zero transition. Our Sustainability and Corporate Transitions (SCT) team, founded in 2020, also engages with clients at the C-suite and senior levels across sectors to support the transition of their business models to a sustainable and low-carbon future, helping them identify their ESG challenges and opportunities to shape their strategy. In 2021, Citi served as the exclusive financial advisor to South Korean conglomerate SK Holdings in a transaction noted as the largest investment ever in the hydrogen fuel cell space. The $1.6 billion deal gave SK Group a 9.9% stake in Plug Power Inc., a leading provider of hydrogen fuel cell and green hydrogen generation systems in North America. The two companies entered into a strategic partnership to provide hydrogen fuel cell systems, hydrogen fueling stations and electrolyzers to the Korean and broader Asian markets in order to accelerate hydrogen as an alternative clean energy source throughout Asia. South Korea is one of the most important and developed markets for hydrogen. The government has set a roadmap with ambitious goals to build a hydrogen-based economy by 2040. Also in BCMA, our Sustainable Debt Capital Markets (Sustainable DCM) team has technical expertise on green, social and sustainability bonds as well as sustainability-linked bonds (SLB), and works within debt capital markets and with industry b ankers t o o riginate a nd s tructure issuances for these types of bonds on behalf of clients around the world. The Sustainable DCM team also advises Citi Treasury on Citi’s own sustainable debt issuance programs. The Sustainable DCM team has helped numerous clients globally structure innovative sustainability-linked bonds (SLB) tied to sustainability goals. Such bonds are an example of KPI-linked instruments that commit the issuer or borrower to specific sustainability objectives, such as greenhouse gas (GHG) emissions reduction or other key performance indicators (KPIs). Citi acted as SLB Structuring Advisor and Active Bookrunner on Johnson Controls International (JCI)’s inaugural $500 million SLB in September 2021. As part of this transaction, JCI committed to (i) reduce absolute Scope 1 and 2 GHG emissions by 35% and (ii) reduce absolute Scope 3 GHG emissions from the use of sold products by 5%, all by 2025 from a 2017 baseline, supporting JCI’s long-term net zero emissions by 2040 target. Failure to achieve these targets will result in a 25 basis point coupon step-up. JCI was also the first S&P 500 company to publish an integrated sustainable finance framework encompassing both use-of-proceeds bonds (green, social or sustainability) and sustainability-linked bonds, allowing JCI to issue any/all sustainable financing instruments. In another first, Citi client Tesco became the first UK corporate and the first retailer globally to launch a SLB tied to ambitious GHG emissions reduction targets in January 2021. As the largest retailer in the United Kingdom, Tesco PLC has the ability to make a significant impact on the path to a low-carbon future. Tesco is aiming to become carbon neutral across its own operations by 2035 and Contents ESGatCiti SustainableFinance SustainableProgress Equitable&ResilientCommunities Talent& DEI RiskManagement&ResponsibleBusiness Appendices CITI 2021 ESG REPORT 34