44 BMW Group Report 2024 To Our Stakeholders Combined Management Report Group Financial Statements Responsibility Statement and Auditor’s Report Remuneration Report Other Information Overview of the BMW Group » To meet the generally increasing demand for climate-neutral energy through electricity from renewable sources1, the corre- sponding capacities would need to be expanded quickly. How- ever, the resulting increase in the share of renewable energies would lead to greater fluctuations in electricity generation and thus to new challenges for grid stability. Together with the limited capacities of the distribution networks, this would require further efforts for the sustainable success of electromobility. ↗ Innovations and Product Technologies « Economy » Economy and ecology are closely interconnected and influence each other. In addition to CO2 emissions, resource efficiency will gain importance. There are also increasing requirements for sec- ondary materials and recycling, such as quota mandates. At the same time, this can lead to cross-industry initiatives and oppor- tunities for new business models. ↗ Circular Economy and Resource Use Competition among different political systems dominates inter- national politics. Sanctions, tariffs and subsidies are altering in- ternational trade flows. The resulting geopolitical risks necessi- tate securing international supply chains. « Ecology » Governments around the world are working to translate the goals of the Paris Agreement on CO2 reduction into national laws. An ambitious climate policy orientation will become an important foundation for successful business operations. It is crucial to pre- pare for the impacts of climate change. Driven by the global need for decarbonization, the role of hydrogen as an energy carrier will fundamentally change in this context. « Politics » Politics and regulations restrict the scope of action across the entire automotive value creation model. The internationally var- ying legislation on similar issues significantly contributes to a heterogeneous regulatory landscape. Complying reliably with the often very complex requirements is frequently associated with high costs and increasingly poses a challenge for the automotive industry. « CORNERSTONES OF THE STRATEGY 2 The BMW Group strategy is aligned with the company's purpose “The BMW Group exists to move body, heart and mind.” This purpose is the driving force, the guiding principle and the orien- tation for our employees, and our commitment to our active role in society. Its long-term focus guides us purposefully into the fu- ture. Transitioning to the specific content of the BMW Group Strategy, the BMW Group Impact further develops the Company’s long- term strategic vision and emphasizes the ambition to contribute to societal advancement. “We make individual mobility more hu- man, intelligent and responsible – creating an inspiring future for all of us.” 1 See ↗ Glossary for a definition of electricity from renewable sources. 2 This chapter contains disclosures in line with ESRS 2 SBM-1.40e)-g); 42a)-c).