1.3 Strategy Scaling sustainability impact Supporting our customers in their sustainability These megatrends and their impacts are reshaping the needs transformation of our customers and markets. To create a holistic picture of Siemens’ business is focused on enabling customers to potential futures, we execute sustainability scenario analyses achieve a positive sustainability impact along the following that enable us to map impacts and risks, identify opportunities, value propositions: and find new ways to create value through pathways by 2030 and 2040. Strategic insights are derived from scientific Decarbonization & energy efficiency frameworks like the Intergovernmental Panel on Climate We support our customers with their efforts to decarbonize Change’s (IPCC) Representative Concentration Pathways their infrastructure and operations, drive energy-efficiency, (RCPs) and Shared Socioeconomic Pathways (SSPs) as well as and future-proof entire industries. We do this by offering market trends and expert knowledge. The sustainability products, systems, solutions, and services that are based on scenarios illustrate different possible development pathways our strategic focus on digitalization, electrification, and for the global economy and Siemens’ operating environment automation. For example, our energy-efficient products and across the focus topics climate, circularity, biodiversity, and solutions support the transition from fossil fuels to renew- society that take into account both an organized 1.5°C and a able energy sources, and our electrification solutions enable disorganized 3°C pathway. These scenarios guide the devel- renewable grid integration and the electrification of heat opment of our sustainability strategy. and hydrogen. Across industries, we offer energy optimiza- tion and carbon footprint management throughout our To further increase our positive impact, we believe that products’ lifecycles and supply chains. In buildings, we offer working in ecosystems is the best way to jointly create seam- energy efficiency and decarbonization solutions, such as less solutions for our customers and their specific challenges. smart buildings and smart energy management for a reduced This approach increases our own sustainable offerings and carbon footprint. Our rail systems offer low-carbon mobility solutions and facilitates our customers’ sustainability trans- and increased energy efficiency. formation. Our commitment to sustainability covers the entire value chain. Based on our strategic priority to produce Resource efficiency & circularity purpose-driven technology, we strive to create a positive Through their use of our digital technology, our customers long-term impact for our customers with our products across can achieve resource efficiency and profitability. For our operations and through connected ecosystems. instance, we harness digitalization to reduce the require- ments of physical assets and resources. We combine the real and the digital worlds with our digital twin technology, a virtual representation of a physical product or process that is used to simulate, predict, and optimize its physical counter- part. Digital twins enable users to do more with fewer resources and make current and future environmental foot- prints transparent. Our building solutions also contribute to optimized space utilization and ultimately increase resource efficiency. Our mobility solutions focus on enhanced network capacity and extended lifecycles. SIEMENS SUSTAINABILITY REPORT 2023 18