Sustainability Policy
1.INTRODUCTION
1.1 Local Comunicaciones, S.L. (hereinafter, “Localcom”), together with its subsidiaries (hereinafter, the “Group”) is responsible for building and managing an open access optic fiber network. The Group focuses on providing telecom services in rural areas of Spain.
1.2 Through its activities, Localcom provides essential infrastructure for key digital services in rural areas, and we are dedicated to conducting ourselves in accordance with the highest legal, ethical and professional standards throughout our business and our investment activities. We consider the appropriate assessment of sustainability, and engagement with environmental, social and governance (“ESG”) matters as fundamental to achieving and maintaining these standards.
1.3 We are committed to integrate ESG matters throughout our investment and ownership activities and to work closely with our clients and other stakeholders to further our sustainability beliefs.
1.4 This sustainability policy (hereinafter, the “Sustainability Policy”) provides guidance on how ESG matters are integrated into our activities.
1.5 The Sustainability Policy has been adopted by the Board of Directors of Localcom (the “Board”). Adherence to the Sustainability Policy applies to all entities controlled by the Group and all employees, directors, officers and agents of the Group whether or not employed directly by the Group (collectively, “Employees”). All Employees are required to read and understand this Sustainability Policy and are encouraged to ask questions regarding its application. Employees may direct such questions to the Human Resources Directorate of Localcom.
1.6 Employees individually are ultimately responsible for their compliance with the Sustainability Policy. Every manager will also be responsible for administering the Sustainability Policy as it applies to Employees and operations within their area of supervision. Violation of the Sustainability Policy will constitute grounds for disciplinary actions.
1.7 Employees who observe or become aware of a situation that they believe to be a violation of the Sustainability Policy or to introduce heightened ESG risks, whether caused by an Employee or another stakeholder, have an obligation to notify their immediate supervisor, the executive management or a member of the Board unless the Sustainability Policy directs otherwise. Violations involving a manager should be reported directly to a member of the Board. When a manager receives a report of a violation, it will be the manager’s responsibility to handle the matter in consultation with a member of the Board.
1.8 If an Employee reporting a violation wishes to remain anonymous, all reasonable steps will be taken to keep their identity confidential. All communications will be taken seriously and, if warranted, any reports of violations will be investigated. Localcom will not retaliate or allow retaliation in respect of any reports made by an Employee in good faith.
2. ENVIRONMENTAL
2.1 Biodiversity and habitat
Localcom aims for its activities to have minimal impact on the surrounding habitat, including its flora and fauna. Where possible, we will seek to protect and improve biodiversity and Localcom will aim to monitor the impacts of its operations, whether positive or negative.
2.2 Climate change mitigation and adaptation
2.2.1 Localcom will monitor and assess the possible impact of climate change on its fiber optic and Wimax network management activities. Climate change effects include changes in the patterns of strong winds (for example, easterly winds in the Cadiz area) or the effects of possible increases in temperature and risks of flooding. With them, Localcom will establish plans to improve the resilience of its network in the future to prevent these effects of climate change from affecting its services, with proposed actions to improve its infrastructure such as: improvement of installations protected from strong winds, strengthening of antennas, dynamic management of temperatures in the equipment rooms, and improvement of network infrastructures to avoid disruptions due to flooding, etc.
2.2.2 We will conduct and integrate climate risk studies (addressing both physical and transition risk) in our investment decisions
2.2.3 Where necessary and possible, we will investigate and complete climate change adaptation and mitigation measures.
2.2.4 We will consider the resilience of our portfolio to catastrophe or natural disasters and will support our tenants where necessary in implementing resilience measures.
2.3 Energy consumption
2.3.1 Where feasible, Localcom will focus on the efficient use of power and will source low carbon electricity for its data centres and the active side of the network to ensure our greenhouse gas emissions are minimized
2.4 Greenhouse gas emissions
2.4.1 Localcom’s aim is to reduce greenhouse gas emissions through measures such as those noted in item 2.3.1.
2.4.2 Our ambition is to reach net zero carbon emissions by 2040, covering scope 1, 2 and most material scope 3 operational emissions. To this effect, Localcom is developing a decarbonisation plan consistent with best practice recommendations
2.5 Material sourcing and resource efficiency
2.5.1 Where possible, Localcom will look to support its operations in developing sustainable procurement or sourcing processes.
2.5.2 Where relevant, Localcom itself will adopt sustainable material sourcing and promote resource efficiency.
2.6 Waste
2.6.1 Localcom will aim to support its operators and suppliers in reducing waste generation and the diversion of materials to landfill.
2.6.2 Where relevant Localcom itself will reduce its waste generation and work with its suppliers to improve recycling and circular economy efforts.
2.7 Water
Localcom will ensure sustainable use of water resources by its operators.
2.8 Pollution
Localcom intends to minimise air, light and noise pollution and, where necessary and possible, will engage with operators to further support this aim.
3.SOCIAL
3.1 Community
3.1.1 Through our assets, Localcom plays a key role in community development. Our aim is to:
(i) have a positive impact in the local communities in which we operate by providing necessary training related to telecom services to populations who have not benefited from a digital education;
(ii) support local communities through social enterprise partnering with community groups;
(iii) support charities related to social care in areas that are deprived of basic social infrastructure; and
(iv) promote local employment opportunities.
3.1.2 Health and safety of the local communities and users of our networks are of key importance to Localcom. Together with our operators, we will work to ensure health and safety measures are upheld.
3.1.3 Where possible, we would seek to understand our clients’ satisfaction levels and will aim to engage with our customers on an annual basis.
3.2 Employees
3.2.1 Localcom aims to provide a safe and comfortable work environment with a strong emphasis on health and safety measures, labour standards and working conditions. In this sense, Localcom is working to establish an evaluation and planning of occupational risks in the parent company and its subsidiaries. These tasks evaluate the current employment situation of the company and its occupational health and safety conditions. Through this analysis, an action plan will be established for general risks, risks according to specific job roles, and by work teams, as well as establishing protocols for monitoring the health of its employees and the planning of preventive actions to improve the health and safety of its workers.
3.2.2 Employee engagement is of high importance to Localcom. All personnel directly employed by entities within the Group are subject to annual performance reviews with their immediate supervisor, a member of the executive management or our Board of Directors, including modules for self-assessment vis-à-vis pre-agreed KPIs, corporate and personal development goals and feedback concerning the business, the employee’s supervisor and executive management. Localcom also intends to establish employee satisfaction surveys at the company level and in each of its affiliates in order to improve general working conditions, as well as to establish learning of best practices by middle managers who will subsequently apply them in improving the satisfaction of all its employees.
3.2.3 Localcom wholeheartedly believes in the value and importance of equality and diversity and strives for broad diversity across directors, management and staff. Localcom will actively monitor diversity statistics across its workforce and will look to partner with organisations to improve diversity in the digital sector in the areas where it operates.
3.2.4 Our remuneration framework outlines the importance of the consideration of ESG risks in Localcom’s development. It is important to us that all employees are fully aligned with the contents of our Sustainability Policy. Adherence to the Sustainability Policy is considered in every employee’s performance assessment. Such performance assessments are linked to, and will directly impact, the remuneration of employees.
3.3 Supply chain and contractors
3.3.1 Localcom will strive to ensure that our supply chain and contractors abide by the minimum standards set by the jurisdictions in which we operate. This includes measures to prevent child labour and other forms of forced labour or modern slavery. As well as promoting the protection of human rights, in line with the United Nations Universal Declaration of Human Rights
3.3.2 We aim to ensure that our contractors and supply chain abide by our jurisdictions’ health and safety measures. In addition, all of them will be informed of the contents of the Group’s Code of Conduct
4. GOVERNANCE
4.1 Governance processes
4.1.1 Localcom’s Board has an active role in the Group’s sustainability drive and supports continuous improvement of our ESG decision-making.
4.1.2 We adhere and subscribe to our shareholders’ responsible investment practices, including those set by PATRIZIA Infrastructure.
4.1.3 We believe in an open, transparent and safe working environment and recognise and support whistle-blower protection.
4.1.4 The Group has several communication channels to report potential breaches of this Policy. Such reports should be submitted through the available channels, https://canalinternodenuncias.es/localcom/ or by email to the Officer in charge of the Communication Channel.
4.1.5 We aim to delegate authority on ESG issues throughout our organisation, emphasising the importance of the integration of issues into our business plan and strategy process.
4.1.6 Shareholder rights are defined by our charter and bylaws, and we ensure that we abide by the standards set.
4.1.7 We ensure that any engagement with lobbying groups is aligned with our climate change and other sustainability commitments and with those of our shareholders, as well as with PATRIZIA Infrastructure’s corporate commitments.
4.2 Cybersecurity, data protection and privacy
Localcom commits to abide by GDPR and any cybersecurity policies which currently exist is the jurisdictions that we operate in. As a fibre optic network owner, Localcom understands the importance of upholding strong data protection and cybersecurity measures. It will therefore integrate data protection and cybersecurity requirements throughout the asset lifecycle from the due diligence through to operational phase for all assets.
4.3 Conflicts of interest
Localcom requires that all our Employees refrain from actions or to have interests that hinder them in performing their duties objectively and effectively. Therefore, it establishes mechanisms to prevent and manage any conflicts of interest that may arise.
4.4 Bribery, corruption and fraud
Localcom has implemented a Code of Conduct aimed at creating a sound corporate culture and to preserve the Group’s integrity by helping our Employees to promote standards of good business practice. This includes the promotion of fairness, honesty and integrity in every aspect of dealing with other colleagues, business relationships and customers, the public, business communities, shareholders, suppliers, competitors and government authorities, including through refraining from making political contributions.
.
4.5 Remuneración de Alta Dirección
4.5.1 Localcom will develop an executive compensation policy ensuring that members work in alignment with the entity’s objectives and risk tolerance, including consideration of ESG objectives and material risks.
4.5.2 Executive compensation will be linked to sustainability performance which will be measured against defined criteria such as compliance with group policies, operations in line with EHS best practices, incident statistics and the promotion of ED&I.
4.5.3 This policy is reviewed annually and aligned with Localcom’s shareholder values.
4.6 Delegating authority
ESG is integrated throughout all activities, with the Board having oversight and final decision making upon issues. Compliance with and implementation of this policy is actively monitored by the Management team and discussed in the Board meetings.
5. SUSTAINABILITY OBJECTIVES
Consistent with the integration of ESG matters into our operations, Localcom has set the following long-term strategic objectives, and reports on progress to the Board at least twice a year:
ESG matter | Key Company Objective | Associated Target |
Energy | Optimize energy efficiency to achieve environmental and economic best practices, taking advantage of the green energy transition | • >50% procured energy from renewable sources by 2026 |
Greenhouse gas emissions | Reach net zero carbon emissions by 2040, covering scope 1, 2 and most material scope 3 operational emissions | • 8.28 tons CO2e/M EUR revenue by 2030 • Net zero by 2040 |
Social | Continue investing in the local communities that we serve | Continue investing in the local communities that we serve |
Customer satisfaction | Ensure the best NPS in the regions Localcom operates in and maximize brand loyalty | • Overall net promoter score >24.6 by 2026 |
Diversity and inclusion | Ensure equal opportunities for all current and future employees, fostering diversity and inclusion for all | • Tracking of diversity metrics • >40% of female employees |
Cybersecurity | Ensure best-in-class cybersecurity practices to avoid breaches that can damage Localcom’s business and reputation | • 0 severe security breaches. - On going • 0 employee failing cyber hacking tests. - On going • >90% employees with compliance training completed in 2025 |
Local Comunicaciones SL Sustainability Policy | |
Approved by: | The Board of Directors of Local Comunicaciones, S.L. |
Approval date: | 19 December 2025 |
Policy owner: | CEO of Local Comunicaciones, S.L. |
Policy Reference no.: | LCP-001 |
Version control: | V1.0.- First version Local Comunicaciones S.L. LSP-001 (20/07/2023) V2.0.- Reviewed version Local Comunicaciones S.L. LSP-001 (BoD 11/12/2024) V1.0.- First version Local Comunicaciones S.L. LSP-001 (20/07/2023) |
Use: | Approved for external use |