In alignment with the expectations of our executive management, customers and other stakeholders to manage our business in a responsible manner, Xylem has entered a new chapter in our Sustainability journey: we have launched in 2020 a sustainable procurement program to monitor social and environmental performance in our supply chain.

To make this initiative as efficient as possible for both Xylem and our suppliers, we have selected the EcoVadis monitoring platform. EcoVadis combines sustainability expertise and online tools that will save you time and resources on sustainability assessment and reporting in the years to come with:

• Confidential and efficient Sustainability questionnaire and expert analysis
• A Sustainability Performance Scorecard (which you can share with other clients as well)
• Tools for benchmarking and improving your Sustainability practices

Xylem has been responding to the EcoVadis assessment since 2018. Participation in this program will be a mandatory condition to get the status of Preferred Supplier by 2025, and our suppliers’ engagement and performance results will be integrated into our sourcing process.

Supplier audits and risk management

Over the past four years, we have established a comprehensive and scalable supply chain risk management program. This program focuses on identifying and quantifying supplier risk and establishing mitigation management approaches that reduce the overall exposure from identified areas of concern.

The program aims to identify potential issues early, model the impact and likelihood of a supply partner’s failure, analyze potential mitigation strategies, and implement preventive risk actions.

We use EcoVadis and comparable sustainability assessments to evaluate our suppliers' performance in the areas of labor practices, human rights, environmental protection, ethics, and sustainable procurement. These assessments enable us to identify both risks and opportunities and help our suppliers track and improve their sustainability performance year over year.

At the end of 2023, 61% of reassessed suppliers had improved their score; 21% remained unchanged. The average rating of our suppliers is higher than the average rating of the EcoVadis network and has continued to improve since 2020.

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