04 Sustainability Statement General information Impacts, Risks and Opportunities (IROs) Brief description Upstream value chain Downstream value chain Own operations Short-term Medium-term Long-term E1 – CLIMATE CHANGE Climate change mitigation Higher energy performance standards for tires Standards are being raised both by market demand and through regulations. Tires account for 15% to 30% of an internal combustion vehicle’s fuel consumption. As mobility goes electric, the focus is expected to shift to certain products or components that are harder to decarbonize, such as tires. Original equipment manufacturers are looking for tires with low rolling resistance, while fleets prefer long-lasting, high-mileage products. Urbanization and the emergence of new mobility solutions will heighten the role of fleets. Regulatory standards governing rolling resistance and other energy performance factors are tending to become stricter around the world, along the lines of European Union legislation. Opportunity Rising demand for a wider range of electric vehicles Michelin is positioned as a leading manufacturer of high-performance, long-lasting, energy-efficient tires that play a critical role in optimizing the EV experience. According to the International Transport Forum, an estimated 40% of new vehicles will be electric in 2027, representing a tripling of their market share in just five years and offering the Group new opportunities. Opportunity Contributing to climate change through direct and indirect greenhouse gas emissions (Scopes 1 and 2) Michelin is a global manufacturer with a broad industrial footprint. Greenhouse gases are emitted by our own operations and by the energy used in our production and other sites. The impact covers Scope 1 and 2 emissions. Negative impact Contributing to climate change through direct and indirect greenhouse gas emissions and land use change (Scope 3) Scope 3 emissions comprise two main categories: n GHG Protocol required Scope 3 emissions, which come from purchased raw materials, upstream logistics activities, upstream purchased energy and a variety of other sources. This category is significantly larger than Scope 1 and 2 emissions; n GHG Protocol optional Scope 3 emissions from the use of sold products, which in the case of Michelin corresponds to the 15% to 30% of a vehicle's fuel or electricity used to overcome tire rolling resistance. This makes their contribution critically important, with Scope 3 use-phase emissions representing more than 90% of Michelin’s carbon footprint (115 million tonnes of CO2 in 2024). Michelin is a leader in rolling resistance performance. Negative impact Facilitating greater energy efficiency by offering services to optimize the use and management of vehicle fleets and accelerating the transition to zero-emission mobility Michelin is a leading sustainable mobility enabler. In addition to tires, the Group offers solutions to optimize fleet management and support hydrogen-powered and other forms of zero-emission mobility. The Group promotes sustainable mobility, in particular through international forums and networks such as Movin'On and the World Bank’s Sum4All initiative. Positive impact Climate change adaptation Impact of physical climate risks on business activities, assets, employees, raw materials, delays and logistics costs Michelin has operations around the world that could be impacted by the increased frequency of adverse climate events, such as storms, floods, droughts and other risks. In light of the diverse range of suppliers and the many interdependent factors necessarily involved in the manufacture of its products (infrastructure, energy, availability of labor, transportation systems, etc.), the effects of climate change may be qualified as systemic. Risk E2 – POLLUTION Water, soil, air and noise pollution Tightening standards limiting the impact on water, soil and air pollution from microplastics (tire and road wear particles – TRWP) and substances (e.g., 6PPD) More stringent pollution regulatory standards could lead to lower maximum tire abrasion limits and stricter regulation of particles (TRWP) and substances (6PPD) and other substances, as well as to impacts on Michelin services. Insofar as Michelin tires are well known for their superior abrasion performance compared to their premium competitors, this could represent an opportunity for the Group. Risk Water, soil and air pollution from the use of tires (TRWP) Friction between tires and the road generates wear particles (TRWP), influenced by a variety of factors. Since 2010, certain studies have demonstrated their presence in the environment and their potential impact. However, scientific knowledge of the impact and behavior of these tire and road wear particles (TRWP) needs to be improved. Michelin and the entire industry, through the Tire Industry Project (TIP) have engaged a proactive approach to TRWP. Negative impact Upstream Downstream OP Downstream Downstream Upstream OP Downstream Upstream OP OP Downstream Downstream 189 2024 UNIVERSAL REGISTRATION DOCUMENT_MICHELIN
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