Braskem

¹ Other residual fuel oils: C10+, RAP, BTE, UNILEVE.

We were not able to consolidate this data globally for this reporting cycle. We have committed to improve the global management of this topic to report it in the next cycle (2021).

We have established annual eco-efficiency targets for water consumption and effluent generation per ton of products produced (m³/t) that are monitored monthly by the company's top management. In all units, effluent management is based on local legislation standards and internal procedures related to the characteristics of the operations in each region, including substances of interest and composition of the effluents. These substances and their respective limits are listed in the specific legislation of each country and/or region or in the operating licenses.

Our long-term goal is to ensure that all the water used by Braskem comes from sources with low-risk supply. Given the challenging global scenario - the climate risk assessment pointed out the risk of severe droughts as the greatest potential risk in Brazil. This diagnosis is the basis for the development of Braskem's Adaptation Plan which aims to mitigate availability risks as well as to promote that investments in safer sources of water such as reused and desalinated water take place.

The overall corporate water stress score rose from 75% in 2019 to 82.9% in 2020, with a total of 18.86% of our water consumption coming from areas with high or very high-water stress.

The use of fresh water occurs throughout the production process of our operations. Among its main uses, being a very water-intensive industry (chemical / petrochemical), we highlight the use of fresh water for cooling systems and steam generation, consumption in processes and products and destination of effluents. Therefore, lack of water can affect operational costs and ultimately stop operations (dependence is high in the present and future scenarios), explaining why it is vital for operations. As Braskem is a chemical / petrochemical industry, a significant part of our suppliers makes similar use of water (e.g., cooling, steam), especially considering that Braskem's main raw material is petrochemical naphtha. Lack of water may affect / interrupt its operations (indirect use), explaining why the importance is vital, resulting in impacts also for Braskem, in current scenarios and until 2040, according to internal climate risk assessments. In areas of "water stress", reuse water is an alternative to maintain operations under normal conditions (mitigate / neutralize impacts) and avoid competition for fresh water. Its main use in Braskem's direct operations is throughout the production process. The main uses of reused water, being a very water intensive industry, are for cooling systems and steam generation, consumption in processes and products and disposal of effluents. Therefore, lack of water can affect operational costs and ultimately stop operations (dependence is high in the present and future scenarios), explaining why it is vital for operations. As Braskem is a chemical / petrochemical industry, a significant part of our suppliers makes similar use of reuse water (e.g. cooling, steam), especially considering that Braskem's main raw material is petrochemical naphtha. Water shortage may affect / interrupt its operations (indirect use), explaining why the importance is vital, resulting in impacts also for Braskem, in current scenarios and until 2040, according to internal climate risk assessments. Braskem measures and monitors 100% of the sites. The total volume of water withdrawal refers to the consumption of 41 industrial facilities located in Brazil (29), USA (6), Germany (2) and Mexico (4) measured monthly and registered in the SAP system. The volume is obtained through a meter inserted directly into the pipeline, which transports the water, taking the measurement and sending the result through a transmitter to the centralized control system. Monitored daily and consolidated monthly on site by HSE focal point.

In all our units, effluent management is based on discharge standards defined according to local legislation and internal procedures. Some industrial plants also have laboratories capable of analyzing the effluents and creating internal standards for environmental quality evaluation.

We emphasize that each region where we operate is unique, so we respect its operating characteristics, including in relation to the substances of interest and the composition of the effluents. These substances and their respective limits are listed in the specific legislation of each country and/or region or in the operating licenses.

Braskem has internal documents that regulate the topic, such as the Work Instructions (IT), which address locally the management and monitoring of effluents in the company. At Braskem, the liquid effluents have four general destinations: discharge into bodies of surface water; discharge into the ocean; delivery to third parties; and sprinkling on the ground. For each one of the destinations, there are specific quality standards of the effluent released that take into consideration the receptor body. In the case of soil sprinkling, the effluent is treated internally by the SITEL - Integrated System for Treatment of Liquid Effluents. For effluents sent to third parties, monitoring of the effluent quality is done by the third-party company itself, which is responsible for the treatment and must maintain the effluent quality standards established - Braskem constantly monitors the results

¹ Data is sent annually by the industrial units and compiled by Corporate HSE.

¹ Disposal limits are set in the conditions of operating licenses, based on current legislation and good practices. Data is sent annually by the industrial units and compiled by Corporate HSE.

¹ Total water consumption was 69.341 megaliters. Optimization of the concentration cycles of cooling towers in some of the units, especially for Q1 BA and start-up of the backup osmosis in Q4 DCX, had a positive impact on the result.

Generation and disposal indicator not necessarily follow each other. This is because shipping waste for processing requires specific planning involving total volume that will be disposed of and shipping logistics. Thus, waste can be generated in a given month but not necessarily will be disposed for processing in the same month.

Currently, Braskem has a portfolio of 120 innovation projects with a net present value (NPV) of approximately 8 billion reais, related to the themes, among them projects leveraged by the “Lighweight” platform, which seeks solutions with less weight in the product final for the packaging industry and the automotive sector, with the objective of contributing to a more sustainable world, with the reduction of waste generation and gas emissions. In addition, we also work with the concept of "Design for Environment", in which we combine our expertise in polymers and transformation processes with the consumer knowledge of brand owners to deliver an incredible experience with the least possible environmental impact. Aiming at more sustainable and circular packaging, we developed a design for environment methodology that uses Life Cycle Assessment to identify environmental hotspots throughout the product's life cycle. From this scientifically identified gap, the next step is to explore the consumer universe and its journey by maximizing attractiveness and usability. The ideation / prototyping / testing loop is repeated until we can combine sustainability, circularity and consumer experience in one product.

Braskem has several initiatives to avoid waste generation, having as basic principle the compliance with the priority order: 1. non-generation; 2. reduction; 3. reuse; 4. waste treatment; 5. environmentally adequate destination of waste. Compliance with the order seeks to reduce waste treatment costs; achieve increasing eco-efficiency rates (Benchmark); and prevent environmental liabilities.

The industrial units have several initiatives, within the operational routine of each process. Among the measures taken, we can highlight Reverse logistics of packaging of inputs used in the processes themselves; Reuse of waste as inputs between plants (pallets); Sale of waste as raw material for other processes; Sending plastic scrap to the I'm Green project; Educational campaigns for the supply area, strengthening the commitment to reverse logistics of packaging; Educational campaigns: Selective collection for segregation, correct disposal, Circular economy, Recycling, I'm Green, Environment Week, Against waste, Resignify consumption and disposal, Metal scrap; Search for treatment alternatives to reduce sending waste to landfills.

We rely on operational support in waste management from third-party companies specialized in this area. The monitoring of the services provided is carried out by the Environment team of each industrial unit, assessing the data generated monthly and holding periodic monitoring meetings to update the actions agreed upon in each specific contract.

Several verifications are performed monthly in the management process: 1) After issuing the documentation in which the technician from the third company requests the signature of the Braskem HSE representative; 2) When the Braskem engineer makes the monthly eco-indicator justification; 3) In the Waste Transportation Manifest reports (in Brazil); 4) In Measuring Bulletins or Audits conference (internal and external), in which the waste management process is evaluated; 5) Several reports.

In 2020, our eco-efficiency in waste generation was 2.23 kg/t, 1.27% below the value of the previous year and 9.79% below the target set for the year. The generation of non-hazardous waste was 18,543.18t and that of hazardous waste 17,349.48t, in total of 35,892.66t. Among the negative highlights are the increase in generation due to the implementation of the Delta Project at PP8, the disposal of metal scrap and the decommissioning process of operations in Bahia and the disposal of the contaminated liquid additive and mineral oil in Rio Grande do Sul.

¹ Indicator revision in 2020, as a result data from previous years not included.

¹ Indicator revision in 2020, as a result data from previous years not included.

(1) 2.7% of Braskem products contain CMR substances
(2) all products have been assessed for hazards based on GHS or other classification criteria for the creation of the safety data sheet

At Braskem, we consider product stewardship to be an integrated part of product design, manufacturing, marketing, distribution, use, recycling and disposal. According to our Health, Safety and Environment (HSE) Policy, countries and companies must establish responsibility for the stewardship of their respective products. Our product stewardship practice aims to assess and mitigate exposure risks and manage chemicals of concern. Our Product Stewardship approach follows three main steps: i. hazard characterization; ii. management risk characterization; and iii. stewardship risk management. To establish, implement and maintain business processes that effectively implement product stewardship and product regulatory processes, Braskem focuses on three main objectives: - Ensure product management and product regulatory processes are established reflecting HSE aspects and impacts to ensure regulatory compliance and avoid losses or undesirable outcomes; - Ensure product management and product regulatory processes and/or requirements are established and communicated at all stages of manufacturing, product value chain, logistics and distribution operations. - Ensure that product stewardship and product regulatory processes and/or requirements are established for Braskem.

Braskem does not use or have GMOs in its products to date that would be subject to such legislation.

Our business and operations are inherently subject to environmental, health and safety hazards. As a result, our business is subject to strict environmental regulations, among others. Despite our environmental, health and safety standards, policies and controls, our operations continue to be subject to incidents or accidents that could adversely affect our business or reputation, which could result in significant environmental and social impacts. Accordingly, we conduct a continuous assessment of the potential impacts arising from the industrial operation and monitor each of the potential scenarios that may affect the environment and the surrounding communities together with the Board of Directors.

In 2020, there were 71 accidents, at a rate of 1.8 accidents per 10,000 trips, a reduction of 28% of serious events, compared to 2019. The unified Road Safety management helped in the reduction, providing a more solid process with a more encompassing and deep view of these operations. The same controls and processes adopted for hazardous cargoes were implemented for non-hazardous cargoes. Initiatives such as the Road Safety Committee, Human Reliability in Logistics Journey, Guided Workshops and process digitization emphasize the commitment with operational safety and social responsibility. In Maritime Safety, the Vetting process remains as a global market benchmark.

Labelling information follows the SDS information (GHS format) and is handled by each site. The internal procedure used is ANX 6020-00840 - Information on chemical hazards. All significant product categories are evaluated and audited by Braskem.

Infractions involving cash penalties or not were considered for the period from 01/01/2020 to 12/31/2020, with no cut-off value. Fines paid: BRL 42,637.61. Fines received, with appeal possible or not: BRL 495,358.55

Braskem has an environmental protection area adjacent to its Chlorine/Soda operation in Alagoas (CS1 AL), the Santa Rita APA [Área de Proteção Ambiental (Environmental Protection Area)] comprised of 100% Atlantic Forest (93% of Open Rain Forest).

In 2020, there were no significant impacts on biodiversity.

Benjamín Conservation Area, in Mexico with 1 km², located at 2.4 km from the operation. Environmental activities are developed by biologists in partnership with NGOs in reforestation programs.

Alagoas Green Belt, in Brazil, with 0.20 km² (latitude 09 40 57.0 S longitude 35 49 32.0 W). Contracted companies carry out site management and conduct cleaning and care of animals.

Less than 1% of new suppliers selected based on this criteria.

N/A – Donations to political campaigns are prohibited in Brazil, according to interpretation issued by the Federal Supreme Court in the sentence in ADI [Ação Direta de Inconstitucionalidade (Direct Unconstitutionality Action)] 4650/2015 about Article no. 81 of Law no. 9.504/1997, later repealed by Law no. 13.165/2015.

Braskem has processes in the mentioned period, whether environmental or regulatory. However, the company does not have final decisions on significant fines during the period in question. This report adopted the same criterion used in the “Reference Form” introduced by the Brazilian “Securities and Exchange Commission” (Comissão de Valores Mobiliários, CVM), pursuant to CVM Instruction 480/209 – BRL 50 million