Independent Assurance Statement

To the Directors and Management Kirloskar Brothers Limited, “Yamuna” Survey No. 98/ (3 to 7), Plot No. 3, Baner, Pune – 411045, Maharashtra, India

Kirloskar Brothers Limited (hereafter ‘KBL’) commissioned TUV India Private Limited (TUVI) to conduct independent external assurance of non-financial Information disclosed in their Integrated Report (hereinafter ‘the Report’) for the period 1st April 2023 to 31st March 2024. The report is based on the principles of IIRC Integrated Reporting Framework and Global Reporting Initiative (GRI) standards. This engagement comprises a “limited assurance” of KBL’s sustainability information for the applied reporting period. The Report is developed with reference to GRI Standards 2021, IIRC Integrated Reporting (<IR>), and ISAE 3000 (Revised) with “limited level”.

Management’s Responsibility

KBL has developed the Report content and is responsible for the identification of materiality through the double materiality test, corresponding ESG issues, identifying, establishing, and reporting performance management, data management, and quality. The management team at KBL is accountable for the accuracy of the information provided in the Report and the process of collecting, analysing, and reporting that information in both web-based and printed Report. This includes the maintenance and integrity of the company’s website. Furthermore, KBL’s management team takes responsibility for the accurate preparation of the Report in reference to the applied criteria of GRI Standards and <IR> framework. They ensure that the Report is free of any intended or unintended material misstatements, so stakeholders can trust the information provided. KBL will be responsible for archiving and reproducing the disclosed data for the stakeholders upon request.

Scope and Boundary

The assurance engagement encompasses a review of the evidence (on a sample basis) for identified ESG indicators. Additionally, the verification team performed

• Verification of the application of the Report content according to material topics identified based on the double materiality, and principles as mentioned in the Global Reporting Initiative (GRI) Standards, the principles of IIRC Integrated Reporting (<IR>), and the quality of information presented in the Report over the reporting period;
• Review of the policies, initiatives, practices, and performance described in the Report;
• Review of the ESG disclosures made in the Report against the requirements of the GRI Standards and <IR> framework;
• Verification of the reliability of the GRI Standards disclosure on environmental and social topics;
• The specified information was selected based on the materiality determination and needs to be meaningful to the intended users.

TUVI has verified the below-mentioned disclosures given in the report.

The reporting boundary for the above topics includes 01 Corporate office location and 09 manufacturing facilities across India. The onsite and web-based video meetings were conducted for the below tabulated locations in the month of February 2024.

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The assurance activities were done together with a desk review for all other KBL sites within the reporting boundary.

Our Responsibility

TUVI’s responsibility as per the assurance engagement is to perform independent assurance and to express a conclusion based on the work performed. We conducted our engagement in reference to the AA1000 Assurance Standard v3 for identified non- financial ESG indicators. Our engagement did not include an assessment of the adequacy or effectiveness of KBL’s strategy or management of sustainability-related issues or the sufficiency of the Report against the principles of GRI Standards, IIRC Integrated Reporting (<IR>), and ISAE 3000 (Revised), other than those mentioned in the scope of the assurance. The data is verified on a sample basis, the responsibility for the authenticity of data lies with the reporting organisation. The reporting organisation is responsible for archiving the related data for a reasonable period of time. TUV does not take any liability or co- responsibility 1) for any damages in the case of erroneous data reported. 2) for any decision a person or entity would make based on this assurance statement. This assurance engagement is based on the assumption that the data and information provided to TUVI by KBL are complete and true.

Verification Methodology

TUVI adopted a risk-based approach, focusing on verification efforts on issues of high material relevance to KBL business and its stakeholders. TUVI has verified the statements and claims made in the Report and assessed the robustness of the underlying data management system, information flows, and controls. In doing so,

• TUVI reviewed the approach adopted by KBL for the stakeholder engagement and materiality determination process (based on the principle of double materiality and the requirements of the GRI Standards).
• TUVI verified the disclosures and claims made in the Report and assessed the robustness of the data management system, information flow, and controls;
• TUVI examined and reviewed the documents, data, and other information made available by KBL for the reported disclosures, including the disclosure on management approach and performance disclosures;
• TUVI conducted interviews with key representatives, including data owners and decision-makers from different functions of the KBL, during the remote assessments;
• TUVI performed sample-based reviews of the mechanisms for implementing the ESG related policies, as described in the KBL Report;
• TUVI verified sample-based checks of the processes for generating, gathering, and managing the quantitative data and qualitative information included in the Report for the reporting period.

The Report was evaluated against the following criteria: adherence to the principles of stakeholder inclusiveness, materiality, responsiveness, completeness, neutrality, relevance, sustainability context, accuracy, reliability, comparability, clarity, and timeliness, as prescribed in the GRI Standards, IIRC Integrated Reporting (<IR>), and AISAE 3000 (Revised).

Opportunities for Improvement

The following are the opportunities for improvement reported to KBL. However, they are generally consistent with management’s objectives and programmes.

• KBL may strengthen its internal reporting by opting a smart cloud-based data management system and compliment the same with periodic internal data and performance reviews;
• KBL may develop and declare sustainability targets along with timelines;
• KBL may start verifying environmental and social performance e.g. zero waste to landfill, ESG supply chain audit, water audit, EPD/ LCA verification, social return on investment etc.;
• KBL may opt for water positive index and zero waste to landfill verification

Our Conclusion

In our opinion, based on the scope of this assurance engagement, the ESG disclosures and reference information provide a fair representation of the material topics and meet the general content and quality requirements of the applied standards.

KBL appropriately discloses the KPIs and actions that focus on the creation of value over the short, medium, and long term. The selected KPIs disclosed by KBL are fairly represented. TUVI did not perform any assurance procedures on the prospective information, such as targets, expectations, and ambitions, disclosed in the Report. Consequently, TUVI draws no conclusion from the prospective information. This assurance statement has been prepared in reference to the terms of our engagement.

Disclosures: TUVI is of the opinion that the reported disclosures generally meet the GRI Standards reporting requirements. KBL refers to universal disclosure to Report contextual information about KBL, while the ‘Management Approach’ is discussed to Report the management approach for each material topic.

Universal Standard: KBL followed GRI 1 Foundation 2021: Requirements and Principles for using the GRI Standards; GRI 2: General Disclosures 2021: Disclosures about the reporting organization. General Disclosures were followed when reporting information about an organisation’s profile, strategy, ethics and integrity, governance, stakeholder engagement practices, and reporting process. and GRI 3: Material Topics 2021: Disclosures and guidance about the organization’s material topics. GRI3 was selected for management’s approach to reporting information about how an organisation manages a material topic.

TUVI is of the opinion that this report has been prepared in reference to the GRI Standards and <IR> framework.

Topic-Specific Standards: 300 series (environmental topics), and 400 series (social topics); these topic-specific standards were used to Report information on the organisation’s impacts related to environmental and social topics. TUVI is of the opinion that the reported material topics and topic-specific standards that KBL used to prepare its Report are appropriately identified and addressed.

Assurance Conclusion: Based on the procedures we have performed; nothing has come to our attention that causes us to believe that the information subject to the limited assurance engagement was not prepared in all material respects. TUVI found the ESG information to be reliable in all respects, with regards to the reporting criteria of the GRI Standards and <IR> framework.

TUVI confirms that KBL has transparently reported major material information pertaining to all its six capitals in line with the <IR> framework, as below

Financial Capital: net worth, capex, investment spent, the economic value generated, gross revenue, etc.

Manufactured Capital: Manufacturing facilities, R & D centers, number of new products launched, new plants, buildings, infrastructure, etc.

Intellectual Capital: Knowledge-based intangibles, including intellectual property, R & D activities, patents, designs registered new product development, etc.

Human Capital: KBL’s Engineers, technicians, skilling and re-skilling of employees to enhance their competencies, safety performance, capabilities, experience, motivations to innovate, etc.

Social and Relationship Capital: KBL’s relationship with stakeholders such as customers, business partners, regulators, suppliers, communities, legislators, policy-makers, and benefits associated with brand and reputation, along with KBL’s ability to share information to enhance well-being.

Natural Capital: Sourcing responsibilities for the majority of renewable and non-renewable environmental resources and processes that provide goods or services. Reporting of circular economy, emissions, water consumption, waste disposal, etc.

Evaluation of the adherence contemporary Principles

Stakeholder Inclusiveness: Stakeholder identification and engagement is carried out by KBL on a periodic basis to bring out key stakeholder concerns as material topics of significant stakeholders. In our view, the Report meets the requirements.

Sustainability context: KBL established the relationship between ESG and organisational strategy within the Report, as well as the context in which disclosures are made. In our view, the Report meets the requirements with regards to the sustainability Context.

Materiality: The materiality determination process has been conducted and reviewed based on the principle of double materiality and the requirements of the GRI Standards, considering involvement of internal and external stakeholders in upstream and downstream value chain in identifying the material issues to the KBL range of businesses. The Report fairly brings out the aspects, topics, and their respective boundaries of the diverse operations of KBL. In our view, the Report meets the requirements.

Responsiveness: TUVI believes that the responses to the material aspects (identified through the Double Materiality Test) are fairly articulated in the report, i.e., disclosures on KBL policies and management systems, including governance. In our view, the Report meets the requirements.

Impact: KBL communicates its sustainability performance through regular, transparent internal and external reporting throughout the year, aligned with GRI, IIRC Integrated Reporting (<IR>) as part of its policy framework encompassing environmental, social, ethical, and other policies. KBL reports on sustainability performance to the Board of Directors, who oversees and monitors the implementation and performance of objectives, as well as progress against goals and targets for addressing sustainability-related issues.

Completeness: The Report has fairly disclosed the selected non-financial KPIs, as per GRI Standards. In our view, the Report meets the requirements.

Reporting Principles for defining report quality: The majority of the data and information were verified by TUVI’s assurance team during the remote assessment and found to be fairly accurate. The disclosures related to ESG issues and performances are reported in a balanced manner and are clear in terms of content and presentation. In our view, the Report meets the requirements.

Reliability: The majority of the data and information were verified by TUVI’s assurance team and found to be fairly accurate. Some inaccuracies in the data identified during the verification process were found to be attributable to transcription, interpretation, and aggregation errors, and these errors have been corrected. Therefore, in reference to the GRI Standards and <IR> framework, TUVI concludes that the ESG data and information presented in the Report are fairly reliable and acceptable. In our view, the Report meets the requirements.

Neutrality: The disclosures related to ESG issues and performance are reported in a neutral tone, in terms of content and presentation. In our view, the Report meets the requirements.

Our Assurance Team and Independence

TUVI is an independent, neutral third party providing sustainability services with qualified environmental and social specialists. TUVI states its independence and impartiality and confirms that there is “no conflict of interest” with regard to this assurance engagement. In the reporting year, TUVI did not work with KBL on any engagement that could compromise the independence or impartiality of our findings, conclusions, and recommendations. TUVI was not involved in the preparation of any content or data included in the report, with the exception of this assurance statement. TUVI maintains complete impartiality towards any individuals interviewed during the assurance engagement.

For and on behalf of TUV India Private Limited