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TABLE OF CONTENTS

1. LETTER FROM THE PRESIDENT ...... 7 2. OUR ORGANISATION: ...... 10 2.1 UBE Corporation Europe (UCE) ...... 10 Brief history ...... 11 Vision and mission ...... 11 Business model ...... 12 Markets and products ...... 13 The business environment of El Serrallo Industrial Estate ...... 15 2.2 Organisation and structure ...... 17 Organisational structure ...... 17 Governing body ...... 20 External initiatives ...... 21 Responsible Care: ...... 21 Association memberships ...... 22 2.3 Key financial figures ...... 24 2.4 Objectives, strategies and future prospects ...... 26 Gender Equality ...... 29 Castellón CSR Committee ...... 30 Recognition by society ...... 31 2.5 Integrated management system and risk analysis ...... 31 2.6 Health and Safety ...... 33 Health and safety training ...... 34 Health and safety performance ...... 34 Safety Standards Manual ...... 35 Hazard identification and risk assessment ...... 35 In-house prevention service ...... 37 Staff participation and consultation processes ...... 37 Promotion of the personnel's health. Health Promotion Programme ....38 Physical area ...... 38 Mental Area ...... 39 Social area ...... 40 3.ETHICS AND COMPLIANCE ...... 41

3.1 Control mechanisms ...... 41 3.2 Ethics and integrity ...... 42 3.3 Code of Ethics and Conduct ...... 45 3.4 Materiality report ...... 48 Results ...... 49 Materiality ...... 49 3.5 Participation and transparency ...... 52 3.6 Fight against corruption and bribery ...... 54 3.7 Respect for human rights ...... 56 4. ENVIRONMENT ...... 57 4.1 Management approach ...... 57 4.2 Environmental management system ...... 58 4.3 Environmental responsibility ...... 58 4.4 Economic resources for the environment...... 59 4.5 Circular economy and waste management ...... 60 4.6 Materials and sustainable use of resources ...... 63 Water consumption ...... 63 Consumption of raw materials ...... 64 Catalysts and organic solvents ...... 64 Catalysts: ...... 64 Organic solvents: ...... 64 4.7 Pollution Prevention: Energy, Emissions and Climate Change ...... 65 Energy...... 65 Atmospheric emissions ...... 66 Reduction of Greenhouse Gas Emissions ...... 66 Noise emissions ...... 68 Light emission ...... 69 Emissions to water ...... 69 Significant spills ...... 70 Odour Control...... 71 Other environmental contributions ...... 71 Mobility ...... 71 Environmental Awareness and Volunteering ...... 72 4.8 Protection of biodiversity ...... 72 4.9 Positive impact on the environment ...... 73

Collaboration with the Carbon Disclosure Project ...... 74 4.10 Environmental assessment of suppliers...... 75 4.11 Challenges for the future ...... 75 5. PERSONNEL ...... 77 5.1 Management approach ...... 77 5.2 Description of the group ...... 79 Professional groups and functional levels ...... 79 Outside personnel ...... 81 Promotion and professional development ...... 81 Professional classification in figures ...... 83 Age ranges ...... 85 People with disabilities and universal accessibility ...... 88 Working days, hours, overtime and holidays ...... 89 Reconciliation between personal life and professional development ...... 93 Absenteeism ...... 94 New recruitments and dismissals ...... 95 Periodic performance evaluations ...... 97 5.3 Collective agreement ...... 98 5.4 Training ...... 101 5.5 Salaries ...... 103 5.6 Occupational health and safety ...... 106 Workplace accidents and occupational diseases ...... 107 Health and safety training ...... 108 Production staff working shifts...... 109 Normal working day and laboratory staff...... 110 Continuous training ...... 111 5.7 Support schemes ...... 111 Pension Plan ...... 112 Social Fund ...... 113 5.8 Challenges for the future ...... 116 6. CUSTOMERS AND SUPPLIERS ...... 117 6.1 Management approach ...... 117 6.2 Customers ...... 117 6.3 Suppliers ...... 119 6.4 Marketing and labelling ...... 119

6.5 Challenges for the future ...... 120 7. SOCIETY ...... 121 7.1 Management approach ...... 121 7.2 Community ...... 122 Actions linked to the public administration in FY2019 ...... 123 Local authorities in Castellón: ...... 123 Almazora Town Council: ...... 123 Generalitat Valenciana: ...... 123 Port of Castellón: ...... 124 Relationship with the local media ...... 124 Relationship with non-profit organisations ...... 124 Sports Clubs...... 124 Non-governmental organisations for social welfare and similar, based in Castellón...... 124 The intervention of UCE before the effects of Covid -19...... 125 Academic and cultural entities and activities...... 125 Jaume I University ...... 125 Vicent Castell i Domenech de Castelló Secondary School...... 125 Cultural promotion ...... 126 Alliances and partnerships...... 126 Promotional activities for the environment...... 127 Volunteering Promotion Group ...... 127 Guided tours in UCE ...... 127 7.3 Challenges for the future ...... 128 Annex 1: About this report ...... 129 Annex 2: GRI Table of Contents ...... 130 UNIVERSAL STANDARDS...... 130 102: General contents (2016) ...... 130 ECONOMIC 200 ...... 134 201 Economic Performance ...... 134 202 Market presence ...... 134 203 Indirect economic impacts 2016 ...... 135 204 Procurement practices...... 135 205 Anti-Corruption ...... 135 206 Unfair competition ...... 136

ENVIRONMENTAL 300 ...... 137 301 Materials...... 137 302 Energy ...... 137 303 Water and effluents ...... 138 304 Biodiversity ...... 138 305 Emissions ...... 139 306 Effluents and waste ...... 140 307 Environmental compliance ...... 140 308 Environmental assessment of suppliers ...... 141 SOCIAL 400 ...... 142 401 Employment ...... 142 402 Worker-employer relations ...... 142 403 Occupational health and safety (v_2018)...... 142 404 Training and education ...... 144 405 Diversity and equal opportunities ...... 144 406 Non-discrimination ...... 144 407 Freedom of association and collective bargaining ...... 145 .408 Child labour ...... 145 409 Forced or compulsory labour ...... 145 410 Security Practices ...... 145 411 Rights of indigenous peoples...... 146 412 Assessment of human rights ...... 146 413 Local communities ...... 146 414 Social assessment of suppliers ...... 147 415 Public policy ...... 147 416 Customer Health and Safety...... 147 417 Marketing and labelling ...... 148 418 Customer Privacy ...... 148 419 Socio-economic compliance ...... 149 Annex 3: Equivalences of the UCE-REPOL professional groups ...... 150

1. LETTER FROM THE PRESIDENT [102.14/ 102.15]

We are pleased to present the Non- Financial Report from UBE Corporation Europe, S.A.U. (UCE), following the requirements of Law 11/2018 of 28 December 1and which, for the first time, has been carried out in accordance with the GRI Standards methodology (Global Reporting Initiative) for sustainability reporting. A methodology that allows us to present our commitments and the results achieved in the period covering 1 April 2019 to 31 March 20202The aim is to make the information available in a relevant, comparable and verifiable manner.

UBE Corporation Europe (UCE) is a group of companies dedicated to the production and distribution of value-added chemicals and to the creation of technological and sustainable solutions to meet the demands of industry and market trends. It has a presence in Europe and Latin America through delegations and offices in Castellón, Almazora and Madrid (Spain), Düsseldorf (Germany), Sao Paulo (Brazil) and Mexico City (Mexico). UBE Corporation Europe is part of the Japanese group UBE Industries, Ltd. On 29 March 2019, UCE acquired a majority stake in Repol, S.L. (Almazora, Castellón), which was therefore then included in its scope of consolidation.

UCE reiterates its commitment to sustainability based on the principles established by the UBE Group worldwide. This philosophy has been reinforced during 2019 with the launch of the Vision UBE 2025 - Prime Phase which aims to continue contributing to the prosperity of all its stakeholders by adapting to the conditions of the markets in which it operates. Specifically, the following lines of work included in the Vision UBE 2025:

 To actively participate in the reduction of greenhouse gas emissions and other impacts on the environment through the promotion of products and the use of technologies that mitigate the effects on the environment

1 Law 11/2018, of 28 December, available at: https://www.boe.es/boe/days/2018/12/29/pdfs/BOE-A-2018-17989.pdf 2Fiscal Year 2019 (FY2019) The reason for taking this reference is that UCE is part of the UBE Industries, Ltd. group, which works on the basis of those fiscal years. 7

 Promotion of a corporate governance culture that allows for transparency in management and internal control systems, including a comprehensive analysis of the risks associated with the activities.

 Promotion of human resources by favouring safe and appropriate working environments for professional and personal development.

UCE's Management Policy, updated in April 2019, is in line with the UBE Group's philosophy, sharing the spirit of innovation and use of technology to ensure the quality of its products and contribute to the development of society.

As will be specified in this report, multidisciplinary working groups have been organised in UCE to deal with the analysis and practical application of the various initiatives in the field of sustainability, including the Sustainability Group, the Decarbonisation group and the Change and Challenge project.

Change and Challenge is a UBE initiative led by committed individuals and organisations concerned about the impact of food packaging on the environment and the preservation of natural resources throughout the food chain, from the field to the home. Its vision is to generate awareness, direct global attention and a solution to the food waste crisis.

Since 2019, and following the directive of UBE Industries, the risk assessment of UCE is carried out annually (previously it was every three years), including the stages of identification, evaluation, prevention and mitigation of significant risks and impacts. This procedure is included in the corporate standard UCE 001 Corporate approach to risk assessment. Based on the SWOT analysis of UCE activities, the risk matrix is applied systematically to all roles, areas and subsidiaries of UCE.

In relation to risks in the work environment, risk assessments of jobs are carried out using the risk matrix of the National Institute of Occupational Health and Safety. Other internal active safety tools are also used, such as safety inspections, preventive safety observations, occupational safety analysis or the the work permits procedure.

With regard to process safety, specific risk management studies are carried out to identify, assess and mitigate risks by applying PHA techniques (Process Hazard Analysis). Equally relevant is the application of the PGI.02.07 Change Management procedure, better known as MOC (management of change) whose purpose is to ensure that any change in processes, whether permanent or temporary, is systematically assessed to ensure that risks to people, facilities, products and the environment are assessed, communicated and controlled to an acceptable level of risk.

The above-mentioned approach to risk assessment enables the development of a risk-based decision-making culture in practice by providing a common standardized approach. As a result of this assessment process, a series of risks have been identified in UCE, which may also be opportunities for improvement in management by strengthening dialogue with the company's various stakeholders, namely:

 Strict regulatory compliance, specifically in the areas of the environment, industrial and occupational safety and product protection.  Supply of raw materials and services.  Secure sales management in emerging countries.  Innovation and competitiveness of UCE's main products (new competitors, alternative products...) Integration in the value chain.  Adequate management of the talent of UCE employees, with a focus on promoting talent and reconciling professional and personal life.  Community relations (NGOs, associations, town councils, media...).  Risks from cyber-security and impact on the continuity of the activities.  Information security risks, both in the regulatory field and in terms of confidentiality of UCE's intellectual and industrial property.  Natural disasters (flooding, storms...).  Adaptation of the business model to the new requirements of society (European Strategy on Climate Change and Energy 2030, European Strategy for Plastics 2030, Circular Economy and Life Cycle Analysis, compliance with best available technologies regulations...).  Effect of globalization/climate change (pandemics, resources...)

In addition, the procedure in force involves reporting to UBE Industries on the risks considered critical according to the standard applied for their consolidation in UBE Group's corporate parent and subsequent monitoring.

The achievements made in this culture of improvement in the management of economic, social and environmental risks are described in this report and show the efforts made by the company to meet the commitments made to its stakeholders, the only way to generate confidence in them.

Bruno De Bièvre

President

2. OUR ORGANISATION: [102.1/ 102.2/ 102.3/ 102.4/ 102.5/ 102.8/ 102.9 /102.10 / 107.7]

UBE Corporation Europe (UCE) is a group of companies dedicated to the production and distribution of value-added chemicals and to the creation of technological and sustainable solutions to meet the demands of industry and market trends. It has a presence in Europe and Latin America through delegations and offices in Castellón, Almazora and Madrid (Spain), Düsseldorf (Germany), Sao Paulo (Brazil) and Mexico City (Mexico). UBE Corporation Europe is integrated into the Japanese group UBE Industries, Ltd.

2.1 UBE Corporation Europe (UCE)

UBE Corporation Europe (hereinafter UCE) is located in the Industrial Park El Serrallo s/n of Castellón de la Plana (Spain), within an industrial area 10 kms from Castellón and 5-6 kms from the nearest town in the Grao de Castellón y Almazora.

The location of UCE belongs to the Town Council of Castellón.

The surface area occupied is 300,000m2 and is surrounded by other companies. In addition, the company has a 40,000m2 administrative concession in the Port of Castellón for the entry and storage of raw materials. Staff of 597 employees.

Brief history

The company was founded in 1967 under the name of Productos Químicos Esso S.A owned by Esso Chemicals and Banco Español de Crédito (Banesto). In 1975, Banesto acquired a majority stake in Esso and the company adopted the name Productos Químicos del Mediterráneo S.A. (hereinafter Proquimed), becoming part of the Petromed group of companies.

In 1991 the British company British Petroleum (BP) bought the Petromed group, selling Proquimed to UBE Industries Ltd. in 1994, which continues to own it. UBE Industries is a Japanese multinational founded in 1897, its main factory is located in the city of Ube and the head office is in Tokyo. The company manufactures a wide variety of products including chemicals and pharmaceuticals, cement and building materials, and industrial machinery, and has a division for power generation and environmental management. From an organisational point of view, UCE belongs to the chemical branch of UBE Industries.

Vision and mission

UBE Industries' vision is defined as:

"Wings of Technology and Spirit of Innovation. This is the DNA, which is behind our global success. The UBE Group will assume a pioneering spirit in its search for balance in the global community, relying on the limitless possibilities of technology, while striving to create value for the next generations.

And its mission is:

"To achieve sustainable growth and increase the Group's corporate value in the long term".

Business model [102.10]

UCE is the only Spanish company that produces caprolactam, a raw material used in the manufacture of polyamide synthetic fibre known as Nylon-6. As a result of the production of caprolactam, UCE manufactures and markets fertilizers: ammonium sulphate in various grades.

Over the years, UCE has diversified its product portfolio by taking advantage of end and intermediate products and developing the production of fine chemicals: 1.6 hexanediol, 1.5, pentanediol and different grades of polycarbonate diols (PCD) for various applications.

Since 2004, UCE has been manufacturing nylon under a technology licence from UBE Industries in increasing quantities and different value-added grades, mainly for food contact packaging and, since 2017, expanding the portfolio to the production of composite grades for the automotive industry.

The UCE Group is the owner of the chemical plant in Castellón which is supported by a commercial office in Madrid and by other subsidiary companies acting as agents: UBE Europe GmbH in Düsseldorf (Germany), UBE Latin America Serviços Ltda. in Sao Paulo (Brazil) and UBE México S. de R.L. de C.V. in Mexico City.

At the end of 2018 UCE acquired a majority shareholding in Repol, S.L. (Almazora, Spain).

Repol, S.L., a specialist in the formulation, transformation and marketing of engineering plastics; it has a staff of around 60 people and was established in Almazora in 1975, where it has its headquarters, factory and R&D department. The company operates both nationally and in several foreign markets. Repol materials provide durability, lightness and stability and are used for advanced applications in household appliances, cars, machinery and electrical and electronic equipment, among others.

The integration of Repol into the UCE Group means the generation of synergies in specialised injection and extrusion markets and the complementarity of product and market portfolios. New possibilities are also opening up in the field of R&D, especially in plastic injection and the study of circular economy and plastic recycling activities.

No significant changes have taken place in the supply chain in 2019.

Markets and products [102.6]

WE CREATE SOLUTIONS FOR THE FOOD INDUSTRY: Protecting food and avoiding its waste

With polyamide, we produce in UCE (UBE NYLON) the cling-film industry obtains plastic films for packaging, which preserve the flavours and nutrients of the food products so that they reach the consumer in optimum conditions. And not only do we protect the food of all those involved in its production and consumption, but we also make it possible to extend its shelf life and thus reduce food waste.

The film manufactured with our UBE NYLON, is flexible and transparent. It acts as an excellent barrier effect to the external elements of food, such as oxygen (avoiding oxidation) and has an excellent mechanical resistance.

WE CREATE SOLUTIONS FOR THE AUTOMOTIVE INDUSTRY: With high performance materials for its components

At UBE we manufacture materials that contribute to making cars more efficient, more comfortable and also safer. This is because the components made with our materials are more resistant to abrasion, sun, heat, cold and water, which extends their life. We provide the automotive component industry with quality materials that bring great performance to their products and greater speed in their production processes.

With our materials, we meet the requirements of the following industries:

- Tyres - Synthetic leather for car seats and interiors - Windscreen adhesives - Engine covers - Fuel lines - Truck brake hoses, driving controls, etc.

WE CREATE SOLUTIONS FOR THE HABITAT AND LIFESTYLE INDUSTRY: With strong, high-performance materials

At UBE we manufacture materials that facilitate the diversity of people's lifestyles; providing them with more comfortable, resistant and longer-lasting items.

We provide the industry with quality materials that give great performance to their products (decoration applications, sports shoes, home appliances, gardening and do-it-yourself tools, printing...) and greater speed in their production processes.

With our materials, we meet the requirements of the following industries: - Indoor and outdoor wooden floors - Synthetic leather for indoor and outdoor sofas - Trainers - Ski boots - Bathroom furniture - Printer inks - Etc.

WE CREATE SOLUTIONS FOR AGRICULTURE: With fertilizers that provide food with a higher quality

At UCE we contribute to providing better quality to fruit, vegetables, legumes and cereals by manufacturing our UBESOL 45 (ammonium sulphate), a fertilizer in granular format that can be applied by the farmer to all types of crops, by means of precision fertilizers and centrifuges.

Farmers benefit from our product, which has a high degree of purity, compatible with other granular fertilizers and whose properties provide greater profitability to their crops. We supply them with fertilizers to cover the nutrient needs of the plants (sulphur, nitrogen, phosphorus, iron, manganese and many other micro-nutrients) in a great diversity of crops.

The business environment of El Serrallo Industrial Estate

In 2019, the Institut Cerdá prepared a report for UCE and another seven companies of INDES (Association of Industries of El Serrallo de Castellón) located in the same industrial estate, addressing two main objectives:

1) To analyse the relationship of the companies on the El Serrallo Industrial Estate with their economic, environmental and social environment.

2) To publicise their socio-economic impact, environmental management and commitments to continuous improvement by these companies with their local environment.

This study identified the socio-economic contribution of the companies on the estate and analysed their relationship with the neighbouring community:

"In recent years, the industrial complex has become one of the main centres for creating wealth and employment in the province of Castellón and the Valencian Community as a whole, while also maintaining close links with the Port of Castellón and other agents and institutions in the province's industrial fabric. The Serrallo Industrial Estate generates more than 1,060 direct jobs and as many indirect ones".

It should be noted that the stakeholders coincide in highlighting the importance of the Industrial Estate as a centre for the generation of jobs and the revitalisation of economic activity in the area of Castellón and the Province. The strategic interest of the complex in the economic field is in no way questioned. Nor are the activities carried out by industries and their contribution to territorial development questioned.

However, this study detected certain concerns regarding the need for greater information and transparency by the industrial estate and public administrations, as well as aspects of environmental pollution, safety or mobility in the surroundings of the industrial complex.

In accordance with the aforementioned study and the assessment carried out for this non-financial report, UCE considers that its activity has a special impact, to a greater or lesser degree, on the following aspects of materiality detected and related to the socio-economic and environmental impact on the surrounding community:

● Growth and financial results ● Sound corporate governance and regulatory compliance ● Productive investment in innovation ● Growth in markets and customers ● Promoting local socio-economic development ● Alliances with society and the public authorities ● Relationships with the community (sporting, civic and charity organisations) ● Evaluation of human rights impacts ● Informational transparency ● Identification of opportunities to avoid or minimise damage associated to climate change

The Human Resources and CSR Area of UCE coordinates a communication policy involving various areas and departments in order to respond to and manage the issues mentioned above.

For this, this area is developing an institutional relations programme with external stakeholders, based on the Management Policy, the principles of the Responsible Care company code, the values of the Code of Ethics and Conduct and the UBE Action Guidelines.

UCE's area responsible for this is clearly identified to the community and operates with criteria of transparency, proactivity and accountability.

UCE has its corresponding Integrated Environmental Authorisation (IEA), which has a binding nature relating to environmental conditions and is the legal instrument granted by public administrations to demonstrate compliance with integrated pollution prevention and control regulations for the operation of activities and facilities. This is a response to the Law on Integrated Pollution Prevention and Control in its consolidated text of Royal Legislative Decree 1/2016, of 16 December, which is in accordance with Directive 2010/75/EU, of the European Parliament and of the Council.

Among the contents included are: emission limit values for pollutants, equivalent parameters or technical measures; requirements for the protection of soil and groundwater; waste management procedures and methods; systems and procedures for the treatment and control of emissions and waste; measures for

16 operating conditions other than normal conditions; conditions for assessing compliance with emission limit values etc.

In short, the IEA includes all environmental aspects, and those other related aspects considered by the competent environmental authorities, in accordance with basic state legislation and the corresponding regional legislation. On the basis of the active management of the IEA, UCE applies other management strategies and policies in aspects of innovation, investment, market development, human asset management, contribution to the fight against climate change, etc., the main lines and results of which constitute the areas of communication with society.

2.2 Organisation and structure [102.6/ 102.18]

UCE (Castellón, Spain) directs and coordinates the strategy and activities of the subsidiaries, with emphasis on the homogenization and efficient management of the entire group. It has production lines for caprolactam (the raw material for nylon or polyamide 6), fertilizers, fine chemicals (1,6-hexanediol, 1,5-pentanediol, polycarbonate diols), polyamides, copolyamides and their compounds.

At UBE Europe GmbH (UEG, Düsseldorf, Germany) the group markets a broad portfolio of advanced technology products in the Atlantic area (Europe, Africa, Latin and North America) and the Middle East. UBE Latin America Serviços Ltda. , (ULA, Sao Paulo, Brazil), is the subsidiary dedicated to the promotion of a wide variety of products from UCE's portfolio in the Latin American market, in order to satisfy the growing demand of needs in these expanding markets. UBE México S. de R.L. de C.V., (UMEX, Mexico DF, Mexico) is focused on the promotion of polyamides, fine chemicals, fertilizers and other products in the markets of Central America, North America and the Caribbean. Repol, S.L. (Almazora, Spain), produces and commercializes engineering plastics and operates in Spain and several international markets

Organisational structure [102.19/ 102.20/ 102.22/ 102.23/ 102.24/ 102.26/ 405.1]]

Since 2014, UCE has followed the single director model, with UBE Industries, Ltd as the sole shareholder, represented by the President of UCE as its tax representative.

In UCE's subsidiaries, the governance model is adapted to local jurisdictions and corporate forms of each company, with the subsidiaries in Germany, Brazil and Mexico following a model of individual administrators, while in Repol there is a board of directors with 4 members.

Powers are granted in each company, corresponding to the specific scope of the powers granted to the list of authorisations in force for each company in accordance with the established internal control system.

At a second level are the vice-presidents and the presidents of the subsidiaries.

At a third hierarchy level are the heads of the following units: Human Resources and CSR; Safety, Environment, Quality and Subsidies; Compliance and IT, which report directly to the President. At the same hierarchical level, there are the following functional areas and their respective managers:

● Strategy and Business Development. ● Fine Chemicals B. Unit. ● Engineering. Plastics B. Unit. ● Supply Chain and Chemicals & Fertilizer B.Unit. ● Plant Operations. ● Technical and Projects Area. ● R & D area. ● Finance and Management Control.

Repol Co Fine Chem B.Unit

UEG Co Nylon B.Unit

ULA Co UAI Co Supply chain & UJT Chem + Fert B.Unit UMEX Co Plant site & Operations Unit Ube Group Europe Corporate Governance America Unit Vice Presidence Technical&Projects Unit

EHS-QA-PL Unit UCE Co R&D Unit UJT

Vice Presidence HR Unit Finance & Controlling Unit

Strategy & Business Digital Transformation Development Unit Unit

Hierarchical Report ( Decisions) Functional relation ( Leadership&Coordination of resources ) Subsidiary Company relation( Shareholder)

Figure 1. Organisational structure of UBE Corporation Europe.

In addition, the parent company UCE has a number of committees (which sometimes include other Group companies). Which operate in the following areas:

● Executive Committee is responsible for the executive representation of the company, the control of the units and internal coordination. ● Strategic management, in charge of defining and monitoring medium and long-term strategic plans as well as relevant investment decisions, such as mergers and acquisitions

● Safety, which includes specific committees for operational safety, improved occupational health and safety. ● Crisis communication, in charge of defining and managing the compliance of crisis communications with all stakeholders; as well as training. ● Ethics and Corporate Responsibility ● Human Resources, which covers internal organisation and regulation, as well as administration and personnel management. ● Computer science, with specific groups of Computer Systems Management and Information Security. ● Innovation, an area in which initiatives are developed and priorities are set in research and development projects, as well as issues related to intellectual property are discussed. ● Issues relating to the integrated management system of UCE, including, inter alia, operational procedures for improvements, purchasing, or inventory management. ● Financial, with specialised financial management committees, responsible for defining and monitoring procedures (liquidity, financial plan, investment, currency management, etc.) and the pension fund supervisory committee, FONDOUBE Pensiones FP.

Some of these committees are mentioned in more detail in section 3.5 Participation and transparency.

Governing body [102.27/ 102.28]

There is a training plan in UCE that also applies to the management, and its subsidiaries, as detailed in the Personnel section.

It should also be noted that, as part of the Compliance Programme developed in UCE as from 2016, the executive committee has received specific training covering different aspects relating to responsibility in the performance of corporate activities. This training was given to employees who are promoting or taking on managerial functions for the first time in the UCE.

The sole director of the company countersigns the annual accounts of the company and the management report that includes the main risks, participating in the definition of those risks and the action plans associated with them.

The specific objectives established for UCE are defined in the annual budget and the results of the activity are monitored monthly. A summary report of the relevant events of the period is prepared quarterly.

In addition, the economic-financial budget is reviewed every six months. Finally, the assessment of the entire fiscal year is carried out in the first quarter of the year.

Figure 2. Process Map of UBE Corporation Europe.

External initiatives [102.12/102.13]

UCE adheres to the following initiatives:

Responsible Care: Voluntary CSR programme in sustainability of the Spanish chemical industry, to which 67 companies are members, representing a production volume of 60% of this industry, and UCE has its certificate.3.

3 The certificate can be consulted at the following link: https://www.ube.es/EN/sustainability/pdfs/Responsible_Care_Certificate_Esp.pdf 21

Responsible Care is a global, voluntary and active initiative of the chemical industry whose objective is to ensure that the companies that adhere to this programme achieve continuous improvements in relation to health, safety and environmental protection whilst undertaking their productive activity, as well as other parameters of Corporate Social Responsibility put into practice and measured with improvement objectives in accordance with the principles of Sustainable Development.

Responsible Care comprehensively covers aspects of CSR through its six management codes and their respective progress indicators including the renewed "Responsible Company" code.

Association memberships [102.13]

UCE belongs to several industry and horizontal business organisations, as well as other institutions, to which it contributes membership fees and/or the participation and dedication of personnel that represent it.

1. Chamber of Commerce of Castellón: Participation in the plenary session of this corporation and in its internationalization committee.

2. Feique (Spanish Chemical Industry Business Federation) Participation in the board of directors and in the Trade and Internationalisation committees; Responsible Care; Economic and Fiscal Affairs; R&D; Environment; Transport and Distribution; Suschem Platform; Product Liability and Safety.

3. Quimacova (Chemical and Environmental Association of the Chemical Sector of the Valencian Community): Participation in the general assembly. Special presentation of UCE at QUIMACOVA's 5th Safety Day on 21.11.2019.

4. Indes (Association of Industries of El Serrallo de Castellón): UCE holds the secretariat of the association and is part of the board of directors.

5. CEV (Business Confederation of the Valencian Community): Participation in the Education and Knowledge Management committees; Labour relations; Sustainable Development and Environment; Logistics and Transport; Food Chain; Public-Private Collaboration; European Union and International; Energy; Corporate Social Responsibility.

6. CEJE (Japan-Spain Business Circle) Participation in the General Assembly.

7. Jaume I University Foundation - Company of the Valencian Community: Participation in the plenary session of the Board of Trustees.

8. Castellón CSR Committee: Participation in the assembly, and the working groups "2nd Good Practice Awards in Social Responsibility" and "Social- Environmental Action".

9. APD (Association for the Advancement of Management): The President of UBE Corporation Europe is a member of the APD Governing Council of Levante.

10. Energy Cluster of the Valencian Community: Participation in the general assembly.

11. Port Castelló Foundation: Collaborating company.

12. Plastics Europe Spain: Participation in the general assembly.

13. Acogen (Spanish Association of Cogeneration): Participation in the general assembly.

14. Bequinor (National Association for the Standardization of Capital Goods and Industrial Safety) Participation in the general assembly.

15. Avia (Automotive Cluster of the Valencian Community): Participation in the general assembly.

16. Aimplas (Technological Institute of Plastics): Associated company.

17. Anffe (National Association of Fertilizer Manufacturers) Participation in the general assembly.

2.3 Key financial figures [102.10/ 201.1/ 201.4/ 102.45]

The consolidated group of UCE comprises the following companies:

● UBE Corporation Europe S.A. Unipersonal (Single shareholder company) (Spain), parent company ● UBE Europe GmbH (Germany), subsidiary; ● UBE Latin America Serviços Ltda (Brazil), subsidiary; ● UBE Mexico S.R.L. de C.V. (Mexico), subsidiary. ● Repol, S.L. (Spain), subsidiary;

Below is the tax information of the UCE headquarters in the different countries in which it operates, as well as information regarding profits, taxes and subsidies, broken down by country:

Financial information by country (aggregate information in € thousand)

Spain Germany Brazil Mexico

Income (turnover) 367,761 63,373 1,276 911

Tax on profits 6,235 359 88 15

Profits obtained (Profit after tax) 19,087 751 111 6

Dividends 374 0 0 0

At the end of FY2018 UCE acquired a majority shareholding in the company Repol, S.L. (Almazora, Spain) as described above.

The net turnover of Repol, S.L. amounted to €24,814 thousand, compared with €27,509 thousand in the previous year. Profit after tax amounted to €373 thousand, compared to €1,116 thousand in 2018. The balance sheet results in a positive working capital and a stable financial situation. The fiscal year of Repol S.L. coincides with the calendar year.

Consolidated income for FY2019 amounted to €427,992 thousand compared to €440,216 thousand in the previous year. The profit obtained (profit after tax) amounted to €18,678 thousand and amounted to €37,935 thousand in FY2018.

The following table gives a breakdown of the Financial Value Generated and Distributed in each of the countries in which it is established, with particular emphasis on Spain, which covers the companies UCE and Repol. The information is shown in aggregate in € thousand and on an accrual basis.

Spain Germany Brazil Mexico

Economic Value Generated 367,761 63,373 1,276 911

Economic Value Distributed 349,048 62,622 1,165 905

Economic Value Retained 18,713 751 111 6

As reflected in the notes to the financial statements for FY2019, UCE has recorded only subsidies and tax credits applied to income for the year in Spain, the breakdown of which is shown in the accompanying table:

Aggregated information in € thousand Spain

Capital subsidies charged to results 559

Operating subsidies recognised as income 1,211

Credits/ tax deductions applied to results 630

Financial incentives applied to results 2,400

On 11 March 2020, the World Health Organization elevated the public health emergency caused by the coronavirus outbreak (COVID-19) to an international pandemic. The rapid development of events, both nationally and internationally, is an unprecedented health crisis, which will impact the macroeconomic environment and business developments. To address this situation the Government of Spain declared a state of alarm, among other measures, through the publication of Royal Decree 463/2020, of 14 March, and the subsequent approval of a series of extraordinary urgent measures to address the economic and social impact.

UCE considers that these events do not imply an adjustment to the annual accounts for the FY2019, although it could impact its future results. In view of the complexity of the situation, it is not possible at the date of preparation of the consolidated financial statements to make a reliable estimate of the possible economic and financial impact on results.

UCE is taking the appropriate steps to address the situation and minimize its impact, considering that this is a temporary situation which, according to the most recent estimates and the consolidated financial position, does not compromise the viability of the operations.

2.4 Objectives, strategies and future prospects

UBE Corporation Europe and its subsidiaries are part of the Japanese group UBE Industries Ltd. and as such their main objectives and strategies are framed and

26 coordinated with those of the parent company. The medium-term planning unit in the UBE group is called Mid Term Plan, which comprises periods of three fiscal years, with 2019 being the first of the three-year period 2019-2021, which is integrated into the Vision UBE 2025 - Prime Phase

The fundamental aspects of this plan have been the following:

 Principles: Coexistence and mutual prosperity. From the finite resources of mining, move towards an industry without limits. To do this, the company relies on the potential of technology and the spirit of innovation to become a company that continues to create value for its customers.  Strategies: They focus on two areas.

1.-To strengthen the business base to enable sustainable growth

● To seek profitability of operations through comprehensive cost reductions and increased product sales revenue. ● To ensure the generation of financial cash flow, which allows the investments needed for growth to be financed. The profitability of each investment project must be achieved. ● To expand the company's activities globally, encouraging greater coordination between group companies inside and outside Japan, in order to respond quickly to the changing global environment. ● To recover the level of results of the chemicals division, to lay a strong foundation for the next stage of growth.

2.-To address and be part of the solution to the sustainability challenges posed by scarcity of resources, energy, and the global environment

● To reduce greenhouse gas emissions along supply chains by reducing energy consumption and increasing recycling. ● To develop and extend technologies and products that help reduce environmental impact.

At UBE Corporation Europe this strategy fits, for example, into the following actions:

● Development of nylon production and innovation in new applications of this material, which contributes to reducing weight in sectors such as the automotive industry, food packaging, etc., improving its environmental friendliness.

● Research and development of know-how in new grades and applications of fine chemicals, with their contribution to the durability of materials in general ● Energy integration and efficiency projects to reduce energy consumption

andCO2emissions. ● Coordination of sales in the Atlantic area through subsidiaries in Europe, North America and Latin America. ● Improvement of the quality assurance of our technological products and services, strengthening the management system.

Gender equality

UCE is governed, among others, by the value of Equality, which enshrines maintaining fair working conditions, based on non-discrimination and equal opportunities, recognising and promoting the work of its professionals in any situation, and respecting equal treatment within the company.

UBE Corporation Europe's 1st Equality Plan covered the period 1 September 2016 - 30 August 2020. In March 2020, at the end of the current fiscal year, the current monitoring committee began the process of preparing the Second Equality Plan, which should be ready in August 2020. According to Royal Decree- Law 6/2019 of 7 March, Repol must have its own plan before 7 March 2022, and this requirement does not apply to subsidiaries abroad.

The measures implemented during the term of the 1st Plan in previous fiscal years were as follows:

● Incorporation of non-sexist language in job offers. ● Creation of a selection protocol based on experience and training rather than on gender. ● Recording of selection processes with a non-discriminatory approach. ● Carrying out specific training for the members of the Equality Committee. ● Dissemination of measures in co-responsibility. ● Carrying out information campaigns in co-responsibility ● Review and modification of the possible sexist image of the company if necessary. ● Updating the communication procedure by integrating a code of good practice in relation to gender communication ● Carrying out an annual remuneration study to measure the level of equality ● Creation of a remuneration protocol based on the concept of equality ● Keeping a record and study of professional development.

In addition, the following actions have been carried out in fiscal year 2019:

-Implantation of health programmes for women by organising courses and workshops on the prevention of breast cancer, pelvic floor exercises and self-defence.

- Creation of a protocol for access to training based on the concept of gender equality.

The company plans to complete two more measures before the conclusion of this Equality Plan:

- Creation of a protocol to manage sensitive people.

- Creation of a non-discriminatory professional development protocol regulated by the principle of gender equality.

Castellón CSR Committee

The Management Policy of UBE Corporation Europe (UCE) integrates various principles and values, including sustainability, environmental protection and a mutually beneficial relationship with stakeholders, which are the basis of corporate social responsibility. In addition to developing CSR through its internal programmes and policies, UCE is concerned with promoting and communicating CSR in its environment through active participation in the Castellón Corporate Social Responsibility Committee.

At present, the CSR Committee of Castellón is made up of around 50 institutions, organisations, associations and companies that are active in the province. UCE joined in 2010.

For UCE the integration and collaboration with the Committee, which is the main CSR forum in the province, is linked to the principles and practices of the Responsible Care programme - Commitment to Progress4 and to the founding philosophy of the UBE Industries Ltd. Group "coexistence and mutual prosperity" with communities and "from finite mining to infinite industry. (coexistence and mutual prosperity with the community / from the finite resources of mining to the infinite possibilities of the industry5).

UCE personnel actively contribute to the activities of the Committee, from annual participation in the forum 'Networking of Employment' for vulnerable people or people at risk of exclusion, which held its 5th edition in May 2019 with the attendance of 70 people6, to the preparation of the rules and selection of the jury for the organisation of the 2nd Good Practice Awards in Social Responsibility (scheduled for March 2020 and postponed as a result of the situation caused by the Covid-19)7.

4https://www.feique.org/program-responsible-care/ 5https://www.ube-ind.co.jp/ube/en/corporate/management/vision.html 6https://www.elperiodic.com/pcastellon/position-open-doors-market-labor-people-different- capacities_622697 7https://mesarscs.site123.me/actualidad/la-mesa-de-rscs-lanza-la-ii-edici%C3%B3n-de-los- premios-de-buenas-practicas-en-responsabilidad-social) 30

Recognition by society

During FY2019 UCE received the award in the "Company" category in the 16th edition of the Radio Castellón - Cadena SER Awards, which since 2004 it publicly recognises the companies located in the territorial area of the province of Castellón, as well as different people who due their professional and personal work have helped the economic or social development of the province8.

The Fundació Parc Científic Universitat de València and Banco Santander awarded UCE, along with 9 other innovative science and technology based companies, as part of the 10th Anniversary of the Science Park. UCE received the award in recognition of its collaboration with the university over the years, developed over 9 R&D contracts for the development of polyurethanes and polycarbonates.

2.5 Integrated management system and risk analysis [102.11]

A change management procedure is currently in place at UCE to ensure that all changes, whether permanent or temporary, are systematically assessed to ensure that risks to people, facilities, products and the environment are assessed, communicated and controlled to an acceptable level of risk.

The procedure allows for each change to identify and document all risks related to the change and the steps needed to mitigate them. If the residual risk is unacceptable, the change should not be implemented.

This procedure applies to any temporary or permanent change related to:

- Intentions for design changes in the plant. - Any deviation from the limits or procedures documented as safe - Any change in process outside the design specification. - Any change in management systems that may affect safety, environment, quality or specific product legislation - Where deemed necessary, a significant change in organisational structure or staff.

In addition, there are related procedures at product-specific level, the most important of which is the approval procedure.

In order to meet the objectives set out in the UCE Management Policy, to measure and control the risks and impacts of the group's activity, the corporation has developed and maintains an Integrated Management System that covers the

8 The news can be found at: https://cadenaser.com/station/2019/09/10/radio_castellon/1568106135_703003.html 31

requirements of the applicable standards and regulations ISO 9001, ISO 14001, ISO 45001, IATF 16949 (limited to the production of Nylon composite), food safety management tools (limited to the production of Nylon in polymerisation plants) and the Responsible Care initiative. The integrated management system for UCE covers quality, environment and occupational health and safety.

The scope of the management system includes the design and development, manufacture and marketing of Ɛ-caprolactam, ammonium sulphate, liquid fertilizers, 1.6 hexanediol, 1.5 pentanediol, polycarbonate diols, additives, prepolymers and polyamides, as well as the loading and unloading of bulk liquid in the concession of the Port of Castellón. For the purposes of ISO 9001, 14001 and 45001 certification this scope has been summarised as "Design and development, manufacturing and marketing of chemicals and engineering plastics. Design, development and marketing of additives and prepolymers. Loading and unloading of bulk liquids in the concession of the Port of Castellón".

The scope of IATF16949 is established as "Design and Manufacture of Nylon Composites". The Olive K manufacturing site is located within the UCE facilities in Castellon. There are two remote sites: UBE Industries Ltd from Japan (design process) and UBE Europe GmbH (UEG) from Germany (sales and purchase management process).

In order to identify, assess, prevent and mitigate significant risks and impacts, the UCE Group carries out a company-wide risk assessment every three years following the corporate standard UCE001 Corporate approach to identify risks. In addition, risk assessments of jobs are carried out using the risk matrix of the National Institute of Occupational Health and Safety. Other safety tools are also used for this purpose: safety inspections, preventive safety observations, safety at work analysis or work permits.

With regard to process safety, specific safety studies are carried out to identify hazards and assess and mitigate risks using different PHA (Process Hazard Analysis) techniques.

Furthermore, in line with the Group's Management Policy, the corporation has established a corporate approach to risk assessment, with the aim of applying a harmonised level of protection across the UCE Group with regard to risks that may affect employees, the community, environmental integrity, property, generation of profits, business continuity, as well as the corporate image and reputation. The document also seeks to foster a culture of decision making based on UCE risks and to provide a common standardized approach to risk assessment that will lead to a common understanding/interpretation of the risks in the company.

The risk matrix developed in the document is applied systematically to all operations related to risk assessment (e.g., financial, health and safety,

32 information systems, regulation, installation or process design, project execution, security, commercial, etc.)

As a result of the assessment process, a series of risks have been identified in UCE, which may also lead to improvement opportunities in the management by further dialogue with the company's various stakeholders:

● Supply of raw materials and services. ● Secure sales management in emerging countries ● Competition over the main UCE products (new competitors, alternative products...) ● Adequate management of the talent of UCE employees. ● Compliance with current and future legislation, voluntary agreements and internal regulations of UCE. ● External opinion groups (NGOs, neighbourhood associations, town halls, media...) ● Downstream integration of UCE products to maintain a competitive cost structure ● Risks derived from the use of Information and Communication Technologies (information security, personal data protection, business continuity in case of failure...) ● Natural disasters (flooding, storms...) ● Safety and environmental risks derived from plant and port terminal operations. ● Adaptation of the business model to the new requirements of society (European Strategy on Climate Change and Energy 2030, European Strategy for Plastics 2030, compliance with BAT regulations...) ● Effects of globalisation/climate change (pandemics, droughts, resource constraints...)

2.5 Health and Safety [403.1]

The company has a Strategic Safety Plan and a Central Safety Committee through which continuous improvement activities are promoted. Multidisciplinary working groups are organised for this in order to enrich the health and safety approach. Some of the activities that are part of the strategic plan are: change management, mechanical integrity, improvements in security standards and

33 procedures, emergency plan, communication plan, training, operational discipline and digitization of security tools

The main objectives in the area of occupational health and safety are to achieve zero accidents with sick leave and to reduce the number of process safety incidents due to loss of containment.

UCE has a joint medical service that provides care 24 hour a say to all personnel, both own and those of contractors.

Health and safety training

With regard to occupational health and safety training , initial and periodic training in this area is defined through the matrix of training per job for all own staff. In addition, all contractor staff must pass an initial safety course on the risks of the UCE activity, emergency measures and the main occupational health and safety regulations. The course must be renewed annually.

Each year, a guide to the coordination of business activities is prepared and distributed to the contracting companies. In turn, contractors are required to prepare an annual Safety Plan detailing their activities, risks and preventive measures.

Health and safety results

In order to measure the results in terms of occupational health and safety, UCE has established an indicator on a voluntary basis, the Process Safety Events, related to the effective safety of production processes. The index measures the number of incidents involving leakage or loss of material containment. Incidents are classified as Tier 1 or Tier 2, depending on the quantity and hazardousness of the substances, according to the recommendations of the Centre for Chemical Process Safety (CCPS). The target index set for 2019 was 8 points, and the effective index was 1.6, according to the attached formula.

푛º 표푓 푒푣푒푛푡푠 푐푙푎푠푠𝑖푓𝑖푒푑 푎푠 푇퐼퐸푅 1 푥 2+(푛º 표푓 푒푣푒푛푡푠 푐푙푎푠푠𝑖푓𝑖푒푑 푎푠 푇퐼퐸푅 2 ) 6 푃푆퐸 = x 10 푛 º 푤표푟푘푒푑 ℎ표푢푟푠 (표푤푛 푝푒푟푠표푛푎푙 +푚푎𝑖푛 푐표푛푡푟푎푐푡표푟푠 )

The effective index is referenced to 1 million hours to be consistent with the rest of the indicators.

Specific data on health and safety indicators for FY2019 are detailed in section 3.10 of the report.

Safety Standards Manual [403.2]

On the other hand, the importance of the UCE Safety Standards Manual should be highlighted, which, among other measures, establishes indications for carrying out the annual programme of Preventive Safety and Environmental Observations (PSOs) and a guide for carrying them out. An "observer" is defined as any UBE or contract employee trained to make preventive safety and environmental observations.

As a result of the PSO, the observer may find a series of deficiencies or anomalies that affect the health and safety of the personnel performing that work, or who are in the area of influence of the work, and the environment. These anomalies can be classified in three ways: Unsafe Act, Violation of Safety Standards, and Violation of Environmental Standards The latter is an unsafe act, since it is provoked by the worker or workers observed, but it also violates an environmental standard.

At the end of the PSO, the observer writes a report of the observation or observations found, taking into account aspects such as the reaction of people, working environment (position, environment, facility), compliance with procedures and/or standards, the state of order and cleanliness or suggestions for improvement of the work. The report also includes the positive aspects observed.

For a PSO to be considered as such and, therefore, be counted in the statistics, it must be evident that the observer has maintained a dialogue with the personnel carrying out the work and that the safety and environmental aspects of the task observed have been addressed.

Hazard identification and risk assessment [403.2]

With regard to the description of the processes used to identify occupational hazards and assess risks on a periodic or sporadic basis, as well as to apply the hierarchy of control in order to eliminate hazards and minimise risks, UCE carries out the following actions:

● Previous collection of documentary information and their analysis.

● Meeting with the heads of the department where the work centre to be assessed is located to define the work centre. ● Informing the prevention officers that the risk assessment will be carried out, indicating the date and time in order to be able to accompany the prevention technicians.

● Field data is collected, the defined workplaces are visited and information is collected on the operations carried out. ● Staff involvement. The comments made by the prevention officers and the line of supervision responsible for each position are included. ● Inclusion of the contributions made by the Medical Department.

Once a risk has been identified, the degree of risk is assessed from a combination of agent/type of risk. The assessment takes into account the preventive measures proposed for each risk, which aim to reduce the probability of occurrence to a minimum. Risk assessment establishes the priority of action among the various risks identified (i.e. which risks should be acted upon first).

UCE updates and/or reviews risk assessments according to legal criteria. Since 2016, UCE has developed its own software to manage the risk assessments of workplaces, with the aim of being more agile in their preparation and modification, as well as improving their content. All company personnel have access to the content of the risk assessments, in a shared directory, so that they can consult the updates of the assessments. Those responsible for each area study and adopt the preventive measures of the planning of activities. The people responsible, deadlines and resources required to carry out all preventive actions are defined in the corresponding records (training plan, improvement proposals, maintenance work orders, purchase requests, etc.). General risk assessments help us to identify where specific risk assessments are required. Some examples of the actions carried out in this regard are:

 Lighting measurements, according to RD 486/97 on minimum occupational health and safety requirements.  Assessment of noise exposure, according to RD 286/2006 on the protection of the health and safety of workers from risks related to exposure to noise  Assessment of exposure to chemical substances, according to RD 374/2001 on the protection of the health and safety of workers against risks related to chemical agents during work.

 Assessment of exposure to carcinogens or mutagens, in accordance with RD 665/97 on the protection of workers against risks related to exposure to carcinogens or mutagens during work.  Assessment of exposure to electromagnetic fields, in accordance with RD 299/2016 on the protection of the health and safety of workers from risks related to exposure to electromagnetic fields.

Own prevention service [403.3]

UCE has established its own prevention service with the speciality of health surveillance, together with the company BP OIL. The medical department or clinic constitutes a Basic Health Unit in accordance with RD 843/2011 for the development of health activity of prevention services, and carries out the monitoring of staff health by observing the working conditions and the effects of these on the worker himself. The aim is to provide effective health and safety protection with regard to the risks inherent to each job, as provided for in the Law on the Prevention of Occupational Risks. Apart from the basic care functions, the Clinic also carries out the necessary occupational epidemiological studies to determine the incidence of certain risks among the company's population.

Staff participation and consultation processes [403.4]

UCE has mechanisms and tools for the consultation and participation of workers in relation to health and safety, as detailed below:

● Health and Safety Committee (HSC): Its composition and functioning is established in the safety standard NS 0.2 Organisation of safety and environmental protection. The Committee is composed of representatives of the workers and the company. ● Group health, safety and environmental meetings as described in standard NS 12.2 ● The Safety Management Procedure PGS 04.03 Risk communication ● PGS 04.01 Incidents-Events ● Risk analysis as described in standard NS 15.3 Occupational safety analysis ● Preventive safety and environmental observations (NS 15.1) and safety inspections (PGS 02.12)

● Proposal for the improvement of health and safety in accordance with the procedure PGI 02.07 Management of change.

To facilitate the information and consultation process, the following internal communication channels are available:

● IntraUbe ● Notice boards ● UBEConnect

Promotion of staff health. Health promotion programme. [403.6]

At UBE Corporation Europe we understand that the future of the company is linked to the health of the employees and their families and this motivates us to promote actions aimed at preserving their health.

Health promotion programmes are an investment in the future that brings with it less accidents and absenteeism, increased productivity, greater motivation and commitment of employees, and improved social relations and work environment. We undertake actions in the three areas of health (mental, social and physical) for this, which involve workers, as agents of their own health, to promote change by leading by example.

Three multidisciplinary working groups (physical, mental and social areas), made up of staff from the Human Resources and Health and Safety departments, accompanied by employee representatives, are available for the development of health promotion actions. Each working group manages the economic resources necessary to achieve the established objectives.

In addition, we have the support of the communication, medical service and IT groups and, sometimes, external collaborators for the implementation of specific activities.

The general objectives of the Health Promotion Programme are to encourage the retention and attraction of talent, reduce accident rates and absenteeism, increase motivation and improve social relations among UCE employees. The main objectives and activities for each of the areas are:

Physical area

Objectives: ● To reduce the number of employees that are overweight, obese and have high cholesterol levels.

● To reduce the number of workers who smoke. ● To improve information and services to employees to reduce non-work related illnesses.

Activities: There are four lines of work: Physical activity, healthy eating, giving up smoking and prevention of diseases.

Physical activity: Actions are developed to promote physical activity, directly or indirectly encouraging employees to carry it out. This allows for more active and healthy lifestyles. Some of the related actions are: ● Agreements with external sports centres. ● Information and training on the benefits of physical activity. ● Company sports groups

Healthy eating: Preventive actions are undertaken with influence beyond the strictly labour scope. Among other actions, it is worth mentioning: ● Information and education on healthy eating. ● Workshops on nutrition and healthy recipe competitions. ● Collaboration agreements with external specialists in nutrition and dietetics

Smoking: Tobacco use and passive exposure to tobacco smoke is the main public health problem in most developed countries. According to the World Health Organization (WHO), tobacco use is the first isolated causal factor of preventable disease, disability and premature death in developed countries. With this in mind, the UCE Health Promotion Plan aims to develop specific lines of action against tobacco consumption, including: ● To develop and implement a programme for the prevention and control of smoking . Disease prevention: Actions aimed at preventing diseases whose origin is not strictly limited to the labour relationship and which go beyond specific actions in the areas of healthy eating, physical activity and smoking. Other actions include: ● Improvement of medical examinations by including parameters such as vitamin D analysis, thyroid profile or tumour markers in the analyses. ● Vaccination campaigns (e.g., for flu or tetanus) ● Information and education.

Mental Area

Objectives ● To provide employees with tools for better stress management. ● To promote a better human relationship between workers.

Activities We carry out preventive actions that favour the creation of environments and conditions that promote participation, autonomy and communication, as well as the improvement of the working environment and the satisfaction of the employee; all this means we are paid back with greater productivity and efficiency. The main actions in this aspect are based on giving tools to the employees and the supervision line for better self-management: ● Training and information (e.g. on leadership, teamwork or communication) ● Stress management (for example, with the Mindfulness Programme. Programme adapted to work to reduce reactivity, distractions, multi-tasking, automatic pilot and disconnection). ● Improvement of the working climate and collaboration between colleagues (e.g. with information and training "pills", lasting no longer than two hours)

Social area

Objectives ● Promote social benefits and volunteering. ● Increase the percentage of employees who can request flexible hours

Activities: Health has an influence beyond the working relationship with employees, since a set of actions is developed to generate a positive impact on the employees themselves, their families and society as a whole. Within the social aspects, a distinction must be made as follows: ● Labour relations: A set of initiatives to improve the working environment (e.g. reconciliation of work and family life, code of ethics in the company, diversity and equality, company groups to promote labour welfare, social benefits, etc.). ● Relations with society: Activities for integration into the local environment in which the company operates (e.g. environmental actions in the surroundings, sponsorships, agreements with the university, etc.). ● Social action: Actions to promote commitment and involvement with society (e.g. annual blood donation campaigns, annual food collection for certain groups, integration of disabled staff, etc.).

3.ETHICS AND COMPLIANCE

3.1 Control mechanisms

The structure of the administrative body of the UBE Corporation Europe (UCE) group is legally configured as a single director model, with UBE Industries, a condition that is held by the company UBE Industries, Ltd. in order to adopt and carry out decisions, the company organisation has a President and 2 vice- presidents, an executive committee, the heads of the external delegations and/or subsidiaries and the staff units and functional areas in which the operation is structured.

With regard to control mechanisms, there is the legal figure of the Compliance Officers; the Compliance Committee (or Complaints Committee); and the Ethics and Corporate Responsibility Committee.

UCE has two Compliance Officers, responsible for the implementation, development, supervision and control of the model for the prevention of criminal charges for UCE. They are autonomous in their operation and report organically to the sole director. They also advise and inform the management bodies about compliance with current legislation on criminal matters and coordinate the establishment of appropriate internal audit, monitoring and control systems.

The Compliance Committee (or Complaints Committee) is a collegial body consisting of five components, including the two Compliance Officers. These are the people who direct and coordinate the internal investigations that may come through the Communication and Whistleblower Channel. This channel operates in conjunction with the Ethics and Compliance Line (EC Line) provided for in the Ethics and Compliance System in force at UCE and allows any conduct or fact to be reported that could be considered a breach of the company's minimum ethical standards and/or entail a risk of criminal prosecution.

Once the Compliance Officers and the Ethics Committee Manager receive the notification of non-compliance (through the EC Line or any other channel), they must acknowledge receipt from the UCE sender and make a preliminary assessment, either to convene the Complaint Committee for its immediate analysis and verification, or to forward the communication to the Ethics and Corporate Responsibility Committee, which shall manage it when no risk of a criminal nature is apparent from the complaint.

The framework for compliance with ethical standards and the prevention of criminal behaviour is established both through the Ethics and Compliance System and through the other procedures and protocols that make up the Crime Prevention Programme, the most important of which are those relating to the Integrated Management System (organisation and responsibilities; list of

41 authorisations, purchases and contracts, disposal of funds, information security, etc.) legal powers of attorney granted by the company, safety management or environmental management procedures. In addition, the Integrated Audit Management Procedure is aimed at ensuring the establishment of an effective and efficient internal audit process to assess the strengths and weaknesses of the Integrated Management System.

The scope of this procedure affects all corporate processes, providing information about whether the Integrated Management System for UCE is effectively implemented and maintained. The system refers to both first part audits, which are internal audits, second part ones, which are customer and supplier audits and third part, which are certification audits. Finally, the Management System Review Procedure also seeks to guarantee compliance with the system and ensure its effectiveness and efficiency in a process of continuous improvement.

3.2 Ethics and integrity

The generation of trust is considered within UCE as the company's most important asset and its maintenance and development has led to progress in honest and responsible corporate behaviour. For this reason, since 2014 the company has been equipped with an Ethics and Compliance System (ECS) that has allowed an institutional design aimed at generating confidence in UCE.

The ECS is composed of a Code of Ethics and Conduct that is the firm foundation on which the corporate ethics and social responsibility policy is based. This Code is based on the UBE Group Action Guidelines9, established by UBE Industries, Ltd. as a guide to ethical conduct for all its personnel. They also incorporate the principles of the international Responsible Care10programme and have been developed in accordance with the highest international standards of ethical conduct, which are recognised and accepted worldwide.

This UCE Ethics and Compliance System can be displayed graphically as follows:

9Available at: https://www.ube-ind.co.jp/ube/en/csr/compliance/compliance_policy.html 10Available at: https://www.feique.org/program-responsible-care/ 42

Figure 4. Ethics and Compliance System

The Code of Ethics and Conduct (CEC) is compulsory for everyone that has any kind of contractual relationship with UCE companies, including all their personnel and especially their managers and directors. It has versions in Spanish and English and is available to all staff on the group's internal website. Training and information about it is provided to the management team, who must sign up to it, and to the business partners.

The four values on which this Code is based (Responsibility, Integrity, Sustainability and Equality) define the way in which UCE understands corporate responsibility and its social commitment. Internally, these values are the basis of the shared culture, the vectors that define the common project and the character as a company. Externally, they are the key elements on which to build the confidence of customers, suppliers and society, the pillars on which to build a good public reputation.

The second element of the ECS is a Corporate Responsibility and Ethics Committee (CREC) at the headquarters in Castellón, Spain, which has a dual function: to promote and advise on those issues related to the application of the Code of Ethics, as well as to receive and manage suggestions and reports of irregularities related to the Code of Ethics and Conduct and to respond to them. These notices and queries are received through a confidential channel (Ethics Line - EC-Line) which provides a means of confidential communication on matters related to the ethics and social responsibility of UCE and to respond to them. The Channel also collects complaints or relevant information on aspects that are considered to be or may come into conflict with the company's compliance obligations (criminal risk), and which, where appropriate, are referred to the Compliance Committee, also known as the Complaints Committee.

The Confidential Channel (Ethical Line - EC-Line) is accessible via computer or mobile devices in Spanish and English and is hosted externally to the company. The "Ethics and Compliance" tab on the internal website contains the Code of Ethics and Conduct, the link to the EC Line, the so-called UBE Action Guidelines and the Catalogue of Prohibited Conduct, developed for the prevention of the company's criminal risks, within the framework of the Compliance system. There are English and Spanish versions of all these.

The alert system guarantees both the indemnity of the informant and the effectiveness of the notification, which is transmitted to the members of the Corporate Responsibility and Ehtics Committee (CREC ) in the Castellón headquarters, with the obligation to receive and respond to alerts, complaints and queries, received through the EC Line or any other means, relating to the Code of Ethics and Conduct and with it, the respect and recognition of human rights. In the event that the reported conduct could affect the criminal liability of the company under Spanish law, the Complaints Committee, or Compliance Committee, will manage the resolution of the notice.

The EC Line details the three types of warnings that can be sent: -ComplaintsThere is evidence of a practice or conduct contrary to the UCE's code of ethics and the person responsible is known. -Alerts:there is evidence of a practice or conduct that may be contrary to UCE's code of ethics but it is not known who is responsible. -Consultations: information about a certain practice or conduct because it is not known whether or not it is contrary to the code of ethics.

Outline of the assignment of the alerts or warnings of the Confidential Channel (Ethics Line - EC Line)

Other measures: mediation... Ethics and Corporate Responsibility Committee Compliance Committee (5 members - incl. 1 external to UBE) UBE Industries

UCE Disciplinary measures Presidency: Alert -Appoints members -Requests Compliance Committee advice Complaint in court (5 members)

3.3 Code of Ethics and Conduct [102.16/ 102.17/ 102.25/ 102.32/ 102.33/ 102.34/ 419.1/ 307.1]

The Code of Ethics and Conduct is the firm foundation on which the corporate ethics and social responsibility policy of the company is based.

Within this Code of Ethics and Conduct there is an entire section dedicated to non-discrimination and respect for the dignity of persons that includes the following commitments: -It is a commitment of UCE to treat employees with respect and equality, protecting and promoting human rights in the development of our activity and creating safe, healthy and motivating workplaces. This commitment shall apply to the production, supply and support of UCE products and services worldwide. -Every person who works for UCE must enjoy their basic human rights and may not in any way be forced to suffer either physically or mentally as a result of their work. UCE does not accept, directly or indirectly, child labour or work in precarious or forced conditions. All employees are free to form or join associations of their own choosing in a peaceful, legal manner and have the right to negotiate collectively. - UCE will not tolerate any employee being discriminated against on the basis of, among other things, race, colour, gender, sexual orientation, marital status, pregnancy, parental status, religion, political opinion, nationality, ethnic origin or social status, disability, age or union membership. All workers should know the basic terms and conditions of their employment. Employees with the same experience, performance, qualification and potential will receive equal remuneration when performing the same jobs and under similar working conditions. - Employees are required to be careful not to use words or language that would injure the respect of others, as well as not to initiate or spread any rumours or insinuations that seek to discredit and/or defame the reputation of others or UCE itself. - The occupational health and safety of workers must at all times be a priority concern and a source of motivation. This applies to any aspect related to working conditions, including the handling of hazardous substances, noise levels, temperature, ventilation, lighting and the quality of and access to sanitary facilities. All UCE locations must ensure a safe and healthy working environment. They should be spaces where employees act with respect among themselves and towards all people related to their activity.

The Ethics and Compliance System (ECS) can be used by any employee to report on the non-compliance of any of these conducts, using for this purpose the Confidential Channel of Alerts and Complaints, EC Line, which guarantees both the effectiveness of the notification and the indemnity of the communicator.

UBE Corporation Europe has a system for the management of ethics and respect for human rights, as set out in the previous section, and the activity and relations with stakeholders of the UCE Group are based on a common body of values and standards of conduct that guide all actions and all UCE professionals in their decision-making and in the daily performance of their duties.

Together with the Code of Ethics and Conduct and the EC Line alert channel, the Corporate Responsibility and Ehtics Committee (CREC) completes the system, being composed of five people, one of them external to the company and belonging to the Group of Practical Ethics and Democracy (PE&D) of Jaume I University of Castellón.

Likewise, and in accordance with Spanish law, UCE has a Legal Risk Prevention System to ensure Compliance, supervised by the Compliance Committee (Complaints Committee) which acts in coordination with the CREC. Anyone in the company can access the Code and the EC Line channel, and all alerts are treated in strict confidence.

During FY2019, the Ethics and Corporate Responsibility Committee of UCE held a meeting and resolved four of the five alerts received, given that the last one was issued on 28 March 2020 and is being assessed for closure at the time this report was drafted. The other cases also did not involve breaches of the values or conduct set out in the Code of Ethics and Conduct. Three of the FY2019 notices refer to the value of Fairness in the application of labour standards, and two others refer to the value of Integrity in decision making.

No. of More serious: No. of cases Less serious: cases alerts and submitted consultations Total closed complaints Total 5 4 2 3 5 FY2019

No other complaints have been received concerning cases of discrimination as defined by the International Labour Organisation (ILO), nor have any other situations of a similar nature been identified. No cases of conflict of interest have been detected.

Since 2014, UCE has followed the single director model, with UBE Industries, Ltd as the sole shareholder, represented by the UCE President as the tax representative.

The single director of the company countersigns the annual accounts of the company and the management report that includes the main risks, and also participates in the definition of the risks and action and monitoring plans.

In UCE subsidiaries, the governance model is adapted to the local jurisdictions and corporate forms of each company, with the subsidiaries in Germany, Brazil and Mexico following a model of individual directors, while in Repol there is a board of directors with four members.

In addition to the legal provisions in force, the UBE Group applies an internal procedure for the approval of decisions considered to be relevant, which applies to both UCE and its subsidiaries.

The representative of the sole director of UCE is involved in defining the principles and contents of the sustainability report as the person ultimately responsible for the application of the principles of UBE Industries Ltd. and the UCE Management Policy.

The conclusions of impact reports, materiality surveys and other information regarding sustainability are reported in a timely manner to the UCE's executive or management committee, for which the representative of the sole director is responsible. In application of UCE's Management Policy, the above-mentioned materiality analysis contributes significantly to the risk management procedure established for UCE.

Every year, and following the directive of UBE Industries Ltd., UCE carries out a risk assessment that includes the stages of identification, assessment, prevention and mitigation of significant risks and impacts. This procedure is set out in the corporate standard UCE001 Corporate approach to risk assessment and is applied systematically to all UCE functions, areas and subsidiaries.

The procedure in force involves reporting to UBE Industries the risks considered critical according to the standard applied for their consolidation in the UBE Group's corporate headquarters and subsequent monitoring.

No express breaches of social or economic legislation (in commercial and tax fields) have been recorded in FY2019.

The general tax inspection in UCE started in 2018 and related to the fiscal years 2013-2016 was concluded in 2019. Some of the elements of the inspection ended up with a statement of disagreement with the Tax Agency, but the entire tax debt resulting from the inspection was settled.

No breaches of the applicable environmental legislation and regulations have been recorded, and the company has complied with all the requirements included in the Integrated Environmental Authorisation in force for the complex located in the El Serrallo Industrial Estate.

3.4 Materiality report [103-1/102-21/ 102-29 /102.31/102-40/ 102-42/102-43/102-44/102-46/102-47]

In this report, UCE reflects the relevant or important aspects for all stakeholders, following the definition of the principle of materiality contained in the GRI.

To this end, with the collaboration of the group Ética Práctica y Democracia (EPyD) from the Jaume I University of Castellón, for the first time, it has prepared a study of materiality through dialogue with each of these groups in such a way that it can respond to the interests and expectations of each of them.

UBE Corporation Europe Stakeholder Map

This project allowed:

 To define the economic, social and environmental impacts, based on the comparative study of the sector; the image generated and perceived by UCE during 2018 and 2019 and the management documentation and guidelines generated by UCE internally and externally. Following this study, the defined impacts were analysed internally by the UCE Management Committee and reviewed by the President, and were defined in 22 impacts.

 To design the materiality survey based on 5 categories, in which the expectations and values of the stakeholders were also reviewed: - socio-economic - socio-corporative - social and labour

- community partner - socio-environmental

 The questionnaire was sent to 737 people from all stakeholders by e-mail. The basis for identifying and selecting participating stakeholders has been the definition of stakeholders prepared by UCE: customers, employees, managers, suppliers, community/company, companies from the "El Serrallo" industrial estate and UBE Industries Ltd.

Results The response rate obtained was 21.30%. The response percentage by stakeholders was as follows:

Custom Employees Managers Suppliers Community/ Other companies UBE ers Society in the "El industries Serrallo” Industrial Estate

30% 17.8% 25% 54% 16.7% 0% 50%

Materiality In order to prepare this matrix, the data on Customers, Employees, Managers, Suppliers and Community have been grouped into a single average to present "the importance of the stakeholders" on the ordinate or "Y" axis, and the data from UBE Corporation Europe (UCE) has been taken to represent "the importance for UCE" on the abscissa or "X" axis. The aggregate data and general materiality matrix are shown below:

The impacts, from greater to lesser relevance, are:

After analysing the results obtained and the materiality matrix, the conclusions were as follows:

● Each and every one of the impacts, that is, the list of the 22 impacts assessed were material or relevant, with a score of three (3) or more points.

● There are no strategic impacts from UCE i.e. impacts that are only relevant for UCE and little material for the rest of the stakeholders. This is because all impacts evaluated are assessed as relevant.

● Nor are there any impacts that are strategic for the Stakeholders, i.e. impacts that are only relevant for the Stakeholders and not very important for UCE. This is because all impacts evaluated are assessed as relevant.

This report is structured by stakeholders, so that each block reports on the material issues reflected in this matrix, as well as other indicators and aspects relevant to each group.

3.5 Participation and transparency

In order to be able to better share information to promote meaningful and fluid communication, UCE has established several internal and external communication tools, such as the intranet ("intraUBE"), the corporate APP "UBEconnect" for voluntary installation by staff who wish to do so on their smartphone, committees with internal participation, and the website www.ube.es..

The intraUBE is accessible to all staff through shared PCs or equipment and includes a general open notice board, and sections for the works council, volunteer group, staff sports and leisure activity groups or clubs. The news section frequently publishes information relating to aspects of health, safety, protection, welfare measures, news and activities of the parent company and other offices, training and business issues, etc.

In addition to the Works Council, at UCE it is possible to submit general queries or suggestions through the supervision line or the Human Resources Area staff, which may be escalated to higher levels of decision making or other departments. Certain working committees make it possible to combine aspects of business management with greater transparency and fluidity of communication and allow the participation of staff related to certain functions or projects (prevention officers, those in charge of proposals for improvements, etc.)

The most notable committees are:

● Operational discipline. This is responsible for the recognition and improvement of good security practices, the detection of non-compliance and may recommend awards or recognitions, or the adoption of disciplinary measures. ● Approval of improvements.

This assesses and approves technical improvements affecting general operational, health and safety issues, and can make decisions on resource allocation and implementation priorities. ● Occupational health and safety. This manages the operational issues of the health and safety system and meets more frequently than required by the applicable regulations. ● Pension Fund Committee. Responsible for the supervision of FONDO UBE FP. ● Security of operations. In charge of safety and environmental analysis of projects, changes in production units and procedures and requests from the occupational health and safety committee and approval of safety and environmental standards. ● Safety improvements. This is in charge of regulation, control and allocation of responsibilities to carry out safety investments (risk assessment, communication, safety team meetings).

Externally, and in addition to the corporate information for authorities, media and social entities that is provided through the Institutional Relations function developed by the Human Resources Area, the UBE Corporation Europe website is a general communication vehicle that makes information available to the public on the company's management policies and principles, main objectives and achievements, products and their applications, etc. The website is also the means to access the annual Non-Financial Report, the integrated management system certificates, and the so-called Global Product Strategy (GPS) reports that present the composition, uses and safety aspects of the company's main finished products and raw materials in a transparent and accessible manner, in accordance with the worldwide initiative of the International Council of Chemical Associations (ICCA).

3.6 Fight against corruption and bribery [205.1/ 205.2 / 205.3 ]

The Code of Ethics and Conduct of UBE Corporation Europe includes in point 4.2 the obligation of the company and its staff to comply with applicable laws and regulations, always observing transparency in transactions and opposing antisocial solicitations from groups, individuals or organised crime, who may seek economic gain through "violence, fraud or coercion". Also, in its point 4.4 the code states that "no one may directly or indirectly request or accept, offer or give any kind of bribe, blackmail or any other illegal or unethical benefit to employees or other representatives (...) or to third parties".

The protection mechanisms in this regard include the Ethics and Compliance System and the Compliance System, with its corresponding Committees, the two Compliance Officers, the Whistleblower Channel (EC Line) and the Compliance Manual.

The Compliance Manual is integrated into the UCE governance system in order to provide the company with an organisational and control model that includes the appropriate monitoring and control measures to prevent the commission of crimes within the company, including those related to corruption or bribery. The prevention measures applied include, among others:

- Strict decision-making system (PGI.01.01). - List of Authorisations (including contracts and payments) - System of powers of attorney - Procurement and Contract Procedures - Purchasing Procedure for Raw Materials - Internal audit system - Anti-corruption protocol (limits and declaration of gifts)

It should be noted that the UCE Group does not have any commercial relations with private individuals or public authorities and, therefore, the scope of risk control in commercial transactions is reduced.

In relation to illicit trade, the guidelines to be followed are described so as to eliminate all types of risks by UCE, such as the entry and exit of goods without payment of the corresponding customs duties, or trade

With regard to compliance with customs obligations, it should be noted that UCE has passed inspections by the Tax and Customs Control Unit of the Tax Agency in recent years without any particular incidence. The inspections took place in 2016 (relating to 2014) and in 2018 (relating to 2016).

With regard to the risks arising from illicit trade, i.e. from prohibited or fraudulently imported or exported goods, especially in the case of dual-use items, UCE applies the directive of UBE Industries Ltd.

The Guideline for Export Control Management of Overseas Group Companies, reviewed in August 2019, covers international, European and national legislation. Although UCE would not be an obligated undertaking, the due diligence measures considered reasonable are applied to the Spanish regulatory framework for the prevention of money laundering and financing of terrorism.

Specifically, since August 2018 the UCE Group has been applying procedures known as KYC/AML(Know your customer and Anti Money Laundering) through an external information service. This database allows the telematic consultation of the identification data of companies, including directors, shareholders and ultimate beneficiaries, and the verification of the international lists of sanctions, among which should be highlighted those of the United Nations, the European Union, the Office of Foreign Assets Control (OFAC, USA) or the HMT (United Kingdom).

Thus, during fiscal year 2019, 36 investigations were carried out (with the corresponding Compliance Report) regarding customers (23 cases) and suppliers (13 cases), verifying possible risks. Once the established controls had been carried out, all the proposed transactions proceeded with no other incidents than compliance with the necessary documentary procedures.

Within the scope of the Compliance Programme carried out at UCE, all employees considered at risk of exposure to situations of fraud, bribery or corruption received telematic training in 2019, which in its content included the manual for the prevention of money laundering, illegal trade and the financing of terrorism and also the catalogue of prohibited conduct.

Members of the UCE Management Committee and the sales teams of UCE Group subsidiaries received face-to-face training on the Compliance Programme, covering issues of corruption and bribery. The sales teams of the subsidiaries in Brazil and Mexico underwent refresher training in 2019 and further training is planned for 2020.

New employees receive training on the UCE Code of Ethics and Conduct as part of the induction process.

No files have been reported to the Executive Service of the Commission for the Prevention of Money Laundering and Monetary Offences (SEPBLAC) during the year, nor have there been any reports of any kind in other bodies concerning illicit trade, money laundering or financing of terrorism.

3.7 Respect for human rights [410.1/412.2/412.3]

The external security service of UCE facilities in the El Serrallo Industrial Estate is shared with the company BP Oil Spain and is contracted to an external security company.

This company has been a member of the Spanish Network of the United Nations Global Compact since June 2016 and has expressed its commitment to the 10 Principles of the Global Compact in the areas of Human Rights, Labour Standards, the Environment and the Fight against Corruption by means of a certificate of membership.

As part of the Compliance Programme, a series of telematic training activities were carried out during the 2019 financial year which included an explanation of UCE's Code of Ethics and Conduct.

The UCE Group does not make direct financial investments in securities, bonds or shares that can be considered as financial assets.

UCE, as the promoter of the FONDOUBE Pensiones, F.P. employment pension plan, has established, through the fund's Control Committee, the inclusion of ESG (Environmental, Social and Governance) criteria and their integration into investment management.

The management body is thus urged to take into consideration socially responsible investment criteria for its investments based on the principles of sustainable investment and transparency in management. To this end, the Management Entity takes the PRI criteria (Principles for Responsible Investment promoted by the United Nations, to which the Management Entity adheres) as its main reference, as well as the following international declarations:

● The International Charter and Universal Declaration of Human Rights of the United Nations ● The ILO (International Labour Organisation) Declaration on Fundamental Principles and Rights at Work. ● The United Nations Guiding Principles on Business and Human Rights ● The OECD Guidelines for Multi-national Companies ● The United Nations Global Compact. ● The United Nations Sustainable Development Goals.

The last review of the management mandate to the management entity is dated 20 April 2020.

4. ENVIRONMENT

4.1 Management approach [103.1/103.2/103.3]

Sustainability is one of the company's values. The activity of UCE does not make sense without respect for and protection of the environment. The company's strategy integrates environmental aspects with a sustainability-based approach.

UCE takes into consideration the current and foreseeable effects of the company's activities on the environment in accordance with the policies and directives of UBE Industries Group. Care for the environment and the fight against climate change are actively addressed to reduce Greenhouse Gas (GHG) emissions and promote the sustainable use of resources.

UCE's commitment is set out in its Code of Ethics and Conduct and in the company's Management Policy, and is embodied in an environmental management system based on the ISO 14001 standard.

Since 1999, UCE has been a member of the Responsible Care Programme, promoted in Spain by the Spanish Chemical Industry Federation (Feique), which guarantees the commitment of the chemical sector to Corporate Social Responsibility. It is a voluntary initiative at international level that aims at the continuous improvement of health, safety and environmental protection in all its operations and is carried out according to the principles of Sustainable Development.

Additionally, Responsible Care is based on the report of performance indicators and evaluations of the practices included in the different management chapters that comprise the programme, the promotion of the development of CSR policies promoted by Feique, and the promotion of the fulfilment of the objectives and spirit of the programme.

4.2 Environmental management system

The company's environmental management is focused on prevention, avoidance and/or minimisation of environmental aspects, by improving its processes, monitoring indicators and implementing best available techniques (BAT).

The control of atmospheric emissions, generated discharges, correct waste management, energy efficiency, biodiversity, noise and odours are the environmental vectors included in the management.

In addition, issues such as the European Strategy for the Circular Economy and Climate Change are managed through the company's cross-cutting groups.

The environmental management system has been certified by the ISO 14001 standard since 2009, and the voluntary Responsible Care programme has been followed since 1999.

There is an environmental policy, integrated with quality and safety, where the company's management shows its commitment to respect and protect the environment. Through the various procedures and/or performance standards of the different processes ensure the identification of environmental aspects and their control and/or minimisation, with a life cycle approach. This can be seen in the change management procedure, project management, identification and control of critical equipment in the company, etc.

The management has the power to review the actions and their modifications by monitoring indicators and behaviours in the Executive Committees and in the Management Committee.

4.3 Environmental responsibility

UCE has identified its potential environmental risks and established an environmental financial guarantee signed with the insurance company Allianz Global Corporate and Specialty, in compliance with the Environmental Liability Law, effective until 31 March 2020.

4.4 Economic resources for the environment [201.2]

UCE has an environmental department that is responsible for keeping up to date with applicable environmental legislation, transmitting requirements internally, collaborating to ensure compliance and monitoring that this is the case. It maintains active contact with the administration and industry associations.

There is also a multidisciplinary group responsible for monitoring the European Strategy for the Circular Economy and taking the necessary actions for its fulfilment.

Companies specialised in the field of waste management and wastewater management work in UCE on a permanent basis to support both activities. On the other hand, other types of companies are contracted with the established frequency to ensure and control other environmental aspects, such as the control of atmospheric emissions, noise and others.

Economic investments are made for the continuous improvement of the process and the plant in the environmental field. The investments aimed at preserving the environment in FY2019 amounted to €1.1 million , divided into the following actions:

● Improvement projects in water treatment for adaptation to CWW BREF and LVOC BREF ● Soil pollution prevention ● Noise protection ● Ion exchange polymer recovery project ● Improvements in gas treatment systems ● Improvements in gaseous emissions control ● Energy integration

The environmental protection investment programme that UBE Corporation Europe has been undertaking in recent years will allow for continuous improvement in environmental management and compliance with BATs11.

11 The analysis of compliance with the best available techniques is carried out in accordance with the framework of the European Directive on Industrial Emissions (DEI, 2010/75/EU) which establishes the reference documents of the Best Available Techniques applicable to the various types of industrial activity within the deadlines set by the regulations. 59

There are several BAT reference documents (BREF documents) that are or will be mandatory for the company and will involve investments in various time frames. These are, mainly:

● BREF for water and waste gases in the chemical industry (CWW BREF). Due in June 2020. It is in full development within UCE. ● Large Volume Organic Chemistry BREF (LVOC BREF) Due in November 2021. Also in the implementation phase. ● Waste Incineration BREF (WI BREF). The date of compliance is mandatory from December 2023 onwards. It is in the initial analysis phase. ● Waste gas BREF in the chemical industry (WGC BREF). Document being prepared, expected to be published during 2020 or 2021, obliging compliance from 2024 or 2025. In the analysis phase.

The European Green Pact12 and the Paris Agreement13 will require that UCE continue to invest in energy efficiency and switch to renewable fuels in the coming years.

There are other reference documents that are still to be reviewed by the European authorities, so their publication and compliance will be compulsory over a longer period of time. Among others:

● Large Volume Inorganic Chemistry, Ammonia, Acids and Fertilizers BREF (LVIC-AAF BREF) ● Polymer BREF (POL BREF). ● Cooling Systems BREF (ICS BREF).

4.5 Circular economy and waste management [306.2/306.4]

As part of the UBE Group's global strategy, UBE Corporation Europe and the other companies in the Group aim to address and be part of the solution to the sustainability challenges posed by scarcity in resources, energy and the global environment.

Of particular importance is the European Strategy for the Circular Economy14 and, in particular, the European Strategy for Plastics15.

12https://ec.europa.eu/info/strategy/priorities-2019-2024/european-green-deal_en 13https://ec.europa.eu/climate/policies/international/negotiations/paris_en 14https://ec.europa.eu/environment/circular-economy/ 15https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=COM%3A2018%3A28%3AFIN 60

UCE has established a multidisciplinary group focused on strategies of Circular Economy(Sustainability Group), giving support to customers and suppliers to achieve European objectives, mainly. This group carries out research and development projects throughout the life cycle of plastic: origin of the substances, minimisation of environmental impacts during production, chemical and mechanical recycling and biodegradability.

The company is also a member of active sector associations and groups that participate in the development of legislation and its application, such as CEFLEX, Plastics Europe, ANAIP and others.

One of the projects implemented at the plant to support the European Strategy for Plastics is participation in the Operation Clean Sweepinitiative (OCS)16), the aim of which is to reduce the loss of pellets (primary micro-plastics) to the environment by optimising or modifying operations in which plastic pellets are handled and applying good cleaning and pellet control practices. Participation in this programme is a commitment of the association Plastics Europe17, of which UBE is a member effective in FY2019.

Likewise, within the activities of the Circular Economy, beyond the European Strategy for Plastics, there are the projects for adaptation to Best Available Techniques in the management of water, atmospheric emissions and others related to the large volume organic chemistry sector.

16https://www.opcleansweep.org/ 17https://www.plasticseurope.org/en 61

Another important support to the circular economy is the internal management of liquid flows generated in the plant itself, generating steam and thus avoiding the consumption of fossil fuel. The unit that generates steam from these currents has an installed thermal power of 17.5 MW.

With regard to waste management, the following graph shows the flow of industrial waste treatment blocks with the different stages referred to in the tables below.

Industrial waste treatment flow.

The graph shows the possibilities of reusing industrial waste generated according to its environmental impact.

To prevent or, if this is not possible, to reduce the amount of waste that is disposed of, UCE applies the following MTDs:

- Minimisation of the formation of high boiling point waste in distillation systems.

- Use of catalysts arranged in beds instead of trays, allowing work to be carried out under less aggressive pressure and temperature conditions for the catalysts.

- Catalyst and adsorbent regeneration.

- Use of waste as fuel.

During FY2019 a total of 38,814 tons of hazardous waste were generated, of which 35,821 tons were managed by recovery, including energy recovery, 2,876 tons by other types of treatment (D9, D13, D15, R-12, R13), 117 tons by composting and 0.064 tons were recycled.

In addition, a total of 2,993 tons of hazardous waste have been transported according to the information indicated for each shipment in the Identification Documents (in accordance with Spanish waste regulations), which is subsequently notified in the Autonomous Community after each shipment has

62 been carried out. No hazardous waste was imported or exported during this FY2019.

On the other hand, a total of 10,759 tons of non-hazardous waste was generated. Of this total, 272 tons were eliminated through recycling, 6,740 tons through composting, 3,086 tons were transported to landfills and 660 tons were eliminated through other types of treatment such as D13 Treatment18.

The following graph shows the percentage of waste according to its method of disposal.

4.6 Materials and sustainable use of resources [303.3/303.5]

Water consumption

As part of the environmental management of UCE and the adaptation to the Best Available Techniques, the previous processes are constantly being optimised in order to minimise consumption.

A total of 3,466 km3 was consumed during FY201919. The company does not extract water of any kind, and the total amount of water consumed comes from

18 D 13 Blending or mixing prior to any of the operations numbered D 1 to D 12 D 15 Storage pending any of the operations numbered D 1 to D 14 (excluding temporary storage, pending collection, on the site where the waste is produced) R 12 Exchange of waste for submission to any of the operations numbered R 1 to R 11 R 13 Storage of waste pending any of the operations numbered R 1 to R 12 (excluding temporary storage, pending collection, on the site where the waste is produced)

19 This amount converted into megalitres would be a total of 3,465,700,000 ML. 63

a supply company. It provides industrial-type water and drinking water for buildings.

Industrial water is consumed for different purposes: ● cooling of chemical processes. ● steam generation. ● gas flushes. ● water consumed in processes.

Consumption of raw materials

The optimisation of the consumption of raw or intermediate materials is a continuous process that requires the application of technical improvements to production units through investment projects whose execution extends over a single fiscal year.

Caprolactam production in FY2019 was 95,515 tons, 7.64% lower than the previous year.

Catalysts and organic solvents

On the other hand, in the use of catalysts and organic solvents, the application of Best Available Techniques and the efficient management of resources involve the combined use of the following techniques, currently implemented in UCE:

Catalysts:

● Selection of the catalyst with which the optimal balance between activity, catalyst selectivity, catalyst life and use of less toxic metals is achieved. ● Protecting the catalyst with some of the techniques used in previous steps to extend its life. ● Process optimisation by controlling reactor conditions (e.g. temperature, pressure) to achieve the optimal balance between conversion efficiency and catalyst life. ● Monitoring of catalyst performance to detect the onset of decomposition using appropriate parameters.

Organic solvents:

To increase resource efficiency, the MTD provides for the recovery and reuse of organic solvents used in processes (e.g. chemical reactions) or operations (e.g. extraction). They are recovered using appropriate techniques, purified if necessary (e.g. by distillation, adsorption, separation or filtration) and reintroduced into the process or operation. The amount recovered and reused depends on each process.

4.7 Pollution Prevention: Energy, Emissions and Climate Change [302.1 /302.3 /303.1 /303.2/ 303.4/ 305.1 /305.2/ 305.4/ 305.5/ 305.7/ 306-3]

UCE maintains active policies to reduce pollution in the different environmental vectors as much as possible. Actions and data concerning each of these areas are detailed below.

Energy

With regard to the commitment to the sustainable use of resources, it is worth noting:

- A total of 652 TJ (181,127 MWh) of electricity from 100% renewable

sources with noCO2 emissionswas consumed. - On the other hand, there has been other energy consumption from fuels from non-renewable sources amounting to 1887 TJ during the period covered by this report. Consumption and sales data are shown below according to the type of energy.

Total consumption Total sales

Green energy = 652 TJ (181,127 403.6 TJ (112105 Electricity MWh) MWh)

n.a. 0 Heating

Refrigeration n.a. 0

Purchased 61 TJ (16,944 MWh) 0 steam

As for energy intensity within the company, this was 0.020 TJ/t Lc.

Energy intensity ratio of the organisation. Within the organisation 0.020 TJ/t Lc

Denominator 95515 t Lactam

Included energy Natural gas, fuel oil, purchased electricity 1940 TJ types minus sold electricity

Atmospheric emissions

Various Best Available Techniques (BATs) are used to minimise and control air emissions in the factory's existing light bulbs:

● Ensure optimised combustion in process furnaces by monitoring key parameters.

● Use of natural gas to minimise the emission of particles, SO2 and NOx. ● Recovery and use of organic solvents and unreacted raw materials ● Use of selective catalytic reduction for the reduction of nitrous gases from the hydroxylamine plant. ● Use of thermal gas treatment to remove volatile organic compounds from the cyclohexane plant.

The application of the above-mentioned BATs, together with others that are widely used (such as filters, cyclones, washers, electro-filters, etc.) allows compliance with the limits required by the Integrated Environmental Authorisation in force.

Reduction of Greenhouse Gas Emissions

The environmental management procedures for UCE include a system for the assessment of risks and uncertainties in the monitoring of Greenhouse Gas (GHG) emissions.

The electricity consumed by UCE comes from 100% green energyso there are no CO2 emissions. As for the intensity of GHG emissions, the data are as follows:

Intensity of GHG emissions

1.53 t CO₂ /t The organisation's GHG emission intensity ratio. Lactam

Specific parameters that have been selected to calculate the 96,811 t Lc key figure Tons of caprolactam produced (calendar year)

The gases included in the calculation: CO₂,CH4, N2O, HFC, CO₂ PFC, SF6, NF3 or all.

CO2emissions in 2019 amounted to 148,248 tons, which were verified and reported to the administration on a calendar year basis. In 2019, annualCO2

66 emissions were 4% lower than in 201320 in absolute value and compared to production, the reduction has been 6% with respect to the production of caprolactam.

The reduction has been achieved through the use of clean fuels, energy efficiency projects and operational improvements.

20The comparison is made with 2013 as this is the first year of the current allocation period for CO2 emission allowances (2013-2020). 67

As regards the emission of nitrogen oxides (NOx), sulphur oxides (SOx) and other significant emissions to air, the data are set out in the table below:

NOx 859 t

SOx 79t

Persistent Organic Pollutants (POPs) n.a.

Volatile Organic Compounds (VOCs) 13 t

n.a. Hazardous Air Pollutants (HAP)

Particles (PM) 12 t

Other categories of air emissions identified n.a. in relevant regulations

Noise emissions

The perimeter limit of UCE is constituted by the company BP Oil Refinery of Castellón. Therefore, at environmental noise level, noise emissions are assessed jointly, since it is not possible to discern the exact origin of the noise. There is an agreement between the two companies for this purpose.

Internally, with regard to noise, UCE has developed a management plan that contains numerous actions aimed at minimising the effect on its environment and adapting its installations to BAT. Thus, the measures implemented in the complex in terms of noise are as follows:

● Annual measurements on the exterior façade of the adjacent houses. ● Annual noise impact study that allows the categorisation of noise sources according to their impact on nearby non-adjacent dwellings. From the result of this study, the focal points on which interventions are needed to reduce their impact are obtained. ● Equipment insulation interventions have been made in the points derived from the annual acoustic study. ● Noise reduction programmes at the point of origin.

● Maintenance plan for the equipment and facilities so that they work correctly and with the noise emission levels guaranteed by the suppliers. ● Implementation of equipment purchase specifications that guarantee maximum noise levels.

With respect to the data from the annual measurement of the environment of the Industrial Estate carried out by an accredited entity, the results for FY2019 are below the maximum noise levels marked by the current legislation of

● 70 dB (A): industrial zone, daytime. ● 60 dB (A): industrial zone, night time. ● 55 dB (A): residential area during daytime. ● 45 dB (A): residential area, daytime.

Light emission

The Integrated Environmental Authorisation of UCE does not require the company to control light pollution because it is not near special protection areas for fauna. However, from the maintenance area, the correct functioning is assessed and a plan for changeover to facilities with less polluting potential is carried out.

Emissions to water

Three types of effluent are produced at the UCE facilities, depending on the origin of their generation:

● Process waters: As their name suggests, they correspond to polluted water generated in the different production processes. Such water is treated in the complex's Wastewater Treatment Plant.

● Rainwater: effluent associated with rainwater collected at the facility. This effluent is sent to the water treatment plant through a specific drainage network.

● Sanitary water: effluent generated in offices, showers and facility services. This effluent is transported to decanting tanks where the water is separated from the sludge. The water is then sent to the wastewater treatment plant (WTP), while the sludge is managed at the Castellón treatment plant.

Such effluents are collected by means of separate drainage networks, through which they are conveyed to the facility's wastewater treatment plant (WTP). And from there, they are sent, via underwater emissary, to the sea.

The wastewater treatment plant is based on a biological process consisting of an aerobic zone for the degradation of carbonaceous matter and an anoxic zone to ensure the complete reduction of oxidized nitrogen.

A total of 2,442 km321of water was discharged during FY2019.

The quality of the treated water is that indicated in the Integrated Environmental Authorisation (IEA):

pH 6-9 COD 125 mg/l Suspended solids 35 mg/l Kjeldahl Nitrogen 40 mg/l Total phosphorus 2 mg/l Oils and Fats 10 mg/l Hydrocarbons 10 mg/l Toxicity 5 TUS EscherichiaColi 500 Ucf/100 ml Intestinal Enterococci 200 Ufc/100 ml

Certain parameters are periodically monitored to ensure the correct operation of the treatment plant and the control of discharges, both upstream and in the treatment plant. In addition, the water supply, the discharge parameters and the impact on the receiving environment are monitored.

The water monitoring data, carried out by an accredited body, is submitted to the administration on a quarterly basis. If there is any deviation, it is communicated to the administration in this same report.

Currently, UCE is in the process of adapting to the Reference Document on Best Available Techniques (BAT) for the management and treatment of wastewater and gases in the chemical industry (CWW BREF), for its entry into force in June 2020.

Significant spills

In FY2019 an accidental spill of 110 tons of a chemical substance (Hydroxylamine Sulphate) into the plant's network of chambers occurred. This incident caused a worsening of the water treatment process which was controlled by internal measures.

21 According to indicator 303.3 of the GRI Standards this amount in megalitres would be a total of 2,441,700,000 ML. 70

Odour Control

In June 2019, a protocol was presented to the local administration with the aim of establishing the system to be followed in the event that any of the companies on the El Serrallo Industrial Estate, which includes UCE, receive an odour nuisance alert from neighbours in the area, in order to be able to offer a coordinated response to both the regulatory bodies and the public.

Other environmental contributions

The care of the environment and the fight against climate change by UCE is actively focused on the reduction of Greenhouse Gas (GHG) emissions, but this action is also accompanied by different initiatives that favour active environmental protection measures by the company's personnel, such as the promotion of sustainable mobility or environmental volunteer actions.

Mobility

In relation to mobility, UCE has two recharging points for electric or plug-in hybrid cars, in the employee car park and the visitor car park. In addition, bicycle parking has been made available and since 2018 there is a programme to encourage car sharing, providing a special car park. Regarding this last action, it is worth noting that 47 people have regularly shared a car during 2019 to go to work.

Environmental Awareness and Volunteering

UCE and its group of volunteers celebrated Tree Day in March 2020 with an environmental day held in a catalogued ecological restoration area on the banks of the Mijares River as it passes through the neighbouring town of Almazora. With the participation of more than 85 people, including workers and their families, and with the supervision of monitors from the Limne Foundation, 400 Neriumoleander and Juncussp seedlings were planted, provided by the Ministry of Agriculture, Rural Development, Climate Emergency and Ecological Transition,

4.8 Protection of biodiversity [304.1/304.2/304.3/304.4]

UCE is located 3.7 km from the mouth of the Mijares River. Although it is not within any specific area of protected species or of great value for biodiversity, actions are taken to be able to protect and safeguard that environment.

Within the actions aimed at protecting biodiversity, in addition to the volunteer work referred to in the previous section, a Marine Phytoplankton Analysis should be highlighted, which is undertaken annually; there is a characterisation of benthic communities and bionomic mapping in the areas of influence of the estuary of the treated water in the treatment plant owned by UBE Corporation Europe.

The aim of the study is to provide environmental data on the phytoplankton community, marine biocenoses and the state of conservation of the benthic infaunal communities present in the area of discharge and influence of the company's submarine emissary, located south of the port of Castellón,

In order to meet the proposed objectives, the following tasks were carried out in 2019, as shown in the analysis:

 characterisation of the phytoplankton communities in the discharge area.  characterisation of the infaunal benthic communities and assessment of their degree of conservation (ecological status).  preparation of a bionomic cartography of the area of influence of the submarine emissary from specific observations by means of georeferenced submarine TV.

In the campaign carried out in 2019, the conclusions of the study, carried out by an external accredited laboratory, were as follows:

 The potentially toxic or harmful species identified in the samples did not reach high enough cellular concentrations to show negative effects on the environment and/or human health.

- Absence of Harmful Algae Proliferation or "red tide". - No deterioration of the water body is detected based on the results of the phytoplankton analysis.

4.9 Positive impact on the environment The products manufactured by UBE Corporation Europe contribute to the preservation of the global environment, thus being an activity with a positive impact on the planet. Two of the main contributions of the polyamides manufactured by UCE are highlighted below: ● Polyamides are materials with high mechanical and chemical resistance properties that are applied in the production of automotive components (fuel circuits, engine covers, dashboards...) allowing weight reduction by replacing metals and other heavy materials. According to technical studies the reduction of 100 kg of weight in an average car could mean a reduction in fuel consumption of 0.4 litres per 100 kilometres, contributing to the reduction of the generation of greenhouse gases (GHG). ● The application of polyamides in food packaging allows its conservation time to be increased, avoiding its deterioration and later loss. Polyamides allow the production of containers for long preservation, avoiding loss of food, and therefore, of the resources used in its production

The Appropriate food packaging solutions for developing countries study states that "Improvements in food packaging will contribute both to food quality and safety and to the development of small-scale producers in less advanced economies, favouring their access to markets through sustainable supply chains".

Collaboration with Carbon Disclosure Project

CDP, formerly known as the Carbon Disclosure Project, is an international non-governmental organisation whose objective is to promote the active management of the environmental impact of companies, communities, regions and states. CDP collaborates with a large number of business and financial entities to motivate companies and institutions to report their environmental impact and mobilise resources to reduce it.

The information from the different focus areas of CDP (Climate, Water and Forests) is incorporated into the analyses of the IPCC (Intergovernmental Panel on Climate Change) serving as relevant information for the monitoring of the UN SDGs. It also integrates with the recommendations of the TCFC(Task Force on Climate-related Financial Disclosure)22.)

The UBE Group reports the CDP questionnaires, and its classification is as follows for the year 2019. UCE data are included in the consolidated report of the UBE Group worldwide.

● SUPPLIER ENGAGEMENT RATING REPORT 2019, Score D (Disclosure). ● WATER SECURITY 2019, Score C (Awareness) ● CLIMATE CHANGE 2019, Score D (Disclosure).

22www.cdp.net 74

4.10 Environmental assessment of suppliers [308.1]

In application of the management system procedures in force, certified according to ISO 9001 and ISO 14001, all suppliers identified as relevant or critical are assessed, taking into account for the analysis criteria included in the following categories: Quality, Corporate Social Responsibility, Health and Safety and the Environment.

4.11 Challenges for the future

In the coming years, UCE has proposed a series of activities in the field of environmental management with the challenge of promoting the sustainable use of resources and reducing environmental impact, involving the participation of staff in the processes.

In this area, the UBE Industries Group includes in its Vision UBE 2025 Prime Phase initiative the target for 2021 of reducing its emissions by 15% compared to 2005. Additionally, it is intended that 30% of the revenues in 2021 will come from products or technologies that reduce environmental impact or contribute to the promotion of a low-carbon economy.

At UCE, adaptation to the BREF documents, which began to be drawn up in application of Directive 96/61/EC, is a priority. The mechanism for the approval

75 of Best Available Techniques (BAT) is carried out through an exchange of information between the different agents involved and provides results in the so- called BREF(BAT References Documents) or European Best Available Techniques Reference Documents.

As established in the field of the chemical sector in UCE, the following activities stand out:

● Improvement projects for the management and treatment of water and waste gases in the chemical industry (CWW BREF), which is in full development in the company. ● Large Volume Organic Chemistry BREF (LVOC BREF), also in the implementation phase

To address the analysis and implementation of the various initiatives in the field of sustainability, UCE has established several multidisciplinary working groups establishing as a challenge for the following exercises the development and consolidation of these. Among these participation groups, the following stand out:

● Sustainability group: development of a circular economy system for plastic. At the beginning of the life cycle, with projects to use raw materials from renewable sources, at the end of the life cycle, taking into account mechanical and chemical recycling as complementary alternatives. Other projects underway seek to give new life cycles to plastic waste, turning it into useful and high quality raw materials, as well as research into a new range of biodegradable compostable polyamides. ● Decarbonisation group: application of tools for the management of energy efficiency, projects for the reduction of greenhouse gas emissions, with the aim of achieving decarbonisation in line with the targets of the European Union. ● Change and Challenge Project: an initiative of UBE Industries with the participation of private companies and committed organisations concerned about the impact of food packaging on the environment and the preservation of natural resources throughout the food chain, from the field to households. Its vision is to generate awareness, direct global attention and a solution to the food waste crisis and the improvement of

the balance ofCO2 emissions in the food production and distribution chain.

5. PERSONNEL

5.1 Management approach [103.1/ 103.2 /103.3]

The management of human resources at UCE is based on the UBE Group's Global Human Resources Policy, formulated in 2015 by the parent company UBE Industries.

This policy defines the values shared by the UBE Group in its human resources management. Although regulations, customs and human resource systems may vary across the different countries where UBE Group is present in the world, this Policy sets out the fundamental and long-term approach to human resource management in the UBE Group, as we consider each member of staff to be the most important and valuable business asset.

For this reason, UCE is committed to:

● Valuing the diversity of our human resources and respect the individuality of each person. ● Keeping the motivation of the employees very high, stimulating their creativity and autonomy. ● Providing opportunities for all employees to develop on the basis of their own professionalism. ● Conducting a fair assessment and remuneration. ● Striving to improve the working environment.

In turn, it is expected that all the staff of UBE Group companies will meet the following requirements:

● That they are aware of their responsibility in their behaviour as members of the UBE Group. ● To communicate proactively within and outside the UBE Group with a global mindset. ● That they promote the continuous improvement of the business, promoting teamwork and innovative thinking. ● That they show their specialities in each field and work for great results. ● That they seek personal growth through self-transformation and accept the challenge of seeking infinite possibilities.

The company has a history of net job creation in recent years due to the increase in technical and management projects, and the expansion of production activity at the Castellón factory, where most of the workforce is concentrated, with a positive socio-economic impact on the environment.

EMPLOYMENT GENERATION

Total staff of the Staff in the parent Staff in

consolidated group company subsidiaries

at 31.3.2018 500 443 57

at 31.3.2019 517 457 60

at 31.3.2020 597 465 132

In fiscal year 2019, UCE has outsourced daily services at its factory with a monthly average equivalent to approximately 250 full-time jobs.

In addition, according to the estimates of the Spanish Chemical Industry Federation (Feique), there is a multiplication factor of 0.67 of induced employment for each direct job in the sector, contributing to the additional generation of employment through other services such as engineering work, consultancy, legal advice, logistics, transport and storage services, waste management, specialised services, catering, banking, etc. Applying this factor to the workforce of 465 employees at the UCE factory would result in 312 induced jobs

5.2 Description of the group [202.2/ 405.1]

The UCE staff is structured in different functional levels, which are detailed below, together with other relevant aspects such as professional promotion or staff classification figures.

Professional groups and functional levels

UBE Corporation Europe has a total of 597 employees, of which:

● 465 belong to UBE Corporation Europe, 20% being women. ● 74 to Repol S.L., 17% being women. ● 45 belong to UBE Europe GmbH, 51% are women ● 9 to UBE Latin America Serviços, with 33.33% being women, and ● 4 to UBE Mexico, of which women represent 25%

The percentage of senior executives hired from the local community in UCE is 87.50% of 8 people, 7 are local.

UBE Corporation Europe has a Personnel Policy Manual which aims to regulate working relations between the group and its employees, with the dual purpose of:

● adapting the company's particular characteristics to the social legislation in force. ● formalising in a single text all the details of UCE's employment relationship, guidelines for conduct and specific uses, which frame the rights and obligations of both parties.

The professional structure responds to the requirements of the work and production organisation regime, allowing adaptability and optimisation in the use of available resources and at the same time enabling employees to progress economically and professionally.

Accordingly, the company is promoting values related to the versatility and professional training of its employeesThe aim is to obtain the best levels of efficiency in the allocation of the available resources, and at the same time, to promote the maximum degree of work versatility, professional development and economic progression of its workers, so that they feel sufficiently integrated and recognised professionally and in terms of remuneration.

In addition to these groups, the company has a professional classification with nine categories, of which levels 0 and 7 include management levels and levels 1 to 6 different professional groups, with level 55 being reserved for special situations, such as foreign personnel or expatriates that provide their services temporarily from Spain.

The functional levels are classification intervals that make it possible to horizontally group different degrees of responsibility and organisational content, determining the different degrees of professional promotion and the remuneration equivalence to the salary tables.

Belonging to a professional group enables these employees to perform a type of position, according to the equivalence between groups and levels established, putting forward sufficient professional qualifications for their correct performance. In turn, the jobs are structured in different levels of organisational content and/or similar responsibility. Each level has a remuneration reference associated with it.

The functional levels are then defined:

Group I Specialists and operators:

Included in this professional group are personnel trained to carry out job tasks that may require a greater or lesser degree of autonomy and initiative and that, under supervision, may involve responsibility for them. The training required is Secondary Education or Intermediate Level Training (Second Level Vocational Training) or equivalent knowledge acquired in the performance of the equivalent job.

Level These are positions that perform technical and/or routine 1 administrative tasks

Level These are positions that carry out specific technical and/or very 2 methodical administrative activities.

Group II Managers and Operating Technicians.

This professional group includes those employees trained to carry out functions that involve the integration, coordination and supervision of tasks with similar content carried out by a group of collaborators and to carry out tasks that have a content of intellectual activity and/or of average human interrelationship within a framework of methodical instructions and that involve autonomy within the process. The training required for this group is Medium Technician, Higher Level Training Cycle (Vocational Training) or equivalent professional experience

These are jobs that carry out duties that involve the integration and Level supervision of tasks with homogeneous content carried out by a group 3 of collaborators

Group III Technicians:

It includes personnel trained to carry out functions that involve the integration, coordination and supervision of various tasks in the same functional unit, carried out by a group of collaborators. It also includes personnel trained for functions involving the performance of complex and heterogeneous technical tasks, with defined overall objectives and a high degree of demand for autonomy, initiative and responsibility. The training required in this case is a degree or knowledge acquired in the course of their profession equivalent to higher university studies and/or resource with sufficient experience.

These are positions that carry out technical activities within a process, Level acting with autonomy and being able to have a certain level of 4 supervision over activities carried out by third parties.

They are posts responsible for programming and managing a partial Level function with a medium/low level of development, whose results affect 5 those of an area in a contibutory manner.

They are positions responsible for programming and managing a Level highly developed partial function, the results of which are important for 6 those of a business or support area

It is a management position, which covers different functional areas Level and involves participation in the company's Management Committee 7 and Strategy Committees

Outside personnel [403.8]

The number of external workers at UCE facilities is highly variable and depends on the maintenance schedule of the facilities, as well as on the planning of ongoing projects.

All contractors and subcontractors providing services at the UCE facilities comply with the requirements set out in the general conditions for contracting the services of the UCE, in accordance with established regulations.

The coordination of business activities and authorisations for plant work are carried out through the CTAIMA platform, which provides this service to the chemical sector at national level.

Promotion and professional development [402.1]

With regard to promotion and career development, the Staff Policy Manual states that the professional and salary evolution within the designed professional structure has two paths: - Upward mobility or career advancementThis is the increase in the functional level as a result of the development of functions or the performance of positions framed in a higher level of responsibility. - Horizontal or professional developmentThis consists of the professional and economic progression of the employee within the same level of responsibility.

Both promotion and professional development means consolidating the professional and salary situation that is being achieved.

Substantial change in the individual working conditions:

The decision to make substantial changes to individual working conditions must be notified by the employer to the worker concerned and their legal representatives at least a fortnight in advance of the date of their effectiveness.

Substantial change in the collective working conditions :

Without prejudice to any specific procedures which may be established by collective bargaining, a decision to substantially alter the collective working conditions shall be preceded by a period of consultation with the legal representatives of the employees, lasting not more than 15 days, concerning the reasons for the employer's decision and the possibility of avoiding or reducing their effects, as well as the measures necessary to mitigate their consequences for the employees concerned. The consultation will take place in a single Negotiating Committee, but if there are several sites, it will be limited to the sites concerned by the procedure. The Negotiating Committee shall be composed of a maximum of thirteen members representing each of the parties.

Professional classification in figures

The data referring to the professional categories commented on in the previous section are shown in the following tables.

PERSONAL CLASSIFICATION UBE Corporation Europe (Spain)

Total Gender 0 1 2 3 4 5 6 7 55 total

Men 7 122 85 65 34 33 12 9 3 370

Women 0 13 31 17 22 7 4 1 0 95

% Women 10% 27% 21% 39% 17% 25% 10% 0% 20%

Grand total 7 135 116 82 56 40 16 10 3 465

PROFESSIONAL CLASSIFICATION REPOL S.L.

Grand Gender 0 1 2 3 4 5 6 7 55 total

Men 1 7 14 19 6 3 7 4 61

Women 2 3 3 3 2 13

% 0% 100% 0% 17.65% 13.64% 33.33% 25% 22% 0% 17.57% Women

Grand 1 2 2 17 22 9 3 9 4 74 total

PERSONAL CLASSIFICATION UBE EuropeGmbH (Germany)

Job Classification Men Women Total

Corporate services, sales and 1 0 1 marketing

Corporate services: finance and 3 2 administration

sales and marketing 2 6 8

Logistics, sales administration 1 4 5

Machinery Division 7 1 8

Nylon sales 8 10 18

Total 22 23 45

% 48% 51% 100%

PERSONAL CLASSIFICATION UBE Latin America Serviços Ltda.

Classification Men Women Total

Directors 1

Administration 1 1

Sales 3 2 6

Machinery Division 2 2

Total 6 3 9

% 67% 33% 100%

PERSONAL CLASSIFICATION UBE Mexico

Men 3 75%

Women 1 25%

Age ranges

UCE has a staff that reflects different age ranges, with the highest percentage, 44% people between the ages of 31 and 41. In the following table shows a classification by age and percentage of employees within each of the age ranges.

Age ranges Percentage of staff

21-31 13%

31-41 44%

41-51 31%

51> 12%

100%

Within the different modalities of work in UCE Spain, taking into account the gender perspective, it should be noted that of the total of 447 permanent contracts, 20% are women. As for temporary contracts, out of 13 contracts, 31% are women and in the case of partial retirements, there are a total of 5 cases, all of them male.

The following table shows a summary that includes the average annual number of permanent contracts, temporary contracts and part-time contracts by gender, age and professional classification.

CLASSIFICATION BY TYPE OF CONTRACT, GENDER AND PROFESSIONAL CATEGORY

JOB CATEGORY

TYPE OF CONTRACT 0 1 2 3 4 5 6 7 55 Grand total

Permanent 100 6 73 69 65 16 34 12 10 3 288

Men 6 66 55 50 7 28 10 9 3 234

Women 7 14 15 9 6 2 1 54

Permanent 189 1 56 42 13 37 6 4 159

Men 1 51 27 11 25 5 2 122

Women 5 15 2 12 1 2 37 temporary 401 4 5 3 12

Men 3 3 2 8

Women 1 2 1 4 partial retirement 540 1 4 5

Men 1 4 5

Women 0

Temporary 530A 1 1

Men 1

Grand total 7 135 116 82 56 40 16 10 3 465

SUMMARY OF CONTRACT TYPES BROKEN DOWN BY GENDER ( UCE )

Men Women % Women Total permanent: 447 356 91 20%

Men Women % Women Total temporary: 13 9 4 31%

Men Women % Women Total partial retirements: 5 5 0 0%

Gran Contrac GROU GROU GROU GROU GROU GROU GROU GROU GROU d t P 0 P 1 P 2 P 3 P 4 P 5 P 6 P 7 P 8 Total

100 1 2 14 3 1 6 4 31

M 1 2 14 2 1 5 4 29

W 1 1 2

109 1 1

M 1 1

189 2 14 7 6 1 2 32

M 2 12 5 4 1 1 25

W 2 2 2 1 7

200 1 1 2

M 1 1

W 1 1

289 1 1

W 1 1

401 1 1 2

M 1 1

W 1 1

402 4 1 5

M 4 4

W 1 1

TOTAL 1 2 7 17 22 9 3 9 4 74

REPOL S.L: TYPES OF CONTRACTS BROKEN DOWN BY GENDER

TYPE OF CONTRACT MEN WOMEN TOTAL

PERMANENT 56 (91.80%) 11 (84.62%) 67 (90.54%)

TEMPORARY 5 (8.20%) 2 (15.38%) 7 (9.46%)

61 (82.43%) 13 (17.57%) 74 (100%)

People with disabilities and universal accessibility

Under Spanish law, UBE Corporation Europe is obliged to guarantee a quota that reserves two per cent of jobs for disabled workers. There is currently only one male employee with a disability on the staff, who is classified as level 4.

The company has a certificate of exemption from this reserve quota, granted in 2016 for a period of three years and renewed in 2019 by the Ministry of Sustainable Economy, Productive Sectors, Trade and Labour. This exemption is based on Royal Decree 364/2005, for the regulation of the alternative compliance with the reserve quota in favour of workers with disabilities on an exceptional basis. In the case of UCE, the situation of exceptionality is declared due to the impossibility of the competent public employment services, or the employment agencies, to attend to the job offers presented, given the non-existence of disabled job seekers registered in the indicated occupation.

As it has not been possible to recruit people with disabilities for the various positions offered, the regulations require compliance with alternative measures, which in the case of UCE have been the following in the last three years:

●Contract for the provision of business services in the Castellón offices with the Special Employment Centre Compañía Valenciana para la Integración y el Desarrollo (2016-2017) and with the Special Employment Centre Servicios Asistenciales y Gráficos Azahar , in 2018.

●Providing monetary donations, for the development of activities of labour insertion and creation of employment in the surroundings of Castellón, by the following public utility entities: Adecco Foundation, El CAU School Association and El Rinconet Farm School Association

The Human Resources Area continues to actively study other possibilities for the integration of people with disabilities into the work force in UCE. For this, since 2015, the company has been collaborating with the Employment Networking initiative of the Castellón Corporate Social Responsibility Committee, which consists of a meeting between companies and unemployed people to swap experiences and promote the employability of those groups that have the greatest difficulty in finding a place in the labour market. During the five editions held, in addition to contributing to the training and preparation of the participants in the Networking, before personnel selection processes, UCE has held interviews and analysed the curriculum of people with disabilities to study their possible incorporation into the company.

In terms of universal accessibility, UBE Corporation Europe's facilities present an intrinsic complexity, common to other chemical manufacturing plants, due to the design and layout of the production units, which involve risks of a physical nature, which are catalogued and assessed for each job. In addition, access by personnel to production and storage areas for chemicals classified as hazardous requires special preventive measures as appropriate (personal protective

equipment, prior atmosphere analysis, etc.) which are mandatory for security reasons. For this reason, access for people with reduced mobility has been restricted to the R&D Centre, a building completed in 2006, which houses the general management, administration, human resources and logistics units, in addition to the R&D units themselves. This building is located in the part of the company's site that is furthest away from the production units and is equipped with an access ramp, lift and accessible bathroom, where people with reduced mobility are received.

Working days, hours, overtime and holidays

The Personnel Policy Manualsummarises the organisation of the company's work. In this section, all the questions related to working days, schedules, overtime, holidays, etc. are included.

In normal daytime working, the timetable is established as follows, with a distinction being made between a split shift and a continuous shift:

-Split shift: ● Madrid work centre, from 9.00 a.m. to 1.00 p.m. and from 2.00 p.m. to 6.00 p.m., from Monday to Thursday inclusive and from 9.00 to 3.00 p.m. on Fridays. ● At the Castellón work centre, from 8.00 a.m. to 5.20 p.m., Monday to Thursday inclusive, with a daily break of 40 minutes for lunch and from 8.00 a.m. to 2.00 p.m. on Fridays. ● In the Castellón work centre, and for the group of employees from the company UBE Chemical Europe S.A.U., which was absorbed by UCE on 01/04/2016, the timetable is from 8.00 a.m. to 5.00 p.m. from Monday to Thursday, both inclusive, with a daily break of 36 minutes for lunch and from 8.00 to 2.00 p.m. on Fridays.

- Continuous shift. The schedule is established as follows:

-Working time from 8.00 a.m. to 2.00 p.m. from Monday to Friday in the months of July and August and from 23 December to 6 January of the following year, as well as the days in June that are necessary to keep the number of working hours in the annual calculation unchanged, according to the continuous shift established in previous agreements. -This schedule is applicable in UCEfor both the Castellón and Madrid workplaces.

As for overtime,this is regulated in the Personnel Policy Manual.

It should be noted that, for employees who do not work shifts, the weekly rest and public holidays are respected in accordance with the general precepts

89 established in the legislation in force. Employees who work shifts covering 24 hours a day (long shift), enjoy the breaks defined for each 35 day cycle as defined in Article V-C of the "Agreement for the implementation of the fifth shift" and also enjoy the following additional days off per year:

● Employees under 40: 10 additional days off. ● Employees aged 40 to 44: 12 additional days off. ● Employees aged 45 to 49: 15 additional days off. ● Employees aged 50 to 54: 18 additional days off. ● Employees 55 years and older: 21 additional days off.

In general, the company's permanent staff is given 22 working days' paid holiday each year for normal working days and 23 working days for shift work. In addition, in both cases, the working days for holiday are increased as follows:

● Permanent staff with recognised length of service of five years and more: 1 additional day. ● Permanent staff with recognised length of service of ten years and more: 2 additional days. ● Permanent staff with recognised length of service of fifteen years and more: 3 additional days. ● Permanent staff with recognised length of service of twenty years and more: 4 additional days. ● Permanent staff with recognised length of service of twenty-five years and more: 5 additional days. ● Permanent staff with recognised length of service of thirty years and more: 6 additional days.

The following agreement applies to the implementation of working a "fifth shift" in order to improve the working conditions of the company's personnel because: -the number of hours worked at night is reduced to a minimum, with no more than a third of the annual working hours normally being worked at night. -overtime is reduced to a minimum. -the reconciliation of work and family life is favoured by making the weekly days off coincide more frequently with the weekends, ensuring two free weekends in each 35-day cycle Furthermore, the company understands that organisationally it is more competitive and improves the quality of production. The agreement regulates the conditions under which work will be carried out in the so-called continuous process, i.e. in jobs that must be covered 24 hours a day, every day of the year, under an organisation of shift work.

The working time is regulated as follows: - Working hours of the shift system:

-first shift: from 6.00 a.m. to 2.00 p.m. (morning shift) -second shift: from 2.00 p.m. to 10.00 p.m. (afternoon shift) -third shift: from 10.00 p.m. to 6.00 a.m. (night shift).

- Shift cycle Each shift of workers changes between different work and rest periods in a 35-day cycle of irregular distribution starting on Monday: 3 days on morning shift, 4 days on night shift, 3 days off, 4 days on morning shift, 3 days on afternoon shift, 7 days off, 4 days on afternoon shift, 3 days on night shift, 4 days off. This same 35-day cycle is carried out by each of the five workers' shifts with a one-week gap to another of the five workers' shifts. In this way, each 35-day cycle has 21 working days and 14 days off.

- Excess days off The weekly rest period established in the previous cycle accumulates an annual excess of 14 days off, so a mechanism to return days off is established by systematically cutting the first two or the last two days off of the middle group of seven days off of each two cycles. The return of days off occurs alternately, one cycle resting the seven days and the other returning two of those seven days off. That is, every two cycles (70 days) a group of seven days off is affected. The first return is Thursday and Friday in the morning shift, after two cycles, the next return is Tuesday and Wednesday in the afternoon shift, another two cycles later the return is Thursday and Friday in the afternoon shift and another two cycles later the return is Tuesday and Wednesday in the morning shift. Thus, every year, 10 of the days off are returned. The way in which these days off are modified is individual, so that the staff of each work shift is broken up to give greater coverage from Tuesday to Friday in the morning and afternoon shifts.

The following table shows the total number of hours planned for the different working day modes.

TOTAL HOURS PER SHIFT TYPE

Shift type Total hours

Shift A 67,200

Shift B 68,800

Shift C 67,200

Shift D 70,400

Shift E 70,400

Substitutes 22,400

Split day 408,734

Total 775,134

Reconciliation between personal life and work development [401.3]

In order to allow a balance between work life and personal development, the company allows the entry and exit time to be adapted with this formula, maintaining the working day and always attending to the needs of the company. Its application depends on the characteristics of each area and the specific job and is analysed on a case-by-case basis, when the employee must take care of the schooling needs of children under 12 years of age, or the care of a relative in the first degree of consanguinity or affinity with a recognised disability and without paid work, or a relative in need of special care due to age, accident or illness.

With regard to the family and work reconciliation of UCE employees, the different types of permission for time off and leave that have been requested by the employees of the company during FY2019 and in the different headquarters are the following:

UCE Reconciliation leave

Spain Germany Brazil

No. of people No. of people No. of people Type of permission M W M W M W benefited benefited benefited

Paternity leave in the 19 19 year

Maternity leave in the 8 8 1 1 year

Leave for breastfeeding 9 1 8

Leave due to risk in pregnancy and 4 4 lactation

Leave in the year 1 1 1 1

Reduction in working 18 1 17 4 4 day during the year

Flexible working days 29 21 8 9 7 2

Number of employees who returned to work

after parental leave Percentage of return to work Total number of employees who had to 100% return to work after parental leave

No. of employees still working 12 months 100% after parental leave Percentage of continuity in the job Number of employees returning from

parental leave

Absenteeism

During FY2019, the absenteeism rate within UBE Corporation Europe was 2.61% while within UBE Europe GmbH (Germany), the absenteeism rate was 3.11% and at Repol S.L. it was 5.28%

Absenteeism rate: 2018 2019 % IT hours/ total hours worked

Average UBE Corporation Europe 2.70% 2.61%

Average in UBE Europe Gmbh 2.47% 3.11%

Average in Repol S.L -- 5.28%

New recruitments and dismissals [401.1]

With regard to new recruitments in FY2019, out of a total of 22 new hirings, 32% are women. It should be noted that the number of new hirings was higher than the number of lay-offs, 22 new hirings as opposed to 14 lay-offs.

HIRINGS AND LAY-OFFS FY2019 ( UCE )

Total M W % W

No. of hirings 22 15 7 32%

No. of lay-offs 14 10 4 28%

Hirings and lay-offs ( UCE ) by employee origin

Dominican Spain Thailand Venezuela Japan Total Republic

No. of 22 0 0 0 0 22 hirings

No. of lay- -8 1 1 3 1 -14 offs

Number of 100% hirings (%)

No. of lay- 57.14% 7.14% 7.14% 21.43% 7.14% offs (%)

Hirings and lay-offs ( UCE ) by age group

Total <21 21-31 31-41 41-51 51-61 >61

No. of 22 1 5 13 3 0 0 hirings

No. of lay- -8 0 -2 -8 -2 -2 0 offs

Number of 4.55% 22.73% 59.09% 13.64% 0% 0% hirings (%)

No. of lay- 0% 14.29% 57.14% 14.29% 14.29% 0% offs (%)

In terms of the number of dismissals, a total of 5 people have been dismissed during the period FY2019, of whom 1 was female and 4 male.

FY2019 DISMISSALS ( UCE )

Gender Age Group

M 32 I

M 52 Manager

M 61 II

W 25 I

M 60 Manager

The regulations regarding the disciplinary regime of UCE can be consulted in the chapter of the Personnel Policy Manualwhich includes all the information regarding prizes, faults and penalties

Periodic performance assessments [404.3]

Attitudinal assessment is a tool that allows us to encourage the professional development of UCE employees.

These 9 competencies are assessed by means of an annual questionnaire with values from 0 to 100. The assessors are the employee's supervisor and the employee's internal customer, i.e. colleagues as well as other departments with whom they usually work closely on a day-to-day basis. The scores obtained by Supervision weigh 60% and those of the internal Customer 40%, thus forming a result with the averages of each competence that will allow us to draw up an

97 action plan in the individual interviews that are carried out with the person assessed in order to favour their professional development.

Gender Professional category

1 2 3 4 5 6 Total

Man 122 85 65 34 33 12 351

Woman 13 31 17 22 7 4 94

Total 135 116 82 56 40 16 445

5.3 Collective agreement [102.41]

UBE Corporation Europe is subject to the General Agreement of the Chemical Industry. Within this global framework, company agreements are agreed upon that improve the conditions of the chemical agreement. The latest agreements reached with the Works Council cover the financial years 2018, 2019 and 2020. The works council is made up of 13 people. Article 84 of the current General Agreement of the Chemical Industry is followed with regard to the rights and obligations of the Works Council.

Apart from the works council, there are sub-committees to deal with different issues. Meetings between management and the sub-committees are held on a monthly or quarterly basis. The sub-committees are as follows:

- Economic and HR monitoring sub-committee. - Occupational health and safety sub-committee. - Professional Development Project ("Cruise") Sub-committees and Standards Manual. - Fifth shift monitoring sub-committee. - Social fund, loans, cafeteria and studies sub-committee. - Monitoring sub-committee for working day equality. - Equality Sub-committee.

Within the Personnel Policy Manual, the chapter on union activities establishes that the company's management recognises the figure of the union delegate of the Castellón work centre, representative of the Union Section of the Union

Organisations with representation in said centre, with the attributions and obligations that result from its legal regulation.

Likewise, the management authorises the members of the works committees to accumulate the hours recognised for exercising their function, dedicating themselves to activities related to the members of the staff, and announcing themselves with a minimum of 48 hours' notice, for the purpose of organising the work without greater costs than those assumed. These hours cannot exceed 60 hours per month.

As regards channels of communication, consultation and participation of staff, the following should be highlighted:

● Health and Safety Committee (HSC). Its composition and operation is established in Safety Standard 0.2 Organisation of safety and environmental protection. The committee is made up of representatives of the workers and the company and holds meetings every two months, more often than legally established. ● Group health, safety and environmental meetings as described in regulation NS 12.2. ● Notice boards distributed throughout the factory premises. ● IntraUBE (intranet). All staff have access through personal computers or shared equipment. ● Sub-committee on Equality. ● Ethics System EC Line alert channel.

100% of UCE employees and 100% of Repol S.L. employees are subject to collective bargaining agreements

The collective agreements by country are as follows:

-Spain 100% of the staff is covered by a collective agreement and a company agreement. UBE Corporation Europe is subject to the General Agreement on the Chemical Industry, which is nearly 40 years old and regulates labour relations in the chemical sector. Negotiated under the rules of Title III of the Workers' Statute, which applies to all companies and is state-wide, it is generally effective, thus affecting all companies within its scope and more than 200,000 workers.

Within this overall framework, company agreements are agreed upon that improve the conditions of the general agreement. The latest agreements reached with the Works Council in Spain cover financial years 2018, 2019 and 2020. The balance sheet is positive, as shown by the history of its application within the company, the relationship of fluid social dialogue and

99 the long period of time of the last company agreement reached, currently in force.

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-Germany UBE Europe GmbH does not belong to any employer's organisation and there is no mandatory collective bargaining agreement in place, so staff are not subject to a collective bargaining agreement, but are subject to the labour laws applicable in each region and at state level, with an agreement on conditions between management and staff

Individual salary conditions are agreed with the new employee at the time of their hiring according to their specific circumstances but always within the range of other comparable recruitments, and with the advice of external recruitment companies. Annual increases for staff, work schedule etc. are authorised by the company's management committee.

-Brazil UBE Latin America Serviços uses the collective agreement of the employers' association as a reference for the annual salary update Sindicato dos Empregados de Agentes Autônomos do Comércio e em Empresas de Assessoramento, Perícias, informações e pesquisas e de Empresas de Serviços Contábeis no Estado de São Paulo.

- Mexico UBE México S. de R.L. de C.V. does not belong to any employer organisation and there is no mandatory collective bargaining agreement, so the staff are subject to the applicable labour laws and there is an agreement on conditions with the management.

5.4 Training [404.1/ 404.2 ]

UCE's annual training plan is aimed at all employees to increase the organisation's potential, professional development, competitiveness and change.

It consists mainly of 5 main areas:

● Technical Expertise Training: Specific training for the job is defined by the Area's supervisor and is managed as the job requires. ● General Expertise Training Transversal training, for example training in computer programs, new working procedures, languages etc. This training is defined by HR working in collaboration with other Areas. ● Corporate Training

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Mandatory training to support the general objectives of the organisation. It is defined by Management. This includes issues of Compliance, Travel, Quality, new corporate procedures etc. ● Safety Training/Prevention/E. Environment Compulsory training defined by the Department of Prevention, Safety and Environment. ● Competence Training Defined by the Human Resources department, it is a complementary training to strengthen those skills that the employee needs to develop his professional career in order to facilitate the transition to new positions or for succession plans.

Safety, Working Total Prevention, days Grand hours/ Competence Environment Generalexpertise Technicalexpertise /conferences total year and /forums Corporate*

Men 1,007 4,167.22 1,156.52 843.73 257.25 7,431.72

Women 272 1,023 694.97 95.75 223.34 2,309.06

1,279 5,190.22 1,851.49 939.48 480.59 9,740.78

The training plan is assessed both by the student and by the supervision.

Professional category UCE Grand total Hours of training 1-3 4-6 0-7 year by gender

M 3,577.27 3,619.70 234.75 7,431.72

W 915.97 1,332.92 60.17 2,309.06

Grand total 4,493.24 4,952.62 294.92 9,740.78

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OUTPLACEMENT

Outplacement, also known as job placement, is a support service that UBE provides to an employee who decides to dismiss, with the objective of facilitating them to get a new job that fits their profile in the shortest time possible.

Through a specialised agency to locate possible jobs for the former employee, and also to help them improve their job search techniques23.

This support usually begins with planning prior to the end of the employment relationship and continues with counselling and follow-up throughout the new job search process. This involves regular training sessions and individual coaching, in which the outplacement expert works with the former employee's fears and concerns to help them develop the skills needed to find employment.

5.5 Salaries 202.1/ 405.2/ 102.35/ 102.36/ 102.37/ 102.38/ 102.39 ]

All employees are paid a salary above the minimum wage from the outset. The annual average by occupational group, for men and women, is then broken down into percentages based on 100 of the overall average. The calculation is based on the basic wage, the assigned supplement and the length of service supplement, leaving out the shift or night-time supplements, which are specific to the job, regardless of the person.

The greatest difference in average pay over the base value is found in level 6 (Group III) of technicians with greater training and responsibility, with 13%. The overall average salary of female staff is 95.77% compared to the average, and this difference is not considered significant. Similarly, in the breakdown by professional group, the differences in one direction or another do not exceed 25%, and are therefore not significant.

23https://empapelarte.es/strategies-seeking-employment-where to start/ 103

Ratio of basic salary and remuneration of women compared to men

Level Men Women Grand total

0 297.84% 0.00% 301.08%

1 70.52% 73.45% 71.20%

2 84.06% 86.93% 84.52%

3 103.83% 105.73% 104.19%

4 91.68% 100.08% 93.92%

5 136.22% 136.68% 136.51%

6 180.08% 167.05% 176.52%

7 207.53% 226.13% 210.46%

55 258.54% 0.00% 261.35%

101.09% 95.77% 100.00%

The following table shows the average remuneration of the professional groups by age range and gender, based on 100 of the general average. There are increasing differences from the overall average as people age.

The most significant difference by gender between average earnings within each age range is in the 51-61 age range. The positive difference for women in comparison to men is 32%, the reason being purely statistical as there are only four women in it, out of a total of 41 people.

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Average annual remuneration as a percentage of the overall average

Age ranges M W Grand total

<21 51.3% 0% 51.86%

21-31 68.01% 79.54% 70.11%

31-41 84.68% 90.28% 85.81%

41-51 111.68% 110.18% 111.27%

51-61 159.20% 191.56% 162.77%

>61 99.15% 0% 100.23%

Grand total 101.52% 96.18% 100%

Repol's figures are as follows:

Gender

Categories Prof. M W Total

Group 0 370.65% 0.00% 383.22%

Group 1 0.00% 69.43% 58.28%

Group 2 57.71% 0.00% 50.67%

Group 3 66.88% 77.85% 68.50%

Group 4 82.66% 91.55% 84.31%

Group 5 94.99% 107.96% 95.73%

Group 6 101.19% 0.00% 104.62%

Group 7 152.53% 164.52% 153.40%

Group 8 219.33% 0.00% 226.76%

Grand total 103.39% 84.09% 100.00%

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Average annual salary

Gender

Age ranges Grand total M W

21-31 65.11% 103.68% 74.96%

31-41 81.61% 95.74% 84.04%

41-51 118.03% 103.34% 115.44%

51-61 123.36% 93.37% 120.19%

61-71 116.88% 120.84%

Grand total 103.39% 84.09% 100.00%

5.6 Occupational health and safety [403.1/ 403.7]

UCE has an integrated management system for quality, environment and occupational health and safety. The management policy is integrated and reflected in the Staff Standards Manual.

The company is ISO 45001:2018 certified.

The UCE Group performs a company-wide risk assessment every three years following the UCE001 Corporate Approach to Risk Assessment standard. In addition, risk assessments of jobs are carried out using the risk matrix of the National Institute of Health and Safety at Work.

Other safety tools are also used for this purpose: safety inspections, preventive safety

106 observations, safety at work analysis or work permits.

With regard to process safety, specific safety studies are carried out to identify hazards and assess and mitigate risks using different PHA techniques(ProcessHazardAnalysis).

Based on the objectives and calculation of indicators in section 1.5, the health and safety data for FY2019 are shown below.

FY2019 HEALTH AND SAFETY RESULTS

Indicator Result 2018 Result 2019

Process Safety Index 4.2 1.6

Accident rate 19.6 16.8

Frequency rate 16.6 16.85

Severity Rate 0.03 0

Continuous improvement activities are promoted through the Central Safety Committee. Multidisciplinary working groups are organised for this in order to enrich the health and safety approach. Some of the activities that are part of the Strategic Security Plan are: ● Change Management ● Mechanical Integrity ● Improvements in security standards and procedures ● Emergency plan ● Communication plan ● Training ● Operational discipline ● Digitization of security tools

Workplace accidents and occupational diseases [403.9/ 403.10]

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As far as workplace accidents and occupational diseases are concerned, at UBE Corporation Europe, all incidents are investigated using different techniques to determine the basic causes of the incidents. In the incidents a distinction is made between own staff and contractor staff, classifying the accidents as first aid, accidents without leave and accidents with leave.

It has a joint medical service that attends to all staff, both own and contractor staff, 24 hours a day.

With regard to the data for FY2019, shown in the following table, no cases of occupational disease have been recorded.

UCE ACCIDENT SUMMARY TABLE (Spain)

Accidents Accident Accident Accidents First First Aid without s without s with with leave aid Contractor leave sick leave sick leave Contractor ECU s Contractor UCE UCE s s

Fisca W M W M W M W M W M W M l Year

1 2018 0 0 1 0 1 0 14 0 0 0 1 0

1 2019 1 0 1 0 0 3 15 0 0 0 1 0

At Repol, S.L., four first aid cases (male employees) were recorded and no occupational accidents were reported.

On the other hand, in FY2019 there were no occupational accidents and no cases of occupational disease were recorded either at the UCE headquarters in Germany or in Brazil.

Health and safety training

The initial and periodic training in occupational health and safety is defined through the training matrix per job that is part of the standard NS 12.1 Training ofthe Safety Standards Manual. It identifies what training should be received according to the type of staff and position, and how often.

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UCE carries out health and safety training for new employees, continuous refresher training for employees and training for contractors.

With regard to the initial training of new employees, two cases can be distinguished: production staff on shifts and normal staff.

Production staff working on shifts [403.5]

Its training process consists of 4 large blocks:

Basic Process Knowledge (BPC) Course This course starts after the reception and lasts 4 weeks. Basic knowledge training is provided on a number of general subjects. Within this course, a very complete training in health, safety and environment is included in which subjects related to the hazards of the facility are taught.

General Process Knowledge Course (GPC) This course lasts 4 weeks and includes training in health, safety and the environment in accordance with the basic approach to the prevention of occupational hazards established in the Royal Decree on Prevention Services. Therefore, personnel who have completed the training process in the previous stages and have passed the corresponding exams have this basic training in ORP and the training to work as a preventive resource.

Maintenance Training At this stage of the training, new personnel spend two weeks in the maintenance department (one week in the instrumentation / electricity workshops and another week in the rotary and static workshops) to see how the maintenance working groups are organised and to manage the work orders received by the workshops.

Specific unit training (within the assigned shift) After the first 10 weeks of training and after passing the corresponding assessments, the new personnel join the Production Department and start working in shifts. Each employee is assigned a zone, shift and manager who follows up on their training plan within the shift.

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The work within the shift combines the study of the application documentation accompanied by the incumbent operator who occupies the work post to see "in situ" the tasks to be carried out and to know in detail the operation of the unit and its equipment. In order to obtain and be recognised in the first job, it is necessary to pass a theoretical and practical exam of the unit being studied. The support documentation used to study each unit is the Training Manual and, above all, the Operation Manual, which contains the instructions for action in case of: -Preparation of the unit for start-up. -Start up. -Normal operation. -Reduced load and top load operation. -Normal stop (short or long duration). -Emergency stop. -Predictable Conditions of Abnormality. All Operating Manuals must be kept up to date. To meet this objective they will be reviewed every three years as a rule and whenever there is a significant change in the Unit. This training process, which culminates in the recognition of the first job, lasts approximately 9 months.

Normal day and laboratory staff. It describes the training process that this group follows until they occupy their job. There are 3 stages: 1.-Basic security and environment course (booth) On the first day of their stay at UCE, new employee must attend the basic safety and environmental training course held at the training booth next to reception. The duration of this training is 2 hours 2.-Reception (HR / supervisor) This stage of the process takes place on the first day of work and basically consists of the completion of documentation by the new employee. From the moment they join the Company, each employee receives basic training on the general aspects of the organisation and the facilities, going through all the departments. 3.-Safety and environmental training The new employee must attend a safety training course that covers the basic topics in occupational risk prevention such as chemical risk, working at heights, personal protective equipment, work equipment, emergencies or confined spaces. This training is mostly on an online platform.

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With regard to periodic training,, there is a matrix per job that defines what training should be done and how often it should be done. Some examples are training in forklifts, work equipment, confined spaces, working at heights, self-propelled cranes or chemical risk.

Continuing training

General training in Safety and Environment is scheduled annually, which basically contains: -Practices in the use and handling of Self-Contained Breathing Equipment. -Firefighting practices. -Emergency fire drill. -Emergency gas drill. -Spill drill. -Interior Maritime Plan Drill -Advanced Fire Fighting Course for Shift Brigades and First Intervention Maintenance (Tepesa) ·First Aid. -Preventative safety observations (OPS). -Fire extinguisher practices for contractors. -Interior Emergency Plan / -Interior Maritime Plan

In order to improve the coordination of business activities, all contractor personnel must pass an initial safety course on the risks of the UCE activity, emergency measures and main occupational health and safety regulations. The course must be renewed annually.

Each year UCE prepares a guide for the coordination of business activities that is distributed with the contracting companies. In turn, contractors are required to prepare an annual Safety Plan detailing their activities, risks and preventive measures.

In addition, the company has an online platform (CTAIMA) to speed up the review of contractors' documentation, as well as their authorisation to access the plant.

5.7 Support schemes [401.2]

In addition to its commitment to conciliation, UCE has a series of social benefit aid plans for employees. All the social benefits described apply to employees with permanent contracts, while those with temporary contracts (only 2.82%) do not. They are the following:

● Employee study grant plan. Once the study grant has been awarded, the company reimburses the beneficiary up to two thirds of

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the costs incurred, up to a maximum of €1,500 per academic year or year. ● Educational support plan for employees' children. This includes both School and University aid. The ceiling for the lifetime allowance for staff members' children at school and university is €4,500. ● Life and accident insurance. The company has taken out group life and accident insurance.

Pension Plan [201.3]

UCE is the promoter of a joint promotion Pension Plan constituted on 10 July 1990 and registered in the Administrative Registry of Pension Funds of the Ministry of Economy and Finance under number F0214.

The purpose of the plan is to improve protection in the face of certain contingencies and situations of those included in the official social welfare system currently in place in Spain.

The fund management entity in 2019 was VidaCaixa, S.A.U., de Seguros y Reaseguros, with the depositary entity CecaBank, S.A. and the auditor Mazars Auditores, S.L.P. The supervision and control of the plan corresponds to a control committee, with the roles taken into account in the Regulation on Pension Plans and Funds. This committee is made up of 12 people, 6 appointed directly by the promoter and 6 chosen to represent the participants and beneficiaries of the plan

With the details contained in the Regulations governing the operation of the Pension Plan, the pension system that is complemented and improved is the General Social Security System, with the aim of providing retirement, disability, widowhood, orphanhood and inheritance benefits to the beneficiaries of the Plan, which is governed by the Pension Plans and Funds Regulation Law, its Regulations and other regulations that implement and amend them.

Any employee with a permanent contract may participate, once the trial period has passed, and who meets the conditions and requirements determined in the Regulations, without requiring more than two years' length of service to be eligible.

The adhesion right will be exercised by filling in the Adhesion Bulletin and addressing the Plan's Control Committee through the promoter, after checking that the requirements indicated in the previous paragraph have been met. The effects of the hiring will occur from the date of the application, which will be considered as the recognised length of service date for the purposes of the Pension Plan.

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The participants may make voluntary contributions to improve the retirement supplement, with the frequency and for the amount that the participant decides, being able to modify both the amount and the periodicity when this is determined.

Contributions to the plan may not, under any circumstances, exceed the limit set by the legislation in force at any given time. Any excess over the maximum contribution established must be withdrawn before 30 June of the following year.

Social Fund

The main objective is to stimulate the collective awareness of Security, obtaining, according to the collective results in security, some economic contributions that will constitute a fund with a welfare and commemorative purpose. The company's contributions are subject to the absence of occupational accidents with sick leave, in accordance with the UCE philosophy. The fund is intended to provide financial assistance, not provided for in another UCE social plan, and to commemorate milestones relating to occupational safety and characterised by the absence of accidents involving sick leave. From the Social Fund, employees can apply for loans up to €5,000. During 2019, 4 loans were granted for a total amount of €13,300.

 Employees' childcare assistance plan. This benefit consists of the company's payment to the employee of €70 per month maximum for the costs incurred in enrolling children in nursery schools.  Compensation of interest on personal loans. This benefitis applicable to UCE employees from the former company UBE Chemical Europe, who are linked to the company by virtue of an employment contract of indefinite duration and with a length of service date later than 01/01/2002, and to all those employees of UCE from the former companies UBE Engineering Plastics and UBE Corporation Europe S.A. (prior to the merger), and consists of the payment by the company to the employee of part of the interest that the latter pays to a financial entity derived from the subscription of a personal credit.  Loans for the purchase of cars and for the purchase of housing. They are applicable to the permanent employees of the company with a date of incorporation prior to 1 January 2002 and that came from the former company UBE Chemical Europe (currently integrated in UBE Corporation Europe, S.A.U.).

-In the case of car purchases, the number of loans available to all permanent employees of the company is limited to five years after the last loan is granted and totally repaid. The maximum amount per loan is set at €20,000. The maximum annual amount allocated by the company for these loans is €432,720,

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and the number of loans granted in any one year may not exceed this amount. This amount is annual and the remainder cannot be carried over to the following year.

-With respect to loans for the acquisition of homes for the permanent residence of the employee, the loan will be for the amount requested by the employee, and may be extended up to the total or up to 90% of the value of the home acquired, without exceeding the maximum loan limit.

The total capital allocated to these social benefits by UCE for FY2019 was €162,085. Of these, €74,760 were allocated to study grants for the children of a total of 172 employees.

Social benefit UCE Spain

No. of Total year employees Men Women (euros) benefited

Help with 14,725 60 46 14 studies

Aid for children's 74,760 172 135 37 studies

Nursery school 32,242 65 49 16

Interest 40,358 101 82 19 Compensation

TOTAL € 162,085

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DESCRIPTION OF SOCIAL BENEFITS IN UCE (Germany and Brazil)

TYPE OF BENEFIT Germany Brazil Repol

Food vouchers (when eating at work) Yes Yes YES

Travel expenses to the office or cost of Yes parking in a garage

Travel expenses (partly) Yes

Drinks in the office (tea, coffee, water) Yes YES

Accident insurance Yes

Luggage insurance Yes

Height-adjustable table (office) Yes YES YES

Work-related courses (with limits) Yes YES

Financial aid for celebration of marriage, Yes birth of child

Compensation for sick children Yes

Nursery school costs (with justification) Yes

Health and Dental Insurance Yes YES

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5.8 Challenges for the future

The companies of the UCE group are not immune to the effects of the pandemic caused by the Covid-19 in early February 2020. Throughout the state of alarm, the basic premise has been and will be to safeguard the health of the staff and contractor staff, by means of a series of extraordinary protection measures: physical separation, surveillance and control protocols, distribution of masks and other equipment, teleworking, reinforced hygiene and cleaning protocols, etc.

The challenges facing the UCE group in managing staff affairs for the coming years are:

● Develop Covid-19 pandemic management policies that will continue to safeguard the health of own and contractor staff, maintaining group operations and activities, and without affecting the continuity of the level of employment. ● To align the staff policies in UCE subsidiaries abroad with those of the head office, in the fields of performance management, remuneration and professional development. ● Establish and start developing the 2nd Equality Plan of UBE Corporation Europe.

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6. CUSTOMERS AND SUPPLIERS

6.1 Management approach

The UCE Group shares the UBE Group's spirit of innovation and use of technology to contribute to the development of society by ensuring the quality and safety of its products. As indicated in the Management Policy, this vision is carried out through research and development processes, manufacturing and marketing of chemicals and engineering plastics, framed in a management system certified by ISO 9001 and IATF 16949.

In the face of a changing environment with a growing demand for more efficient, sustainable products, UBE's aim is to design safe supply chains and ensure compliance with applicable regulations in each jurisdiction in which it operates.

In addition, UCE actively participates in discussion forums and development initiatives in the engineering plastics industry such as CEFLEX(A Circular Economy for Flexible Packaging) and Change and Challenge.

Change and Challenge is a UBE initiative led by committed individuals and organisations concerned about the impact of food packaging on the environment and the preservation of natural resources throughout the food chain. Their vision is to generate awareness, direct global attention and a solution to the food waste crisis.

6.2 Customers [416.1/ 416.2/418.1]

The company does not sell directly to the consumer, although some of its products are incorporated into manufacturing processes for industrial and consumer products.

Nylon or polyamide is the company's main product and has two main applications: packaging of food and automotive components.

The UCE management system, certified according to the Quality Management System Standard: ISO 9001:2015, provides for the identification, classification

117 and monitoring of each and every customer complaint, as well as possible complaints from related public administrations24.

In reference to products and non-compliance with any type of regulation, the situation during FY2019 of UCE has been the following:

● At the end of the 2019 financial year, there were no open cases of non- compliance. Regulatory standards (generic and/or applicable) that could lead to possible non-compliance continue to be monitored. ● The self-assessment of Responsible Care from the product stewardship chapter has been undertaken, reaching 92 points out of 100. ● The assessment in the voluntary CEFIC project for updating REACH registration dossiers has resulted in the following assessment. ○ Number of re-assessed REACH registrations: 2 ○ Forecast for 2020-2026: number of REACH registrations to be re- assessed: 25 ● It does not apply to UCE products to detect cases of non-compliance with regulations that give rise to warnings.

Complaint management is carried out through the complaints procedure (PGC.04.01) and the "Recall" Procedure (PGC.04.02), which channels any complaint or claim that arrives from our customer companies. No such incidents were recorded at Repol during FY2019.

Customer incidents are collected through the various Business Units, which send them to the Quality Assurance Department, which is responsible for coordinating the investigation of the causes with the various departments involved, and the establishment of immediate contingency and/or corrective actions.

All incidents received from customers are analysed in a similar way. If, after analysing the incident, it is concluded that it is not the responsibility of UBE Corporation Europe, it is classified as a "complaint" or "not-claim". When the incident is the responsibility of UBE Corporation Europe, it is classified as a "claim».

Following the corresponding procedure within the integrated management system, complaints are received, recorded and managed until their solution and closure. By April 2020, one month after the close of FY2019, 97% had been closed.

On the other hand, in the event that a product is detected that may pose a risk to the end user, and is unsuitable for consumption or out of specification, the

24The Management Policy, as well as the current certificate of the mentioned standard, are available on the UCE https://www.ube.es/EN/sustainability/rsc.php 118

"Recall" procedure would be activated, (PGC.04.02.). Throughout FY2019 no product incidents have been received that have involved the initiation of a "Recall" process or that have been related to food or automotive safety, the company's main markets.

The company has carried out a "withdrawal" drill with results and satisfactory in terms of the time targets set and the Traceability exercise

6.3 Suppliers [204.1/ 414.1/ 414.2/ 308.1/ 308.2]

The proportion of spending on local suppliers was as follows for FY2019:

● National, 50.8% of the total. ● Province of Castellón, 7.7% of total

In application of the management system procedures in force, certified according to ISO9001 and ISO14001, all suppliers identified as relevant or critical are assessed, taking into account criteria included in the following categories for the analysis : Quality, Corporate Social Responsibility, Health and Safety and the Environment.

All suppliers considered critical or relevant to the activity are assessed.

6.4 Marketing and labelling [417.1/ 417.2/ 417.3]

The products that UCE produces are labelled according to their hazard classification, and by application in the case of fertilisers. The organisation's procedures do not require reporting of any of these items but due to legislation certain information should be provided to customers within the safety data sheet or label. Product data sheets can be requested via the following link: https://www.ube.es/EN/product/product.php

No breaches of applicable regulations or standards relating to marketing communications, advertising, promotion or sponsorship were recorded during the 2019 financial year. .

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UCE participates in the Global Product Strategy (GPS), a worldwide initiative developed by the International Council of Chemical Associations (ICCA) to achieve safe management and handling of chemicals throughout their life cycle.

To improve the chemical industry's transparency and increase confidence in its products, the ICCA has established the ICCA GPS Portal, where the industry is encouraged to share safety reports on its chemicals and where citizens or any interested parties can access them directly.

The UCE website contains the UBE Group's policy on this matter, as well as links to the safety reports of the most relevant substances25

6.5 Challenges for the future

UCE monitors in detail the directives and regulations that, especially in the EU framework, frame the medium and long term future trends, among which the Circular Economy Package adoption and publication of the Action Plan (2016 ) and the European Commission review of the EU Plastics Strategy (2017) stand out.

The adaptation of products to new applications and sectors is an important challenge for the UCE Group, which is faced through integrated processes of innovation, quality assurance and regulatory compliance.

Procedures for the approval of new products and new grades of existing products are reinforced in order to follow up innovation and development projects.

The development of the processes associated with the adoption by UCE of the IATF 16949 certification, the most widely used international standard for quality management systems in the automotive industry, is highlighted. In this area, the integration of Repol into the UCE Group's management system is an ongoing project, generating synergies in injection and extrusion activities and creating R&D opportunities, especially in the study of circular economy and plastic recycling activities.

25https://www.ube.es/EN/sustainability/rsc.php 120

7. SOCIETY

7.1 Management approach [103.1/ 103.2/ 103.3]

As reflected in the Code of Ethics and Conduct, UCE makes a significant effort to be a responsible citizen in the various communities where it carries out its activities and is aware that it is also a member of the international community. As the Code states:

«This requires us to be sensitive to social and environmental concerns and to respond appropriately to the concerns of stakeholders, while contributing to the development of the region in which we are located»,

UCE is aware that the products and services it offers have the potential to provide benefits to society. At the same time, it is important to behave in a socially, ethically responsible manner. Which is why:

● It cares about the people who are involved in the manufacture and support of its products and services around the world ● It strives to increase productivity while minimising the environmental impact on the societies in which it operates.

Although UCE is a global company, belonging in turn to a Japanese industrial group with an important multinational presence, the impact of its activity on the socio-economic and environmental dimensions mainly affects the immediate surroundings of the headquarters and production plant in Castellón (Spain): the city of Castellón and its province, the neighbouring town of Almazora, and the regional area of the Valencian Community.

This is due to the very nature of the environmental impact (emissions, effluents and solid waste); the visual impact of the industrial facilities; the effect related to the safety of the processes, products and raw materials; the economic drive in the region by the selection of labour personnel and undertaking of purchases and contracting of services of all kinds (supplies, consulting services, prevention, maintenance, construction, research and development, engineering, etc.) or the positive impact of its social action in the community.

UCE regularly cooperates with the different representative groups of civil society by carrying out activities with the educational community, the media, universities, citizen and business associations, etc.

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The company also encourages all its staff to engage in individual civic and volunteer activities.

Likewise, it maintains a permanent dialogue throughout the year with the administrations of the nearby municipal, provincial and regional environment, in order to inform them, in person and transparently, about the evolution of employment and business results, new investment projects, technical improvements and environmental impact, as well as to listen and respond to possible complaints from citizens or the legitimate interests of society, which the institutions may channel.

It is important that the UCE brand is always associated with respect for human rights , fair and safe working conditions , and environmentally friendly business practice and with economic development and employment, promoting general and local welfare and socio-economic development .

The company's initiatives in this regard seek to improve stakeholders' knowledge of the company, offering answers to the questions they may raise in the performance of their legitimate interests.

7.2 Community [413.1/ 413.2/ 415.1]

In the development of its communication policy with the community, UBE Corporation Europe maintains an active relationship of communication, exchange and cooperation with various social actors in the surrounding area, which are listed below.

It is important to emphasise that the company's principle is not to make any contribution to political parties or representatives.

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Actions linked to the public administration in FY2019

Local authorities in Castellón: ● General dialogue as a foreign capital investment company established in the city. ● Contribution to the institutional promotional video for attracting industrial investment in the municipality. ● Support for relations between the town councils of Castellón and the city of Ube (Japan) to develop and strengthen the twinning between the two cities (participation and support in city trade missions). ● Participation in the 1st International Spain-Europe-Japan Congress organised by the city, with the paper on circular economy "Eco Town Models in Japan: an inspiration for Spain. Close the plastic circle. Kawasaki case." ● Collaboration with the municipal Sustainability Area, Almazora Town Council, the General Directorate of Environmental Quality of the Government of Catalonia and the Indes Association, for the implementation of the Communication Protocol for odour alerts in the area of the El Serrallo industrial estate.

Almazora Town Council: ● General dialogue; ● Sponsorship of the entrepreneurship competition for local youth; ● A day of planting bushes in a catalogued ecological restoration area in the course of the Mijares River as it passes through the town, with the participation of volunteers from the company. ● Financing of the environmental education space "Darremur Orgànic", to create an outdoor area for environmental workshops and environmental education courses for families and local schoolchildren.

Generalitat Valenciana: ● Participation in the 21st Spain-Japan Forum promoted by the Spain- Japan Council Foundation and the Generalitat, with the dialogue "Urban Diplomacy: a practical case", which analyses the institutional relationship of the cities of Ube (Japan) and Castelló. ● Permanent dialogue with the DG of Environmental Quality and monitoring of possible environmental episodes in the surroundings of the El Serrallo industrial estate.

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Port of Castellón: UCE is the concessionaire of a facility in the port to carry out loading, unloading and storage of chemical products. It collaborates with the Port Castelló Foundation and is a member of the jury for the Faro Awards given by the Port.

Relationship with the local media During FY2019 and as part of a general communication policy, UCE maintained an open dialogue with the local media, reflected in articles, notes and mentions in the various media, highlighting the annual presentation of business results for transfer to the whole of society.

UCE participated in the 4th Innovation Day of the Mediterranean newspaper with a presentation on the role of chemical recycling of plastics in the circular economy.

Relationship with non-profit organisations UBE Corporation Europe also contributes to other associations, foundations and non-profit organisations in the surrounding area. The contributions made in FY2019 are shown below:

Sports Clubs. The company has a sponsorship programme for sports clubs and various athletic events in Castellón and Almazora, to promote sports activities in grassroot clubs and with a presence of children and youth (Club L'Illa Grau Volleyball, CD Almazora, Club Bromera, Club Basket de Castellón, C. Handball of Castellón, C. Indoor Football in Castellón, Club Esporting, Escuela de Pelota Almazora, 10K Nocturno Grao, Grau Runners Club, 12th Junior Padel World Championship, Marató i Mitja-PenyagolosaTrails, BTT MediterraneanEpic, etc.). The amount dedicated to these sponsorships in fiscal year 2019 was €23,000.

Non-governmental organisations of social assistance and similar, based in Castellón. During the year, the company sponsored programmes run by Cáritas, the Red Cross, Afanías, Down's Syndrome, the Multiple Sclerosis Association, the Spanish Cancer Association, Cocemfe, Patim, the Adecco Foundation, the El CAU Centre, El Rinconet and the Castellón Food Bank, for a total of over €80,000.

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The intervention of UCE in the face of the effects of Covid -19. The start of the pandemic and the state of alarm in our country have coincided with the last month of FY2019, which is the subject of the report. Back in March, special donations were made, included in the above-mentioned item, to the Food Bank, Cáritas and the Red Cross of Castellón. We anticipate a total of donations that will reach €70,000.

Academic and cultural entities and activities.

Jaume I University The company is represented in the Internationalisation Commission of the Jaume I University (UJI from now on). During FY2019 the Rector of the UJI held a work meeting and visit to UCE, and both entities signed an agreement for the financing of international mobility scholarships at Yamaguchi University, in the city of Ube (Japan).

There are other sponsorship agreements for the University Master's Degree in Energy Efficiency and Sustainability and the competition "The Taste of Research", aimed at secondary school students in the province.

UCE is also one of the patrons of the Fundación Universidad Jaume I - Empresa. The contributions for all these concepts in 2019 amounted to €15,800 .

The UJI also represents a source of knowledge and talent for the company and this is an important employment and training opportunity. In the last five years 38 graduates from UJI have joined the company in various areas and the company actively participates in the curricular and extracurricular internship programme, having received 29 students on internships in FY2019.

Vicent Castell i Domenech de Castelló Secondary School. Support for the higher degree training cycle in Industrial Chemistry that this centre has been teaching since the 2018-2019 academic year, with 18 students in each course. This is a study that has not existed until now in the province and with a high degree of employability.

UCE has contributed to the preparation of the teaching staff and several professionals from the company have given theoretical and practical classes. Some of the students have carried out their work experience in the company.

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Cultural promotion

In the field of cultural promotion, UCE supported the painting competition I.B. Vicent Castell Domenech and sponsored the contemporary art fair Mars and the Red Pier Festival, both in Castellón, all with a total amount of €4,600.

Alliances and partnerships. During fiscal year 2019 UCE has taken part in the meetings of the Plenary and the Internationalisation Committee of the Chamber of Commerce of Castellón. It has also participated in various organisations as an associate company:

1. Feique (Spanish Chemical Industry Business Federation) 2. ResponsibleCare (voluntary CSR and sustainability programme of the Spanish chemical sector; 3. Quimacova (Chemical and Environmental Association of the Chemical Sector of the Valencian Community); 4. CEV (Business Confederation of the Valencian Community); 5. Indes (Association of Industries of El Serrallo de Castellón); 6. CEJE (Japan-Spain Business Circle) 7. APD (Association for the Advancement of Management) 8. Energy Cluster of the Valencian Community; 9. Avia (Automotive Cluster of the Valencian Community); 10. Plastics Europe Spain; 11. Acogen (Spanish Association of Cogeneration); 12. Aimplas (Technological Institute of Plastics); 13. Anffe (National Association of Fertilizer Manufacturers) 14. Universitat Jaume I-Empresa Foundation of the Valencian Community.

These are industry and business associations of both a horizontal and multi- sectoral nature, where the participation of UCE is focused on cooperation and exchange of experiences for mutual advancement in the large areas of innovation, sustainability, safety, marketing, training, etc. The total amount contributed to these voluntary organisations was €98,000.

For over ten years, UCE has maintained an active presence at the Castellón CSR Committee, a forum made up of companies and NGOs from the province, for the promotion of Corporate Social Responsibility, as mentioned in another section of this report.

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Promotional activities for the environment. Apart from the company's own programmes linked to environmental improvement, UCE regularly organises volunteer activities with the Almazora Town Council to raise awareness and improve, as mentioned in other sections.

Promotion of Volunteering Group This is made up of five volunteers from the UCE staff, who meet monthly to plan the collective volunteering activities proposed to the rest of the staff. During 2019 the group spent 160 hours on planning. The activities carried out involved the global participation of 95 people from the company, who dedicated 360 hours, participating in initiatives related to volunteering to support sporting events (AEAC solidarity race; Mediterranean Epic mountain bike race; World Junior Paddle Tennis Championship) charity activities (food collection, visits to children's hospital patients, toy collection) and planting of bushes in the protected ecological restoration area of the Mijares River in Almazora, aimed at UCE staff and their families.

Guided tours in UCE In the guided tours programme to UCE, during fiscal year 2019, more than 150 students and teachers from colleges and universities in the region were received. Open days and factory tours were also held for UCE staff and their families, with the support of the volunteer group and a total of 430 visitors.

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7.3 Challenges for the future The great challenges that UCE faces in order to meet its commitments to the territory and to the society that surrounds it are, in particular, the following:

● To contribute, together with prestigious non-governmental organisations or local institutions, to mitigate the consequences of the pandemic caused by Covid-19 on the most disadvantaged sectors of society in the Castellón area.

● Maintenance of a close relationship with the local educational community to contribute to providing interest in scientific careers, the study of technical training cycles and the strengthening of the English language.

● Development of cultural, social and economic exchange between the areas of Yamaguchi and Ube city (Japan) and Castelló and its province.

● Progressive extension of volunteering activities to Repol S.L. staff

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Annex 1: About this report [102.48/ 102.49/ 102.50/ 102.51/ 102.52/ 102.53/ 102.54/ 102.56]

In order to continue with UCE's ethical and social commitment, and also to improve the quality and materiality of the information presented in previous years (non financial report 201826), the international methodology for the preparation of social responsibility reports of the Global Reporting Initiative (GRI) Standards version has been used, with the aim of reporting more detailed information, beyond the legislative requirements on the social, environmental and economic impacts of UBE Corporation Europe.

This non-financial report by UBE Corporation Europe (UCE) is thus a response to Law 11/2018 of 28 December, which calls on companies to submit a non- financial report in response to Directive 2014/95/EU which requires the disclosure of non-financial information, particularly in social and environmental matters.

This document reflects non-financial information data for fiscal year 2019, which runs from 1 April 2019 to 31 March 2020 (FY2019). The reason for taking this fiscal year reference is that UCE is part of the UBE Industries, Ltd group, which works on the basis of those fiscal years. In addition, the reporting cycle for this report will be annual.

The geographical coverage of this document includes Europe and Latin America through delegations and offices in Castellón, Almazora and Madrid (Spain), Düsseldorf (Germany), Sao Paulo (Brazil) and Mexico City (Mexico).

The contents of this report are reviewed and verified externally by Lloyd's Register Quality Assurance España S.L.U. according to the corresponding verification statement.

For any query or clarification cooncerning this document you can contact:

Jaime Sanjuanbenito Bonal([email protected]) Pablo Cruz Orozco([email protected]).

26https://www.ube.es/EN/sustainability/pdfs/Non-Financial Report.pdf 129

Annex 2: GRI Table of Contents [102.55]

GRI Standards (2016) have been used for the preparation of this report. In addition, the changes in the contents on effluents of GRI 306: Effluents and waste 2016 (Contents 306.1 and 306.5) have been taken into account, which have been updated and can be found in GRI 303: Water and effluents 2018.Likewise, the contents of indicator 403: Occupational health and safety (2016) has been updated in indicator 403: Occupational health and safety (2018).

UNIVERSAL STANDARDS

GRI STANDARD Section / Direct response

102: General contents (2016)

102-1 2. Our organisation

102-2 2. Our organisation

102-3 2. Our organisation

102-4 2. Our organisation

102-5 2. Our organisation

102-6 2.2 Organisation and structure

102-7 2. Our organisation

102-8 2. Our organisation

102-9 2. Our organisation

2. Our organisation 102-10 2.3 Key financial figures

2.5 Integrated management system and risk 102-11 analysis

130

102-12 2.2 Organisation and structure

102-13 2.2 Organisation and structure

102-14 1.Letter from the President

102-15 1.Letter from the President

102-16 3.3 Code of Ethics and Conduct

102-17 3.3 Code of Ethics and Conduct

102-18 2.2 Organisation and structure

102-19 2. Our organisation

102-20 2.2 Organisation and structure

102-21 3.4 Materiality report

102-22 2.2 Organisation and structure

102-23 2.2 Organisation and structure

102-24 2.2 Organisation and structure

102-25 3.3 Code of Ethics and Conduct

102-26 2.2 Organisation and structure

102-27 2.2 Organisation and structure

102-28 2.2 Organisation and structure

102-29 3.4 Materiality report

102-30 3. Ethics and compliance

131

102-31 3.4 Materiality report

102-32 3.3 Code of Ethics and Conduct.

102-33 3.3 Code of Ethics and Conduct

102-34 3.3 Code of Ethics and Conduct

102-35 5.5 Salaries

102-36 5.5 Salaries

102-37 5.5 Salaries

102-38 5.5 Salaries

102-39 5.5 Salaries

102-40 3.4 Materiality report

102-41 5.3 Collective agreement.

102-42 3.4 Materiality report

102-43 3.4 Materiality report

102-44 3.4 Materiality report

102-45 2.3 Key financial figures

102-46 3.4 Materiality report

102-47 3.4 Materiality report

102-48 Annex 1: About this report

102-49 Annex 1: About this report

132

102-50 Annex 1: About this report

102-51 Annex 1: About this report

102-52 Annex 1: About this report

102-53 Annex 1: About this report

102-54 Annex 1: About this report

102-55 Annex 2: GRI Table of Contents

102-56 Annex 1: About this report

4. Environment/ 4.1 Management approach

5.Staff/ 5.1 Management approach 103: Management approach 6. Customers and suppliers/ 6.1 Management approach

7. Company/ 7.1 Management approach

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ECONOMIC 200 201 Economic Performance

INDICATOR SECTION/ Direct response

201-1 Direct economic value generated and 2.3 Key financial figures distributed

201-2 Financial implications and other risks and opportunities 4.4 Economic resources intended for the environment. arising from climate change

201-3 Obligations of the defined benefit plan and 5.7 Support schemes other retirement plans

201-4 Financial assistance received from 2.3 Key financial figures the government

202 Market presence

INDICATOR SECTION/ Direct response

202-1 Ratio of standard entry level salary by 5.5 Salaries. gender compared to local minimum wage

202-2 Proportion of senior executives recruited from 5.2 Description of the group. the local community

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203 Indirect economic impacts 2016

INDICATOR SECTION/ Direct response

203-1 Investments in infrastructure and There were no investments of this type in 2019. supported services

203-2 Significant indirect Not available economic impacts

204 Procurement practices

INDICATOR SECTION/ Direct response

204-1 Proportion of spending on local suppliers 6.3 Suppliers

205 Anti-Corruption

INDICATOR SECTION/ Direct response

205-1 Operations assessed for corruption- related risks 3.6 Fighting corruption and bribery

205-2 Communication and training on anti- corruption policies and 3.6 Fighting corruption and bribery procedures

205-3 Confirmed cases of corruption and measures taken 3.6 Fighting corruption and bribery

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206 Unfair competition

INDICATOR SECTION/ Direct response

206-1 Legal actions relating to unfair competition and No complaints or legal actions in the field of competition monopolistic and anti- law have been registered in 2019 competitive practices

136

ENVIRONMENTAL 300 301 Materials

INDICATOR SECTION/ Direct response

301-1 Materials used by The information is not broken down in application of the

weight or volume UCE information security policy.

The % of recycled inputs over total is not an indicator 301-2 Recycled inputs included in the UCE management system.

301-3 Reused products There are no statistics on recycled packaging in the

and packaging materials UCE management system.

302 Energy

INDICATOR SECTION/ Direct response

302-1 Energy 4.7 Pollution Prevention: Energy, Emissions and Climate consumption within the Change organisation

302-2 Energy 4.7 Pollution prevention: Energy, emissions and climate consumption outside the change. organisation

4.7 Pollution Prevention: Energy, Emissions and Climate 302-3 Energy intensity Change

302-4 Reduction of 4.7 Pollution Prevention: Energy, Emissions and Climate

energy consumption Change

302-5 Reduction of energy requirements for It is not an indicator of the UCE management system. products and services

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303 Water and effluents

INDICATOR SECTION/ Direct response

303-1 Interaction with 4.7 Pollution Prevention: Energy, Emissions and Climate water as a shared Change resource

303-2 Management of 4.7 Pollution Prevention: Energy, Emissions and Climate impacts related to water Change discharges

4.7 Pollution prevention: Energy, emissions and climate 303-3 Water extraction change.

4.7 Pollution prevention: Energy, emissions and climate 303-4 Water discharges change:

303-5 Water consumption 4.6 materials and sustainable use of resources

304 Biodiversity

INDICATOR SECTION/ Direct response

304-1 Centres located in or near protected areas or areas of high biodiversity value 4.8 Protection of biodiversity

304-2 Significant impacts of activities, products and services on biodiversity 4.8 Protection of biodiversity

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304-3 Protected or 4.8 Protection of biodiversity: Not located in protected restored habitats species areas.

304-4 Species found in areas affected by operations 4.8 Protection of biodiversity: Not located in protected species areas.

305 Emissions

INDICATOR SECTION/ Direct response

305-1 Direct GHG 4.7 Pollution Prevention: Energy, Emissions and emissions Climate Change

305-2 Indirect GHG 4.7 Pollution Prevention: Energy, Emissions and emissions from power Climate Change generation

305-3 Other indirect GHG Not available emissions

305-4 GHG emission 4.7 Pollution Prevention: Energy, Emissions and intensity Climate Change

305-5 Reduction of GHG 4.7 Pollution Prevention: Energy, Emissions and Climate emissions Change

305-6 Emissions of ozone-depleting No emissions related to these substances substances (ODS)

305-7 Nitrogen oxides (NOX), sulphur oxides 4.7 Pollution Prevention: Energy, Emissions and (SOX) and other Climate Change significant air emissions

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306 Effluents and waste

INDICATOR SECTION/ Direct response

306-2 Waste by type and 4.5 Circular economy and waste management disposal method

4.7 Pollution Prevention: Energy, Emissions and 306-3 Significant spills Climate Change

306-4 Transport of 4.5 Circular economy and waste management hazardous waste

307 Environmental compliance

INDICATOR SECTION/ Direct response

No breaches of the applicable environmental legislation and 307-1 Non-compliance regulations have been recorded, and the company has with environmental laws complied with all the requirements included in the and regulations Integrated Environmental Authorisation in force for the complex located in the El Serrallo Industrial Estate

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308 Environmental assessment of suppliers

INDICATOR SECTION/ Direct response

In application of the management system procedures in 308-1 New suppliers that force, certified according to ISO9001 and ISO14001, all have passed assessment suppliers identified as relevant or critical are assessed, and selection filters taking into account criteria included in the following according to categories for the analysis : Quality, Corporate Social environmental criteria Responsibility, Health and Safety and the Environment.

In application of the management system procedures in 308-2 Negative force, certified according to ISO9001 and ISO14001, all environmental impacts in suppliers identified as relevant or critical are assessed, the supply chain and taking into account criteria included in the following measures taken categories for the analysis : Quality, Corporate Social Responsibility, Health and Safety and the Environment.

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SOCIAL 400 401 Employment

INDICATOR SECTION/ Direct response

401-1 New recruitment 5.2 Description of the group/ New recruits and staff rotation

401-2 Benefits for full- time employees not given 5.7 Support schemes : to part-time or temporary employees

5.2 Description of the group/ Reconciliation between 401-3 Parental leave personal life and professional development.

402 Worker-employer relations

INDICATOR SECTION/ Direct response

402-1 Minimum notice 5.2 Group description/Promotion and professional periods for operational development changes

403 occupational health and safety (v_2018)

INDICATOR SECTION/ Direct response

403-1 Occupational 2.6 Health and Safety health and safety 5.6 Occupational health and safety management system

403-2 Hazard identification, risk 2.6 Health and Safety/ Safety Manual assessment and incident investigation

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403-3 Occupational 2.6 Health and safety/ Own prevention service health services

403-4 Workers' participation, consultation 2.6 Health and Safety/Staff engagement and and communication on consultation process occupational health and safety

403-5 Occupational health and safety training 5.6 Occupational health and safety/ Shift production staff for workers

403-6 Promoting workers' 2.6 Health and safety/ Promoting staff health health

403-7 Prevention and mitigation of impacts on 5.6 Occupational health and safety workers' health and safety

403-8 Workers covered by an occupational health 5.2 Group description/ External staff and safety management system

5.6 Occupational health and safety/ Occupational 403-9 Occupational injury accidents and diseases

5.6 Occupational health and safety/ Occupational 403-10 Occupational accidents and diseases: illnesses and diseases

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404 Training and education

INDICATOR SECTION/ Direct response

404-1 Average hours of training per year per 5.4 Training employee

404-2 Employee skill enhancement and 5.4 Training transition assistance programmes

404-3 Percentage of employees receiving regular performance and 5.2 Group description/ Periodic performance evaluations career development reviews

405 Diversity and equal opportunities

INDICATOR SECTION/ Direct response

405-1 Diversity in 2.2 Organisation and structure/ Organisational structure governing bodies and 5.2 Description of the group employees

405-2 Ratio of basic salary and remuneration 5.5 Salaries of women to men

406 Non-discrimination

INDICATOR SECTION/ Direct response

406-1 Cases of discrimination and There have been no cases in 2019. remedial action taken

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407 Freedom of association and collective bargaining

INDICATOR SECTION/ Direct response

407-1 Operations and suppliers whose right to This does not apply since Spain's provisions as a freedom of association member of the EU in the field of employment are in and collective bargaining force. may be at risk

.408 Child labour

INDICATOR SECTION/ Direct response

408-1 Operations and This does not apply since Spain's provisions as a suppliers with significant member of the EU in the field of employment are in risk of child labour force.

409 Forced or compulsory labour

INDICATOR SECTION/ Direct response

409-1 Operations and This does not apply since Spain's provisions as a suppliers with significant member of the EU in the field of employment are in risk of forced or force. compulsory labour

410 Security Practices

INDICATOR SECTION/ Direct response

410-1 Security personnel trained in human rights 3.7 Respect for human rights policies or procedures

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411 Rights of indigenous peoples

INDICATOR SECTION/ Direct response

411-1 Cases of violations This does not apply since Spain's provisions as a of the rights of indigenous member of the EU in the field of employment are in peoples force.

412 Human rights assessment

INDICATOR SECTION/ Direct response

412-1 Operations subject This does not apply since Spain's provisions as a to human rights reviews member of the EU in the field of employment are in or impact assessments force.

412-2 Employee training on human rights policies 3.7 Respect for human rights or procedures

412-3 Significant investment agreements and contracts with human 3.7 Respect for human rights rights clauses or subject to human rights assessment

413 Local communities

INDICATOR SECTION/ Direct response

413-1 Operations with local community participation, impact assessments and 7.2 Community development programmes

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413-2 Operations with significant negative impacts - actual and potential - on local 7.2 Community communities

414 Social assessment of suppliers

INDICATOR SECTION/ Direct response

414-1 New suppliers that have passed selection 6.3 Suppliers filters according to social criteria

414-2 Negative social impacts on the supply 6.3 Suppliers chain and measures taken

415 Public policy

INDICATOR SECTION/ Direct response

7.2 Community: 415-1 Contributions to It is important to emphasise that the company's principle parties and/or political is not to make any contribution to political parties or representatives representatives.

416 Customer Health and Safety

SECTION/ Direct response INDICATOR

416-1 Assessment of health and safety impacts 6.2 Customers of product or service categories

147

416-2 Cases of non- compliance relating to the health and safety impacts 6.2 Customers of product and service categories

417 Marketing and labelling

SECTION/ Direct response INDICATOR

417-1 Requirements for information and labelling 6.4 Marketing and labelling of products and services

417-2 Cases of non- No breaches of applicable regulations or standards relating compliance related to to marketing communications, advertising, promotion or product and service sponsorship were recorded during the 2019 financial year. information and labelling

417-3 Cases of non- No breaches of applicable regulations or standards relating compliance related to to marketing communications, advertising, promotion or marketing sponsorship were recorded during the 2019 financial year. communications

418 Customer Privacy

INDICATOR SECTION/ Direct response

418-1 Substantiated claims regarding violations 6.2 Customers of customer privacy and loss of customer data

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419 Socio-economic compliance

INDICATOR SECTION/ Direct response

419-1 Non-compliance 3.3 Code of Ethics and Conduct: with laws and regulations No express breaches of social or economic legislation (in in social and economic commercial and tax fields) were recorded in 2019. fields

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Annex 3: Equivalences of the UCE-REPOL professional groups

INDUSTRY PROFESSIONAL GROUP PROFESSIONAL GROUP CHEMICAL UCE

Group 0 Levels 7 and 0

Group 1 Level 1

Group 2

Group 3 Level 2

Group 4

Group 5 Level 3

Group 6 Level 4

Group 7 Level 5

Group 8 Level 6

150

Annex Verification statement (Lloyd’s Register Quality Assurance España S.L.U.)

151

152

153

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