ANNUAL DUE DILIGENCE REPORT: AN ETHICAL JOURNEY INTO HUMAN RIGHTS AND RESPONSIBLE SOURCING

INTRODUCTION

This year we have made significant progress toward complete ethical and environmental sustainability, a journey that has stimulated and enriched our organization.

C.PAOLILLO & CO. Srl has moved ever closer to achieving a business model that not only excels in the market, but also sets new benchmarks in terms of Corporate Social Responsibility.

Our environmental and social performance is a fundamental element of our corporate culture and guides our strategic choices.

FOCUS ON HUMAN RIGHTS

During the year, our commitment to human rights became concrete with measurable actions consistent with UN and OECD principles.

We have built into our corporate culture initiatives to ensure that every voice, both internal and external, is heard and considered important.

This year we embarked on the journey to obtain RJC certification, an important step in conforming to the required standards.

HUMAN RIGHTS POLICIES

Our human rights policies transcend the formality of documents, becoming an ethical commitment that every member of our team embodies every day:

- We strengthened measures against violence and harassment by introducing anonymous reporting channels and establishing an ethics committee.

- We actively work against child and forced labor by cooperating with local entities and strictly monitoring our suppliers.

- We maintain a constant dialogue with authorities to anticipate and understand legislative developments.

- We launch professional development programs that elevate the skills of our employees and ensure their safety and well-being.

DUE DILIGENCE PROCESS

We have refined our due diligence process, which guides us in identifying and mitigating risks:

• Impact Assessment: We have implemented an advanced risk management system that increases the accuracy of our forecasts

• Action and Response: We turn risks into opportunities for improvement through proactive policies and specific development plans.

• Traceability: Implemented a real-time tracking system for all corrective actions, ensuring transparency.

• Communication: We will publish annual due diligence updates to maintain an open dialogue with all stakeholders.

SUPPLIER ENGAGEMENT

We have sent due diligence questionnaires to our suppliers to assess their practices and their alignment with our ethical standards. This helps us gain a clear and detailed view of our supply chain, with most suppliers already RJC certified, demonstrating a shared commitment to responsible practices.

CONCLUSIONS

The commitment of C.PAOLILLO & CO. Srl manifests itself not only in policies and processes, but also in the personal stories of those who interact with us.

Constructive interaction with the Workers' Safety Representative has opened up new possibilities for the well-being of our employees.

The results of the self-assessment questionnaires show alignment with our standards, laying the foundation for future responsible collaborations.

We look to the future with a commitment to remain an example of ethics and integrity, leading the industry toward ever higher standards.

Our audit of suppliers in 2023/24 confirmed the absence of human rights violations, reinforcing our confidence in business partners.

La Direzione