Climate change is the long- term shift in temperatures and weather patterns primarily driven by greenhouse gas emissions (GHG). Because passenger cars and light commercial vehicles (vans) are respectively responsible for around 16% and 3% of total EU GHG emissions 1 , Arval, as a major mobility player, has been transitioning its business since 2020 to reduce the emissions of its leased fleet. Arval has recognised several impacts and risks related to climate change due of its leasing business model and value chain: • GHG emissions from the leased fleet, including upstream manufacturing emissions and the use of vehicles, during the leasing period and after their resale. • P hysical risks from extreme weather events, causing damage to the fleet. • T ransition risks on the resale value of cars in the EU market due to legislative, technological changes and consumer preferences. • The transition is also a source of new opportunities for Arval to be part of a more sustainable economy: > Cost-saving opportunities by reducing GHG in its own operations > Commercial opportunities in promoting the emergence of electric mobility and new mobility solutions. I CLIMATE change Arval’s Commitment to Addressing Climate Change + Arval’s approach to mitigating fleet risks + Arval’s approach to mitigating fleet risks + Decarbonisation trajectory + Decarbonisation trajectory + Our decarbonisation trajectory + Read more + Read more Arval’s carbon footprint (1) CO 2 emission performance standards for cars and vans – European Commission How Arval calculates its carbon footprint SCOPE 1 Direct emissions from owned or controlled sources: direct GHG emissions that are released by Arval by use of energy that is not electricity, which in Arval’s case stands for natural gas consumption and heating oil (for heating systems), and fuel (for emergency power units). SCOPE 2 Indirect emissions from the generation of purchased energy: includes all types of electricity Arval buys, and all the electricity spent in district heating and cooling systems. Communicated figures, unless stated otherwise are ‘location-based’ and calculated using countries’ average electricity carbon intensity. SCOPE 3 Indirect emissions are associated with: • Emissions relating to Arval’s leased fleet including upstream vehicle manufacturing, use during the leasing period, and after their resale. • Employees’ business travels: at this stage calculated for business trips made by plane, rail and car (for the sake of visual simplicity business Travel emissions are summed with Scope 2 figures). Arval’s 2024 GHG emissions in tCO2e Own operations1 12 444 Commercial activities2 23 298 087 TOTAL 23 310 531 (1) Arval own operations GHG emissions includes Scope 1, Scope 2 and business travels (2) Arval commercial activities GHG emissions include Scope 3 linked with the manufacturing emissions of vehicles purchased and vehicles use phase emissions (during leasing and after sale) Arval Group’s carbon footprint is calculated using the Greenhouse Gas protocol, a reference standard for GHG accounting. Its reporting framework relies on the definition of the operational boundaries via ‘scope of emissions’ (Scope 1, 2 and 3 – see definitions), which categorise emissions resulting either directly or indirectly from the company’s operations and activities. Arval Group’s Scope 3 includes GHG emissions from its leased fleet across the value chain. This provides a comprehensive understanding of its carbon footprint and helps identify levers to decarbonise Arval’s own operations and its commercial activities. Scopes 1 & 2 are calculated using data collected in the 13 Arval countries where Arval operates, covering almost 80% of its employees. The data is extrapolated to the rest of the group. The calculation of Scope 3 uses Arval’s own fleet database for the usage phase, completed with external data sources for indirect upstream and downstream emissions. Details of Arval’s methodology are provided on a Scope-by-Scope basis in Arval Group’s Sustainability Statements of the 31st of December 2024, § 2.4.3 “Gross Scopes 1&2,3 and total GHG emissions”. Arval’s approach to mitigating fleet risks In addition, Arval has set business continuity procedures for acute climate events, defining measures to protect employees whilst ensuring business continuity, through various strategies ranging from working from home, temporary transfers of employees or activities to other sites or other measures if deemed necessary. To reduce the risks of the fleet’s exposure to extreme weather events, and to ensure the continuity of services, Arval has put in place an adaptation plan: • Protection of Arval’s assets through a variety of initiatives such as protecting stocks in high-risk areas and risk-monitoring. • Prevention, towards drivers with weather alerts and rewarding parking in secure areas. • Insurance and hedging of risk with reinsurance policies as well as adapting damage covered. Decarbonisation levers • Technology mix / electrification • Vehicle weight monitoring• Increase contract duration or leverage used cars FLEET COMPOSITION 1 USAGE OPTIMIZATION • Increase eco-driving • Optimize PHEV3 Recharging 2 FLEET SIZE & NEW MOBILITIES • Improve utilization rate and optimize sharing / Pooling • Transfer mileage to alternative mobilities where relevant 3 (1) % decrease of average WLTP theoretical tailpipe CO2 emissions per vehicle of Arval fleet and per kilometre compared to Jan 2020 (2) Battery Electric Vehicle (3) Plug-In Hybrid Electric Vehicle + Know more + Know more 2013 2020 2026 2050 Here we are! 2030 (1) All its leased fleet, including passenger cars and commercial vehicles, worldwide (2) Belgium, Germany, Spain, France, Italy, The Netherlands, Poland (3) Source ICCT : https://theicct.org/publication/european-market-monitor-cars-vans-2024-feb25 (4) Including direct emissions from fuel combustion, indirect emissions from power generation, and upstream energy-related emissions (5) The term «real emissions» corresponds to direct and indirect emissions (including upstream energy production and distribution as well as a correction of WLTP emissions with the aim of approaching actual emission values, related to overconsumption of fuel in real conditions) during the use of the vehicle over its entire lifetime (6) Using ‘Location-based’ method figures computed using countries average electricity carbon intensity and expressed in equivalent tCO2 per Full Time Employee (FTE) + View the infography + View the infography Decarbonisation trajectory Through its “Arval Beyond” strategic plan, since 2020 Arval has been transitioning its business to reduce the emissions of its leased fleet, promote the emergence of electric mobility and new mobility solutions, and contribute to better road safety. Decarbonisation of leased fleet: Arval recorded a reduction of average tailpipe emissions of its leased fleet of nearly 1.8 million vehicles of 22.4% compared to January 2020, with an average intensity of 111 gCO2/km per vehicle1 average theoretical tailpipe CO2 emissions (WLTP values). Arval aims to bring the average emissions down to 100 gCO2/km by the end of 2026 (30% lower than 2020), and at the same time increase the number of electric vehicles in its fleet to 400,000. With an intensity of just 92 gCO2/km of its 2024 production in its main European markets2, Arval has already achieved average emissions well below that of the European market at 108 gCO2/km over the same period3. Well-to-wheel emissions4 from vehicle use during the leasing period and after resale, expressed as intensity per kilometre, are calculated according to the SBTi methodology. The decarbonisation trajectory aims to achieve a reduction of -35% in real emissions5 in gCO2 intensity per kilometre travelled, i.e. 144 gCO2/km in 2030 compared to 221 gCO2/km in January 2020. For its own operations decarbonisation, Arval is aligned with the BNP Paribas Group having set a 2025 intensity target of less than or equal to 1.85 tCo2/FTE6 for Scopes 1 and 2, and employee business travel emissions.