Objectives, actions and results

To concretely implement sustainability in the economic, financial, environmental and social fields, the Group has outlined shared strategic objectives and actions oriented towards the development of communities and territories, in line with its business model.

We are convinced that the processes of an economic activity are only really sustainable if they manage to preserve, increase or minimize the consumption of the capital which is used for the production of value.

A vision on which we have decided to invest effort and resources by developing a Sustainable Value Creation Plan ) that, starting from the analysis of the evolution of the external environment, Identifies objectives and actions that can have a positive impact on the capital we draw.

An innovative model, which we have articulated in three pillars to which correspond as many lines of action, with defined commitments and measurable targets: Planet, People and Partnerships.

Through this approach we place stakeholders at the center of our commitment, transparently implementing actions and projects to contribute to the achievement of the Sustainable Development Goals of the UN 2030 Agenda and create long-term value, For the Group and all the actors involved.

Our performance

We communicate our sustainability performance to stakeholders, providing a transparent view of Italgas’ commitment and impact.

Since 2016 we have been reporting on our environmental, social and governance actions and achievements.
We started with our first Sustainability Report, and then from 2017 we prepared the Non-Financial Statement pursuant to Legislative Decree 254/2016. After three editions, in 2020 we have chosen to inaugurate a new season of our reporting by publishing the Italgas Group’s first Integrated Annual Report. The intention is to provide an effective and transparent representation of the company’s ability to create value over time, reporting financial and non-financial performance in an integrated manner.

We adopt the GRI Sustainability Reporting Standards, published in 2016 by the Global Reporting Initiative, according to the “In accordance – Core” option and refer to the guiding principles and content elements set out in the International Integrated Reporting Framework issued by the International Integrated Reporting Council.

In addition, the reported indicators are audited by an external company.

Final Customers and Sales Companies

CUSTOMER SATISFACTION SURVEY RESULTS

Satisfaction Measurement	Unit	FY 2019*	FY 2020	FY 2021	FY 2022	FY 2023
Satisfaction Measurement	Percentage of satisfied respondent	53%	53%	66%	73%	82%
Data coverage:	% of sales companies invited	100%	100%	100%	100%	100%
	Minimum % of redelivery point represented by respondent	>85%	>85%	>83%	>91%	>92%

(*) In 2020 the survey covered both 2019 and 2020

Governance and ethics

In the following tables, data reflect 100% of revenues, 100% of consolidated operations and FTEs as at 31 December of
each year.

REPORTING ON BREACHES

Reporting Areas	Number of breaches in 2022	Number of breaches in 2023
Corruption or Bribery	0	0
Discrimination or Harassment	0	0
Customer Privacy Data	0	0
Conflicts of Interest	0	0
Money Laundering or Insider trading	0	0

GRI 2-28 Membership of associations
GRI 415-1 Political contribution

€	FY 2019	FY 2020	FY 2021	FY 2022	FY 2023
Lobbying, interest representation or similar	96,743	77,990	90,640	122,119	198,542
Local, regional or national political campaigns / organizations / candidates	0	0	0	0	0
Trade associations or tax-exempt groups	673,944	535,973	573,995	743,778	765,312
Other	0	0	0	0	0
Total	770,687	613,963	664,635	865,897	963,854
Data coverage (operations and revenues)	100%	100%	100%	100%	100%

DIALOGUE THROUGH PARTNERSHIPS

Proxygas	Proxigas – formerly known as ANIGAS. This industry Association, a member of Confindustria, represents firms operating along the entire natural gas supply chain with a particular focus on the following sectors: distribution, transportation, sale of natural gas on the end market and wholesale market, trading and methane for motor vehicle use. The association aims to support the role of natural gas, LNG and renewable gases as energy sources with lower environmental impact, especially when compared to other fossil sources. In 2023 Proxigas reshuffled its internal organization and Italgas now participates to the following: DIST Commission; TFs on Gas Concession, Technical and Green Gas regulation, Technical metering regulation, Distribution and net. users relations, Tariffs, Unbundling, Energy Efficiency, Labour, Tax, Energy policies, Mobility, IT and EU Policies, Energy Scenarios.
Eurogas	Eurogas is an association that plays a significant role in advocating for the transition to carbon neutrality within the energy sector. Their efforts focus on leveraging the potential of various gases, particularly renewable ones, to achieve a sustainable energy future. Here’s an overview of Eurogas’s activities and areas of engagement in 2023. Key Areas of Engagement are: Security of Supply, to maintain and improve the reliability of gas supplies across Europe; Energy Transition, promoting the shift from traditional fossil fuels to renewable energy sources particularly by integrating renewable gases like biomethane and hydrogen into the energy mix; Gas Market Design, developing and promoting market designs that enhance the efficiency and functionality of gas markets, supporting regulatory frameworks that facilitate fair competition and innovation; Methane Emissions Regulation, backing regulations aimed at reducing these emissions from the gas sector, contributing to overall greenhouse gas reduction efforts; Energy Performance of Buildings Directive (EPBD), supporting the revision of this directive, which seeks to improve the energy efficiency of buildings, thereby reducing energy consumption and emissions. Eurogas’s strong emphasis on renewable gases like biomethane and hydrogen highlights their commitment to sustainable energy solutions.
GD4S	GD4S is a non-profit association under Belgian law gathering the voices of the largest natural gas and renewable gas distributors in Europe in 8 European Member States: France, Greece, Ireland, Italy, the Netherlands, Portugal, Romania and Spain. The association’s mission is to represent the views of the gas distribution sector at European institutions, specifically concerning the role that such infrastructures can play in the energy transition process towards a low carbon economy. In particular, the association supports gas and LNG as fuels for the transport sector, biomethane development and use for space heating, the study and implementation of Power to Gas technologies for the production of “green” hydrogen and its use as energy carrier able to carry and store renewable energy, taking advantage of the existing infrastructure now used for natural gas. In 2023, GD4S focused on several key dossiers, including the Gas Package, Methane Emissions Regulation, Energy Performance of Buildings Directive (EPBD), Ecolabelling & Ecodesign, the Energy Efficiency Directive. In 2023, GD4S also released its first progress report on its “Sustainability Charter”.
Confindustria	Confindustria is Italy’s most important organisation representing entrepreneurs, grouping more than 153,000 manufacturing and service companies, with a total of more than 5 million employees. The association aims to support the role of business as an engine for the economic, social and civil growth of the country. In this perspective, it defines common paths and – while respecting the areas of autonomy and influence – shares objectives and initiatives with the world of economics and finance, national, European and international institutions, PA, social partners, culture and research, science and technology, politics, information and civil society. By representing companies and their values at institutions of all levels, Confindustria contributes to social well-being and progress, and from this standpoint guarantees increasingly diversified, efficient and modern services.

Employees

In the following tables, data reflect 100% of revenues, 100% of consolidated operations and FTEs as at 31
December of each year, if not specified otherwise.

Share of employees Contractors or temporary staff as a % of
employees

	U.o.m	2019	2020	2021	2022	2023
Share of employees Contractors or temporary staff as a % of employees	%	0%	0%	0%	0.4%	0.4%

DIVERSITY INDICATOR

In 2022 we continued our commitment towards Diversity and Inclusion, achieving a
rate of women in managerial role of 24.9%^* (vs 22% in 2021).

*Values related to overall Group perimeter. Italian value:
24.7%

	2021	2022	2023	Note
% women of total workforce	16.4%	19.7%	20.3%	% total workforce
% women in positions of responsibility	22.2%	24.9%	28.8%	% of all positions of responsibility
% women in junior positions of responsibility	23.1%	26.3%	30.2%	% of all positions of junior responsibility (first level)
% women in top management positions	17.2%	18.2%	21.8%	% of all top management positions (two levels from CEO)
% women in positions of responsibility in revenue-generating departments	18.0%	21.4%	24.9%	% of this type of position
% women in STEM positions	35.8%	34.3%	32.4%	% of this type of position

GRI 405-2 – ITALY RATIO OF BASIC SALARY AND REMUNERATION OF WOMEN TO
MEN

Employee level	Average Women Salary 2023	Average Men Salary 2023	Ratio (W/M)
Executive level (base salary only)	147,461.6	138,352.07	106.6%
Executive level (base salary + other cash incentives)	235,642.97	212,840.58	110.7%
Management level (base salary only)	62,364.76	65,234.98	95.6%
Management level (base salary + other cash incentives)	66,594.58	74,066.43	89.9%
Non-Management level (base salary only)	40,328.84	40,440.52	99.7%

EMPLOYEES BY LEVEL OF EDUCATION

	U.o.m.	Men	Women	Total	Men	Women	Total	Men	Women	Total	Men	Women	Total
	U.o.m.	2019			2020			2021			2022
University graduates	no.	388	218	606	405	255	660	445	308	763	601	405	1,006
Secondary school graduates		1,807	277	2,084	1,727	268	1,995	1,671	263	1,934	1,692	335	2,027
Other (below secondary school diploma)		1,322	84	1,406	1,253	77	1,330	1,138	69	1,207	1110	95	1,205
Total		3,517	579	4,096	3,385	600	3,985	3,264	640	3,904	3,403	835	4,238

EMPLOYEES BY LEVEL OF EDUCATION (% OF THE TOTAL)

	U.o.m	2019	2020	2021	2022
University graduates	%	14.8	16.6	19.5	23.7
Secondary school graduates	%	50.9	50.1	49.5	47.8
Other (below secondary school diploma)	%	34.3	33.4	30.9	28.4

VOLUNTARY OUTGOING TURNOVER
RATE

	2019	2020	2021	2022	2023
Voluntary outgoing turnover rate*	0.63	0.35	0.74	1.93	2.4

*Calculated as: voluntary leavers/employees as at 31.12

NEW RECRUITS (HEADCOUNT)* – GRI 401-1

	U.o.m	2020			2021			2022			2023
	U.o.m	Men	Women	Total	Men	Women	Total	Men	Women	Total	Men	Women	Total
Total	no.	102	57	159	143	57	217	240	92	332	277	107	384
under 30 years		83	38	121	89	38	127	148	40	187	113	34	147
between 30 and 50 years		16	19	35	53	35	88	90	49	135	159	71	239
over 50 years		3	0	3	1	1	2	2	3	5	5	2	7

*Only market entries are considered.

NEW RECRUITS BY NATIONALITY

	n. employed 2022	% out of total employed 2022	n. employed 2023	% out of total employed 2023
Italian	323	97.3%	282	73.4%
Greek	5	1.5%	97	25.3%
Other European Countries	2	0.6%	2	0,5%
Extra European Countries	2	0.6%	3	0.8%
	332		384

OUTGOING TURNOVER – BY MANAGEMENT
LEVEL * GRI 401-1

	U.o.m.	2020	2021	2022	2023
Executives	%	12	9	9	5
Managers	%	8	9	8	9
Office workers	%	7	8	9	8
Manual workers	%	6	7	8	7
Total	%	7	8	8	8

*Calculated as: leavers/employees as at 31.12 every year for each cluster.

OUTGOING TURNOVER RATE– BY AGE AND GENDER* GRI 401-1

	U.o.m.	2023
Men	%	12
Women	%	8
< 30	%	7
between 30 and 50	%	6
> 50	%	7
Total	%	7.9

*Calculated as: leavers/employees as at 31.12 every year for each cluster.

OUTGOING TURNOVER RATE– BY NATIONALITY* GRI 401-1

	U.o.m.	2023
Italian	%	8%
Greek	%	7%
Other European Countries	%	0%
Extra European Countries	%	10%

PERCENTAGE OF NEW POSITIONS HELD BY IN-HOUSE
CANDIDATES

U.o.m.		2019	2020	2021	2022	2023
Percentage of new positions held by in-house candidates – Total	%	96.6	90.6	87.6	80.8	76.3

TURNOVER RATE GRI 401-1

	U.o.m.	2019	2020	2021
Turnover rate*	%	10.9	10.7	13.2
Men	%	10.6	9.9	12.4
Women	%	12.3	15.6	17
Inbound turnover rate	%	5	4	6
< 30	%	41	28	28
between 30 and 50	%	4	4	9
> 50	%	0	0	0
Outgoing turnover rate	%	6	7	8
< 30	%	3	2	3
between 30 and 50	%	2	1	2
> 50	%	8	10	11

EMPLOYEE AVARAGE TURNOVER

	U.o.m.	2018	2019	2020	2021
Executives	%	8.5	17.8	18.3	18.1
Managers	%	13.6	6.1	11.3	12.8
Office workers	%	9.3	10.8	10.6	14.3
Manual workers	%	9.9	11.6	10.5	11.0
Total	%	9.8	10.9	10.7	13.1

INBOUND TURNOVER RATE* GRI 401-1

	U.o.m	2019			2020			2021
	U.o.m	Men	Women	Total	Men	Women	Total	Men	Women	Total
Total	%	4	9	5	3	10	4	4	12	6
under 30 years		36	69	41	24	49	28	25	46	28
between 30 and 50 years		3	8	4	2	9	4	7	15	9
over 50 years		0	0	0	0	0	0	0	0	0

*Calculated as: new recruits/employees as at 31.12 every year for each cluster.

OUTGOING WORKERS* GRI-401-1

	U.o.m	2019			2020			2021			2022
	U.o.m	Men	Women	Total	Men	Women	Total	Men	Women	Total	Men	Women	Total
Total	no.	237	13	250	238	35	273	263	35	298	300	60	360
under 30 years		12	1	13	4	4	8	6	9	15	26	11	37
between 30 and 50 years		13	4	17	6	3	9	13	2	15	51	20	71
over 50 years		212	8	220	228	28	256	144	24	268	223	29	252

*Termination by mutual agreement and other outgoings.

OUTGOING TURNOVER RATE* GRI 401-1

	U.o.m	2019			2020			2021			2022
	U.o.m	Men	Women	Total	Men	Women	Total	Men	Women	Total	Men	Women	Total
Total	%	7	2	6	7	6	7	8	5	8	9	7	8
under 30 years		4	2	3	1	5	2	2	11	3	6	2	7
between 30 and 50 years		2	2	2	1	1	1	2	1	2	5	5	5
over 50 years		9	2	8	10	9	10	11	7	11	12	9	11

*Calculated as: leavers/employees as at 31.12 every year for each cluster.

TRAINING

In 2023 we pursued in our commitment towards training (target: 45 hours per
employee by 2029), achieving a total number of hours of training per employee of 40,34**

GRI 404-1 AVERAGE HOURS OF TRAININGS PER YEARS PER EMPLOYEE

	U.o.m.	2019	2020	2021	2022	2023
Total time as a company	hours	84,038	75,948	112,379	132,395	173,330
· women	hours	7,856	11,899	17,571	21,421	29,798
· men	hours	76,182	64,049	94,808	110,974	145,533
Average hours per employee	hours	21	19	29	34.26	40.34
Average days per employee	days	3	2	4	4.28	5.04

HOURS OF TRAINING BY AGE RANGE

	U.o.m.	2021	2022	U.o.m.	2021	2022	2023
<30 years	Hours	28,016	28,936	Hours/n.	62.8	55	67
between 30 and 50 years	Hours	36,400	43,693	Hours/n.	37.6	37	44
>50 years	Hours	47,964	59,767	Hours/n.	19.3	28	30

COLLECTIVE AGREEMENTS GRI 102-41

	U.o.m.	2019	2020	2021	2022	2023
Total	%	100	100	100	98.8	98.4

Health and safety

In the following tables, year-end data reflect 100% of revenues, 100% of consolidated operations and FTEs as at 31 December

HSEQE POLICY

For details on Italgas’ Group Health and Safety policy please refer to the link

HSEQE Policy Italgas.

The HSEQE policy of Italgas was discussed for oversight by the Board in June 2023. The Board approves the Strategic Plan and the Sustainable Value Creation Plan of the Group. The Board approves the sustainability targets of the group, including those related to the environment and health and safety and monitors the performance of the group towards the targets

LOST
TIME INJURY FREQUENCY RATE AND FATALITIES EMPLOYEES

	2019	2020	2021	2022	2023
Current Year Lost Time Injury Frequency Rate Employees	0.98	1.07	0.61	2.02	1.60
Fatalities	0	0	0	0	0
Coverage (revenues / operations)	100%	100%	100%	100%	100%

LOST TIME INJURY FREQUENCY RATE AND FATALITIES CONTRACTORS

	2019	2020	2021	2022	2023
Current Year Lost Time Injury Frequency Rate Contractors	1.85	1.94	1.71	2.03	0.85
Fatalities	0	0	0	0	0
Coverage (revenues / operations)	100%	100%	100%	100%	100%

Lost time injury frequency rate was defined as: “number of injuries recorded / million hours worked

SOCIAL COST OF WORK-RELATED INJURIES

Social cost of work-related injuries represents the impact evaluation methodology to assess the external impact to affected stakeholders with regard to the issue “Safety of network, assets and people”. Ouput KPI (n. of injuries) was assessed through a social cost of work-related injuries, resulting in a total negative impact of approx. 1,154,501 euros. Considering that 6 injuries for the Group’s contractors occurred, the social cost of work-related injuries resulted in a total negative impact of 407,471 euros.

Communities

Italgas conducts regular local stakeholder engagement programs, applied at all local operations, especially with local authorities of the territories impacted by its operations. Such programs are performed through impact assessments to identify potential negative impacts of Italgas operations as well as maximizing value creation in local communities. To do this, the Group established clear communication channels for local stakeholder to communicate with Italgas and providing capacity building to them to effectively communicate with the Group, i.e. leaving personal contacts of local business leads within Local Institutional Relations function, as well as meetings with local authorities. Local end users have also access to relevant website section to communicate grievances.

Italgas conducts reviews to gauge local stakeholders’ perceptions on its strategy and operations also by regularly conducting meetings with relevant stakeholders to foster trust and understanding through constructive dialogue.

Italgas tracks grievances to ensure that any issue raised by local stakeholders are addressed promptly and effectively, also by a system that register all outside-in and inside-out mail correspondence. In 2023, 413 grieviance from local stakeholders were communicated through the aforementioned system. Also, Italgas press office periodically invites local media to events, press conferences, and local initiatives to present specific activities, to deepen mutual understanding, and to provide additional channels of contact with journalists who regularly cover energy and infrastructure topics.

In the following tables, data reflect 100% of revenues, 100% of consolidated operations and FTEs as at 31 December of each year.

STANDARD GRI 203-1 INFRASTRUCTURE INVESTMENTS AND SERVICES SUPPORTED

SPONSORSHIP AND DONATION	U.O.M.	2019	2020	2021	2022	2023
Sponsorship	thousand euros	671	1,086	970	1,443	1,679
Liberal donations		26	2,029*	324	771	284
Total		697	3,115	1,294	2,214	1,963

^*86% of the liberal disbursements activated by the Group in 2020 consisted of donations to various hospitals for the purchase of machinery, equipment, and functional garrisons (such as devices for the protection of health facility personnel, inpatient beds and technical equipment) and contributed to the setting up of new areas to meet the needs arising from the emergency situation related to the pandemic and ensure hospital service.

Suppliers

Over the years, Italgas has implemented a robust and comprehensive ESG program for suppliers, which is constantly updated and consists of a collection of activities and measures aimed to recognize and assess potential ESG risks and, accordingly, to plan corrective measures to ensure solid sustainability performance of the Group’s supply chain.

To ensure the integrity of the supply chain and to maintain the expected quality and efficiency standards, Italgas uses a series of instruments, such as supplier qualification and appraisal processes, inspections audits and performance monitoring during the execution of contracts. Purchasing practices are continuously reviewed and updated to ensure alignment with the Supplier of Conduct and to avoid potential conflicts with ESG requirements.

Supplier screening and assessment are the step to identify, monitor and manage potential risks. Among other activities, Italgas performs systematic desk assessments with a development of specific Corrective Action Plans. Also, on-site assessment are carried out for relevant and strategic suppliers, also involving 3rd party auditors.

Supplier Development Process consists in a series of trainings regarding both Italgas’ suppliers ESG program, process and requirements, and specific workshop where case studies are shared to provide ESG benchmarking to suppliers with the final aim of spreading best practices on different ESG topics (circular economy, wastes, D&I, energy efficiency, cybersecurity).

Moreover, Italgas supports suppliers on the implementation of corrective actions identified during the Supplier Assessment, also through the implementation of capacity building programs. The aim of this initiative is to systematically improve supplier practices and performance on specific ESG topics (e.g., CO2 emissions), sharing Italgas’ objectives and targets with suppliers.

Since 2018 Italgas has set sustainability thresholds and criteria in tender procedure. Each year the model has been improved and enhanced. As well, a sustainability questionnaire compulsory for most of all qualified suppliers has been implemented and results in a rating assigned. The aim is to use the information collected to determine the general and specific level of sustainability of each supplier. The rating allows access to the Italgas Supplier Portal. If the resulting rating is lower than the set threshold, the supplier cannot be admitted to the qualification process. Average-low ratings are subjected to development plans, and an on-site audit.

In addition to qualification requirements, the sustainability score is also required as a minimum criterion for participation in tenders. Suppliers with better ESG performance are preferred by applying a minimum weight to ESG criteria in supplier selection and contract awarding. If they cannot achieve minimum ESG requirements within a set timeframe, they’re excluded from contracting.
The procurement strategy, that includes all ESG suppliers programs indicated above, has been validated by the Board of directors and the results of the monitoring carried out are constantly subjected to top executive management, to align ESG strategies of different functions to reach Group’s sustainability goals, included in the Sustainable Value Creation Plan.

Finally, Italgas is committed to provide continuous training for buyers and for relevant internal stakeholders in their roles, in order to let them understand how their day-to-day actions and decisions are essential part of the Italgas ESG Strategy and to ensure alignment between the supplier ESG strategy and how they implement their roles within the organization.

SUPPLIERS SCREENING

Our supplier screening is an integral part of our Purchasing process. We conduct research to identify categories of suppliers that are critical for our organization, including for reaching our sustainability objectives, based also on the experience built in our day by days operations. The first step of Italgas’ supplier screening programme involves the assessment of potential Environmental, Social and Governance risks associated with country-specific operations, sector-related challenges, and commodity-specific concerns that impact both our operations, the supply chain and the potential interferences. We also consider factors such as the complexity of the supply chain, strategic importance to our operations, volume of trade, and technological impact. Our Suppliers in ‘Strategic Works and Materials’ are particularly scrutinized due to their substantial influence on both our business’s sustainable performance and Environmental, Social and Governance risks associated. By evaluating these aspects we determine which suppliers category may have significant ESG risks before proceeding to a more detailed assessment phase, channeling them into the “strong” qualification process, that implies a deeper evaluation of ESG performance & risk through more detailed data collection requests for the suppliers.

SUPPLIERS ASSESSMENT AND DEVELOPMENT

The supplier assessment process of the Group’s suppliers is the step to identify, monitor and manage potential ESG risks associated with Italgas existing and potential suppliers and, at the same time, to identify and share potential areas of improvement and opportunity.

Italgas performs a systematic desk assessment which also includes verification of evidence and the definition of specific integrated Corrective Action Plan for each supplier. In addition to the audits carried out directly by Italgas personnel, also, on-site assessment (provided by a 3rd party auditing organization, accredited by the AMFORI BSCI Guidelines – Audit Business Social Compliance Initiative and in accordance with ISO/IEC 17021-1:2015 “Conformity assessment – Requirements for bodies providing audit and certification of management systems”) are carried out for relevant and strategic suppliers.

During the on-site assessment on the suppliers, also a guidance and support on the implementation of corrective and improvement actions are provided.

The suppliers’ development process of the Group’s consists in a series of trainings regarding both Italgas suppliers ESG program, process and requirements, and specific workshop where case studies are shared to provide ESG benchmarking to suppliers with the final aim of spreading best practices on different ESG topics (circular economy, wastes, D&I, energy efficiency, cybersecurity). Moreover, Italgas supports suppliers on the implementation of corrective actions identified during the Supplier Assessment, also through the implementation of capacity building programs. The aim of this initiative is to systematically improve supplier practices and performance on specific ESG topics (e.g., CO2 emissions), sharing Italgas’ objectives and targets with suppliers.”

SUPPLIER SCREENING

Supplier Screening	U.o.M.	2022	2023
Total number of Tier-1 suppliers	No	919	1653
Total number of significant suppliers in Tier-1	No	215	307
% of total spend on significant suppliers in Tier-1	%	85%	77%
Total number of significant suppliers in non Tier-1	No	34	60
Total number of significant suppliers (Tier-1 and non Tier-1	No	249	367

SUPPLIER ASSESSMENT

Supplier Assessment	U.o.M.	2022	2023
Total number of suppliers assessed via desk assessments/on-site assessments	No	215	307
% of significant suppliers assessed	%	86.35%	83.65%
Number of suppliers assessed with substantial actual/potential negative impacts	No	215	307
% of suppliers with substantial actual/potential negative impacts with agreed corrective action/improvement plan	%	74%	77%
Number of suppliers with substantial actual/potential negative impacts that were terminated	No	5	2

CORRECTIVE ACTION PLAN SUPPORT

Corrective action plan support	U.o.M.	2022	2023
Total number of suppliers supported in corrective action plan implementation	No	215	307
% of suppliers assessed with substantial actual/potential negative impacts supported in corrective action plan implementation	%	100%	100%

CAPACITY BUILDING PROGRESS

Capacity building progress	U.o.M.	2022	2023
Total number of suppliers in capacity building programs	No	215	307
% of significant suppliers in capacity building programs	%	86.35%	83,65%

The company is dedicated to creating a work environment free from direct or indirect discrimination, in accordance with Article 25 of the Equal Opportunities Code, from any form of violence or harassment, whether sexual or based on personal, political, or cultural differences. Italgas strives to ensure that all employees treat others with dignity, respect, and fairness at all times, reflecting an inclusive approach that aligns with the company’s values.

Environment

Italgas has been a TCFD supporter since October 2021.

In the following tables, data reflect 100% of revenues, 100% of consolidated operations and FTEs as at 31
December of each year, if not specified otherwise.

SANCTIONS
In 2023, just like in 2022, 2021, 2020, 2019, 2018 and 2017, the Italgas Group did not receive any significant
sanctions for breaching environmental laws and regulations.

SMART METERS
As at 31 December 2023 in Italy practically all active mass-market meters are now smart (98,2%) while in Greece
64.4k active meters out of 0.599mn are smart. Overall the % of active smart meters was 91,5% at the end of 2023.

HSEQE POLICY
For details on Italgas’ Group Environmental policy please refer to the link HSEQE Policy Italgas
The HSEQ policy of Italgas was discussed for oversight by the Board in June 2023. The Board approves the
Strategic Plan and the Sustainable Value Creation Plan of the Group. The Board approves the sustainability
targets of the group, including those related to the environment and health and safety and monitors the
performance of the group towards the targets.

EMISSION REDUCTION
TARGETS

	Percentage of emissions covered by target, referred to base year	Base year	Base year emissions (tonnesCO2eq)	Year in which target was set	Target year	Percentage reduction targeted (%)	Net-zero target
Scope 1&2 (market-based)	100%	2020	193.300	2023	2028	-33%	Net zero carbon by 2050
Scope 3*	98%	2020	202.900	2023	2028	-30%
Scope 1&2 (market-based)	100%	2020	193.300	2023	2030	-42%
Scope 3*	98%	2020	202.900	2023	2030	-33%

*100% of supply chain GHG emissions. Categories covered: Capital goods; Purchased goods and services;
Upstream transportation and distribution; Waste generated in operations; Upstream leased assets (CDP
categories 1,2,4,5,8)

ENERGY

Italgas is dedicated to sustainability and delivering long-term positive impact, as outlined in our Sustainable
Value Creation Plan (SVCP). Our commitment to fighting climate change focuses on improving energy efficiency,
reducing energy consumption, and mitigating our environmental impact. In doing so, Italgas set targets
related to energy: -27% of net energy consumption by 2028, -33% by 2030 (2020 baseline). The progress of this
goal is continuously evaluated through the monthly Sustainability Business Review process, established in 2021,
in which a detailed assessment of the main environmental KPIs – inclosing those related to energy, energy
efficiency, energy consumption reduction and energy management – is carried out. Italgas also leverages on green
energy purchase to reduce its carbon footprint.

As part of this process and in accordance with the requirements of the EN ISO 50001:2018 standard provided for in
the group’s HSEQE management system, the Group conducts periodical internal energy audits, supported by the
expertise of Geoside, the Group’s Energy Service Company (ESCo) specialized in energy efficiency, as well as
external energy audits carried out by an independent third party. Through these audits, the Group can analyze
energy consumption and efficiency based on solid data, identifying areas of significant energy use and
opportunities for improving energy performance across all energy uses (industrial, civil, vehicle fleet) while
enabling informed decision-making for the implementation of energy management programs and actions aimed to
reduce the amount of energy used.

Leveraging innovation and R&D efforts and investments, we continuously explore and implement cutting-edge
digital technologies to enhance sustainability programs and to decrease energy consumption. This includes the
development of advanced digital energy management systems, smart grid solutions, and innovative monitoring tools
that provide real-time data and predictive analytics to optimize energy use and reduce emissions such as the
“Savemixer” platform developed by Geoside. All those systems are in integral part of our Strategic plan
investments of €7.8bn to 2029. Our Innovation team also engaged in scouting for and implementing the best
technological solutions that support reduction in energy consumption such as substitution of cathodic protection
power supply units with better energy performing switching power supplies, installation of high-end batteries on
network plants to avoid loss of energy supply.

Finally, the group provides comprehensive training and awareness programs for employees, focusing on reducing
energy consumption and adopting energy-efficient behavioral measures. Training is provided to both the whole
group employees and to specific targeted employees that hold responsibility for decision-making involving energy
management and efficiency programs. In 2023 over 3.000 hours of training on sustainable energy and energy
management have been provided, involving over 1.700 employees.

ENERGY CONSUMPTION

Total energy consumption	U.O.M.	2020	2021	2022*	2023
total non-renewable energy consumption	MWh	136,889	140,389	110,305	101,389
total renewable energy consumption	MWh	27,720	25,636	23,222	16,667
Data coverage (% revenues)	%	100%	100%	100%	100%

*Including Greece from September 2022

GRI 302-1 ENERGY CONSUMED WITHIN THE ORGANIZATION

TOTAL ENERGY CONSUMPTION	U.O.M.	2019	2020	2021	2022*	2023
Energy consumption	TJ	589.8	592.1	597.2	480.7	425.0
Coverage (% revenues)	%	100%	100%	100%	100%	100%

*Including Greece from September 2022

EMISSION

GRI 305-1 Direct (Scope 1) GHG emissions

GRI 305-2 Indirect (Scope 2) GHG emissions from energy consumption

GRI 305-3 Other indirect (Scope 3) GHG emissions

GRI 305-4 Intensity of GHG emissions

GRI 305-1 Direct (Scope 1) GHG emissions GRI 305-2 Indirect (Scope 2) GHG emissions from energy consumption GRI 305-3 Other indirect (Scope 3) GHG emissions GRI 305-4 Intensity of GHG emissions	GRI Standard	U.O.M.	2019¹	2020	2021	2022	2023
Total Scope 1	305-1	10³t CO₂e	156.3	173.1	160.5	147.6	149.7
Total Scope 2²	305-2	10³t CO₂e	7.5	0.2	0.2	0.5	0.6
Total Scope 1 and Scope 2		10³t CO₂e	163.8	173.3	160.7	148.1	150.3
Total Scope 3 – Supply Chain³		10³t CO₂e	128.3	183.3	147.2	146.3	178.4
Total Scope 3³	305-3	10³t CO₂e	136.3	187.9	152.1	150.8	184.4
Total Scope 1, Scope 2 and Scope 3 – Supply Chain		10³t CO₂e	292.1	356.6	307.9	294.4	328.7
Total Scope 1, Scope 2 and Scope 3		10³t CO₂e	300.1	361.2	312.8	298.9	334.7
Carbon intensity⁴	305-4	10³t CO₂e/10⁶Sm³	20.5	20.4	18.1	18.0	19.0
Coverage (% revenues)		%	100%	100%	100%	100%	100%

Details on consolidation method and operational boundaries are presented in the Integrated Annual Report 2023 at
page 17-18.

¹Data restated with respect to the 2019 Non-Financial Statement. For the value shown in the 2019
Consolidated Non-Financial Statement, please refer to the document published on the Group’s website at https://www.italgas.it/wp-content/uploads/sites/2/2021/07/Non-Financial-Statement-2019.pdf

²2019: Scope II location-based. 2020, 2021 and 2022: Scope II market-based

³2020 and 2021 Scope 3 GHG emissions were recalculated using the new methodology applied for 2022
values. For the values shown in the 2021 Consolidated Non-Financial Statement, please refer to the document
published on the Group’s website at https://www.italgas.it/wp-content/uploads/sites/2/2022/04/2021-Integrated-Annual-Report-format-PDF.pdf

⁴Calculated as Scope 1 and Scope 2 emissions / gas distributed.

Methane emissions

Total Methane emissions	U.O.M.	2020	2021	2022	2023
Total Methane emissions	ton CH4	5,142	4,618	4,209	4,370

Gas leakage rate

Gas leakage rate*	Unit	2020	2021	2022	2023
Gas distribution leakage rate	%	0.1	0.087	0.089	0.089
Coverage (% revenues)	%	100%	100%	100%	100%

*Volume of emissions of natural gas / volume of gas distributed

Including Greece from September 2022

Emissions considered in the calculation of the gas leakage rate are fugitive emissions and venting emissions.
Please note that venting emissions are residual (less than 1% of emissions considered for gas leakage rate).
There are no pneumatic or unburned emissions for Italgas Group, hence they are not included in the calculation
of the gas leakage rate.

Fleet fuel efficiency data

Fleet fuel efficiency data	U.O.M.	2022
Fleet fuel efficiency (Europe)	gCO2/km	157.6
Coverage (% revenues)	%	97%

Italgas’ fleet only operates in Europe

GHG emissions per megawatt-hr

GHG emissions per megawatt-hr	U.O.M.	2022	2023
GHG emissions per megawatt-hr (FV Plants for auto-consumption)	tonCO2/MWh	0.00	0.00

Indirect Greenhouse Gas Emissions (Scope 2)

IGHG (Scope 2)	Unit	2018	2019	2020	2021	2022	2023
Location-based	metric tonnes of CO2 equivalents	9’076	7’500	7’300	6’400	6’440	5’600
Market-based	metric tonnes of CO2 equivalents	4’500	12’900	200	200	510	600
Data coverage (% revenues)	%	100%	100%	100%	100%	100%	100%

GRI 305-7 Nitrogen oxides (NO_x), sulfur oxides (SO_x) and other significant air
emissions

GRI 305-7 Nitrogen oxides (NO_x), sulfur oxides (SO_x) and other significant air emissions	U.O.M.	2019	2020	2021	2022	2023
Total	tNO_x	23.6	21.7	21.1	16.3	15.8
Coverage (% revenues)	%	100%	100%	100%	100%	100%

SOx and COV emissions are considered null in all reported years, as they are not significant

GRI 305-5 Reduction of GHG emissions

GRI 302-4 Reduction of energy consumption GRI 305-5 Reduction of GHG emissions	2020		2021
	TJ	tC0₂eq	TJ	tC0₂eq
Network conversion from LPG to natural gas	23.1	217.0	46.3	452.5
Vehicle fleet conversion	–	1,250.0	–	1,390.0
Renovation of the site at Largo Regio Parco 11 and 9 in Turin¹	6.47	382.0	5.5	389.9
Preheating optimisation systems	8.82	500.0	30.9	1,735.1
Installation of smart meters	2.6	192.0	2.6	187.8
Photovoltaic	32.4	2,373.0	33.9	2,452.3
Purchase of electricity from certified renewable sources	0.0	7,039.0	0.0	6,155.7
Replacement of lighting with LED bulbs	–	–	0.5	36.9
Total emissions avoided	73.4	11,953.0	119.7	12,800.2

¹The 2020 figure refers to the site on Largo Regio Parco 11 only

Scope 3 – Emissions classification

Scope 3 – Emissions classification	U.O.M.	2020	2021	2022	2023
Purchased goods and services	10³t CO₂eq	63.3	47.3	45.10	45.4
Capital goods	10³t CO₂eq	106	94.5	94.20	122.0
Fuel-and-energy related activities (not included in scope 1 or 2)	10³t CO₂eq	4.0	4.1	3.30	4.2
Upstream transportation and distribution	10³t CO₂eq	6.2	3.6	4.80	0.9
Waste generated in operations	10³t CO₂eq	7	1.4	1.60	9.2
Business travel	10³t CO₂eq	0.6	0.8	1.20	1.8
Upstream leased assets	10³t CO₂eq	0.8	0.4	0.60	0.9
Total	10³t CO₂eq	187.9	152.1	150.8	184.4
Coverage		100	100	100	100

COVERAGE BY MANAGEMENT SYSTEM

COVERAGE BY RECOGNISED ENVIRONMENTAL MANAGEMENT SYSTEMS SUCH AS ISO14001, EMAS OR ISO45001	U.O.M	2020	2021	31/03/2023	31/12/2023
ISO14001 & ISO 45001	% of sites covered (km of network)	98.9	100	100	100
ISO14001 & ISO 45001	% of sites covered (revenues)	98.7	100	100	100

WATER

GRI 303-3 WATER WITHDRAWALS	U.O.M.	2020	2021	2022	2023
Water withdrawal (excluding saltwater)	Million cubic meters	0.09951	0.07603	0.06907	0.13717
B. Water discharge (excluding saltwater)	Million cubic meters	0.09951	0.07603	0.06907	0.13717
Total net fresh water consumption	Million cubic meters	0.00	0.00	0.00	0.00
Coverage (% revenues)	%	100%	100%	100%	100%

WASTE

Italgas Group is committed to sustainable waste management through comprehensive programs and action plans that
enhance waste performance, reduce waste generation, and promote recycling. Our environmental department
periodically assesses and analyzes processes and activities to evaluate and minimize waste generation and
monitors performance towards targets. These waste audits help identify areas for improvement and to implement
effective waste management practices.

Over the years the Group has distinguished itself for its unique approach on innovation and digitization
investments, also with an effort to minimize waste. At the forefront of Italgas Group’s innovation efforts are
the design and development of a new H2 ready smart meter Nimbus which widespread installation will drive
significant investments over the coming years.

The new smart meters were designed and developed with an effort to minimize waste. 85% of the Smart Meter is made
recycled materials, including a sustainable recycled polycarbonate casing; and it is smaller, easier to
transport and install, contributing significantly to a circular economy system. Further, extending its operating
lifetime to 15 years – double that of existing meters – it reduces by 50% the expected substitution rate.
Additionally, we focus on qualifying suppliers whose products have the longest possible life cycles, thereby
extending the end-of-life period of our equipmente and significantly reducing overall waste. Italgas
set a target to minimize waste that is related to the installation of new smart meter: “50% of all active smart
meters designed according to «Design for environment» criteria in lieu of GPRS meters by 2028”.

Furthermore, the Group widespread focus on innovation include a collaborative R&D program with the
Politechnic of Turin to develop a more recyclable battery for smart meters. In addition to this, we are
investing on the development of innovative back-filling material for excavation works, facilitating reuse and
avoiding waste production.

In line with these efforts, Italgas Group conducts annual waste reduction training for its employees across all
sites. These training sessions focus not only on administrative and mandatory topics, but are designed to raise
awareness on waste hierarchy, to guide on effective waste reduction and recovery rate maximization, trends and
innovative projects.

Moreover, to ensure waste is effectively recovered and reused, we select transporters and destination plants that
manage waste in a sustainable way in order to integrate recycling programs to reduce waste sent to landfill. To
reinforce this, we have introduced a clause requiring waste management contractors to disclose to Italgas the
main categories of waste produced.

Finally, our effort of waste diversion from landfill (specifically regarding waste generated from the
substitution of smart meters) is certified by an independent accredited certification company, monitored by the
Ministry of Environment, thus highlighting our efforts to maximize sustainable waste management.

WASTE	Unit	2019	2020	2021	2022	2023
Total waste recycled/ reused	metric tonnes	639.5	559.4	341.1	242.4	378.4
Total waste disposed	metric tonnes	7.4	70.2	11.5	10.6	2.8
– Waste landfilled	metric tonnes	0.3	0	0	4.6	0.3
– Waste incinerated with energy recovery	metric tonnes	0	0	0	0	0
– Waste incinerated without energy recovery	metric tonnes	0	0.1	0.3	1.4	0
– Waste otherwise disposed	metric tonnes	0	0	0	0	0
– Waste with unknown disposal method	metric tonnes	7.1	70.1	11.2	4.6	2.5
Data coverage (% revenues)	%	100%	100%	100%	100%	100%

TCFD RECOMMENDATIONS

RECONCILIATION OF TCFD RECOMMENDATION WITH 2023 INTEGRATED ANNUAL REPORT DISCLOSURES	Page
*GOVERNANCE* (organisation’s governance model in connection with the risks and opportunities associated with climate change)
a) Supervision of the Board of Directors on the risks and opportunities associated with climate change	Pages 49-52
b) Role played by the management in assessing and managing the risks and opportunities associated with climate change	Pages 49-52
*STRATEGY* (current or potential impacts of the risks and opportunities associated with climate change on the organisation’s business, strategy and financial planning)
a) Risks and opportunities associated with climate change that the organisation has identified in the short-, medium- and long-term	Pages 55-65
b) Impacts of the risks and opportunities associated with climate change on the organisation’s business, strategy and financial planning	Pages 55-65
c) Resilience of the strategy of the organisation, taking into account different climate-related scenarios, including a scenario of 2°C or less.	Pages 37-41
*RISK MANAGEMENT* (how the organisation identifies, assesses and manages risks associated with climate change)
a) Organisation’s processes to identify and assess risks associated with climate change	Pages 55-65
b) The organisation’s processes to manage risks associated with climate change
c) How the processes of identifying, assessing and managing the risks associated with climate are integrated into the organisation’s overall risk management
*METRICS AND TARGETS* (metrics and targets used by the organisation to assess and manage the relevant risks and opportunities associated with climate change)
a) Metrics used by the organisation to assess the risks and opportunities associated with climate change in line with its risk management process and strategy	Pages 134-135, 141-150, 194-197
b) Scope 1, 2 and 3 greenhouse gas (GHG) emissions and related risks	Pages 57, 197
c) Targets used by the organisation to manage the risks and opportunities associated with climate change and performance with respect to the targets	Pages 134-135, 141-150, 194-197

SOCIAL COST OF CARBON

Social cost of carbon represents the the impact evaluation methodology to assess the external impact to
affected stakeholders with regard to the issue “Energy transition and fight against climate change”. Ouput KPI
(tons of CO2 avoided by ESCo activity) was assessed through a social cost of carbon, resulting in a total
positive impact of approx. 1,332,484 euros.

Carbon pricing

Even though not subject to ETS scheme, Italgas Group has integrated an internal carbon price as a core element to
address business strategy, decision making process and prepare to address climate change related issues. The
internal carbon price is monitored as an actual and perspective value over the Strategic Plan period (latest
Strategic Plan 2023-2029).

Italgas CO2 emission reduction targets are publicly disclosed and are a tool to meet Italgas stakeholders’
expectations and to show our strategy and commitment to achieve a net zero carbon business by 2050 (please
see Strategic Plan 23-29, slide 35)

Also, CO2 is a driver to change internal behavior, namely it is used for internal communication strategy to
address employees’ behaviors (also during awareness and training campaigns) and to improve economic and
sustainability sensitivity of employees and spread Heat and cooling best practices in the
offices.

Dialogue and Priorities

Through our daily activities we aim to dialogue transparently with all our stakeholders, communicating clearly and consistently what we do, how we work, where we create value.

Find out more

Discover our vision and projects

Our Sustainability Ambassador

From personal awareness to collective awareness: with the project dedicated to Sustainability Ambassadors, we make people protagonists of our transformation path.

Find out more
Digitalization for the transition

With an increasingly widespread and digitized network, we contribute every day to the energy future of the country and to the development of renewable gases.

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Innovation partnerships

We actively participate in the development of the country through strategic and innovative collaborations, which generate shared value.

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Objectives, actions and results

Our performance

Dialogue and Priorities

Discover our vision and projects

Our Sustainability Ambassador

Digitalization for the transition

Innovation partnerships