_280 2023 UNIVERSAL REGISTRATION DOCUMENT_MICHELIN 4 NON-FINANCIAL STATEMENT Sustainable Development Report The Sustainable Natural Rubber Policy is based on five core commitments: ● respect all stakeholders in the natural rubber production chain, by promoting conflict resolution related to land ownership and improving working conditions and living environments; ● make rubber tree farming environmentally friendly, by combating deforestation and controlling the potential impact of rubber cultivation on fauna and flora; ● take action to improve farming practices, by helping to instill more efficient practices across the natural rubber production chain, especially among village smallholders, in a commitment to increasing agricultural yields; ● encourage the careful use of natural resources by increasing the material efficiency of natural rubber used in tires. Michelin is constantly developing new technical processes that optimize the use of rubber in its products; ● make rubber tree farming a source of better governance practices. Michelin is an engaged stakeholder in the rubber tree farming industry, communicating transparently, refusing all forms of corruption and interacting with local and international stakeholders. Since 2016, the policy has been included in every Michelin supply contract. In addition, Michelin encourages its suppliers to implement policies aligned with GPSNR recommendations. Assessing stakeholders across the supply chain CSR practices in the Group’s natural rubber supply chain are assessed differently depending on the stakeholder: ● for our direct suppliers, desktop reviews are submitted to EcoVadis and on-site audits are performed; ● for our direct suppliers’ production facilities and upstream supply chain, risks are mapped using the RubberWay® application and deforestation risks are analyzed. EcoVadis desktop reviews The Group’s natural rubber suppliers have been participating in EcoVadis reviews of their social responsibility and environmental performance since 2013. If their results fall short of compliance, remedial action plans are deployed. In 2023, reviews covered the vast majority of our natural rubber suppliers and the CSR maturity of suppliers representing 94% of total spend was confirmed as compliant with Michelin standards(1). On-site audits A dedicated team performs on-site audits of every facility supplying natural rubber to the Group. These audits primarily focus on quality performance, but also cover CSR issues, such as the environment (water treatment, etc.) and employee health and safety. Each facility is audited at least once every two years. Follow‑up audits are systematically conducted, with remedial action plans mandated in the event of shortcomings. Supply chain risk assessments To understand and mitigate deforestation, human rights and other risks in its natural rubber supply chain, Michelin is systematically deploying a variety of risk assessment tools and systems. Developed in 2017, the RubberWay® risk-mapping system uses a mobile app to map environmental and social risks in the natural rubber supply chain. Supply chain stakeholders, including raw rubber processing plants, brokers, large plantations and smallholders, are asked to respond to a questionnaire about their practices in such areas as human rights, the environment, agricultural training and market transparency. The inputted data are then analyzed and summarized on an online platform to create a map highlighting the areas of potential social and environmental risk. The results are shared with direct Michelin suppliers and can be used to prepare improvement plans or deploy mutually designed risk mitigation projects. (1) This corresponds to 98% of the spending covered by the reviews (see section 4.1.1.3 b).
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