DECLARATION OF NON-FINANCIAL PERFORMANCE SUPPLIES AND EQUIPMENT FOR INDUSTRY AND THE CONSTRUCTION SECTOR
Alongside the men and women who have been its driving force for over 240 years, DESCOURS & CABAUD has built up a long-standing leadership position in the distribution of products and services for professionals in industry, construction and the water and landscape businesses. The Group develops its business based on the values of trust, fairness and ethics. DESCOURS & CABAUD strives to make its CSR (Corporate Social Responsibility) policy a reality on a daily basis. Its ambition is formalized in the Positive Program, created in 2013, which sets out a dedicated annual roadmap. Its CSR policy details the priorities and commitments to create value for all its stakeholders – shareholders, employees, customers and suppliers – and to leverage everyone’s skills. A leader and a diversified expert, DESCOURS & CABAUD is now at a crossroads, supporting the CSR performance required by the markets and helping to meet the major challenges of adapting to environmental issues. This 2024 edition of the Declaration of Non-Financial Performance provides an insight into the projects and initiatives implemented by the Group in support of sustainable development. It covers the social, environmental, societal and economic aspects of CSR, as well as issues surrounding governance and risk prevention. With its focus on performance, customer satisfaction and loyalty, DESCOURS & CABAUD has many assets that enable it to stand out from the competition and win new market share, while making an active contribution to building a more sustainable future. 3 FOREWORD
4 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD
CONTENTS 5 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD THE DESCOURS & CABAUD GROUP History p. 06 Key figures p. 07 Governance p. 07 COMPLIANCE Compromise of information p. 28 Compliance with the General Data Protection Regulation (GDPR) p. 30 The risk of corruption p. 32 Due diligence p. 34 HUMAN CAPITAL Our social policy p. 36 Talent development and management p. 38 The employer brand p. 40 Succession plans for key positions p. 42 Employee safety p. 44 Turnover p. 46 ENVIRONMENT Environmental policy p. 48 Carbon transition plan p. 50 Transport p. 51 Logistical organization p. 53 OUR VALUES p. 18 Our CSR APPROACH p. 19 Sustainable development goals p. 20 Taking our CSR contribution to the next level: sponsoring initiatives p. 22 Our value creation model p. 24 Driving value through our organizational culture and Group values p. 26 1 5 6 7 4 THE BUSINESS MODEL Our distribution sector p. 08 Our commercial offering p. 08 Process flows p. 12 Our resources p. 14 2 METHODOLOGY FOR DRAFTING THE DNFP p. 16 3 Summary table of DNFP indicators p. 56 Conclusion and prospects p. 61
6 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD 1782 1861 1961 1979 1997 2005 2006 2010 2012 2014 2016 2020 2024 Establishment of an iron business in Lyon International development • Argentina • Indochina • Madagascar • North Africa • French West Africa DIVERSIFICATION OF THE PRODUCT OFFERING AND DEVELOPMENT IN EUROPE AND IN NORTH AMERICA 50 outlets 180 outlets 335 outlets 500 outlets 739 outlets DESCOURS & CABAUD was founded in Lyon in 1782. The Group started out by trading in steel products before branching out, diversifying its activities and expanding geographically. Over the years, it has carved a commanding position as a leading distributor of professional supplies to the industrial, construction, water and landscaping sectors. As the leading player in France and a major force in Europe with active operations also in North America, our Group is recognized for its ability to build lasting partnerships with its trade customers by helping them achieve continual gains in productivity, performance and innovation. The independent, family-owned DESCOURS & CABAUD Group is imbued by the winning spirit of its founders, passed down from generation to generation. This entrepreneurial vision has shaped its history and continues to guide the company, which is firmly of the view that there can be no value creation without entrepreneurial freedom. Since the beginning, it is this entrepreneurial freedom that has allowed the Group to anticipate major changes in the market, adapt accordingly and offer its customers the solutions of tomorrow. THE DESCOURS & CABAUD GROUP HISTORY
7 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD DESCOURS & CABAUD SA has a governance structure based on a Board of Directors and on a two-person team comprising a Chairman and Chief Executive Officer and a Managing Director. The Chairman and Chief Executive Officer is responsible for the day-to-day running and oversight of the business, while maintaining direct and permanent ties with the Group's shareholders. The Managing Director is involved in the operational side of the business. THE DESCOURS & CABAUD GROUP KEY FIGURES THE DESCOURS & CABAUD GROUP GOVERNANCE 421 51 56 42 10 5 28 6 7 5 8 46 54 €4.7 BN in turnover including €3bn in France 14, 862 employees worldwide 450,000 customers Approx. 739 Over 1 million product references outlets 739 OUTLETS IN EUROPE AND NORTH AMERICA
8 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD DESCOURS & CABAUD has forged its reputation as a multispecialist partner and a distributor of high value-added products and services designed to raise the performance bar for professionals in the industrial, construction, water and landscaping sectors. The relationship that we have built with our customers over a period of more than two centuries is based on five commitments that not only drive our performance, but also earn the enduring trust of the professionals we are focused on supporting: • The physical and geographic proximity of our sales teams; • The competitiveness and the breadth of the offer thanks to our purchasing power; • Product availability reinforced by a powerful logistical organization; • The technical excellence of our experts; • The development of high-performance solutions and solutions that facilitate and simplify the operational activities of our trade customers. PRODUCTS We select renowned suppliers both in France and abroad, with the aim of making their products available to our customers. The breadth of our product offering is a major asset in meeting all customer requirements, whether they are routine or specific. We therefore offer over a million product references from well-known suppliers. We also offer product ranges from our private labels: • OPSIAL, for personal protective equipment (PPE); • FLOWDIANS, for specialist solutions in the water industry; • XHANDER, for construction professionals. Solutions to support sustainable development initiatives We also provide our customers with solutions to support their sustainable development initiatives, and the DESCOURS & CABAUD teams are on hand to provide assistance with the resulting changes. The Group's broad range of products and services features solutions for improved sustainable performance. HYDRALIANS, the brand that specializes in distributing watering and irrigation products, proposes solutions designed to reduce water use. DEXIS supports its customers with optimization solutions to boost the energy efficiency of transmission systems. Steel, a major product in PROLIANS' business, is infinitely recyclable and new “green” ranges are now being added to the brand's offering. In 2024, with its OPSIAL private label, the Group continued developing a range of products (gloves, safety footwear, eyewear, masks, jackets and trousers) designed using recycled materials under the “GREENER TOGETHER” label and commissioned several Life Cycle Assessments (LCAs) by specialized firms to better understand the potential levers for reducing THE BUSINESS MODEL OUR DISTRIBUTION SECTOR THE BUSINESS MODEL OUR COMMERCIAL OFFERING 12% 9% 21% 9% 5% 5% 14% 25% Steel products Special products for the building trade Building and Tooling supplies Industry Air conditioning – Sanitation Construction – Water sectors Building hardware Personal protective equipment (PPE) Breakdown in turnover by activity
9 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD the environmental impact of its product ranges. This approach was complemented by a pilot project on social and environmental traceability across the value chain. We advise our customers on the choice and use of products, and inform them about innovations and new products from our suppliers. We also offer various services and performance solutions that facilitate and simplify the operational activities of our customers. Prime examples include: • Logistics services, such as Click & Collect or Vending Machines; • Personal protective equipment services, such as maintenance for category III PPE (protection against risks that may cause irreversible health damage or death) and bespoke clothing; • Technical services: the DEXIS brand offers a predictive maintenance service, which can detect faults in industrial equipment before a breakdown occurs. PROLIANS is rolling out myR’éco: a selection of refurbished professional equipment, available exclusively on prolians.fr. Similarly, HYDRALIANS boasts an extensive selection of services, such as “Hydratest” for assessing pool water quality so that the appropriate treatments can be identified; • Financing services, such as lease with purchase option. Finally, around the world, the Group’s brands provide repair services for equipment and portable power tools, both in-store and directly on customer sites. This covers items such as power tools, welding machines, compressors, pressure washers, dust or fume extractors, generators and machine tools. To support its customers in making sustainable purchasing choices, the Group has developed a method to qualify, identify and promote products whose manufacturers are committed to environmentally responsible practices and to ethical, fair and respectful working conditions. This initiative is called the 'Responsible Selection' and addresses several issues: • Ensuring oversight of social performance and working conditions at every stage of the product’s manufacturing process; • Ensuring oversight of the environmental impacts associated with the manufacturing process; • Supporting local employment and industry by promoting production in France or Europe. Five key criteria are currently used to qualify products for “Responsible Selection”, with at least two of the following criteria required for eligibility: 1. Use of “responsible” raw materials (recycled materials or those derived from organic farming); 2. Implementation of responsible manufacturing practices, validated by third parties, either through environmental performance certifications of the production site (e.g. ISO 14001, ISO 50001), or through certifications and labels ensuring decent working conditions (e.g. respect for workers’ rights, safe and fair labor practices, prohibition of child or forced labor); 3. The product’s ability to generate less waste, particularly its ease of disassembly for recycling; 4. Extended product durability (ease of repair and availability of spare parts, lifetime warranties, or at least two-year warranties for powered products); 5. The geographical location of production (France or the European Union). Refurbished products can also be classified “Responsible Selection”.
10 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD As an expert in every branch of industry, DEXIS helps its customers grow and perform thanks to an end-to-end range of industrial maintenance solutions - including mechatronics, machining and PPE. PROLIANS is an expert in all areas of construction that supports over 200 trades in the sector every day by offering the most comprehensive range of supplies on the market, backed by a wide array of services that make professionals’ work easier and more efficient. IN EUROPE, DISTRIBUTION IS ORGANIZED AROUND THREE TRADING BRANDS SCALED TO THE INTERNATIONAL MARKET: Tooling Hardware Consumables Screw fixings Plumbing - Domestic heating Worksite equipment Workshop equipment PPE Steel Public works products External works Mechanical transmission Pneumatic transmission Automated systems Waterproofing Hydraulics Miscellaneous maintenance products All fluids Respiratory protection PPE Fall protection Safety footwear Machining THE PARTNER OF INDUSTRIAL SECTORS THE PARTNER OF CONSTRUCTION SECTORS
11 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD As a specialist in the water and landscaping sectors, HYDRALIANS offers its professional customers the most extensive range of specialist products on the market, along with high value-added services and personalized support for their projects. Watering Swimming pools Pumping Fountains Lighting Irrigation Water treatment Air conditioning THE PARTNER OF WATER AND LANDSCAPE PROFESSIONALS
12 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD HEAD OFFICE (Lyon) 328 OUTLETS IN EUROPE INCLUDING 258 IN FRANCE 223 OUTLETS IN EUROPE INCLUDING 82 IN FRANCE 79 OUTLETS INCLUDING 6 IN PORTUGAL HEAD OFFICE OUR SUPPLIERS ORDERS for mainly steel products 100 outlets in North America 8 specialized companies MANUFACTURERS THE BUSINESS MODEL PROCESS FLOWS
13 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD GENERAL BUILDING AND PUBLIC WORKS COMPANIES WATER AND LANDSCAPING 12 LOGISTICS PLATFORMS Transport and logistics Deliveries to outlets and customers PURCHASING, NEGOTIATION REFERENCING CENTRAL AND SUPPORT SERVICES FOR CREATION OF THE OFFER OUR CUSTOMERS Lighting Irrigation Swimming pools Pumping Public works products Steel Plumbing - Domestic heating PPE Hardware - Screws Hydraulics Mechanical transmission Machining Automated systems INDUSTRIES LOCAL AUTHORITIES Flow of orders Telephone Products delivered Store purchases Services Reusable transport equipment (pallets, containers, etc.) After-sales service Internet Sales force Flow of goods LOGISTICS
14 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD TEAMS CLOSE TO THE CUSTOMER DESCOURS & CABAUD deploys a sales force of approximately 10,000 employees who combine technical expertise with the ability to adapt to technological change. All of them are committed to meeting the diversity of customer needs, in close proximity, whether on the phone or in store. The development of their skills is ensured by continuous training, via our internal organization - Tech'up - which offers a catalogue of 170 training courses adapted to the Group's activities (sales techniques, product techniques, safety, etc.). PRODUCT AVAILABILITY We ensure that stocks are properly sized, which involves a strict management policy for our supplies and deliveries. The challenge is to maximize product availability. In addition to the inventory in our sales outlets, the products of our logistics platforms can be delivered to our customers within one or two business days. A DENSE REGIONAL NETWORK With 739 outlets, DESCOURS & CABAUD has an unrivalled regional network, which is especially dense in France with 421 outlets across the country. THE BUSINESS MODEL OUR RESOURCES
15 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD A DIGITAL BASE The Group has a number of merchant websites, which in France include prolians.fr, hydralians.fr, dexis.fr and DC Clic, the e-commerce solution dedicated to Key Account customers. Dedicated teams are focused on enhancing the quantity and quality of our ranges, improving product descriptions and the look & feel of our web spaces, and creating intuitive product search tools.
16 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD METHODOLOGY FOR DRAFTING THE DNFP The Declaration of Non-Financial Performance is not only an exercise in transparency, but a tool for steering the company's strategy in the right direction. Such declarations are designed to share information about the company's social, environmental, societal and ethical performance. The DNFP shines the light on the DESCOURS & CABAUD Group's business model and provides insights into the main risks and associated KPIs. OUR RISK ANALYSIS METHODOLOGY IDENTIFY THE RISKS The Group's main divisions, owners of the risks, have been briefed to identify the risks inherent in their areas of responsibility, to assess their levels of importance and to implement action plans aimed at mitigating their effects and impacts. The risks are formalized in a matrix and contribute to the Internal Audit action plan. The Risk Committee (CORIS) coordinates the management of the risks to which the Group is exposed, by monitoring the mapping of all the potential risks involved. IDENTIFY THE KPIS FOR RISK MANAGEMENT Key performance indicators are used to monitor and manage all of the risks identified. The KPIs bring clarity and transparency to the Group's risk management strategy. PRIORITISE AND ASSESS THE EXTENT OF THE RISKS The various risks identified by the Group's divisions are rated in terms of their potential threat to the company's performance, the likelihood of their occurrence and the extent to which they are controlled. The result of the analysis can be used to calculate an overall rating of the level of residual risk for our Group, which stands at between 2 and 14. This assessment helps determine which risks are addressed in the DNPF.
17 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD TOPIC KEY PERFORMANCE INDICATOR SCOPE Compromised information Level of governance Group Level of risk control Group Level of physical and IT security Group Corruption Rate of training for the anti-corruption e-learning module Group Compliance with the General Data Protection Regulation % of requests to exercise rights processed within due time limits France % of compliance among European subsidiaries Europe Due diligence % of suppliers assessed Suppliers Asia Talent development Satisfaction rate of Tech’up trainees France Completion rate of mandatory modules France Attractiveness of the employer brand Number of followers on LinkedIn Group Rate of departure among new hires in their first year France Indeed and Glassdoor reviews France Employee safety Frequency rate Group Severity rate Group Succession for key positions % of management posts with a formal succession plan France Employee turnover Voluntary turnover rate Group Environmental impact % of Euro 5 or 6 heavy vehicles in the fleet France Trend in vehicle fuel consumption Group Operational performance of the logistics platforms Compliance with the maintenance and testing plan Group Platform availability rate Group Frequency rate Group Severity rate Group The accuracy of the information disclosed in this DNFP has been certified by an independent third-party organization (Cabinet de Saint Front) DNPF SCOPE The risks identified cover a number of cross-cutting CSR issues, such as compliance, environmental performance, social considerations and human capital. The KPIs relate to either the Group as a whole (in which case they encompass 97.46% of the Group's workforce) or at least France (equivalent to 59.02% of the Group's total workforce). The environmental indicators cover 95.60% of the Group's workforce. For waste-related indicators alone, the employee coverage rate is 90.21%. The employee base used for the calculations is 14,825, representing the Group’s workforce as of December 31, excluding entities acquired or sold in 2024.
18 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD OUR VALUES Since its origin, DESCOURS & CABAUD has been driven by strong human values and by the entrepreneurial spirit of its founders. Given its history, its external growth strategy and its desire to remain close to its customers, the Group is characterized by a resolutely decentralized organizational structure. Each subsidiary has significant autonomy. This entrepreneurial freedom is nevertheless exercised in a spirit of unity, respecting the Group's processes and strategy, as well as our three fundamental values: unity, transparency and daring. UNITY The complex and competitive environment in which we operate requires strong cohesion and unfailing team spirit to serve our customers' needs. This cohesion is underpinned by a shared ambition, continuous collaboration between our teams, respect for decisions and commitments, and solidarity AUDACITY We give every opportunity to men and women who dare question themselves, and encourage them to take the initiative and experiment, while accepting the right to make mistakes, which is inherent to any action. TRANSPARENCY Transparency regarding our aims and roadmap, transparency in our activities and results.
19 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD OUR VALUES OUR CSR APPROACH VISION AND COMMITMENT DESCOURS & CABAUD's CSR policy opens opportunities for its partners and stakeholders to improve their social and environmental performance. The Group’s commitments are aligned with the standards set forth in the fundamental conventions of the International Labor Organization (ILO), the Universal Declaration of Human Rights, and the principles implemented by the UN Global Compact. Descours & Cabaud has committed to: • Respecting individual liberties (i.e., freedom of move- ment, freedom of thought and creed, and right of ownership); • The right to freedom of association and the right to collective bargaining; • Banning all forms of forced labor; • Abolishing child labor; • Respecting everyone’s right of protection from harassment and discrimination; • Occupational health and safety prevention; • Complying with the code of ethics on anti-corruption, anti-trust and conflict of interest; • Refusing to directly or indirectly provide supplies to conflict zones or to financially profit from intensive or unfair exploitation of natural resources that local communities rely on for their survival or way of life; • Complying with the precautionary principle on protecting the environment and natural spaces. A PROGRAM TO CONVEY THE GROUP'S GOALS Launched in 2013, DESCOURS & CABAUD's CSR approach was intensified in 2023 around the Positive Program, which sets out objectives associated with a wide-ranging action plan for sustainable performance. The Positive Program: • Incorporates the Group’s key CSR ambitions. It consolidates international performance and, as such, establishes a common framework for the Group’s subsidiaries; • Sets the objectives and strategic direction of DESCOURS & CABAUD’s CSR policy and a cross-functional roadmap, developed in partnership between the CSR Department and the Group’s main departments; • Addresses the topics identified as most important by the CSR and Business Departments. The Positive Program is built around four key areas: • Acting as a responsible employer; • Being our customers’ CSR partner; • Controlling the environmental impact of our business; • Having committed governance, anchored in strong business ethics that cut across our actions and our value chain. CSR governance is overseen by the Group's Board of Directors, its CSR Department and by local representatives in subsidiaries, particularly internationally. The company owes its overall CSR performance to its governance and contributions from the local community, individuals and groups. This motivates all involved to reflect the Group's commitment in their professional conduct.
20 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD OUR VALUES SUSTAINABLE DEVELOPMENT GOALS (SDGS) EMPLOYEES Acting as a responsible employer: • strengthen the safety culture of our employees and their managers; SDGs 3 and 8 • Support the professional development of our employees; SDG 4 • Ensure equal treatment in our employment practices; SDGs 5 and 10 • Enrich the CSR knowledge of our employees, particularly in terms of their professions; SDGs 4 and 17 • Strive to improve the employee experience. SDG 3 CUSTOMERS Being our customers’ CSR partner: • Offer our customers “CSR efficient” services, solutions, innovations and products; SDGs 6, 9, 11 and 12 • Make sustainability (eco-design, use, repairability, recyclability) a driver for differentiation and performance in our business relations; SDGs 12 and 17 • W ork towards a responsible supply chain, extend the scope of our commitments to our suppliers; SDGs 1, 8, 9, 10 and 12 • Maintain and expand a regional network of operations to benefit local customer relations; SDGs 8 and 12 • Pursue the commitment of our Group private labels to an ongoing process of improving their CSR performance and offerings; SDGs 1, 8, 9, 12, 13, 15 and 17 • Propose innovations or engineering solutions to improve efficiency in water or energy management. SDGs 6, 9, 12 and 13
21 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD ENVIRONMENT Controlling the environmental impact of our business: • Fight climate change, keep our carbon footprint in check, and work toward the “carbon neutral by 2050” goal; SDG 13 • Act to limit the Group's environmental and ecological impact; SDGs 12, 13 and 15 • Develop eco-designed ranges for our Group private labels; SDGs 12, 13 and 15 • Better understand and measure our impact on the environment. SDGs 12, 13 and 15 GOVERNANCE AND VALUE CHAIN Having committed governance: • Make CSR and sustainable development an integral part of the Group's strategy; SDG 17 • Instill business ethics as a fundamental value of our practices; SDG 16 • Be diligent in promoting respect for fundamental human rights in our activities and partnerships; SDGs 1, 3, 5, 8 and 10 • Ensure responsible marketing practices. SDG 12 Taking action at every stage of the value chain: • Work toward social and environmental efficiencies that benefit our upstream and downstream value chain; SDGs 8, 10 and 17 • Contribute to the economic fabric and employment; SDGs 8 and 11 • Support initiatives in the fields of training, culture, social inclusion, the economy and health, in particular through sponsorship; SDG 17 • Promote and stimulate responsible consumption; SDGs 12 and 17 • Develop our interactions with the circular economy. SDGs 8 and 12
22 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD OUR VALUES TAKING OUR CSR CONTRIBUTION TO THE NEXT LEVEL: SPONSORING INITIATIVES On account of its strong roots in Lyon, DESCOURS & CABAUD has a long-standing commitment to major local associations and foundations that share its values of excellence and quality. Guided by its humanist convictions, it supports many projects in different fields, from health to education and culture. CULTURE SUPPORT FOR THE POLICY OF ACQUIRING WORKS OF ART The Museum of Fine Arts of Lyon is renowned Europe-wide for its exceptional collections – which extend from antiquity to the present day – its major exhibitions organized in partnership with museums around the world. DESCOURS & CABAUD is one of 11 corporate patrons that founded the Musée Saint-Pierre Club in 2009, with the aim of supporting the museum’s acquisition policy. The Club was one of a number of contributors who helped to bring a dozen works by Pierre Soulages, Jean-Honoré Fragonard, Nicolas Poussin and Henri Matisse into the collections. HEALTH PERSONALISATION OF HOSPITAL CARE Recognized as an association in the public interest, the Fondation des Hospices Civils de Lyon funds multiple initiatives to promote more personalized hospital care, as well as research programs. In particular, it aims to improve the reception and comfort of patients at the second largest hospital center in France. DESCOURS & CABAUD has provided financial support to the foundation since its creation in 2013. Recent projects include research into cell and gene therapy as a new treatment option for patients suffering from incurable diseases involving the immune system.
23 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD EDUCATION SUPPORT FOR TRANSFORMING SOCIETY Lyon Catholic University is a multidisciplinary institution offering more than 130 courses combining respect for humanist values and openness to society. Incorporated as an association, it receives financial sponsorship from around twenty leading local companies, including DESCOURS & CABAUD. Today, sponsorship of the Catholic University mainly consists of financing grants for students on modest incomes. PROMOTION OF EQUAL OPPORTUNITIES IN UNDERPRIVILEGED NEIGHBOURHOODS Based in Lyon, Sport dans la Ville is France’s leading association for social integration through sport. It helps young people in underprivileged neighborhoods find a career by promoting key values through sport and offering personalized support (careers guidance, entrepreneurship, etc.). DESCOURS & CABAUD committed to supporting the association’s actions in 2012. Since 2021, head office employees have been presenting their jobs during discovery workshops and have mentored young people in professional integration programs, while others have taken part in the Jogg charity race in the city or the intercompany football tournaments. SOCIAL ECONOMY BOOST THE EXPANSION OF AN ECONOMIC LANDSCAPE BASED ON SOLIDARITY AND SUSTAINABILITY Backed by a community of 49 Lyon-based companies, the Émergences Foundation supports entrepreneurial project leaders who foster social connection and job creation. The field of action is wide: mutual aid and solidarity, education and professional integration, environmental transition, health and disability. Through volunteering by leadership and employees, its role is to help entrepreneurs put their decisions into perspective. The projects supported boast a 92% sustainability rate after three years. DESCOURS & CABAUD has been delivering financial support to the foundation since 2015. SOCIETAL COMMITMENTS IN SUPPORT OF SUSTAINABLE DEVELOPMENT Several indicators are considered irrelevant given the nature of DESCOURS & CABAUD’s activity, such as animal welfare and responsible, fair and sustainable food practices. The same applies to combating food insecurity and food waste. These areas are not directly related to our business and, furthermore, fewer than 3% of our sites are affected by collective catering services. The catering provider for the relevant sites applies a policy aligned with these concerns. • Sports activities DESCOURS & CABAUD is committed to promoting physical and sports activities through various initiatives. For example, under the company banner, voluntary employees take part in sporting events such as Run in Lyon, Pink October, cycle races and soccer tournaments organized by the Sport dans la Ville association. Many of our operating sites offer shower facilities, as well as facilities for parking bicycles, scooters and other forms of sustainable mobility. • Actions to support national defense relations For employees who serve as reservists, DESCOURS & CABAUD authorizes absences related to duties or training within the military operational reserve or the national police reserve, in accordance with the Labor Code.
24 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD OUR VALUES OUR VALUE CREATION MODEL Creating durable value for all our stakeholders is the bedrock of our corporate culture. SUPPLIERS DESCOURS & CABAUD handles the retail distribution of over 1,100 leading suppliers to a wide range of pro- fessionals. The Group thereby participates in their economic development. CUSTOMERS DESCOURS & CABAUD helps its 450,000 customers address their operating, sustainable growth and performance challenges. Thanks to the selection of recognized brands and suppliers, the Group provides the most comprehensive offering in the market. Our logistics organization ensures optimal delivery of products to customers or directly to their worksites. Customers benefit from competitive pricing thanks to the Group's buying power. The expertise of our workforce, in the stores or directly with our customers on their sites, plays an instrumental role in guiding our customers' purchasing decisions towards the products or services offering the best fit for their needs.
25 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD JOBS DESCOURS & CABAUD is helping grow the economy by providing NEARLY 15,000 direct jobs in France, Europe and North America, as well as offering Group employees a wealth of career prospects. PATRONAGE On account of its long-established roots in Lyon, the Group has a long-standing commitment to major local associations and foundations that share its values of excellence and quality. Guided by its humanist convictions, DESCOURS & CABAUD supports many projects in different fields, from health to education and culture (see pages 22 and 23). SHAREHOLDERS DESCOURS & CABAUD, a family business since its very beginnings, is committed to the long-term growth and development of the company. Its steady and constant track record yields profits for its shareholders, guaranteeing its financial independence and the financing of its investments.
26 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD Our value creation drivers OUR SECTOR OUR RESOURCES AN ACTIVE AND APPROPRIATE SOLUTION FOR OUR CUSTOMERS IN STORE, ON THE TELEPHONE, ON THE WEB AND IN THE FIELD Distribution is organized around three European trading brands: DEXIS, PROLIANS and HYDRALIANS. The Group also has two sales networks in North America. Professional distribution serving manufacturers, tradespeople, local authorities, etc. With: • The most renowned suppliers (recognized brands) • Quality products • Available stock • Fulfillment of our commitments • Advice and technological intelligence • 10,000 employees working in the salesforce • A dense regional network comprising 739 outlets • A supply chain fit for purpose We create value for our stakeholders • A stable and sustainable partnership • A local network and a close-knit relationship • A productivity plan • Our solid credit rating • A partnership conducive to their turnover • Resilience and ability to overcome crises • A long-term future • Recurring results • Asset growth We provide our customers with: We provide our suppliers with: As a Group, we provide our shareholders with: OUR VALUES DRIVING VALUE THROUGH OUR COMPANY CULTURE AND GROUP VALUES • Tech’up, an in-house training organization • A safe environment safeguarding personal integrity
27 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD OUR COMMERCIAL OFFERING OUR COMMERCIAL OFFERING • An offer of more than one million product references • Eco-friendly ranges. • Steel products • Public works products • Industrial maintenance • Metal removal • Tooling • Nuts, bolts and screws • Building hardware • Sanitation, Heating & Plumbing • Industrial supplies • Water sector • PPE Product categories Innovation • Offer innovative services • Select new products • Digitize our approach External growth • Consolidate our lead • New geographical areas Organic growth • Broaden the offering • Develop business assets Talent development • Identify, attract and partner talent • Embody our values day after day • Support the growth and development of our employees • Develop the company's growth and long-term prospects • Approx. 15,000 direct and local jobs • Sponsorship policy and initiatives • Strong regional presence • Create opportunities for career development as well as internal mobility and promotion • Maintain and develop employment in their local area • Promote entrepreneurial “freedom” in their duties For our Group, we endeavor to: For civil society, we provide: For our employees, we strive to:
28 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD RISKS AND CONSEQUENCES Effective control of data and information is critical to the operations of the DESCOURS & CABAUD Group. As part of its information security strategy, the Group deploys robust organizational and technical measures to safeguard against internal or external threats and prevent any loss or compromise of information that could jeopardize its business. MEANS OF CONTROL The means deployed consist in harmonizing, all the more within a context of external growth, the security of information practices for the French and international subsidiaries of DESCOURS & CABAUD. The information security strategy is implemented through protection programs approved by the Group’s Executive Management and carried out in collaboration with IT teams across all international subsidiaries. COMPLIANCE COMPROMISED INFORMATION
29 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD KEY INDICATORS Our key indicators, which cover several information security themes, provide visibility on governance, risk control and information systems security actions. The harmonization programs created in 2023 AND 2024 have helped us to exceed our goals with indicators above 75% coverage in relation to the benchmark references generally accepted in this domain, and to keep them stable thereafter. Level of governance • Governance and management of security of information • Formal definition of security rules and policies • Employee training program • Management of access to information systems Level of risk control • Quality of control of identified risks • Classification of information • Availability of trade applications • Contractual requirements Level of physical and IT security • Operational security of the information system (networks, infrastructure, hosting) • Securing of information • Securing of work stations • Securing of applications and e-commerce sites Target 75% Target 75% Target 75% 0% 0% 0% 10% 10% 10% 20% 20% 20% 30% 30% 30% 40% 40% 40% 50% 50% 50% 60% 60% 60% 80% 80% 80% 70% 70% 70% 90% 90% 90% 100% 100% 100% 2021 76% 2021 69% 2021 76% 2022 77% 2022 68% 2022 76% 2023 86% 2024 90% 2023 78% 2024 84% 2023 88% 2024 91%
30 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD RISKS AND CONSEQUENCES The risks of non-compliance with Europe's General Data Protection Regulation (GDPR) include administrative or financial penalties (up to €20 million or 4% of Group turnover), as well as a deterioration in brand image that could lead to a loss of trust that is detrimental to our business. MEANS OF CONTROL The role of the Data Protection Officer (DPO) is to monitor the continued compliance with the GDPR, in particular for all new projects and acquisitions in Europe. In the event of an acquisition, the subsidiary is monitored and, if necessary, supported in order to maintain or implement compliance with the GDPR. COMPLIANCE COMPLIANCE WITH THE GENERAL DATA PROTECTION REGULATION (GDPR)
31 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD % of requests to exercise rights fulfilled within specified times (France) % compliance of European subsidiaries (companies acquired more than six months previously) Target 100% Target 100% 0% 0% 10% 10% 20% 20% 30% 30% 40% 40% 50% 50% 60% 60% 80% 80% 70% 70% 90% 90% 100% 100% 2021 2021 100% 98% 2022 100% 2022 100% 2023 100% 2024 96.8% 2023 100% 2024 100% KEY INDICATORS In terms of GDPR, we aim to process 100% of individuals’ requests regarding rights within the time limit and to achieve 100% compliance within six months of an acquisition.
32 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD RISKS AND CONSEQUENCES The Sapin 2 Law sets the main objectives which consist in “reinforcing the transparency of public decisiontaking procedures, better preventing corruption and punishing it as quickly and severely as possible”; and “placing France on a par with the best international standards in the fields of transparency and of the fight against corruption.” This law includes an ambitious anticorruption mechanism and establishes new obligations for companies to prevent risks of corruption or the illegal protection of corporate self-interest. It applies to all international subsidiaries of the Group. Given its geographical reach, the Group pays constant attention to the application of this law. The risks incurred can reach €200,000 for individuals and €1m for legal entities. In addition to these financial penalties, the Group is also potentially exposed to the risk of harm to its image, whose impacts on performance may be measured in the short or medium term. MEANS OF CONTROL In its ethics charter, DESCOURS & CABAUD states the common values around which it wants to unite the actions of all its employees and the conduct that each of them must adopt with the company's customers, suppliers and partners. In addition to sharing these fundamental elements, the Group has put in place the measures required by law, including: • A corruption risk map to identify, analyze and prioritize the company's specific exposure risks. This initial map has been produced in France following interviews with managers, both in terms of actual risks encountered and in terms of potential risks; • An anti-corruption code of conduct, translated into the languages of the countries where the Group is present and given to all employees, which recalls the Group's commitment to a zero tolerance policy, presents the behaviors to be avoided and mentions the penalties in the case of violation; this code also incorporates principles for combating fraud, money laundering and discrimination; • A whistleblowing system that allows employees to report any breach or situation that is contrary to the code of conduct. It ensures the protection of whistleblowers as provided for by the Sapin 2 law. An Ethical Committee receives the alert, checks its validity, and, if appropriate, transmits it to one or more persons responsible for conducting an inquiry; • A training course for the sales force and its management. After the course was rolled out in France and then internationally in October 2021, efforts were stepped up in 2022 and 2023; • Internal and external accounting control procedures to ensure that the accounts do not hide corruption and influence peddling; • Procedures for assessing the situation of customers, primary suppliers and consultants in relation to the corruption risk map. COMPLIANCE THE RISK OF CORRUPTION
33 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD KEY INDICATOR A Risk Committee and an Ethics Committee are responsible for managing this risk and the associated issues. Our aim is to train at least 90% of the sales staff and their managers. NB: The training is considered to be “validated” on condition that a minimum rate of correct answers of 80% is obtained. If the rate of correct answers is lower, the trainee must repeat the entire course. Only employees who have completed and validated their training program are considered as trained. Between 2023 and 2024, the training rate among the targeted workforce increased by approximately 5%, reaching the target of 90%. This improvement is the result of a follow-up campaign conducted at the end of 2023 to encourage completion of the training module. Rate of training for the anti-corruption e-learning module Target 90% 0% 10% 20% 30% 40% 50% 60% 80% 70% 90% 100% 2022 89.2% 2023 85.3% 2024 90.1%
34 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD RISK FACTORS AND CONSEQUENCES The Act of 27 March 2017 on the duty of care of parent companies and ordering companies requires large companies to prevent any serious violation of human rights and fundamental freedoms, personal health and safety, and the environment. The scope of application includes not only the company's activity, but also its sphere of influence (subsidiaries, subcontractors and suppliers). A due diligence fault may be committed due to a nonexistent, incomplete or ineffective due diligence plan. If a company fails to respond to a formal notice, it may be required to comply, with a penalty payment, or incur civil liability for environmental, health or human rights damage. The company executives' criminal liability may also be incurred. Finally, the company may suffer from a tarnished image in the event of an actual disaster. COMPLIANCE DUE DILIGENCE MEANS OF CONTROL DESCOURS & CABAUD strives to work in priority with approved suppliers and service providers that respect the Group's values and commitments. Through the framework contracts put in place, suppliers undertake in particular to comply with the requirements of the Charter of CSR commitments for DESCOURS & CABAUD suppliers, which was revised in 2024. This charter sets out the minimum standards required in terms of respect for human rights, business ethics (primarily the fight against corruption) and reducing environmental impact. All the Group's employees, as well as new arrivals, benefit from a training program on the prevention of corruption risks as soon as they join the Group. In 2024, DESCOURS & CABAUD continued deploying its Sustainable Procurement roadmap, which was launched in 2019 after the Group had finished mapping its risks. This policy is focused on providing transparency throughout the supply chain through greater visibility of the social, environmental and ethical performance of its suppliers and business partners. The Procurement Division is responsible for ensuring the compliance of its listed suppliers. It is committed to implementing a process for monitoring and measuring social and environmental performance, and strives to engage product and service providers with the process. In 2022, all employees within the Procurement Division (and who had been in the company back in September 2021) received trained on the issues relating to this topic from training organization ORSYS. They have also been alerted to the actions that must be implemented through the purchasing processes. In June 2024, a dedicated event brought together all Procurement Department employees and the Group’s CSR team and served as an opportunity to reaffirm the Group’s CSR policy and roadmap, as well as the requirements calling for the commitment of approved suppliers to comply with upcoming regulations. To support the deployment of its approach among its registered suppliers, and in particular for a targeted scope of suppliers identified as representing the highest level of commitment and risk for the Group, a CSR evaluation by an independent third party (EcoVadis) is required. This system, already in place in previous years, has been maintained for 2024. The results collected form an integral part of the overall supplier assessments, which enhance the level achieved but also continual progress, encouraging suppliers to take the necessary corrective action. DESCOURS & CABAUD has been based in Shanghai for almost 20 years and has appointed a team of 25 people (DC GLOBAL SOURCING ASIA) to manage its supplier qualification policy in Asia. Their efforts have resulted in a CSR code of conduct that covers respect for human rights, business ethics and the reduction of environmental impacts. On-site audits are also carried out by a dedicated team of inspectors/auditors. The general purchasing terms include CSR-related obligations as well as the full content of the Group’s CSR Charter. More specifically, since 2022, a pre-qualification visit has been carried out upstream of the commercial relationship. This pre-audit addresses CSR compliance issues and helps to validate or reject the conduct of precontractual negotiations with the potential supplier: 100% of accounts payable opened since 2022 have been approved by this pre-qualification assessment.
35 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD At the end of this pre-qualification visit, a level of requirement is estimated and assigned to each supplier on a scale of 1 to 3, incorporating various criteria such as business volume, the industrial sector concerned or the country of production. Each level of requirement triggers its own specific controls. The supplier qualification policy therefore provides for several types of audits and controls to be carried out and followed up when business relationships are established. All the tools deployed in this respect are based on a site-by-site approach, as close as possible to the production plants, and pave the way for corrective action plans when the situation requires the support of a supplier. The rollout and renewal of audits, in line with the frequency defined by the policy, are continuing in 2025, with the aim of guiding strategic purchasing policy decisions by assigning compliance scores with the pillars of CSR, quality and reliability in business. In parallel, several initiatives were launched at the end of 2024 to update the supplier qualification policy and incorporate additional environmental and social criteria, as well as to create new reference standards where they enable a significant increase in requirements. KEY INDICATOR For 2024, the indicator covers the main suppliers based in Asia and with requirement levels 2 & 3 assigned according to DC GLOBAL SOURCING ASIA's own grid. The requirement levels vary from 1 to 3 according to the Group's level of engagement with respect to a supplier, including the volume of business done, but also taking into account the location, as well as the level of CSR maturity. Levels 2 and 3 represent the highest levels of engagement and risk for the Group. For this supplier segment, the target is to carry out a 100% evaluation of each production site involved in a business relationship monitored by DC GLOBAL SOURCING ASIA. In 2024, achievement of this target stood at 98.9%, with the shortfall due to the integration of a new production site belonging to an approved supplier that had already been audited at its other locations. % of Asian suppliers assessed (requirement level 2 and 3) Target 100% 0% 10% 20% 30% 40% 50% 60% 80% 70% 90% 100% 2022 2023 2024 92.5% 96% 98.9% QUALIFICATION OF ASIAN SUPPLIERS IN TERMS OF CSR MATURITY Identification of a potential supplier Requirement level 1 Prequalification visit by the DC GLOBAL SOURCING team Requirement level 2 DCA audit by the DC GLOBAL SOURCING team Requirement level 3 EcoVadis questionnaire + on-site HSE audit or Third-party CSR audit Pre-approval visit Supplier approved Assign a CSR control requirement level based on the: • Supplier's criticality level • DESCOURS & CABAUD Group's potential commitment to the business volume Supplier not approved Supplier not qualified Supplier qualified for the business relationship • Follow-up of action plans • Renewal audit every 1 to 3 years
36 2024 DECLARATION OF NON-FINANCIAL PERFORMANCE _ DESCOURS & CABAUD For more than 240 years, DESCOURS & CABAUD's employees have continually shaped and influenced the Group's history and legacy. The company's human capital is inextricably woven into its development and competitiveness. The Group's growth plan, which features an operational performance program to enhance the services offered to its customers, is driven by the ambition of improving its employer brand and developing a more collaborative and win-oriented organizational culture. Supported by the Human Resources Departments of the Group and its subsidiaries, DESCOURS & CABAUD's policy aims to develop the expertise of its teams, particularly through its in-house training school Tech’up, and to support career development and internal mobility projects in line with its needs and employee aspirations. At the end of 2023, an employee barometer was conducted across several countries, including Italy, the Netherlands, Germany, France, Austria, Belgium and Portugal. In 2024, the initiative was extended to Spain, Germany, Italy, the United Kingdom, Slovakia and the Czech Republic. Based on the survey results, the Group and each of its subsidiaries drew up and introduced action plans in 2024 to address areas identified by employees as opportunities for improvement. The Group’s objective is to increase employee satisfaction, strengthen engagement and loyalty, and maintain its attractiveness as an employer. DESCOURS & CABAUD is committed to offering all its employees fair compensation. Each Group entity, within its own context, ensures equitable pay for its teams and compliance with applicable laws and agreements. DESCOURS & CABAUD offers a range of benefits, including access to high-quality health and welfare coverage, aligned with local regulations. HUMAN CAPITAL OUR SOCIAL POLICY
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