 5 – Waste generated in operations

 

Cat. 6 – Business travel

 

Cat. 7 – Employee commuting

 

Cat. 9 – Downstream transportation and distribution

 

Cat. 10 – Processing of sold products

 

Cat. 11 – Use of sold products

 

Cat. 12 – End-of-life treatment of sold products

 

The Scope 3 categories were determined in accordance with the GHG Protocol and include CO₂, CH₄, N₂O, HFCs, PFCs, SF₆, and NF₃. The scope is consistent with the financial scope of consolidation, so that all combined units of the Group are taken into account. The data is mainly based on secondary data. Almost 0% of emissions are determined using primary data obtained directly from suppliers or other partners in the value chain.

The Scope 3 emissions were methodically revised for financial year 2025 compared to 2024. The adjustment to the calculation method relates to Category 1 – Purchased goods and services, Category 5 – Waste generated in operations, and Category 12 – End-of-life treatment of sold products. As part of the calculation and validation process for 2025, weaknesses were identified in the previous approach for the categories, particularly with regard to the accuracy of the underlying product master data. Against this background, emissions in Category 1 were calculated on the basis of expenditure, while Category 12 was calculated on the basis of the net weight of products sold and waste treatment methods. For Category 5, emission factors along the entire waste treatment process, including transportation and treatment of the waste, were taken into account. Due to the change in methodology, the figures for the previous year 2024 were recalculated using the new calculation method. Scope 3 emissions in financial year 2024 therefore amount to 215,686tCO₂eq in Category 1 (2024 old value: 774,295tCO₂eq), to 4,575tCO₂eq in Category 5 (2024 old value: 4,470tCO₂eq), and to 23,541tCO₂eq in Category 12 (2024 old value: 223,441tCO₂eq).

The following categories were not included in the balance sheet:

NORMA Group discloses biogenic CO₂ emissions from the incineration or biodegradation of biomass, if available. For financial year 2025, NORMA Group did not generate any GHG emissions from Scope 1, 2, or 3 in this regard. In addition, emissions of other greenhouse gases (such as CH₄ and N₂O) and CO₂ emissions that occur in the life cycle of biomass and are not attributable to incineration or biodegradation (such as greenhouse gas emissions from the processing or transportation of biomass) are included in the calculation of regular Scope 3 greenhouse gas emissions.

For the calculation of GHG intensity based on net revenue, NORMA Group has included total GHG emissions in the numerator, while total net revenue of EUR 1,082.752 million is included in the denominator.

 

Greenhouse gas intensity on the basis of net revenue

NORMA Group’s GHG emission intensity is shown in the following table. The greenhouse gas intensity figure includes the total GHG emissions in tons of CO₂ equivalent per net revenue. Net revenue can be found in the following sections of the annual report CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME and DISCONTINUED OPERATION. We take Group sales revenue including discontinued operations into account here.

The following methodology was used to calculate this metric: Total GHG emissions in tons of CO₂ equivalent divided by total net revenue. No significant assumptions were made.

GHG removals and GHG mitigation projects financed through carbon (CO₂) credits (E1-7)

In financial year 2025, NORMA Group will not carry out any projects to reduce or eliminate greenhouse gases that are financed through carbon (CO₂) credits.

Internal carbon (CO₂) pricing (E1-8)

NORMA Group does not currently apply any internal CO₂ pricing.