Supply Chain Due Diligence Act

Information According to German Supply Chain Due Diligence Act (LkSG) Human Rights Officer Compliant Procedure Policy Statement Allegion Deutsche Holding GmbH and its subsidiaries
1. Introduction/Preamble
2. Our understanding of the human rights and environmental standards to be complied with
3. Our approach to compliance with human rights and environmental due diligence obligations
4. Our human rights and environmental strategy: Working together for human rights and environmental protection
5. Human rights and environmental strategy
6. Human rights and environmental standards along the supply chain
7. Our risk management: How we structurally ensure human rights and environmental protection
8. In our own business operations: How we behave in accordance with human rights and the environment
9. Working with our partners to identify and avoid risks
10. Our commitment to implementing this policy statement
11. Reporting of possible misconduct through complaints procedures 12. Documentation and reporting
13. Regular review Information According to German Supply Chain Due Diligence Act (LkSG)

For Allegion Deutsche Holding GmbH and its subsidiaries Last updated: 16 December 2024

Human Rights Officer
The Human Rights Officer for Allegion Deutsche Holding GmbH is Maria Lucena Gómez. If you have any questions or comments regarding the German Supply Chain Due Diligence Act or related topics, please contact our Human Rights Officer at: Email: maria.lucenagomez@allegion.com Address: Spaces Building, Avenue Hermann Debroux 54, 1160 Auderghem– Belgium Compliant Procedure Allegion's Ethics Helpline is available to both employees and outside parties to report potential or actual concerns and questions. You can reach us online at allegion.com/helpline or via email at ethicsandcompliance@allegion.com. Concerns are always confidential, and if you choose, you many report your concern anonymously. Please see more details on the complaint procedure at https://www.allegion.com/corp/en/about/ESG/governance/ethics-and-compliance-program.html.

Policy Statement Allegion Deutsche Holding GmbH and its subsidiaries
1. Introduction/Preamble Allegion aims to improve people’s quality of life and safeguard the livelihoods of present and future generations by acting in an economically, ecologically and socially responsible manner. As a globally operating company, we are aware of our responsibility to respect human rights and to comply with our human rights and environmental due diligence obligations. This is also the benchmark for our business activities along our supply chain. Allegion is therefore committed to respecting human rights and environmental standards in our own business activities, actively demanding this in our global supply chains and providing access to remedy for those affected by human rights and environmental violations. Allegion expects its suppliers to commit to respect human rights and applicable environmental standards, to establish appropriate due diligence processes and to pass on this expectation to their own suppliers in order to ensure these standards along our entire supply chain up to the extraction of raw materials. Effective fiscal year 2024, Allegion is subject to the requirements of the German Supply Chain Due Diligence Act (“SCA”) in the implementation of its human rights and environmental due diligence. Among other things, the Act requires the publication of a policy statement setting out the company's strategy for the protection of human rights and the fulfillment of its environmental obligations in accordance with Section 6 Para. 2 SCA. Key elements of this policy statement also include a description of the procedures used by Allegion to comply with its legal obligations and a description of the human rights and environmental risks and expectations of our employees and suppliers identified on the basis of an annual risk analysis. Allegion considers the comprehensive risk analysis as a core requirement of the SCA and an important basis for continuous progress in our human rights and environmental due diligence.
2. Our understanding of the human rights and environmental standards to be complied with In addition to human rights and environmental standards, we expect directors, managers, and all other employees of Allegion as well as our suppliers to comply with all applicable laws, regulations, and standards in the countries in which we operate or are based, and we expect the same from our suppliers along the supply chain. If national laws or regulations contain more comprehensive regulations than those applicable at Allegion, national law or regulations take precedence. In particular, the following human rights and environmental standards must be complied with: Human rights standards No child labor - Allegion does not tolerate any form of child labor: Our suppliers are prohibited from using or supporting child labor in any possible way. Suppliers must set a minimum age for employment that corresponds to the age at which compulsory education ends under laws and regulations of the place of employment, but not below 15 years of age, even if it would be legal under local laws and/or regulations to employ younger children. Suppliers must prohibit employees and similar personnel under the age of 18 years from undertaking hazardous tasks that could endanger their health or safety. No forced labor - Allegion does not tolerate any form of forced or compulsory labor: Our suppliers may not use any form of forced labor, debt bondage, involuntary labor, practices akin to slavery, serfdom, or other forms of domination or oppression in the workplace or other kinds of modern slavery. Labor must always be provided voluntarily. Punishment, physical and/or psychological coercion and all forms of human trafficking are prohibited. Suppliers must ensure that employment relationships are voluntary and grant employees the opportunity to resign voluntarily, subject to a reasonable notice period. Employees must be allowed to retain control of their identification documents (e.g., passport, work permit, and all other personal legal documents) and must not be restricted in their freedom of movement or forced to involuntarily use employer-provided accommodation without a legitimate work-related reason. No discrimination - Allegion is committed to equal treatment and does not tolerate any form of discrimination: Our suppliers must ensure that any form of unequal treatment, discrimination, intimidation, harassment, or unjustified disadvantaging of its employees and in its working environment is avoided. Suppliers business conduct must thus not be influenced by grounds of national, ethnic, or social origin, religion or belief, skin color, gender, age, nationality, sexual orientation, health status, disability, or political opinion. Suppliers must undertake to implement appropriate measures to ensure that these equal treatment standards are observed at all their sites and in all business areas. Unequal treatment includes, in particular, the payment of unequal remuneration for work of equal value. Reasonable working times - Allegion is committed to complying with the applicable working hours: Our suppliers must observe all applicable national laws and regulations as well as binding industry standards regarding working times and rest breaks. Fair remuneration - Allegion is committed to fair remuneration: Our suppliers must pay their employees no less than the minimum wage as laid down by applicable laws and regulations, applicable collective wage agreements and in accordance with industry standards. This wage should be at least a living wage, covering workers’ basic needs as far as possible and providing a decent standard of living for workers and their families. Suppliers are obliged to pay workers directly, in full and on time. Safe and healthy workplace - For Allegion, protecting and promoting the health and safety of its employees and those in its supply chains is a key priority: Allegion expects its suppliers to comply with all applicable occupational health, safety, and fire protection laws and regulations. In addition, Allegion expects its suppliers to create a workplace with appropriate work equipment (free of charge) in accordance with the applicable laws and regulations to prevent accidents and work-related health hazards. Allegion expects its suppliers to regularly train and instruct their employees appropriately, to create standard operating procedures based on appropriate risk assessments and to monitor the implementation of these procedures. All occupational health and safety measures must not involve any expenditure for the employees. Freedom of association - Allegion recognizes the right of employees to form employee representative bodies and to engage in collective bargaining: Suppliers must undertake to respect the right of employees to form and join associations of any type, to carry out collective bargaining and to strike. Any form of discrimination or retaliation based on employees’ trade union or associations activities is prohibited. Employee representatives are also not subject to retaliation or discrimination and have the opportunity to carry out their representative functions in the workplace. In cases where freedom of association and the right to collective bargaining are restricted by law, alternative possibilities for independent and free association of employees for the purpose of collective bargaining must be granted. Additional human rights standards - Suppliers are also prohibited from, among other things: Causing harmful soil degradation, water pollution, air pollution, harmful noise emissions or excessive water consumption that adversely affects the natural foundations for food and drinking water or the health of a person; the unlawful eviction or unlawful deprivation of land, forests, and water in the phase of acquisition, development or other use of land, the use of which secures the livelihood of a person; the use of private and public security forces if this could lead to a violation of human rights, including the right to freedom of association; and other conduct that may seriously violate human rights. Environmental standards - Allegion attaches great importance to protecting its environment because it is the basis of life for humankind, animals, and plants: Suppliers undertake to behave in an environmentally friendly and climate-conscious manner and to comply with the applicable laws, conventions and regulations issued to protect the environment. All processes, operating facilities and means of production used by our suppliers and sub-suppliers along the supply chain must comply with the applicable laws and regulations on environmental protection. In particular, suppliers must undertake to comply with the following restrictions: The utilization of mercury regarding the manufacture of mercury-added products, the use of mercury and mercury compounds in manufacturing processes, and the permitted treatment of mercury waste must be in accordance with the Minamata Convention of 10 October 2013; the production, use, and environmentally sound handling of waste relating to chemicals and persistent organic pollutants must be carried out in accordance with the Stockholm Convention of 23 May 2001, as amended; and the export bans of hazardous waste of the Basel Convention of 22 March 1989, as amended, must be observed. 3. Our approach to compliance with human rights and environmental due diligence obligations As an industrial company with production sites and supplier relationships in many countries and regions, we influence the situation of people and their living environment in many different ways. Allegion has therefore developed a concept and a corresponding organizational structure to create a sustainable culture for compliance with human rights and environmental due diligence obligations in accordance with the SCA. Allegion's strategic goal for the first year of application of the SCA in relation to human rights and environmental standards is the best and most comprehensive fulfillment of the obligations arising from the Act. Accordingly, our initial aim for the 2024 financial year is to implement all statutory SCA requirements on time and completely. This is particularly challenging given the global operational expansion of our business activities and the high complexity of our supply chains. In the coming years, we will continuously review and improve our procedures, risk analysis, risk management, and derived activities in defense of human rights and environmental protection taking into account insights and learnings gained through own activities as well as input from external stakeholders. This will be ensured through interdisciplinary cooperation between the Purchasing, external and internal Quality Management, Human Resources, Occupational Health and Safety, Risk Management and Legal Department, which are responsible for implementing due diligence obligations in our own business area or in our supply chain together with other experts. Allegion has appointed a Human Rights Officer. The Human Rights Officer manages the implementation of the human rights and environmental due diligence concept at Allegion. The Human Rights Officer is primarily responsible for monitoring, reviewing, and advising the members of the Board of Directors in accordance with Section 4 Para. 3 SCA. The Human Rights Officer also reports directly to the Board of Directors. In the following, we describe the human rights and environmental expectations that Allegion sets for its managers, employees, all other staff, and suppliers in the supply chain based on the risk analysis. 
4. Our human rights and environmental strategy: Working together for human rights and environmental protection Allegion works continuously to analyze the human rights and environmental impacts of its business activities within its own business and along its supply chain in order to minimize potential risks and prevent them from occurring. 
5. Human rights and environmental strategy All of our company’s business activities should always comply with the applicable law, Allegion’s Code of Conduct and other applicable company policies, guidelines, and codes. To the extent possible, Allegion aims to integrate the human rights and environmental due diligence requirements of the SCA into Allegion’s existing management systems, regulations and procedures, such as those for occupational health and safety, environmental protection, supplier management, site management and cooperation with security forces, if applicable. Allegion also integrates the requirements of the SCA into its company-wide compliance management system. To this end, Allegion has created a concept for compliance with human rights and environmental due diligence obligations, which is characterized by an integrated and interdisciplinary risk management system consisting of risk analysis, processes for preventive and remedial measures, the definition of responsibilities, the submission of a policy statement, the maintenance of a complaints procedure and documentation and reporting. In order to ensure a uniform minimum standard, key components of the Allegion concept for compliance with human rights and environmental due diligence obligations are regulated in, among other things: Code of Conduct; Business Partner Code of Conduct; Environmental Health and Safety Policy; Anti-Slavery and Human Trafficking Statement; and Global Human Rights Policy.
6. Human rights and environmental standards along the supply chain Maintaining sustainable and fair supply chains is a core element of our efforts with regard to our human rights strategy. Therefore, Allegion expects all suppliers to commit to our Business Partner Code of Conduct. This Business Partner Code of Conduct includes numerous behavioral obligations and, above all, safeguards the fundamental human rights of our suppliers’ employees. In addition to the comprehensive obligation of our suppliers to comply with applicable laws, regulations, and other behavioral requirements, this includes the human rights and environmental standards listed above in this policy statement as minimum standards. It is important to Allegion that these human rights and environmental standards apply throughout our supply chain. Therefore, these principles are part of our contractual agreements with our suppliers. Allegion expects suppliers to also commit to respect human rights and protect the environment, to implement appropriate due diligence procedures and to pass on these principles to their own suppliers along the supply chain. 
7. Our risk management: How we structurally ensure human rights and environmental protection Human rights and environmental responsibility are a continuous improvement process for Allegion. In establishing and implementing its risk management system, Allegion will therefore also give due consideration to the interests of its own employees, the employees of suppliers in its supply chains and those who may otherwise be directly affected in a protected human rights or environmental position by Allegion’s economic activities or the economic activities of its supply chains. Moreover, the early identification of human rights and environmental risks plays a key role for Allegion as part of an effective risk management system. As part of the implementation of an effective risk management system, Allegion therefore ensures that sufficient financial and human resources are available to monitor the supply chain. Allegion considers effective risk management measures to be those that enable it to identify and minimize human rights and environmental risks and to prevent, end or minimize the extent of human rights or environmental liabilities where Allegion has caused or contributed to these risks or violations in the supply chain. Our risk management aims to address the assessment of any human rights and environmental risks in our operating business at a preventative stage and prioritize key risk areas. Our risk management consists thus of the following elements in particular: A central risk analysis for our own business division and for suppliers along the supply chain; our own locations comply with additional environmental management systems (e.g., ISO14001) as implemented; the operational implementation of measures to minimize or eliminate identified human rights and environmental risks; and a barrier-free, publicly accessible complaints procedure for reporting possible misconduct with regard to the human rights and environmental standards described in Section 2 of this policy. Allegion’s risk analysis and risk management system is updated on an ongoing basis and at least once a year. We also carry out a new risk analysis as and when required – e.g., in the event of a change in the risk situation in the supply chain. The same applies to the risk management system, which we continuously develop further and review for effectiveness based on latest risk analysis. 8. In our own business operations: How we behave in accordance with human rights and the environment Risk analysis in our own business operations - Allegion’s own business operations include all of our activities in Germany and abroad that are carried out for the manufacture and utilization of products and the provision of services.In 2024, Allegion is conducting a supply chain analysis using a risk-based approach. This risk analysis covered all Group companies in Allegion’s own business operations within the meaning of Section 2 Para. 6 SCA. Allegion also uses a risk-based approach to identify potential risks in its own business operations. Based on the results of the risk analysis of the own business operations, a SCA risk category is defined for each violation. We use this SCA risk category as the basis for taking suitable preventive measures to mitigate the risk of further breaches. Prioritization is based on the identified risk, our contribution to causation, and the degree of our influence and the characteristics of the respective business. In 2025, the risk analysis will be further developed by Allegion. In particular, the criteria for the abstract and concrete SCA risk analysis will be reviewed. Preventive measures in own business operations - Allegion has implemented a variety of preventive measures in its own business operations to prevent or minimize human rights or environmental risks. In addition to the implemented SCA regulations, various other measures are implemented. These include in particular: The implementation of the human rights strategy set out in this policy statement in the relevant business processes; the development and implementation of suitable procurement strategies and purchasing practices that prevent or minimize identified risks; conducting training in the relevant business areas (e.g., Procurement, Legal, Human Resources, Occupational Health and Safety, internal and external Quality Management); and the implementation of risk-based control and audit measures to check compliance with the human rights strategy contained in the declaration of principles in the company's own business operations. The training is based in particular on Allegion’s Code of Conduct and Business Partner Code of Conduct as well as this policy statement. In addition, we will train our purchasing department and employees from other relevant areas (Legal Department, Human Resources, Occupational Health and Safety, internal and external Quality Management) through our specific training program. Remedial measures in own business operations - If a potential violation of human rights and environmental rights and legal interests is imminent or has occurred in our own business operations, the respective remediation process will be triggered immediately. Therefore, if Allegion determines that a human rights-related or environmental duty in its own business operations or those of a direct supplier has been or is at imminent risk of being violated, it will take immediate and appropriate remedial action to prevent or stop the violation or to minimize its extent. In its own business operations in Germany, such a remedial measure should lead to an end to the violation. In its own business operations abroad and in its own business operations, the remedial measure should be minimized and generally lead to an end to the violation. 9. Working with our partners to identify and avoid risks Risk analysis our suppliers - In 2024, Allegion has carried out a supply chain analysis using a risk-based approach. Based on the SCA specific risks, we subject our suppliers to a basic risk analysis and identify a risk potential for them.Based on the results of the risk analysis for specific suppliers, an SCA risk category is defined for each supplier. We use this SCA risk category as the basis for taking suitable preventive measures to mitigate the risk to suppliers. Prioritization is based on the potential and/or identified risk, our contribution to causation, the degree of our influence and the characteristics of the respective business. In 2025, the risk analysis for suppliers will be further developed by Allegion. In particular, the criteria for the abstract and concrete SCA risk analysis will be reviewed. Preventive measures in own business operations - Based on the Allegion risk analysis, Allegion has developed an appropriate catalogue of measures. With the help of these measures, we can mitigate the risk of potential violations of human and environmental rights and legal interests at our suppliers.For suppliers where Allegion has identified an increased risk potential, we expect them in particular to: Consider our human rights and environmental expectations when selecting a direct supplier; contractually recognize and respect the Allegion Supplier Code of Conduct; the implementation of supplier training; and agree on individual preventive or remedial measures, such as conducting supplier assessments. Remedial measures in own business operations - In the event of known violations of a human rights or environmental standard at a direct or indirect supplier, Allegion will immediately initiate appropriate measures aimed at ending these violations.In the event of (imminent) violations in the business operations of direct suppliers, we will work to ensure that the responsible purchasing managers, together with the suppliers concerned, immediately draw up a corrective action plan and associated timetable to end or minimize (or avoid) the violation and monitor its sustainable implementation if the business relationship is to be continued. Alternatively, together with other companies, attempts are made within the framework of industry initiatives and industry standards to increase the possibility of influencing the polluter in order to end human rights-related or environmental obligations. If necessary, the business relationship with the supplier may be temporarily suspended while efforts are made to minimize risks. In the case of indirect suppliers, Allegion shall, in the event of substantiated knowledge of an (imminent) violation, create a corrective action plan to end or for the prevention and minimization of human rights or environmental violations and ensure its implementation. In addition, further preventive measures are to be anchored vis-à-vis the perpetrator, such as the conducting supplier audits, integrating supplier support in the prevention and avoidance of a risk or the implementation of industry-specific or cross-industry initiatives to minimize risks. In accordance with the principle of “providing assistance before termination”, we reserve the right to terminate the business relationship with direct suppliers at least in exceptional cases according to the provisions of the SCA. These exceptional cases include: Very serious violations of the SCA; no remedy through implemented measures after expiry of the specified time; and no less severe means at its disposal and increasing the ability to exert influence has no prospect of success. 10. Our commitment to implementing this policy statement This policy statement applies to all subsidiaries of Allegion Deutsche Holding GmbH companies as well as all board members, managers, employees, and all other staff. We also actively promote the communication of the policies and agreements underlying our policy statement. This policy statement is issued by the Board of Directors of Allegion Deutsche Holding GmbH and reviewed for validity by the Human Rights Officer at least once a year and on an ad hoc basis and updated as required, e.g., on the basis of the annual or ad hoc risk analysis or other findings – e.g., from the complaints procedure – regarding human rights or environmental risks. This policy statement is communicated to our employees and relevant stakeholders on the intranet and to external stakeholders via our company website. We offer all employees training to raise their awareness of how to deal with the human rights and environmental expectations in the policy statement. 11. Reporting of possible misconduct through complaints procedures Allegion has established an independent, impartial, and confidential complaints procedure for all Group companies, all suppliers and third parties in order to counteract violations of laws and internal Group regulations/policies/guidelines/codes or possible violations of human rights and environmental legal positions at an early stage and to prevent or reduce damage to our employees, suppliers and business partners. Reports made in this way are forwarded to our compliance organization and followed up. This procedure ensures that relevant information reported by Allegion employees and external parties, such as our direct and indirect suppliers or their employees, can be received and processed. The persons entrusted with processing the reports and discussing the facts are obliged to act impartially and to maintain confidentiality. They perform their duties independently and without being bound by instructions. The complaints procedure allows for anonymous, barrier-free and worldwide submission of complaints on request. Every whistle-blower receives a confirmation of receipt, provided that all the necessary information has been provided. As part of the process, it is ensured that the identity of the whistle-blower is protected. The confidentiality of the whistle-blower’s identity is protected, unless the whistle-blower has remained anonymous. Appropriate disciplinary measures are taken in the event of demonstrable breaches. In addition, the whistle-blower will be protected from discrimination and penalties for providing information. Accordingly, Allegion does not tolerate any retaliatory measures against complainants and endeavors to prevent such measures through comprehensive clarification. Violations of this prohibition will be punished as compliance violations. Complaints are received centrally via various reporting channels, which can be accessed via the following link: Allegion Ethics & Compliance HelpLine - Powered by Convercent. 12. Documentation and reporting Allegion reports annually to the competent authority and on its website on the fulfillment of its due diligence obligations regarding human rights and the environment in the past financial year. In addition, Allegion documents the fulfillment of its due diligence obligations on an ongoing basis. The documentation of the processes described in this policy statement is continuously decentralized and is stored in accordance with legal requirements. 13. Regular review The aforementioned procedures for implementing human rights and environmental due diligence in accordance with the SCA are reviewed regularly – at least once a year - and on an ad hoc basis. The risk analysis for the individual prohibited acts of the SCA also includes continuous monitoring of risk developments. Findings from the processing of information from the complaints procedure are taken into account when reviewing the procedures. The Board of Directors of Allegion Deutsche Holding GmbH