CDP. Module: Introduction. Page: Introduction. CDP 2017 Climate Change 2017 Information Request CC0.1

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1 CDP CDP 2017 Climate Change 2017 Information Request VESTEL BEYAZ EŞYA SANAYİ VE TİCARET A.Ş. Module: Introduction Page: Introduction CC0.1 Introduction Please give a general description and introduction to your organization. Maintaining its steady growth since its establishment in 1997,Vestel Beyaz Eşya today is a player, which leads the market with its long-term strategies and vision and as one of the largest manufacturers of white goods in both Turkey and Europe. Vestel Beyaz Eşya carries out its production activities by employing the state-ofthe- art technology in its six factories at Vestel City, which is one of the largest industrial complexes in Europe established in a single location, covering an area of 1.1 million m2 in Manisa. Vestel Beyaz Eşya manufactures refrigerators, washing machines, cooking appliances, dishwashers, air-conditioners and water heaters in an enclosed area of 312,500 m2 at Vestel City. The Company has an annual production capacity of 9.4 million units. Vestel Beyaz Eşya ranks among the Europe s top manufacturers employing the latest technology. It is one of the ten largest manufacturers of white goods in Europe and one of the top three players in Turkey, developing products by closely following the leading edge technological trends.vestel Beyaz Eşya is one of Europe s largest original design manufacturers (ODM). Vestel Beyaz Eşya s sales in Europe are carried out mainly on an ODM basis accompanied with some branded sales through the well-known regional brands owned and global brands licensed by Vestel Group. The Company pursues a growth strategy with Vestel Group s own brands in Turkey, the CIS and the MENA region. Through its strong R&D organization and competence in the development of technology, Vestel Beyaz Eşya offers a continuously expanding environmentally friendly product range, which appeals to a wide consumer base on a global scale. The Company strives to bring more comfort to millions of homes with its products. Vestel Beyaz Eşya accounts for nearly 30% of Turkey s total white goods exports. A flexible production capability coupled with a high production capacity, competence in product differentiation, logistical advantages derived from its proximity to Europe as well as to the developing MENA and CIS regions and relatively lower unit labor costs stand out as Vestel Beyaz Eşya s key competitive advantages, reinforcing the Company s market position. The logistics-distribution capabilities of Vestel Ticaret, which carries out Vestel Beyaz Eşya s sales and marketing activities, its wide network of dealers and services offered with a technological infrastructure reinforce Vestel Beyaz Eşya s strong brand image in the domestic market. After-sales services are provided by the Central Services and call center under Vestel Customer Services General Directorate and the authorized service centers. CC0.2

2 Reporting Year Please state the start and end date of the year for which you are reporting data. The current reporting year is the latest/most recent 12-month period for which data is reported. Enter the dates of this year first. We request data for more than one reporting period for some emission accounting questions. Please provide data for the three years prior to the current reporting year if you have not provided this information before, or if this is the first time you have answered a CDP information request. (This does not apply if you have been offered and selected the option of answering the shorter questionnaire). If you are going to provide additional years of data, please give the dates of those reporting periods here. Work backwards from the most recent reporting year. Please enter dates in following format: day(dd)/month(mm)/year(yyyy) (i.e. 31/01/2001). Enter Periods that will be disclosed Fri 01 Jan Sun 01 Jan 2017 CC0.3 Country list configuration Please select the countries for which you will be supplying data. If you are responding to the Electric Utilities module, this selection will be carried forward to assist you in completing your response. Turkey Select country CC0.4 Currency selection Please select the currency in which you would like to submit your response. All financial information contained in the response should be in this currency. TRY

3 CC0.6 Modules As part of the request for information on behalf of investors, companies in the electric utility sector, companies in the automobile and auto component manufacturing sector, companies in the oil and gas sector, companies in the information and communications technology sector (ICT) and companies in the food, beverage and tobacco sector (FBT) should complete supplementary questions in addition to the core questionnaire. If you are in these sector groupings, the corresponding sector modules will not appear among the options of question CC0.6 but will automatically appear in the ORS navigation bar when you save this page. If you want to query your classification, please If you have not been presented with a sector module that you consider would be appropriate for your company to answer, please select the module below in CC0.6. Further Information Attachments Change 2017/Shared Documents/Attachments/ClimateChange2017/CC0.Introduction/faaliyet-raporu-2016 (1).pdf Module: Management Page: CC1. Governance CC1.1 Where is the highest level of direct responsibility for climate change within your organization? Board or individual/sub-set of the Board or other committee appointed by the Board CC1.1a

4 Please identify the position of the individual or name of the committee with this responsibility (i) The highest level of direct responsibility for climate change and sustainability is Sustainability Committee. Vestel Beyaz Eşya belong to Zorlu Holding which is one of the biggest home appliances companies in Turkey. At the end of 2016, Zorlu Holding forms a Sustainability Committee. The leader of this committee was one of the Executive Committee Members named Cem Köksal. This shows us that how important the notion of sustainability in Zorlu Holding and its companies. There is a central department for the five factories which is called Management Systems and Customer Relationship Management that is reporting directly to the General Manager. They manage Environmental and Energy Systems of all five factories. To ensure robust activities related to climate change and other environmental topics, the General Manager has established two teams: The Environmental Management Team and The Energy Management Team. These teams are coordinated by Management Systems Manager. These teams, which share significant membership, are comprised of the company's various Production departments, Occupational Health & Safety Department, Quality Department, Planning Department and Maintenance Department. Further, these teams regularly coordinate with the company's Research & Development departments, particularly as it relates to product regulatory requirements. (ii) As an institutional structure, Mr. Cem Köksal( Executive Board Member ) reports directly to the ZORLU HOLDING CEO,Mr. Ömer Yüngül. CC1.2 Do you provide incentives for the management of climate change issues, including the attainment of targets? Yes CC1.2a Please provide further details on the incentives provided for the management of climate change issues Who is entitled to benefit from these incentives? The type of incentives Incentivized performance indicator Comment All employees Recognition Emissions reduction In our Total Productive Maintenance (TPM) System, we have committees on different

5 Who is entitled to benefit from these incentives? The type of incentives Incentivized performance indicator Comment (nonmonetary) project Emissions reduction target Energy reduction project Energy reduction target Efficiency project Efficiency target topics and one of them is Safe, Health and Environment Committee. This committee have targets and tried to improve overall environmental performance.if the targets are realized, the committee members are awarded with a plaquethe by board executive member and general manager. All employees Other nonmonetary reward Emissions reduction project Emissions reduction target Energy reduction project Energy reduction target For the project to reduce greenhouse gases, managers and staff members set their own goals and made kaizens to realize their goals. In this program, kaizens and teams are rewarded. Environment/Sustainability managers Monetary reward Emissions reduction project Emissions reduction target Efficiency project Efficiency target Environmental criteria included in purchases The Environmental Manager reviews sustainability under all headings. Energy managers Monetary reward Emissions reduction project Emissions reduction target Energy reduction project Energy reduction Energy Managers have targets included in their performance targets. Responsible for Energy Management system, incl Energy surveys, Follow up on energy use on a monthly basis, Energy saving action plan to reach energy target. They are also responsible for implementing and sharing best practices, Green Spirit info Points, Suggest & win Campaign.

6 Who is entitled to benefit from these incentives? The type of incentives Incentivized performance indicator Comment target Efficiency project Efficiency target All employees Monetary reward Emissions reduction target Energy reduction target Quantitative and qualitative assessments of GHG and energy reduction activities conducted on Kaizen Days every 3 months during the year. We assess greenhouse gas emission reduction performance. Process operation managers Monetary reward Energy reduction project Efficiency project Efficiency target Energy reduction target achievement. Key managers have energy saving targets included in their performance targets Buyers/purchasers Monetary reward Environmental criteria included in purchases Supply chain engagement Selected Purchasing Managers have objectives for recycled materials, which results in lower carbon footprint and water footprint. In addition, Purchasing Manager has Climate/energy management performance in to their individual targets. Executive officer Monetary reward Emissions reduction target Efficiency target Climate reduction and energy target achievement. Key officers have targets included in their performance targets All employees Other nonmonetary reward Emissions reduction project Energy reduction project Efficiency project Behavior change related indicator Environmental criteria included in purchases Supply chain engagement All employees can submit ideas about all environmental issues by our suggestion system. All the suggestions are scored by the Management System Department and the employees could select the special gifts by their scores.

7 Who is entitled to benefit from these incentives? The type of incentives Incentivized performance indicator Comment Further Information Attachments Change 2017/Shared Documents/Attachments/ClimateChange2017/CC1.Governance/TSE pdf Change 2017/Shared Documents/Attachments/ClimateChange2017/CC1.Governance/TSE pdf Change 2017/Shared Documents/Attachments/ClimateChange2017/CC1.Governance/TSE pdf Change 2017/Shared Documents/Attachments/ClimateChange2017/CC1.Governance/TSE pdf Change 2017/Shared Documents/Attachments/ClimateChange2017/CC1.Governance/TSE pdf Change 2017/Shared Documents/Attachments/ClimateChange2017/CC1.Governance/TSE pdf Change 2017/Shared Documents/Attachments/ClimateChange2017/CC1.Governance/TS ISO IEC pdf Change 2017/Shared Documents/Attachments/ClimateChange2017/CC1.Governance/TSE pdf Change 2017/Shared Documents/Attachments/ClimateChange2017/CC1.Governance/TSE pdf Page: CC2. Strategy CC2.1 Please select the option that best describes your risk management procedures with regard to climate change risks and opportunities Integrated into multi-disciplinary company wide risk management processes CC2.1a Please provide further details on your risk management procedures with regard to climate change risks and opportunities

8 Frequency of monitoring To whom are results reported? Geographical areas considered How far into the future are risks considered? Comment Six-monthly or more frequently Board or individual/sub-set of the Board or committee appointed by the Board Vestel Beyaz Eşya operates in production, marketing and after sales services in the consumer durables sector and exports its products to 154 countries. Vestel Beyaz Eşya'sintegrated risk management procedure covers all activities. > 6 years Vestel Risk Management System is a multidisciplinary process that is integrated. Vestel considers all aspects of its risk management system in order to realize its short- and long-term goals. Strategic, operational, physical, financial and environmental risks and opportunities are addressed within risk management. Attached to Zorlu Holding's risk report. The managed Sustainability Committee and the Corporate Risk Management directorate identify risks and opportunities for climate change. Identification and assessment of risks and opportunities, forecasting the impact of risks on Company level, management of these risks, taking into account decision mechanisms, establishment of effective internal control systems Monitoring and evaluation of risk and opportunity results; It is done by the Board of Directors. CC2.1b Please describe how your risk and opportunity identification processes are applied at both company and asset level Company-level risk and opportunity assessment can be roughly divided into 2 categories, physical risk (e.g., extreme weather threatening business continuity, as nearly all operations are concentrated in the company's Manisa headquarters at Vestel City) and reputational risks. Management of physical risks is the responsibility of the Safety Department, as described in the Occupational Health and Safety Regulations and Business Continuity Processes. The Safety Department is responsible for establishing and running the emergency coordination center, drawing up emergency plans, putting together emergency response teams, conducting emergency drills and taking corrective actions. While we see management of reputational risks and opportunities as a product of business unit or team activities, Vestel does have a company-wide risk management and internal control mechanism established and overseen by the Board of Directors. The rolling out of the new Corporate Risk And Value Management (including reputational risk management) concept in all business units at Vestel will continue in Asset level: Vestel White Goods factories are built using Pestle analysis at least once a year, including climate risks. In addition to a detailed report explaining Vestel White Goods' risk situation, recommendations are also made on how to reduce risk exposure. In addition, risk assessment analyzes are made to all our suppliers. According to Risk Analysis, our suppliers are evaluated. Climate-change related risk and opportunity assessment at Vestel Beyaz Eşya is comprehensive, involving all of the following: evolving market expectations, product

9 regulations (including energy efficiency standards, labeling and chemicals/refrigerants), production efficiency, production-related regulations, energy prices, stakeholder expectations/reputational issues and operational risks due to climate-related weather events. CC2.1c How do you prioritize the risks and opportunities identified? Determination of Environmental Aspect and Effects and Evaluation Procedures are followed to identify, assess and record the environmental dimensions that may arise as a result of the activities and services of Vestel Beyaz Eşya, to define the environmental effects and to eliminate the negativity.considering the following effects of environmental dimensions: Emissions to air, water released by waste, soil laid waste, the use of the natural resources of raw materials, the environment radiated noise, energy use, the media released heat, radiation, vibration, such as energy, waste and by-products are taken into consideration.the purpose of the impact assessment is; Defining the effects, separating the unacceptable effects from the acceptable ones and improving the data for the impact response plan. Risk matrix is contain of two dimensional. The combination of probability and severity will give any event a place on a risk matrix. Following identification the risks and opportunities (strategic, operational or project) are evaluated and prioritised according to the likelihood of the risk occurring and the impact if it did occur. This initial score (stage 1) is based onthe assessment of the pure risk, prior to control measures being identified and helps to make decisions about the significance of the risks to the Council and how they will be managed. Likelihood x Impact = Opportunity and Risk Ratings The aim is to maximise our opportunity scores and minimise risk scores, by implementing controls and management actions. It is important to remember that as risk management attempts to predict and describe potential future events, there is a degree of uncertainty and judgement in these assessments. Vestel Beyaz Eşya uses a 5x5 assessment matrix for both risks and opportunities.the risks and opportunities are presented at the Zorlu Holding Sustainability Committee. It is also evaluated by the Corporate Risk Management Department of Zorlu Holding. CC2.1d Please explain why you do not have a process in place for assessing and managing risks and opportunities from climate change, and whether you plan to introduce such a process in future Main reason for not having a process Do you plan to introduce a process? Comment

10 CC2.2 Is climate change integrated into your business strategy? Yes CC2.2a Please describe the process of how climate change is integrated into your business strategy and any outcomes of this process Vestel Beyaz Eşya sees climate change as a natural fit for our business strategy. This includes both operational imperatives as well as market positioning. i. Vestel Beyaz Eşya has several specific mechanisms in place to ensure that climate change influences the business strategy, both at the company-level and for individual business units: (a) communication to senior leadership and relevant departments by the R&D departments (which have primary responsibility for product related issues) and the Environmental and Energy Management Teams (which have primary responsibility for operational efficiency issues), (b) company-wide communication for specific efforts (e.g., energy reduction under the company's energy management system), (c) the cross-functional nature of the Environmental and Energy Management Teams, comprised of units from across the company, and (d) the regular tracking and reporting of performance to senior executives and relevant department heads for both product performance and operational goals. ii. Below, is a listing of specific company-wide strategic priorities, with a description of sample climate change initiatives that support these priorities and the specific forces that have influenced this integration. a. Meeting customer and consumer needs: Our commitment to meeting customer and consumer desires extends to climate and energy related product preferences. Forces shaping these desires include ODM customer expectations, growing consumer demand for greener, low-energy products and current and anticipated regulation for minimum energy performance. Moreover, for our refrigerators and air conditioners, we are switching to gases that have lower Global Warming Potentials (such as R600a). b. Low cost production driven by state-of-the-art, efficient production facilities: Vestel intends to produce excellent white goods at an affordable price while maintaining attractive margins. As such, low-cost production is a key part of our strategy. Forces shaping this priority include rising and fluctuating energy prices, competition and production competency and flexibility to meet changing consumer demands. Our efficient and consolidated production facilities located in Vestel City (Manisa) offer world-class economies of scale that also minimize use of energy and resources, for example, from component and personnel transport and from heating and cooling of jointly-used buildings. c. Low cost production driven by energy and operational efficiency: Forces shaping this priority include rising and fluctuating energy prices, competition for high quality, low cost products and a desire to maintain operational excellence. The guiding force of these efforts is the company s Environmental Management System certified to ISO and Energy Management System certified to ISO These management systems follow a plan-do-check-act regimen. Under this

11 process, new opportunities for energy use reduction are identified and delegated to individual relevant business units. For each individual business unit, energy reduction targets are set and progress is monitored regularly. Various departments such as Maintenance Department as well as our staff at the shop floor are responsible for identifying improvement measures to reduce energy consumption. For example, our staff makes use of Red alert cards to communicate an efficiency problem and its potential solution. Investment decisions for improvements entail cost-benefit analysis and feasibility studies. The Industrial Engineering sub-department operating under the Production Department is responsible for conducting cost-benefit analysis and feasibility studies. d. Low operational costs: We have a policy in place to reduce the number of flights by replacing them with video-conferencing where possible. iii. The most important aspects of the short-term strategy that have been affected by climate change is meeting customer/consumer product demands for energyefficiency, especially for the European market, and controlling production cost, a key component of which is energy usage. iv. The most important aspect of the long-term strategy that has been influenced by climate change involves our efforts, not to simply meet current demands for energy-efficiency, but to position ourselves as a provider of choice for a low-carbon future. We fully anticipate both regulations and consumer preference for energy efficiency to accelerate in the mid- to long-term. v. We seek to use climate change to gain strategic advantage by further propelling our low-cost production efforts and by exceeding the expectations of both direct customers and final consumers. An important aspect of this is solidifying relationships with value chain partners, particularly the foreign brands, who share this commitment. vi. Energy-efficiency of our products is top priority for us. We produce energy-consuming products and according to studies, there is a huge potential to save energy at the consumer level through the use of more efficient products. The most substantial business decision made during the reporting year was therefore strengthening our efforts to increase the percentage of A or higher-class energy-efficient products. The R&D departments at our business units have targets towards increasing the energy-efficiency of our products.sing the energy-efficiency of our products. CC2.2b Please explain why climate change is not integrated into your business strategy CC2.2c Does your company use an internal price on carbon? No, and we currently don't anticipate doing so in the next 2 years

12 CC2.2d Please provide details and examples of how your company uses an internal price on carbon CC2.3 Do you engage in activities that could either directly or indirectly influence public policy on climate change through any of the following? (tick all that apply) Direct engagement with policy makers Trade associations CC2.3a On what issues have you been engaging directly with policy makers? Focus of legislation Corporate Position Details of engagement Proposed legislative solution Energy efficiency Support Vestel Beyaz Eşya has adopted official policy positions in key strategic issues, such as supporting market incentives that trigger changes in consumer purchases for home appliances. Public policy initiatives are primarily coordinated with industry organizations such as the European Appliance Industry Association (CECED) and the Turkish White Equipments Association (TÜRKBESD). Vestel is harmonizing legislation on public policy issues related to white goods, climate change, energy efficiency, the responsibility of the manufacturer for recycling, product liability, labeling, and the use of chemicals. As performance standards and legislation differ between countries, Vestel Beyaz Eşya supports global harmonization. By 2022, Vestel Beyaz Eşya aims to reduce its carbon emissions by 22%.In addition,vestel Beyaz Eşya has special relations with all relevant Ministries in Turkey. By stating the opinions of the Ministries regarding the draft regulations and legislation. Vestel Beyaz Eşya is in the working groups of the relevant Ministries, such as T.C. Ministry of Environment and Urbanization,T.C.Ministry of Energy

13 Focus of legislation Corporate Position Details of engagement Proposed legislative solution Mandatory carbon reporting Energy efficiency Support Support and Natural Resources and T.C.Ministry of Science,Industry and Technology. Vestel Beyaz Eşya has mandated carbon reporting for each year, 2016 year base year. Vestel Beyaz Eşya is a member of TURKBESD that was established in 1986 as Home Appliances Manufacturers Association (TURKBESD) by the leading home appliances companies of the sector. In 1999, following its membership to the European Union s senior organization of the field CECED (European Committee of Domestic Equipment Manufacturers), the association received permission to use Turkey in its name through a Cabinet of Ministers decree, and changed its name to White Goods Manufacturers Association of Turkey (TÜRKBESD). We also fully support the GHG target management system in the home appliances sector. We have also identified potential problems with systems and standards that may arise when a production-focused GHG goal management system is established to ensure that the system operates consistently. We have set up development methods and standards. When needed and requested, the association makes statements to the relevant ministries and media (Ministry of Science, Industry and Technology, Ministry of Environment and Urban Planning, Ministry of Energy and Natural Resources, Ministry of Economy, Ministry of Customs and Trade, General Directorate for the Protection of Consumers and Competition, the Union of Chambers and Commodity Exchanges of Turkey, Undersecretariat of Foreign Trade, Central Bank of the Republic of Turkey, TUSIAD (Turkish Industry and Business Association]). CC2.3b Are you on the Board of any trade associations or provide funding beyond membership? Yes CC2.3c Please enter the details of those trade associations that are likely to take a position on climate change legislation

14 Trade association Is your position on climate change consistent with theirs? Please explain the trade association's position How have you, or are you attempting to, influence the position? TÜRKBESD TOBB Consistent Consistent White Goods Manufacturers Association of Turkey, whose acronym is TÜRKBESD, was established in 1986 as White Goods Manufacturers Association (BESD) by the leading white goods companies of the sector. In 1999, following its membership to the European Union s senior organization of the field CECED (European Committee of Domestic Equipment Manufacturers), the association received permission to use Turkey in its name through a Cabinet of Ministers decree, and changed its name to White Goods Manufacturers Association of Turkey (TÜRKBESD). Vestel is a member of Türkbesd. TOBB is The Union of Chambers and Commodity Exchanges of Turkey. Vestel Home Appliance is direct member of Durable Consumer Goods Sector(DTMM) of TOBB. The association represents approximately 90-91% of the sector. Additionally, TÜRKBESD represents Turkey at CECED (European Committee of Domestic Equipment Manufacturers), which is a platform where home appliance manufacturers in the European Union come together to make decisions. The efforts in the EU are pursued through this membership, and specialist technical personnel of the member companies participate in the technical committee works of the said organization. When needed and requested, the association makes statements to the relevant ministries, NGOs and media (Ministry of Science, Industry and Technology, Ministry of Environment and Urban Planning, Ministry of Energy and Natural Resources, Ministry of Economy, Ministry of Customs and Trade, General Directorate for the Protection of Consumers and Competition, the Union of Chambers and Commodity Exchanges of Turkey, Undersecretariat of Foreign Trade, Central Bank of the Republic of Turkey, TUSIAD [Turkish Industry and Business Association]). Management Systems and Customer Relations Manager attends to the meetings in monthly. CC2.3d Do you publicly disclose a list of all the research organizations that you fund? CC2.3e Please provide details of the other engagement activities that you undertake

15 CC2.3f What processes do you have in place to ensure that all of your direct and indirect activities that influence policy are consistent with your overall climate change strategy? Vestel has adopted a group-wide strategy to address climate change that goes beyond meeting local legislation and addressing regulatory risks. This strategy naturally ties into the overall strategy very clearly. The activities that are innovating and promoting efficient products, raising awareness on the importance of energyefficient appliances and reducing energy use in operations are consistent with our overall climate change strategy. CC2.3g Please explain why you do not engage with policy makers Further Information Page: CC3. Targets and Initiatives CC3.1 Did you have an emissions reduction or renewable energy consumption or production target that was active (ongoing or reached completion) in the reporting year? Absolute target CC3.1a Please provide details of your absolute target

16 ID Scope % of emissions in scope % reduction from base year Base year Base year emissions covered by target (metric tonnes CO2e) Target year Is this a sciencebased target? Comment Abs1 Scope 1 100% 10% Abs2 Scope 2 (locationbased) 100% 10% No, but we anticipate setting one in the next 2 years No, but we anticipate setting one in the next 2 years Vestel has intended on reducing greenhouse gas emissions caused by its operations by 2020 compared to the base year of Vestel will provide greenhouse gas emission mitigation project and will implement energy efficient manufacturing plans so as to minimize its carbon footprint. Vestel has intended on reducing greenhouse gas emissions caused by purchased electricity by 2020 compared to the base year of Vestel will provide greenhouse gas emission mitigation project and will implement energy efficient manufacturing plans so as to minimize its carbon footprint caused by Scope 2 electricity consumption. CC3.1b Please provide details of your intensity target ID Scope % of emissions in scope % reduction from base year Metric Base year Normalized base year emissions covered by target Target year Is this a sciencebased target? Comment CC3.1c

17 Please also indicate what change in absolute emissions this intensity target reflects ID Direction of change anticipated in absolute Scope 1+2 emissions at target completion? % change anticipated in absolute Scope 1+2 emissions Direction of change anticipated in absolute Scope 3 emissions at target completion? % change anticipated in absolute Scope 3 emissions Comment CC3.1d Please provide details of your renewable energy consumption and/or production target ID Energy types covered by target Base year Base year energy for energy type covered (MWh) % renewable energy in base year Target year % renewable energy in target year Comment CC3.1e For all of your targets, please provide details on the progress made in the reporting year ID % complete (time) % complete (emissions or renewable energy) Comment Abs1 15% 15% Since 2016 is our base year and first verified carbon emission report was developed, 10% reduction in Scope 1 emission target are still in progress.

18 CC3.1f Please explain (i) why you do not have a target; and (ii) forecast how your emissions will change over the next five years CC3.2 Do you classify any of your existing goods and/or services as low carbon products or do they enable a third party to avoid GHG emissions? Yes CC3.2a Please provide details of your products and/or services that you classify as low carbon products or that enable a third party to avoid GHG emissions Level of aggregation Description of product/group of products Are you reporting low carbon product/s or avoided emissions? Taxonomy, project or methodology used to classify product/s as low carbon or to calculate avoided emissions % revenue from low carbon product/s in the reporting year % R&D in low carbon product/s in the reporting year Comment Product A dishwasher that is world-class in its class and consumes 20% less energy than A +++ Avoided emissions Low Carbon Investment (LCI) Registry Taxonomy 10% Less than or equal to 10% While our white goods products do require electricity, we strive to exceed energy performance expectations in all product categories. As a result, our higher performing products do offer the opportunity for customers to reduce emissions relative to average

19 Level of aggregation Description of product/group of products Are you reporting low carbon product/s or avoided emissions? Taxonomy, project or methodology used to classify product/s as low carbon or to calculate avoided emissions % revenue from low carbon product/s in the reporting year % R&D in low carbon product/s in the reporting year Comment Product Washing machine consuming 70% less energy than A +++ Avoided emissions Other: 2009/125/EC Directive of establishing a framework for the setting of ecodesign requirements for energyrelated products 2010/30/EU Directive on the indication by labelling and standard product information of the consumption of energy and other resources by energy-related products Less than or equal to 10% performing products. We intend to continuously increase the total percent of A+ products for all categories. Numerous studies have shown that modern dishwashers have use less water and energy compared to hand washing. We would expect similar results for washing machines. However, we consider this a low bar, as it is our intention to exceed expectations relative to other machines. Due to the complexities involved (e.g., product mix, variety of geographic markets with varying grid emissions factors and difficulty in assigning a single average electricity rate to any one category) we have not attempted to calculate total emissions reduction achieved by our more efficient products. Vestel Pyrojet Washing Machine The washing machine with Pyrojet technology that consumes 70% less energy than products with 8 kg capacity in the A+++ energy class is the holder of world record in terms of energy efficiency in its category. Vestel Pyrojet is endorsed by German Electrical, Electronic and Information Technologies Association (VDE) for its energy efficiency.

20 Level of aggregation Description of product/group of products Are you reporting low carbon product/s or avoided emissions? Taxonomy, project or methodology used to classify product/s as low carbon or to calculate avoided emissions % revenue from low carbon product/s in the reporting year % R&D in low carbon product/s in the reporting year Comment Product Product Product 70 cm dual door Top Freezer Frost Free products with new generation cooling system, 30% less energy consumption than A +++ combi fridge, A +++ French Door Refrigerator with Pro- Drive (Inverter) Motor Technology 60 cm Combined Products with Novel-No- Frost Cooling Technology Low carbon product and avoided emissions Low carbon product and avoided emissions Low carbon product and avoided emissions Addressing the Avoided Emissions Challenge- Chemicals sector Evaluating the carbon reducing impacts of ICT More than 20% but less than or equal to 40% More than 40% but less than or equal to 60% More than 60% but less than or equal to 80% The French Door refrigerator consumes the least energy in the world with A +++ energy performance. Vestel Beyaz Eşya presents many innovations in terms of design, cooling system, energy, food storage and ergonomics with this product group for the first time. These products, which have an A +++ energy level, create two independent air circles in the freezer and cooler compartments, preventing odors from mixing together. As a result, food remains fresh in the cooler section for a longer period of time. While additional storage areas are created thanks to the patented V- Lift (Elevator Door Shelf) and V-Shelf (Moving Glass Shelf) technologies, Overflow System enables zero to 90 degrees can be opened without the need for extra width refrigerator door. Product Super Inverter Air Low carbon Other: Seasonal energy Less than or The most efficient inverter air

21 Level of aggregation Description of product/group of products Are you reporting low carbon product/s or avoided emissions? Taxonomy, project or methodology used to classify product/s as low carbon or to calculate avoided emissions % revenue from low carbon product/s in the reporting year % R&D in low carbon product/s in the reporting year Comment Product Product Conditioner Vestel Pyrojet Washing Machine is the world record holder for 70 kg in 8 kg laundry, 60% less energy in 9 kg laundry and 22% less water consumption, according to A +++ products. Washing machine with Digital Drive motor technology consuming less energy than A +++ energy class product and avoided emissions Low carbon product and avoided emissions Avoided emissions efficiency ratio is calculated according to the EN : Air conditioners, liquid chilling packages and heat pumps, with electrically driven compressors, for space heating and cooling - Testing and rating at part load conditions and calculation of seasonal performance Other: 2009/125/EC Directive of establishing a framework for the setting of ecodesign requirements for energyrelated products 2010/30/EU Directive on the indication by labelling and standard product information of the consumption of energy and other resources by energy-related products Other: 2009/125/EC Directive of establishing a framework for the setting of ecodesign requirements for energyrelated products 2010/30/EU Directive on the indication by labelling and standard product information of the consumption of energy and other resources by energy-related products equal to 10% Less than or equal to 10% Less than or equal to 10% conditioner designed and manufactured at Vestel White Goods. The product features BLDC (Brushless Direct Current) compressor, BLDC indoor and outdoor fan motors and electronic expansion control.it consumes 7% less electricity than A +++ energy level. Vestel Pyrojet Washing Machine The washing machine with Pyrojet technology that consumes 60% less energy than products with 9 kg capacity in the A+++ energy class. Vestel Pyrojet is endorsed by German Electrical, Electronic and Information Technologies Association (VDE) for its energy efficiency. Washing Machine with Digital Drive motor technology that consumes minimum 20% less energy than produscts in the A +++ energy class. Group of Vestel Beyaz Eşya has Low carbon Other: Seasonal energy Less than or In Turkey, 1 out of every 10

22 Level of aggregation Description of product/group of products Are you reporting low carbon product/s or avoided emissions? Taxonomy, project or methodology used to classify product/s as low carbon or to calculate avoided emissions % revenue from low carbon product/s in the reporting year % R&D in low carbon product/s in the reporting year Comment products developed energy efficieny air-conditioners, which include consumer products with the best environmental performance. product and avoided emissions efficiency ratio is calculated according to the EN : Air conditioners, liquid chilling packages and heat pumps, with electrically driven compressors, for space heating and cooling - Testing and rating at part load conditions and calculation of seasonal performance. equal to 10% households have air conditioners, of which 750,000 are about 9000 and Btu / h. If these airports were considered to be average A class with an optimistic approach, Vestel A +++ Plasma Inverter air conditioners could be replaced with energy savings of around 57 GWh per year. In 2016, 86 GWh of electricity was produced annually with thermal power plants in Turkey. With Vestel A +++ Plasma Inverter Airplanes, savings of up to 67% of the electricity generated by thermal power plants per year can be achieved. CC3.3 Did you have emissions reduction initiatives that were active within the reporting year (this can include those in the planning and/or implementation phases) Yes CC3.3a

23 Please identify the total number of projects at each stage of development, and for those in the implementation stages, the estimated CO2e savings Stage of development Number of projects Total estimated annual CO2e savings in metric tonnes CO2e (only for rows marked *) Under investigation To be implemented* Implementation commenced* Implemented* Not to be implemented CC3.3b For those initiatives implemented in the reporting year, please provide details in the table below Activity type Description of activity Estimated annual CO2e savings (metric tonnes CO2e) Scope Voluntary/ Mandatory Annual monetary savings (unit currency - as specified in CC0.4) Investment required (unit currency - as specified in CC0.4) Payback period Estimated lifetime of the initiative Comment Energy efficiency: Building fabric Air-cooled chillers are converted into water-cooled chillers and Renewal of pump group 472 Scope 2 (locationbased) Voluntary <1 year 3-5 years This study has resulted in significant reductions in annual energy consumption for cooling energy. Energy Energy saving from 177 Scope 2 Voluntary <1 year 6-10 years Instead of cooling the hydraulic

24 Activity type Description of activity Estimated annual CO2e savings (metric tonnes CO2e) Scope Voluntary/ Mandatory Annual monetary savings (unit currency - as specified in CC0.4) Investment required (unit currency - as specified in CC0.4) Payback period Estimated lifetime of the initiative Comment efficiency: Building fabric Energy efficiency: Processes Energy efficiency: Building fabric Energy efficiency: Building fabric Energy efficiency: Building fabric cooling water Optimization of hot water pumps- Energy saving in the pump Pressure optimization of circulation pumps in refrigerator-1 factory Servomotor control of mechanical manufacturing hydraulic units in Refrigerator Factory Replacement of screw shaft in Exturuder machine in refrigerator (locationbased) Scope 2 (locationbased) Scope 2 (locationbased) Scope 2 (locationbased) Scope 2 (locationbased) Voluntary Voluntary Voluntary Voluntary <1 year 6-10 years <1 year 6-10 years years 1-3 years 6-10 years 6-10 years units with technological water, the cooling process was carried out by utilizing the wet thermometer temperature of the environment. Because the pressures of the old pumps in the system are different from each other, much energy is consumed. In addition, since pipe diameters are not sufficient, pumps with excess pressure are selected. The most suitable pump and pipe diameter was selected and applied by making calculations. Suitable pressure and pressure pumps have been selected. Pumps in the system work even when the machine is idle. The servo motor is shutting itself down when the system wastes, or even after a certain period of time. When the extruder was producing 500 kg per hour, the screw was changed and 800 kg was removed. The unit

25 Activity type Description of activity Estimated annual CO2e savings (metric tonnes CO2e) Scope Voluntary/ Mandatory Annual monetary savings (unit currency - as specified in CC0.4) Investment required (unit currency - as specified in CC0.4) Payback period Estimated lifetime of the initiative Comment Energy efficiency: Building fabric Energy efficiency: Building fabric Energy efficiency: Processes Energy efficiency: Processes Energy efficiency: Processes Energy efficiency: factory-energy saving with capacity increase Top panel machine modification-energy saving with capacity increase Side panel machine modification-energy saving with capacity increase Modification of refrigerator door line Renovation of paintwork ventilation system Body Heating system renewal of polyurethane machines in Refrigerator Plant Pressure optimization of Scope 2 (locationbased) Scope 2 (locationbased) Scope 2 (locationbased) Scope 2 (locationbased) Scope 2 (locationbased) Scope 2 (location- Voluntary Mandatory Voluntary Voluntary Voluntary Voluntary years 1-3 years 1-3 years <1 year 6-10 years 6-10 years 6-10 years years <1 year 6-10 years energy cost has been reduced while productivity has increased. By increasing the capacities in the machines, the unit energy costs of the products produced are reduced. By increasing the capacities in the machines, the unit energy costs of the products produced are reduced. By increasing the capacities in the machines, the unit energy costs of the products produced are reduced. Machine cooling water and dye house booths are cooled in summer and winter. They were replaced with a water-cooled rooftop, which made use of the coolness of the air in the winter months and cooled down without spending energy. The heating was done with the aid of a residence. Energy saving has been achieved by using hot water taken from Organize Industrial Zone Suitable pressure and pressure pumps have been selected.

26 Activity type Description of activity Estimated annual CO2e savings (metric tonnes CO2e) Scope Voluntary/ Mandatory Annual monetary savings (unit currency - as specified in CC0.4) Investment required (unit currency - as specified in CC0.4) Payback period Estimated lifetime of the initiative Comment Building fabric circulation pumps in the washing machine factory based) CC3.3c What methods do you use to drive investment in emissions reduction activities? Method Comment Dedicated budget for low carbon product R&D Employee engagement Financial optimization calculations We are unable to separate R&D budget for energy efficient products from the total R&D budget, but it is a significant portion of the total amount. By focusing on energy-efficient products we ensure that we always stay ahead of minimum energy performance requirements, but also to tap the growing market for green and energy-efficient products. Vestel Beyaz Esya has an Energy Management Program that sets factory-level energy-efficiency goals and establishes meetings to review performance and discuss emerging opportunities. This program ensures that key employees are informed and empowered to take action. Because the pressures of the old pumps in the system are different from each other, much energy is consumed. In addition, since pipe diameters are not sufficient, pumps with excess pressure are selected. The most suitable pump and pipe diameter was selected and applied by making calculations. CC3.3d

27 If you do not have any emissions reduction initiatives, please explain why not Further Information Page: CC4. Communication CC4.1 Have you published information about your organization s response to climate change and GHG emissions performance for this reporting year in places other than in your CDP response? If so, please attach the publication(s) Publication Status Page/Section reference Attach the document Comment In voluntary communications In other regulatory filings In voluntary communications In voluntary communications In voluntary communications Complete 33 Complete Underway - previous year attached Underway - previous year attached Underway - previous year 6 complete 1 Change 2017/Shared Documents/Attachments/CC4.1/iklim_degisikligi_ve_turkiye.pdf Change 2017/Shared Documents/Attachments/CC4.1/2016 ENERJİ BİLDİRİMİ.pdf Change 2017/Shared Documents/Attachments/CC4.1/BT HABER_ pdf Change 2017/Shared Documents/Attachments/CC4.1/DÜNYA EK_ pdf Change 2017/Shared Documents/Attachments/CC4.1/DÜNYA ÖZEL EK_ pdf Climate Change CEO Perception Survey in Turkey Energy declaration that we have communicated to the Ministry of Energy and Natural Resources in Being environmentalist in production processes Vestel research and development center Vestel reduced energy and water consumption in its products