112 2021 ESG Report Transparency Appendices Responsible supply chain Product impact Climate change Introduction Healthy workforce and communities Strategy A summary of climate risks and opportunities that could have a substantive impact on our business is outlined below. We define substantive strategic risk as climate-related risks that have more variability and uncertainty over a longer time frame than is normally considered for financial risk. The majority of disclosures in this report fall under the category of substantive strategic risk. Any risk or opportunity that could result in a change in business operations, revenue or expenditure, thereby prompting disclosure in other company filings (e.g., 10-K) may be considered financially substantive for the purposes of TCFD-recommended and CDP disclosures. This applies to both supply chain and direct operations. When considering climate-related risks and opportunities, we define the magnitude of potential impact as follows: • Lo w – insignificant impact on revenues and/or minor disruption of operations. • Medium – some impact on r evenues and/or some disruption to operations, likely limited to a geographic region and/or number of business units. This may result in disclosure in financial reports. • High – signific ant impact on revenues and/or severe disruption to operations, likely affecting multiple regions and/or business units. This will likely result in disclosures in financial reports. We consider a short-term horizon to be up to three years in the context of climate-related risks and opportunities. This is in alignment with other general financial planning and business practices (such as financial planning for energy-efficiency projects). Medium-term time horizons are defined as three to 10 years in alignment with general financial planning and business processes with a medium-term outlook, such as power purchase agreements, which often have terms of around 10 years. Long-term time horizons are aligned with other business practices and long-term goals. For example, our company’s 2030+ goals with a 2019 baseline and carbon neutrality goals fit into a long-term time horizon.