POWER THE WORLD WITH SOLAR ENERGY

As a global leading renewable energy company, Canadian Solar aims to power the world with solar energy and to create a cleaner Earth for future generations. At Canadian Solar, we are making progress toward advancing our sustainability strategy from an environmental, social, and governance (ESG) perspective and will continue to take efforts to improve our practices to ensure long-term sustainability. Our sustainability report is aligned with global standards set by the SASB (Sustainability Accounting Standards Board), TCFD (Task Force on Climate-Related Financial Disclosures) and GRI (Global Reporting Initiative). CLICK AND DOWNLOAD Canadian Solar 2022 ESG Sustainability Report and Documents.

INTERNATIONAL ESG INITIATIVES, CERTIFICATIONS AND RECOGNITIONS

We have significantly expanded our participation in international ESG initiatives, recognitions, and certifications. Canadian Solar joined United Nations Global Compact (UNGC) in June 2023, making commitment to the Ten Principles of the UNGC on human rights, labor, environment, and anti-corruption. We also submitted a commitment letter to the SBTi (Science Based Targets initiative) in July 2023, indicating our intention to set the near-term and net-zero science-based climate targets. In addition, we completed the CDP Climate Change 2023 Questionnaire in July 2023, addressing our engagement on environmental issues. Canadian Solar has expanded the universe of our ISO certifications. Our operations are certified under ISO9001 quality management system, ISO14001 environmental management system, ISO45001 occupational health and safety system and ISO50001 energy management system, demonstrating our commitment to maintain a high standard of product quality, environmental protection, energy conservation, and operational safety. Canadian Solar has earned recognition by external ESG rating agencies. We received a Prime ESG rating from Institutional Shareholder Services (ISS) in early 2023, placing us among the top 5 percentile of the nearly 100 global companies rated in the same industry. We also received an Excellent ESG rating from Achilles, a reputable UK agency evaluating environmental, social and governance factors across supply chains.

ENVIRONMENTAL

From 2017 to 2022, we achieved reductions in our greenhouse gas (GHG) emissions, energy intensity, water intensity, and waste intensity of 20%, 25%, 67%, and 45%, respectively. Specifically, on GHG emissions, the we have made further progress towards climate impact transparency by disclosing certain scope 3 emissions. We updated our 5-year rolling targets, aiming to achieve GHG emission, energy intensity, water intensity, and waste intensity reductions of 28%, 29%, 26% and 23%, respectively, from 2022 levels by 2027. We are on track to achieve the goal of powering global operations with 100% renewable electricity before 2030.

SOCIAL

We aim to increase female employees’ representation in our global workforce from 32% to 40%, their representation in middle management from 26% to 30%, and their representation in senior management from 7% to 10% from 2022 levels by 2027. We also plan to increase the share of our employees with people with disabilities to 1-2% by 2027 from 0.6% in 2022. We are certified under ISO14001 environmental and ISO45001 occupational health and safety management systems, and our recordable injury rate in 2022 was 0.75 cases per million working hours. Canadian Solar University (CSU) launched new courses covering key business functions in 2022. CSU aims to help employees gain a broader understanding of our company and the solar industry, drive innovation, and more effective collaboration. Canadian Solar is committed to ensuring ethical labor practices in the Company’s operations and suppliers. In 2022, we conducted 122 supplier ESG audits and initiated a third-party assessment to evaluate the effective of its Anti-Modern Slavery Policy, Supplier Code of Conduct, and Human Rights Policy in preventing forced labor, among other initiatives. Specifically, we engaged the Responsible Business Alliance to conduct a Validated Assessment Program, covering areas of labor practices, health and safety, environment, ethics, and management systems.

GOVERNANCE

The Sustainability Committee at Canadian Solar’s Board reviews sustainability (including climate)-related risks and opportunities associated with our strategy and business development; monitors progress, advises, and assists the Board on strategic measures related to the Company’s long-term sustainability; and oversees the progress and execution of ESG plans. Canadian Solar’s Board is dedicated to enhancing board diversity. Our Board has met the requirements of the NASDAQ New Rule 5605(f) for Diverse Board Representation in the specified time frame. Canadian Solar's sustainability policies provide a framework for our sustainability commitments. CLICK AND DOWNLOAD Canadian Solar Sustainability Policies.

Green Finance

Canadian Solar, as part of its long-standing commitment to sustainability, developed the Canadian Solar Green Financing Framework (“Green Financing Framework”) under which Canadian Solar, or any of its subsidiaries, will issue green financing instruments including green bonds, project finance, green loans, and other eligible financial instruments to finance and/or refinance investments made in renewable power generation and/or storage assets or businesses and to support the ongoing development of clean energy technologies. Canadian Solar’s Green Financing Framework is designed to be in line with the International Capital Market Association (“ICMA”) Green Bond Principles 2021 amended in June 2022 (“GBP”), aiming to encompass further issuances in the capital markets, and the Green Loan Principles of 2018 (“GLP”) published by the Loan Market Association, aiming to encompass bilateral or syndicated loans with financial institutions and/or multilateral agencies. CLICK AND DOWNLOAD Canadian Solar 2022 ESG Sustainability Report and Documents.   Case Study Canadian Solar’s indirectly wholly owned subsidiary Canadian Solar EMEA Capital Markets, S.A.U. on December 2, 2021 successfully completed a EUR30 million green bond issuance due on December 2026 under its EUR100 million Canadian Solar EMEA Green Medium Term Note Program in the Spanish multilateral trading facility (MTF) for debt securities (MARF). The notes are qualified as “green bonds” pursuant to the International Capital Market Association (ICMA) Green Bond Principals and the Green Financing Framework adopted by Canadian Solar in Europe, Middle East and Africa, or EMEA region. CLICK to see more details.