TMK-ARTROM S.A. CONSOLIDATED SUSTAINABILITY REPORT 2019 CONSOLIDATED NON-FINANCIAL STATEMENT The content of this report has been drawn up in accordance with the Global Reporting Initiative (GRI) standards and should be read for a better understanding of economic, social and environmental aspects together with the annual financial reporting 2 Corporate Information TMK-ARTROM S.A. (Management Unit) Registered Office Drăgănești Str. 30, Slatina, OLT county, Romania, 230119 +40 (249) 436862, 434640, 434641 TMK-REȘIȚA S.A. Traian Lalescu Str. 36, REȘIȚA, Caras-Severin County, Romania, 320050 +40 (249) 436862, +40 (255) 211783 TMK Industrial Solutions LLC Legacy Park Office Building 10940 West Sam Houston Pkwy North Suite 325 Houston, TX 77064 USA 3 GRI Table of Contents Contents INTRODUCTION .................................................................................................................................... 11 GRI 102 GENERAL DISCLOSURES .................................................................................................... 11 102-1 Name of the organization: TMK-ARTROM S.A. ......................................................................... 11 102-2 Activities, brand, products and services: ....................................................................................... 11 102-3 Location of headquarters................................................................................................................ 14 102-4 Location of operations ................................................................................................................... 16 102- 5 Ownership and legal form ............................................................................................................. 16 102-6 Markets served ............................................................................................................................... 16 102-7 Scale of the organization ................................................................................................................ 19 102-8 Information on employees and other workers ............................................................................... 24 102-9 Supply chain................................................................................................................................... 25 102-10 Significant changes to the organization and its supply chain ...................................................... 25 102-11 Precautionary principle or approach ............................................................................................ 25 102-12 External initiatives ....................................................................................................................... 27 102-13 Membership of associations ......................................................................................................... 27 102-14 Statement from senior decision-maker ........................................................................................ 28 102-15 Key impacts, risks and opportunities ........................................................................................... 28 102-16 Values, principles, standards and norms of behavior .................................................................. 29 102–17 Mechanisms for advice and concerns about ethics ..................................................................... 31 102-18 Governance structure ................................................................................................................... 33 102-19 Delegating authority..................................................................................................................... 37 102-25 Conflicte de interes ...................................................................................................................... 37 102-40 Lista părților interesate ................................................................................................................ 37 102-41 Collective bargaining agreements ................................................................................................ 39 102-42 Identifying and selecting stakeholders ......................................................................................... 40 4 102-43 Approach to stakeholder engagement .......................................................................................... 40 102-44 Key topics and concerns raised: Customer satisfaction, performance and supplier requirements, information flow with banks, state institutions and other stakeholders. .................................................. 40 102-45 Entities included in the consolidated financial statement ............................................................ 41 102-46 Defining report content and topic Boundaries ............................................................................. 41 102-47 List of material topics .................................................................................................................. 41 102-48 Restatements of information: Not applicable .............................................................................. 42 102-49 Schimbări în raportări: Not applicable ......................................................................................... 42 102-50 Reporting period: 2019. ............................................................................................................... 42 102-51 Date of most recent report: 2018 ................................................................................................. 42 102-52 Reporting cycle: The reporting cycle is annualy. ........................................................................ 42 102-53 Contact point for questions regarding this report: .......................................................................42 102-54 Claims of reporting in accordance with the GRI standards: The report is prepared in accordance with the CORE option. ............................................................................................................................. 42 102-55 Content of GRI report (pag. 2) ..................................................................................................... 42 102-56 External assurance ....................................................................................................................... 42 103-1 Explanation of the material topic and its Boundary....................................................................... 42 103-2 The management approach and its components ........................................................................ 43 103-3 EVALUATION OF THE MANAGEMENT APPROACH .......................................................... 45 GRI 200 ECONOMIC .............................................................................................................................. 47 GRI 201 Economic performance .............................................................................................................. 47 201-1 Economic value generated and distributed .................................................................................... 47 201-2 Financial implications and other risks and opportunities due to climate change .......................... 48 201-3 Defined benefit plan obligations and other retirement plans ......................................................... 48 201-4 Financial assistance received from the Government ..................................................................... 49 GRI 202 MARKET PRESENCE .............................................................................................................. 49 5 202-1 Ratios of standard entry level wage by gender compared to local minimum wage ....................... 50 202-2 Proportion of senior management hired from the local community .............................................. 50 GRI 203 INDIRECT ECONOMIC IMPACTS ........................................................................................ 50 203-1 Infrastructure investments and services supported ........................................................................ 50 203-2 Significant indirect economic impacts ........................................................................................... 51 GRI 204 PROCUREMENT PRACTICES ............................................................................................... 51 204-1 Proportion of spending on local suppliers ..................................................................................... 51 GRI 205: ANTI-CORRUPTION .............................................................................................................. 52 205-1 Operations assessed for risks related to corruption........................................................................ 53 205-2 Communication and training about anti-corruption policies and procedures ................................ 54 205-3 Confirmed incidents of corruption and actions taken .................................................................... 54 GRI 300 ENVIRONMENT ...................................................................................................................... 54 GRI 301 – MATERIALS .......................................................................................................................... 54 301-1 Materials used ...............................................................................................................................