Volkswagen Group (VOW) ESG update summary

ESG strategy and regenerate+ update

• Regenerate+ strategy is a core pillar, focusing on nature, people, society, and business, each with three KPIs to track progress and implementation success.

• Achieved a 60% reduction in CO2 emissions at own facilities, surpassing the 50% target, and remain on track for 2040 net carbon neutrality.

• Scope 3 emissions reduction is progressing, with 18% achieved by 2025 and a 30% target for 2030.

• Biodiversity initiatives include a dedicated fund and upcoming indicator, with global employee engagement in nature projects.

• Diversity and inclusion targets are on track, with 23.3% women in management and 28.1% international representation in top management.

Circular economy and sustainable business models

• Circular economy is positioned as a key driver for resilience, profitability, and decarbonization, with a focus on recycled materials and used parts.

• Group Circular Economy Hub established to scale dismantling, recycling, and reuse, targeting 15,000 cars processed annually and 300 tons of recycled polymers.

• New EU regulations will require 15% post-consumer recycled polymers per car by 2032, scaling to 25%, driving the need for regional recycling networks.

• Partnerships with recyclers and startups are expanding, and digitalization is critical for tracking materials and enabling circularity.

• KPIs for circular economy are under development, focusing on circular revenues, material shares, and profitability, with interim targets planned.

Green finance and supply chain management

• Over €20 billion in bonds issued in 2025, with more than half in green format, exceeding the 2030 target ahead of schedule.

• Responsible Raw Materials Policy is based on global standards, with a robust risk analysis, supplier audits, and due diligence system.

• 85% of high-risk suppliers are certified via S-Rating, and external certifications are leveraged to streamline compliance.

• PowerCo is vertically integrating battery supply chains to secure volumes and reduce price volatility, with strict ESG criteria for suppliers.

• Supply chain complexity is managed through risk-based engagement, audits, and cross-industry collaboration, with ongoing adaptation to regulatory changes.