179 BMW Group Report 2024 To Our Stakeholders Combined Management Report Group Financial Statements Responsibility Statement and Auditor’s Report Remuneration Report Other Information Sustainability Statement Preventive and remedial measures Remedial or preventive measures are taken where risks or actual or potential impacts are identified at direct suppliers and, when circumstances require it, at indirect suppliers. These measures form an integral part of our processes ↗ Risk analysis and control mechanisms. They apply across all topics relating to due diligence on environmental and social standards in the BMW Group supply chain and are based on the requirements laid down by the LkSG. The measures are not limited to individual issue-specific content. In order to achieve positive impacts preventively, the BMW Group provides mandatory training for its own purchasing staff on a needs basis. The BMW Group also provides voluntary training for purchasing staff, process partners and suppliers on the topic of sustainability in the supply chain. In addition, training documen- tation is reviewed by the direct suppliers for their own field of business. The training courses explain how environmental and social standards are interrelated and clearly communicate the BMW Group’s expectations and due diligence measures. Partic- ipants in the training programme are made aware of the im- portance of due diligence in the supply chain and learn how to identify and minimise risks. The BMW Group provides specific training both as part of a comprehensive skills development pro- gramme and in special seminars for suppliers, such as a certified training course on the topic of sustainability. Moreover, suppliers can access industry-wide training programmes run by initiatives such as the RBA, in which the BMW Group is involved. These training programmes are integrated into the process of conduct- ing on-site assessments at supplier sites as, among other things, an additional measure to increase their effectiveness. Where risks or actual or potential impacts are identified during on-site assessments, individual measures are put in place to pre- vent or minimise them. This approach is a standard part of the follow-up to the assessments. In these cases, the supplier draws up an action plan to remedy the findings. The BMW Group mon- itors the implementation of the measures in cooperation with the RBA and the RSCI. Suppliers are provided with training to sup- port their efforts. If the findings are categorised as severe, the effectiveness of the agreed measures is verified in an on-site clo- sure assessment. The BMW Group has set itself the goal that all direct supplier sites that have completed an on-site assessment shall meet lo- cally applicable statutory requirements for sustainability as well as international human rights standards (BMW Group minimum requirements). In 2024, 22 of the 28 closure assessments car- ried out found that all violations of the BMW Group's minimum requirements (priority non-conformities) identified in the initial assessments had been remedied. In 6 cases, the closure assess- ment performed was not yet able to confirm that the agreed measures had been implemented successfully. In these cases, the BMW Group and suppliers jointly agreed on measures again, some of which were already completed during the reporting year. A further inspection in the form of another on-site assessment has either been planned or already successfully carried out in all of the cases. Two cases dating from 2023, where the closure assessment initially was not able to confirm that the measures had been implemented, have since been resolved by the suppli- ers. The effectiveness of the remedial measures was confirmed in further on-site assessments conducted in mid-2024. Complaints procedure The BMW Group’s objective is to protect its business operations from negative impacts related to human rights and the environ- ment, and to correct any substantiated (verified) evidence of en- vironmental or human rights violations in the upstream supply chain by arranging remedial measures. To this end, both our own and existing standardised instruments were established, some of which the BMW Group helped to de- velop. The instruments are accessible to employees, suppliers and other third parties alike. For more on the BMW Group Com- pliance organisation’s notification system, see » Compliance and notification systems. In addition to established internal grievance mechanisms, the BMW Group continuously monitors and tests new applications developed by external organisations, such as the RBA. These can be added to the existing complaints system as needed. In addition, the BMW Group has been involved in a working group of the sector dialogue (Branchendialog Automobilindustrie) on establishing a Company-wide complaints mechanism in Mexico and, since 2024, in piloting it. Information on the reporting channels available can be found on the BMW Group website and elsewhere. In the case of Company-wide channels, communica- tion also takes place via the relevant initiatives. All notifications received are checked and documented and processed using a Group-wide electronic case management system. In the report- ing year, 22 notifications of potential violations of the sustaina- bility principles in the supply chain were received through the re- porting channels. Of these, 16 were resolved in the reporting year, with none of the reports turning out to be justified. If the notifications are substantiated, we work with the supplier to initi- ate suitable remedial and preventive measures. A target date is agreed by which time the implementation of each measure is to be completed. The measures undertaken are evaluated after the deadline has passed. If a supplier refuses to implement the necessary remedial measures, an adjustment may be made to the supply chain. If necessary, the business relationship will be suspended tempo- rarily while efforts are made to mitigate the risk. A termination of the business relationship will only be considered if no other ef- fective means are available and the Company is unable to further leverage its ability to exert influence. The BMW Group strives to avoid this scenario by carefully selecting suppliers and providing them with the skills and support they need to further improve their own performance with regard to sustainability. In addition, the Company plays an active role in cross-sector initiatives to ad- dress systemic issues in a sustainable manner. In the reporting year, no existing supplier relationship was terminated due to se- vere sustainability violations.