Vontier Corporation (VNT): PESTLE Analysis [Nov-2025 Updated]

You're defintely right to focus on Vontier Corporation (VNT) right now; they're navigating a massive shift, and the market is still pricing in the risk. The core challenge for 2025 isn't just selling pumps, it's managing a complex transition where Political funding (like the IIJA) drives EV growth while Economic inflation squeezes margins on raw materials. This PESTLE breakdown cuts straight to the point, showing exactly where the near-term risks lie-like margin pressure and the threat of Technological obsolescence from 400kW+ DC fast charging-and where the real growth is: in software, telematics, and mandated Legal compliance for new EV standards. You need to see how these six forces map to your investment thesis to make an informed decision.

Vontier Corporation (VNT) - PESTLE Analysis: Political factors

US Infrastructure Investment and Jobs Act (IIJA) funding drives demand for EV charging and smart city solutions.

The political landscape around Electric Vehicle (EV) infrastructure in 2025 is defined by significant federal funding, but also by acute regulatory uncertainty. The Infrastructure Investment and Jobs Act (IIJA) allocated a total of $7.5 billion over five years (FY2022-FY2026) for EV charging infrastructure, primarily through the National Electric Vehicle Infrastructure (NEVI) Formula Program ($5 billion) and the Charging and Fueling Infrastructure (CFI) Grant Program ($2.5 billion).

For Vontier, this was a clear tailwind for its multi-energy transition, specifically for Gilbarco Veeder-Root's Konect solution and the Driivz software platform, which manages over 85,000 ports globally. However, the political shift in early 2025 has created a major bottleneck. In February 2025, the Federal Highway Administration (FHWA) suspended approval of all state NEVI plans and halted new awards, pending updated guidance. This pause directly impacts the near-term pipeline for Vontier's EV hardware and software sales to retail fueling operators.

The slow pace of deployment is a clear risk. As of February 2025, states had only obligated approximately $526 million of the $5 billion NEVI funds. This means more than 89% of the program's formula funding remains uncommitted, throttling the expected demand surge. The goal of 500,000 EV fast chargers by 2030 is currently far off track, with only 370 NEVI-funded fast chargers open and operating as of September 2025. The political risk here is simple: a freeze on government spending slows the pace of the energy transition, forcing Vontier to rely more heavily on private capital expenditure (CapEx).

Global trade policies, especially tariffs on components, directly impact the cost of goods sold for their Gilbarco Veeder-Root segment.

The resurgence of protectionist trade policies in 2025 is a direct headwind to Vontier's supply chain efficiency. The company's Gilbarco Veeder-Root segment, which manufactures complex fueling and payment systems, relies on a global supply chain for electronic and metal components.

The implementation of new U.S. tariffs, including a 10% baseline tariff on all imports and reciprocal tariffs on key trading partners, has significantly increased the cost of goods sold (COGS). The U.S. weighted-average tariff rate rose from approximately 2 percent at the start of 2025 to more than 20 percent by April 11, 2025.

This tariff environment forces Vontier to either absorb the higher costs, which compresses Gross Margins, or pass them on to customers, which risks pricing itself out of competitive bids, especially in the highly price-sensitive retail fueling market. Global companies, in general, are anticipating a combined financial impact of $21.0 billion to $22.9 billion from U.S. tariffs for 2025 alone. That's a huge burden.

Government mandates on fuel efficiency and emissions accelerate the decline of traditional internal combustion engine (ICE) vehicle fueling infrastructure.

While the long-term trend is a clear decline for traditional fueling, the near-term political environment in 2025 has slowed the pace of this decline. The new administration announced a series of rollbacks on the stricter fuel economy and emission standards that were previously set to phase in through 2030. This is a defintely mixed signal for Vontier.

On one hand, the previous NHTSA Corporate Average Fuel Economy (CAFE) standards for Model Year 2025 were projected to require an industry-wide fleet average of 45.4 mpg. Maintaining or even slightly loosening this target reduces the immediate pressure on automakers to aggressively push electric and highly efficient vehicles, thereby extending the useful life of Vontier's legacy Gilbarco Veeder-Root equipment.

On the other hand, the political uncertainty around these mandates complicates Vontier's own strategic planning for its multi-energy portfolio transition. The core business of dispensing gasoline and diesel will still face an inevitable decline, but the timeline is now less certain, affecting the return on investment for new ICE-related product development.

Political stability in key emerging markets affects capital expenditure cycles for retail fueling station upgrades.

Vontier's global footprint means its CapEx cycle is highly sensitive to political and economic stability in emerging markets (EM). These markets are crucial for Gilbarco Veeder-Root's traditional fueling and payment systems, which often represent necessary upgrades to meet local regulatory and security standards.

In 2025, geopolitical instability remains a top global risk. This uncertainty directly translates into subdued private-sector CapEx. For instance, in a key market like India, industrial credit growth-a proxy for CapEx-has slowed significantly, with its share of total lending dropping from 39.5% in 2016 to 21.5% in 2025. Low industrial credit means less financing available for large-scale retail fueling station upgrades.

For Vontier, this means:

• Delayed CapEx: Retailers in politically volatile or economically uncertain markets (like Mexico, Brazil, or parts of Eastern Europe) postpone non-essential equipment upgrades.
• Currency Risk: Political instability often leads to currency volatility, making Vontier's imported equipment more expensive for local customers.
• Focus on Maintenance: Demand shifts from full station overhauls (new dispensers, new payment systems) to essential maintenance and regulatory compliance upgrades.

Vontier Corporation (VNT) - PESTLE Analysis: Economic factors

The economic landscape in late 2025 presents a mixed bag for Vontier Corporation, with inflationary pressures on the cost side and a high interest rate environment directly challenging customer capital expenditure (CapEx). While Vontier's end markets are generally resilient, the data shows that not all segments are weathering the macroeconomic headwinds equally, demanding a nuanced view of risk.

Inflationary pressures on raw materials like steel and semiconductor components squeeze gross margins, despite price increases.

Vontier has been actively managing inflation, but the cost of critical components like steel and semiconductors remains a persistent pressure point. Management has pointed to leveraging the Vontier Business System and price increases to offset these costs. The success of this strategy is visible in the full-year 2025 outlook, which projects an Adjusted Operating Profit Margin expansion of 20 to 40 basis points year-over-year. This margin expansion is a testament to strong cost control and pricing power, but it also indicates that Vontier must defintely run faster just to stay ahead of the rising cost curve.

For context, the Adjusted Operating Profit Margin for the third quarter of 2025 was 21.3%.

The core challenge is maintaining this margin expansion as the global supply chain remains tight for key inputs, which are essential for the Environmental & Fueling Solutions (EFS) segment's hardware and the Mobility Technologies (MT) segment's advanced payment systems.

Interest rate environment in late 2025 affects capital expenditure (CapEx) decisions by station owners and fleet operators for new equipment.

The high-interest rate environment is the single biggest near-term headwind for Vontier's capital-intensive customers. As of November 2025, the Federal Reserve's target range for the federal funds rate is 3.75% to 4.00%. This rate, while recently cut, is still significantly elevated compared to the ultra-low rates of the past decade, making debt financing for CapEx far more expensive.

This directly impacts the Gilbarco Veeder-Root business (within EFS), where station owners need to finance new fueling dispensers, point-of-sale systems, and environmental compliance equipment. When borrowing costs are high, station owners are more hesitant to take on new debt, often delaying investments in new technologies and equipment.

Here's the quick math on Vontier's own debt cost, which is relevant for its financial flexibility:

The risk is that projects get pushed out, especially for smaller, independent station owners who rely on commercial loans, leading to volatility in Vontier's large equipment sales.

Automotive aftermarket demand remains resilient, supporting the Matco Tools segment's revenue stream, even during mild economic slowdowns.

Honestly, the data tells a different story for Vontier's Repair Solutions segment, which houses Matco Tools. The traditional view of the aftermarket being recession-proof-because people fix old cars instead of buying new ones-is being challenged by the current macroeconomic pressures. The segment's performance in Q3 2025 was weak:

• Sales declined 6.9% to $142 million.
• Segment operating profit margin fell by 50 basis points year-over-year.

The slowdown is hitting service technicians' discretionary spending on 'high ticket items,' like diagnostic tools and toolboxes, which are the higher-margin products for Matco Tools. This suggests that while basic auto repair demand is resilient, the capital investment by the technician, which drives Matco's growth, is highly sensitive to economic uncertainty and personal financial strain.

The global economic slowdown, if it materializes, could delay large-scale infrastructure projects, impacting Vontier's project-based revenue.

A broad global economic slowdown poses a direct threat to the project-based revenue within the Environmental & Fueling Solutions (EFS) segment, which relies on large-scale infrastructure and regulatory-driven upgrades. While EFS showed modest core sales growth of 1.8% to $358 million in Q3 2025, this is not a booming number.

The full-year 2025 core sales growth for the entire Vontier Corporation is projected to be only 2.0% to 2.5%. This modest growth rate suggests that the market is already factoring in a degree of caution and potential project delays. Large-scale projects, such as new fleet infrastructure for alternative fuels (CNG, RNG, Hydrogen) or major retail fueling network upgrades, are the first to be put on hold when economic uncertainty rises. The slow adoption of new technologies in a tight credit market is a real risk here.

Vontier Corporation (VNT) - PESTLE Analysis: Social factors

Increasing societal demand for sustainable and green technology accelerates the transition to electric mobility and smart energy management.

You are seeing a fundamental shift in consumer values, and it's a massive tailwind for Vontier Corporation's (VNT) pivot toward a multi-energy future. The push for sustainability (ESG) is driving real-world demand for electric vehicle (EV) infrastructure, not just government mandates. The U.S. EV charging infrastructure market alone is projected to be valued at an estimated $6.41 billion in 2025, and it's expected to grow at a Compound Annual Growth Rate (CAGR) of 30.3% through 2030. That's a huge addressable market for Vontier's Konect 400kW EV Charger and its Driivz energy management platform.

This social pressure for 'green' solutions means fuel retailers are forced to adapt their forecourts, which is where Vontier's integrated solutions shine. They don't just sell a charger; they sell a system that manages the energy, integrates payment, and provides remote diagnostics. Honestly, this trend is the clearest long-term opportunity Vontier has.

Shortage of skilled technicians in the automotive and industrial sectors increases the value proposition of Vontier's diagnostic and workflow tools.

The labor market tightness for skilled trades is a crisis for your customers, but it's a structural advantage for Vontier's Repair Solutions segment. Shops are desperate for tools that make less-experienced technicians more productive and diagnose complex problems faster. The U.S. Bureau of Labor Statistics (BLS) projects over 67,000 job openings per year for automotive technicians through 2033, largely due to retirements. This shortage is not a temporary blip.

The severity is clear when you look at shop owner sentiment: in 2025, 31% of U.S. auto repair shops cite the technician shortage as their biggest challenge. Even high-paying roles are going unfilled, with Ford CEO Jim Farley noting a shortage of 5,000 mechanic jobs that pay around $120,000 per year. Vontier's diagnostic and workflow tools, which offer remote diagnostics and guided repair processes, are a direct solution to this labor gap, making them an essential capital expenditure for repair facilities.

Here's the quick math on the technician gap:

Consumer preference shifts toward digital payment and connected services at the pump and charging station, requiring constant POS system upgrades.

Consumers now expect a frictionless shopping experience. They want to pay with their phone, get loyalty rewards automatically, and have a connected experience whether they are pumping gas or charging an EV. This is a big driver for Vontier's Mobility Technologies segment, which saw a core sales increase of 4.8% in Q3 2025. Their Passport Enterprise and FlexPay 6 platforms are designed to unify these experiences.

The shift to connected services at charging stations is especially pronounced. For EV drivers, the top priorities are:

• WiFi (36%)
• Clean Restrooms (30%)
• Loyalty Perks (28%)

This means the Point-of-Sale (POS) system is no longer just a payment terminal; it's a full digital engagement hub. This social expectation necessitates continuous investment in software and hardware upgrades, creating a high-margin, recurring revenue stream for Vontier's unified payment solutions. That's a defintely sticky business model.

Labor market tightness necessitates investment in automation and digital workflow solutions to reduce reliance on manual processes.

The scarcity of labor, coupled with rising wages, makes the return on investment (ROI) for automation and digital workflow tools incredibly compelling. This is why Vontier is focused on enterprise productivity solutions and remote management. The Mobility Technologies segment, which includes these enterprise productivity tools, saw a strong sales growth of 5.1% in Q3 2025.

The core action here is replacing manual labor with software and remote capabilities. For example, Vontier's remote diagnostics and connected tools allow service providers to perform checks and even some repairs without physically sending a technician to the site. This doesn't just save money; it mitigates the risk of downtime caused by the inability to staff a service call, which is a key concern for fleet operators and convenience retailers facing the labor crunch.

Vontier Corporation (VNT) - PESTLE Analysis: Technological factors

Rapid advancements in DC fast charging technology (e.g., 400kW+) constantly threaten to obsolete older EV charging equipment

The pace of electric vehicle (EV) charging technology is a constant threat to Vontier's hardware business, forcing a high-stakes race to innovate. You see this clearly in the shift from 50kW or 150kW chargers to ultra-fast direct current (DC) charging. The market is quickly standardizing on higher power levels to meet consumer demand for faster charging times-think 10 to 80% charge in under 15 minutes.

Vontier is addressing this head-on, showcasing the Konect 400kW EV Charger as a turnkey, future-proof solution as of October 2025. This move is defintely necessary, but the risk remains: any legacy charging equipment with lower power ratings in the field risks becoming a stranded asset for site owners, which pressures Vontier to accelerate replacement cycles or offer costly upgrades.

The key challenge is managing the transition from an installed base of older equipment to the new standard. One clean one-liner: Faster charging makes old hardware a liability.

Telematics and fleet management software integration (e.g., in their DRB Systems) is a major growth vector, moving Vontier from hardware to software

The real opportunity for Vontier is in the software layer, moving from selling a one-time piece of hardware to generating predictable recurring revenue. The acquisition of Driivz, a leading EV charging and energy management software platform, positions Vontier in the highest-value, pure software segment of the Electric Vehicle Charging Infrastructure (EVCI) market. This software-centric strategy is paying off in the Mobility Technologies segment, which includes DRB Systems and saw a sales increase of 5.1% in the third quarter of 2025.

DRB Systems, focused on car wash point-of-sale (POS) and workflow software, is a prime example of this shift. The business was expected to have a high-single digit long-term growth rate, and integrating it with other Vontier solutions creates an ecosystem. This is how you build a sticky customer relationship, not just a transaction.

Here's the quick math on the strategic importance of software-driven segments:

Cybersecurity risks for networked point-of-sale (POS) systems and connected devices require substantial, ongoing R&D investment

As Vontier connects more devices-fuel dispensers, EV chargers, car wash systems, and forecourt automation-the attack surface for cyber threats grows exponentially. This isn't just a compliance issue; it's a direct threat to customer trust and operational uptime. The interconnected nature of their solutions, like Passport Enterprise and DOMS Forecourt Automation, demands enhanced security and operational resilience via isolated, remote-managed networks.

The necessity of this investment is reflected in the company's commitment to research and development (R&D). For the nine months ended September 26, 2025, Vontier reported R&D expenses of $139.7 million. This money isn't just for new product features; a significant portion must be allocated to shoring up the digital perimeter against sophisticated threats like ransomware and data breaches on their point-of-sale (POS) systems.

The cost of a breach would dwarf the R&D budget. You have to spend money to make money, and in this case, to keep it.

Artificial intelligence (AI) and machine learning (ML) are being integrated into diagnostic tools to improve repair efficiency for technicians

While the Repair Solutions segment (Matco Tools) saw a sales decline of 6.9% in Q3 2025 due to macroeconomic pressures on technician spending, the need for efficiency-driving technology is paramount. The long-term trend in vehicle repair is toward complexity, driven by electric vehicles and advanced driver-assistance systems (ADAS), which makes traditional diagnostics slower and less reliable.

Vontier is leveraging advanced analytics, a precursor to full AI/ML, in other parts of its business to solve similar problems. For instance, in its Fleet Solutions segment, an integrated solution using advanced telematics and fuel management technology, along with predictive maintenance, helped a customer cut fuel costs by 15% and reduce vehicle downtime by 20% within a year. This is a concrete example of Machine Learning in action-using data to predict equipment failure before it happens.

The Repair Solutions segment must follow this lead, embedding similar predictive and 'assistive' logic into tools like Matco's Maximus 5.0 Diagnostic Scan Tool, which already offers features like 'Code Assist' and 'Maximus Fix.' The next step is moving from a knowledge base to a truly predictive system that tells a technician why a part is about to fail, not just that it has failed.

• Embed predictive maintenance to cut technician repair time.
• Use advanced telematics to forecast equipment failure.
• Translate complex vehicle data into simple, actionable repair steps.

Vontier Corporation (VNT) - PESTLE Analysis: Legal factors

Evolving data privacy regulations (e.g., state-level US laws, international standards) require compliance upgrades for all payment and telematics systems.

You're running a global business, so data compliance isn't a one-time fix; it's a constant, expensive process. Vontier Corporation's Mobility Technologies segment, with its payment and point-of-sale (POS) systems like FlexPay 6 and telematics solutions from Teletrac Navman, is directly exposed to this risk. Every transaction and every vehicle data point is a compliance liability.

The regulatory landscape is fragmenting, especially in the US with state laws like the California Consumer Privacy Act (CCPA) and its successor, the California Privacy Rights Act (CPRA), plus international standards like the European Union's General Data Protection Regulation (GDPR). To stay compliant, large, multinational technology companies like Vontier are estimated to spend well over $1 million annually on GDPR-related activities, with some spending over $10 million. Honestly, that's just the cost of entry to the global market.

The real action item here is continuous software updates. The FlexPay 6 platform, which Vontier is actively promoting for unified payment across fueling and EV charging, must maintain its certification across all these jurisdictions to avoid crippling fines-penalties for non-compliance can reach up to €20 million or 4% of annual global revenue under GDPR.

New safety and interoperability standards for EV charging infrastructure (e.g., NACS adoption) necessitate product redesigns and certifications.

The electric vehicle (EV) charging world is settling on a standard, and Vontier is in the middle of that transition. The North American Charging Standard (NACS), now officially standardized as SAE J3400, is rapidly being adopted by major automakers for their 2025 model year vehicles. This shift isn't just a simple plug swap; it requires significant design, hardware, and software updates for Electric Vehicle Supply Equipment (EVSE) manufacturers.

Vontier's Konect EV charging solutions must incorporate this new standard to remain competitive and compliant with future federal and state funding requirements, which often mandate interoperability. The company is already showcasing new products, like the Konect 400kW EV Charger, at major industry events in late 2025. This proactive approach mitigates the risk of stranded assets, but it means a higher near-term capital expenditure on R&D for product certification and redesigns across the Gilbarco Veeder-Root portfolio.

Here's the quick map of the impact:

• Product Redesign: Integrating the J3400 port and associated high-voltage electrical system changes.
• Certification Costs: Securing new safety and performance certifications from bodies like Underwriters Laboratories (UL) for the updated hardware.
• Market Opportunity: Compliance with NACS opens Vontier up to a larger and more unified US EV market starting in 2025.

Tax code changes, particularly around R&D capitalization and corporate tax rates, directly affect Vontier's effective tax rate and cash flow.

The biggest, most immediate legal/financial factor for Vontier in 2025 is the legislative debate around Internal Revenue Code (IRC) Section 174. Since 2022, this rule has required companies to capitalize (amortize) domestic Research & Development (R&D) costs over five years instead of immediately expensing them, which significantly hurt cash flow for innovation-driven companies.

To be fair, the legislative tide has turned. As of 2025, there is a high probability of a change, potentially allowing companies to once again immediately expense domestic R&D costs for tax years beginning after December 31, 2024. This is a massive cash flow tailwind. If this change is enacted, it would allow Vontier to deduct its full domestic R&D spend in the year it's incurred, a huge boost to its cash position.

The core financial impact is clear:

This is a defintely a high-leverage point for Finance to track; a favorable resolution to Section 174 could directly support Vontier's full-year 2025 adjusted diluted net EPS guidance of $3.15 to $3.20.

Strict environmental liability laws in the fueling sector mandate continuous monitoring and leak detection system compliance for Gilbarco Veeder-Root.

Vontier's Gilbarco Veeder-Root is a market leader in environmental compliance solutions, particularly for underground storage tanks (USTs) at retail fueling sites. The legal framework here is mature but unforgiving, driven primarily by the US Environmental Protection Agency (EPA) regulations and state-level enforcement of leak detection and vapor recovery standards.

Compliance is non-negotiable. The strict liability nature of environmental laws means that even small, undetected leaks can lead to massive cleanup costs and fines. This mandates continuous, certified monitoring systems. Gilbarco Veeder-Root's core business is built on providing the technology-like their Veeder-Root automatic tank gauging and leak detection systems-that keeps their customers legally compliant and operational.

The opportunity for Vontier is in the upgrade cycle. As regulations tighten and older infrastructure requires replacement, the demand for their environmental and fueling solutions remains strong. The Environmental & Fueling Solutions segment saw a 2.3% increase in sales in Q3 2025, driven by strong performance in aftermarket parts, which includes these compliance-critical components. This is a stable, compliance-driven revenue stream.

Next Step: Legal and Tax teams should model the exact cash flow benefit of a full Section 174 repeal for the 2025 fiscal year by Friday.

Vontier Corporation (VNT) - PESTLE Analysis: Environmental factors

You're looking at Vontier Corporation (VNT) and seeing a company in the middle of a massive environmental transition, and honestly, that's where the biggest risks and opportunities lie. The core takeaway is that Vontier is aggressively managing its direct footprint, but the real financial driver is the pivot to a multi-energy future, which is going well, especially in their Mobility Technologies segment.

Pressure to Reduce the Carbon Footprint of the Supply Chain

The global push for corporate accountability means Vontier is under constant pressure to shrink its carbon footprint, especially in its Scope 3 emissions (value chain). They've made significant operational progress, achieving a 40% reduction in absolute Scope 1 (direct) and Scope 2 (indirect from power) greenhouse gas (GHG) emissions from their 2020 baseline, putting them ahead of their 2030 goal. Still, the supply chain is the next big hurdle.

To address this, Vontier has set a Science Based Targets initiative (SBTi) validated goal to achieve a 25% reduction in absolute Scope 3 GHG emissions by 2030. They are tackling this by engaging with significant suppliers, evaluating their decarbonization maturity, and sharing tools to help them with their own GHG accounting. This isn't just a compliance exercise; it's a critical risk management step, because a non-compliant supply chain can defintely disrupt production and incur costs.

On the manufacturing side, Vontier has already achieved 100% of its manufacturing sites with ISO 14001 Environmental Management Systems certification ahead of their 2026 target, which shows strong internal process control. Here's a quick look at their operational progress:

Global Push for Zero-Emission Vehicles and the Pivot to EV Infrastructure

The transition from fossil fuel to a multi-energy future is the single biggest long-term driver for Vontier, and it's where they are seeing clear financial momentum. Their ability to deliver solutions across traditional petrol, biofuels, natural gas, hydrogen, and electrification is key to navigating the energy trilemma (balancing sustainability, affordability, and security).

You can see the impact in their Mobility Technologies segment, which includes their electric vehicle (EV) infrastructure solutions. In the second quarter of 2025, this segment reported a core sales increase of 17.8% year-over-year. This growth is directly tied to the global EV push. The company is a major player in the EV charging space, managing one of the world's largest networks with over 80,000 plugs under management, primarily through their Driivz platform (a former asset). For the full 2025 fiscal year, Vontier projects total sales to be in the range of $3.028 billion to $3.038 billion, with core sales growth of +2.0% to 2.5%, underpinned by this momentum in mobility technologies.

Increased Scrutiny on Waste Management and Product End-of-Life Disposal

Regulators and customers are increasingly focused on what happens to industrial equipment, especially electronic components and heavy machinery, at the end of its useful life. For Vontier, this means adopting a life cycle thinking approach, from initial product design through disposal.

The company has a clear goal to divert at least 90% of manufacturing facility waste from landfills by the end of 2030. They've already shown progress in managing hazardous materials, decreasing hazardous waste generation by 17% from 120.6 metric tons in 2022 to 99.1 metric tons in 2023. To be fair, this is a complex area, and one limit is that Vontier does not yet track the weight of end-of-life products and e-waste recovered, but they are planning to gather this data for future reporting.

A concrete action in 2025 is the initiation of their first Life Cycle Analysis (LCA) on one of the highest revenue dispensers from their Gilbarco Veeder-Root business. This analysis will assess the environmental impact of the product from raw material extraction to disposal, which is a necessary step to identify reduction opportunities and enable transparent reporting to key customers.

Climate Change-Related Weather Events Can Disrupt Operational Continuity

The physical risk from climate change-like extreme weather events-is a real threat to manufacturing and distribution networks. You need to know if the lights will stay on and if the product can get to the customer. Vontier acknowledges this, having conducted thorough risk and opportunity analyses and climate scenario analyses to strengthen their operational resilience.

A key area of focus is water risk. They have a formal Water Management Policy and have completed water risk assessments for all manufacturing sites. This led to the identification of four high-priority sites where they are implementing conservation plans by the end of 2026. This focus on water management is a direct response to the potential for drought or flooding to disrupt operations, especially in regions with water-intensive manufacturing processes.

• Assess water risk at all manufacturing sites.
• Implement conservation plans at four high-priority sites by 2026.
• Use climate scenario analysis to stress-test supply chain resilience.