Flender/Flender Gear Units/Helical speed reduction gearbox H3
es. RiskMethods allows us to monitor our multi-layered supply network and proactively uncover risks and material supply implications in real

time. In addition to internal data, up-to-date external data is also used and mapped in risk scoring system. Thanks to

the transparency in the supply network, we can take proactive measures at an early stage if risks arise.We have already

registered 4 of our mainsuppliers and receive information about CSRrisks on daily basis. CASE STUDY RISK MINIMIZATION IN THE SUPPLY

CHAIN USING OUR RISK MANAGEMENT TOOL RISKMETHODSVerification of suppliers continued In addition to transparency, diversification of the supply chain is important to us in order to minimize risks. Ourapproach is to position ourselves more broadly in thesupply chain in terms of suppliers and countries. Among other things, we have already significantly increased the degree of localization in procurement in India and China. In China we were able to increase this toover 9% (previously over 8%); in India, where we are expanding our manufacturing capacities, we are also developing local supply base. By 2 we want to achieve degree of localization in India similar to the level achieved in China. In addition, we have reduced the single source situation in many areas of drive technology and hydraulic components, thus ensuring broader supply base in these areas. Furthermore, we have optimized the dependencies of direct and sub-suppliers in certain regions (Russia, Ukraine, China, Turkey, India) and identified and qualified new suppliers in order toreduce the risk in the supply chain logistically andgeopolitically. We also need minerals for the production of our products; among these minerals we cannot avoid using tin, tantalum, tungsten or gold or so-called conflict minerals. As for other industrial companies, there is also lasting risk for Flender. Therefore, we are committed to excluding conflict materials from our supply chain. Weare member of the Responsible