E X P E C T A T I O N S S E L E C T I O N E V A L U A T I O N E N G A G E M E N T Supplier screening and contracting Risk screening is an important part of our supplier selection process. Our strategy includes training AT&T sourcing managers on the principles of sustainability and diversity, requiring compliance with contractual sustainability and diversity clauses for tier 1 and 2 suppliers, and monitoring supplier sustainability and diversity performance at varying frequencies based on high-risk activities analysis. Preferred supplier program AT&T’s Preferred Supplier Program allows us to recognize high-performing suppliers that have demonstrated a commitment to focus areas such as diversity and environmental sustainability. We incorporate these factors into sourcing decisions: • Sustainability metrics such as GHG targets and emissions, waste management and water intensity • Diversity and inclusion metrics reflecting supplier workforce ethnic and gender diversity. Supplier principles and collaboration AT&T suppliers are expected to comply with sustainability and diversity clauses in our contracts, which also require conformance with our AT&T Principles of Conduct for Suppliers and the AT&T Human Rights Policy. We work with organizations such as Global Enabling Sustainability Initiative to improve performance across the value chain and drive achievement of U.N. Sustainable Development Goals. GHG emissions reduction We expect our suppliers to reduce their environmental footprint and to set GHG emissions targets. AT&T set a 2024 science-based target to ensure 50% of our suppliers 20 (as a portion of spend) set their own science-based Scope 1 and Scope 2 GHG targets. Supplier diversity Our Supplier Diversity organization connects certified diverse minority-, woman-, veteran-, LGBTQ+- and disability-owned business enterprises with opportunities to provide products and services to AT&T. Our annual goal is to surpass $10 billion in diverse spend. 3 Attestation and assessments We require suppliers to verify adherence to our Principles of Conduct for Suppliers every 18–24 months. Additionally, we annually engage suppliers representing 80% of spend 19 with ESG assessments developed through both CDP and the Telecommunications Industry Association. These assessments support our ability to integrate sustainability metrics into sourcing decisions. Emissions targets and performance We participate in the CDP supply chain program to analyze data on suppliers’ emissions reduction goals and progress over time, and to reinforce the importance of supplier sustainability disclosures. Diverse supplier spend We evaluate our total spend with diverse suppliers in an effort to drive impactful and meaningful change in their communities through overall economic empowerment and growth. Audits and corrective action planning Collaborating with peer telecom companies in the Joint Audit Cooperation (JAC), we conduct on-site audits and develop corrective action plans for suppliers at risk of noncompliance with social standards, such as child or forced labor, health and safety, freedom of association, working hours or compensation. Supplier engagement on GHG emissions reduction AT&T set a 2024 science-based target to ensure 50% of our suppliers 20 (as a portion of spend) set their own science-based Scope 1 and Scope 2 emissions targets. We work with key suppliers individually to help set their targets and encourage continuous improvement in their emissions reduction work. Support and acceleration programs for diverse suppliers We offer executive-level education and scholarships to support CEOs of diverse- owned businesses. Our Supplier Diversity organization sponsors the Business Growth Acceleration Program, a mentoring series that helps diverse-owned businesses thrive in today’s market. We also offer an early payment program to provide qualified suppliers with flexible financing options. ESG and the supplier lifecycle IN 2021 202 suppliers reported their greenhouse gas (GHG) emissions through the CDP supply chain program. OVER 80% of suppliers by spend are engaged through ESG assessments. 19 IN 2021 $13.2B of our total supplier spend was with certified- diverse businesses. 3 TO DATE 47% of suppliers by spend have set their own science-based Scope 1 and Scope 2 green- house gas emissions targets. 20 IN 2021 participants in our supplier financing program included: • 35 certified women-owned enterprises • 41 certified minority enterprises • 7 certified disabled-veteran enterprises IN 2021 JAC audits identified 402 corrective actions and closed ~71% of all identified corrective actions – including ~61% rated as minor, ~35% rated as major, and ~5% flagged for priority. AT&T’s approach to ESG in the supply chain is designed to mitigate risk and enhance positive impact across the supplier lifecycle. This diagram categorizes key mechanisms according to: ESG operational integration Reducing GHG emissions Supplier diversity SUPPLIERS ESG AND THE SUPPLIER LIEFCYCLE OVERVIEW AT&T AND SHAREHOLDERS CUSTOMERS AND COMMUNITIES EMPLOYEES SUPPLIERS ENVIRONMENT GOVERNANCE GOALS SUMMARY KPI s AT&T ESG SUMMARY REPORT 2022 AT&T ESG SUMMARY REPORT 2022 28 29
AT&T ESG Summary Page 15 Page 17