Thank you for your inquiry. We appreciate your interest in our activities with regards to responsible aluminium supply chains. We take our corporate responsibility very seriously and have implemented measures and set up management systems in our procurement in order to identify, assess and manage sustainability risks in our supply chains.

Only suppliers that accept our sustainability requirements and commit to fulfilling them may enter into a business relationship with the Volkswagen Group. Our direct suppliers are expected to pass on these sustainability requirements to their business partners throughout the supply chain. Since 2019, we have been assessing the sustainability performance of our relevant business partners through our Sustainability Rating (“S-Rating”) prior the final sourcing decision. A detailed explanation of the screening and assessment process is available in our latest Sustainability Report (Please see page 108; Reporting | Volkswagen Group (volkswagen-group.com)).

Our relationships with business partners and suppliers are, as a matter of principle, confidential. We ask for your understanding that we do not comment on business relationships and on ongoing legal proceedings especially regarding other companies.

In order to deal with the sometimes extensive risks in the upstream raw material supply chains, we have implemented a Raw Materials Due Diligence Management System (in short: RMDDMS). This management system is used to identify, prioritize and process sustainability risks in our upstream supply chains. We currently have 18 priority raw materials in scope – aluminium is part of that. Please refer to our latest Responsible Raw Materials Report for details (Volkswagen Group Responsible Raw Materials Report). We explain the Raw Materials Due Diligence Management System, and we report on our activities regarding aluminium (please see page 29).

Within this Management System we have assigned the 18 priority raw materials to lead brands within Volkswagen Group. Audi has the raw material lead for aluminium, and is responsible for aluminium specific risk identification, assessment and mitigation measures. Through this systematic approach, our Group is able to cover a broad range of raw materials and coordinate actions across our Group accordingly.

Participation and engagement in cross-industry initiatives is one of many actions within our Raw Materials Due Diligence Management System. As Audi is the lead brand for aluminium within Volkswagen Group and has been a member of the Aluminium Stewardship Initiative (ASI) since 2013. Audi experts can be found around the (virtual) table when it comes to developing new standards and improving existing ones. As a founding member of the ASI, Audi is continuously supporting the advancement of ASI standards.

Due to the high variety and number of parts in our vehicles using aluminium, a process to track and trace all material back/up to mining level and have 100% transparency for all aluminium parts is currently not possible. Monitoring supply chains is an extremely complex undertaking. The status quo with regard to suppliers and their upstream partners is changing continuously, with some companies departing and others joining the sub-supply chain, rendering complete control impossible. This makes it all the more important to identify and evaluate risks and take steps towards risk mitigation early on.

To achieve this, Audi focuses on engagement with the ASI. Some of the aluminium suppliers are vertically integrated. These suppliers have their own mines and largely already certified in accordance with the sustainability standards of the Aluminium Stewardship Initiative. For Audi, cross-sectoral engagement in initiatives for responsible raw material supply chains is also an important tool to join forces with other industry players and create leverage in order to increase positive impact in complex supply chains. From the Audi perspective, an important step within the Aluminium Stewardship Initiative is the development and implementation of common and widely-accepted sustainability standards that help to assess supply chain partners and trigger continuous improvement of performance. With the first ASI Performance Standard, the ASI set an ambitious, and yet realistic, objective to reach as many supply chain actors as possible. As experience with the Performance Standard is gained, the ambition and the minimum standards will be increased. Version 3 of the ASI performance standard is currently active.

Audi took specific actions in 2022 specifically for bauxite mining in Brazil - based on received hints. Part of these actions were:

• Exchange on sustainability risks in the aluminium supply chain with Human Rights Watch & Inclusive Development International
• Address the criticisms of ASI Performance Standard in the relevant ASI bodies via ASI secretariat
• Use of defined problem solving mechanism of the Aluminium Stewardship Initiative with the result of the ASI quality assurance representative overseeing the Surveillance audit at MRN for Performance Standard
• Outreach to the addressed mining actors and demand for a statement regarding the accusations and the delivery of material in Audi’s supply chain

Based on your inquiry we opened a case within our Supply Chain Grievance Mechanism to further investigate the latest information.

Within ASI, Audi addressed concerns about Brazil and the relevance of this region for international aluminium production as well as the importance of the credibility of the standards. The ASI is in contact with local stakeholders to stress the high importance and added value of sustainable production of bauxite and in general sustainable supply chains.

Additionally, the VW Group has made the delivery of ASI Chain of Custody certified material a mandatory requirement for single aluminium parts with our suppliers and it is our goal to increase the share of ASI Chain of Custody certified materials in our portfolio. The ASI Chain of Custody (CoC) Standard complements the ASI Performance Standard, with assurance of sustainable production at each link in the chain. The Chain of Custody certificate of the Aluminium Stewardship Initiative was also awarded for the Ingolstadt and Neckarsulm sites of our brand Audi. It certifies that the company can demonstrate its ability to input sustainably-produced material into closed loops.

Besides the activities within the ASI, the Volkswagen Group also supports the standardization and cross recognition of sustainability standards at mining level. For this reason we joined IRMA in 2022.

The Volkswagen Group and its Brands set strict requirements towards our business partners. In the event of irregularities – e.g. violations of our human rights and sustainability standards – we take appropriate, quick and resolute action to ensure that our requirements are met. For this action we have a Supply Chain Grievance Mechanism in place (Please see page 11 of our Responsible Raw Materials Report and page 108 of our Sustainability Report). In order to give stakeholders along the value chain the chance to provide us with information about potential sustainability issues connected to our supply chain, grievances can be raised via mail ([email protected] or [email protected]) or anonymously through Volkswagen’s whistle-blower channels.

In addition to more traditional and reactive channels, such as the grievance mechanism, the Volkswagen Group is increasingly using digital tools for automated, proactive monitoring. For example, some brands of the Group - including Audi, Porsche and VW – make use of AI to identify and regularly monitor risk in its supply chain.

We believe that the growing share of certified Aluminium in the market including certified mining operations is the right way to institute more sustainable supply chains. We also recognise that certification does not excuse companies from their duty of care and due diligence. This journey requires commitment from all relevant stakeholders and involves engaging in dialogue with all relevant stakeholders, taking the interests of others seriously – and ensuring that no one is left behind. An industry-wide consensus must be reached, and binding standards and processes that ideally apply to all must be established.

We look forward to your response.