MATERIALITY ANALYSIS

The materiality analysis consists of identifying certain sustainability issues that are particularly relevant to the company, defined as “material issues”, on which a relevance analysis is conducted in order to prioritise the themes both from the company's point of view (internal relevance) and from the stakeholders' point of view (external relevance), in order to position them in a matrix defined as the “Materiality Matrix”. This process is carried out to identify the strategic sustainability guidelines on which the company can focus in the medium term.

As part of the preparation of its first Sustainability Report, Fabbri 1905 approached materiality analysis for the first time. During the course of the year, Fabbri's key leaders identified some material issues useful for building the sustainability strategy:

• Effectiveness of the governance model and institutional communication

Managing business activities in a sustainable manner, considering environmental and social sustainability factors in the various activities of governing bodies, ensuring transparency in communications, and structuring its governance in such a way as to systematise sustainability in normal business operations. Defining a clear corporate identity and a method of institutional communications directed to all stakeholders, paying particular attention to the accuracy and truthfulness of information.

• Ethics and responsible business

Conducting business and business relations in a responsible, transparent, credible and consistent manner. Adopting organisational models to enforce anti-corruption, anti-money laundering, and anti-trust regulations.

• Innovation Squad

Innovating both in terms of products and potential business activities through research and development, in order to implement best practices in terms of production, also considering possible solutions to reduce the environmental impact of activities while maintaining product quality standards.

• Sustainable procurement management

Using socio-environmental criteria to evaluate the supply chain in relation to the social and environmental impacts of procurement activities, including in relation to the policies applied to suppliers to ensure workers' human rights and the right to health and safety. Safeguarding the supply chain by evaluating climate change actions towards core suppliers.

• Employee protection and well-being

Safeguarding the health and safety of employees and contractors, promoting correct behaviour within company premises and ensuring people’s well-being.

• Human capital and skills development

Planning and implement professional and skills development paths for employees, in order to ensure the professional and personal growth of human resources.

Diversity, inclusion and human rights

Creating an inclusive work environment that fosters equal opportunities in the workforce and values diversity, including through programmes and activities promoted by the company itself. Extending good practices on diversity and inclusion as far as possible to the entire value chain.

• Impact on communities

Considering the impact that the business activity may have on the communities in which it operates, acting to maximise positive impacts and reduce negative impacts.

Consumer health and safety

Promoting initiatives and activities aimed at ensuring consumer health and safety through high-quality products.

• Direct environmental impact of corporate production and management

Assessing the environmental impacts directly related to production and managing them responsibly, while at the same time overseeing office activities with the aim of limiting waste and rubbish.

• Circular economy

Evaluating processes/methods of revalorisation of waste from the Production Phase, and other waste from other office activities or packaging circularity.

As anticipated, the materiality analysis would require conducting a study of material issues also involving stakeholders external to the company. As this is the first year of reporting for Fabbri 1905, it was decided to limit ourselves, for the time being, to an analysis of the issues by the company's managers alone, who in dedicated workshops took on the roles of some identified stakeholder categories (customers, consumers, employees, suppliers, sales networks, associations, bodies and institutions, and the media and community), in order to build an initial materiality matrix:

Materiality Matrix

Fabbri 1905 plans to strengthen the methodology for defining the materiality matrix, thus including a more detailed mapping of stakeholders as well as their direct involvement, in future reporting.