through enhanced cooperation with suppliers, contract manufacturers, and customers. Our strategy is a function of the economic, technological, legal, market, regulatory, social, and environmental context in which we operate. Per the Intergovernmental Panel on Climate Change (IPCC), signi昀椀cant GHG emissions reductions are needed in this decade to limit warming to below 2°C from pre-industrial levels, allowing for net-zero emissions by 2050, and avoiding the most catastrophic consequences of global warming. Thus, we are focused on driving impact as quickly and responsibly as possible while also preparing for an uncertain future which may follow a variety of warming trajectories informed by climate science. All climate-related scenarios which require reductions in GHG emissions are favorable to Enphase. A trajectory resulting in 2°C or lower warming from pre-industrial levels will require largescale, rapid, and equitable deployment of clean energy technologies, including those engineered by Enphase. In this case, the economic, technological, legal, market, regulatory, social, and environmental context would create increased demand for our products and drive rapid growth. However, these scenarios (e.g., Shared Socioeconomic Pathway 1) require rapid decarbonization across all sectors globally, implying the need to decouple resource extraction and consumption from economic growth. Thus, signi昀椀cant investment and 昀椀nancing for accelerated R&D, expanded operations, and enhanced coordination with value chain partners would be needed. Ultimately, with the proper global investment, planning, and coordination, a 2°C or lower scenario would allow us to rapidly deploy our products in the near-term and scale at the commensurate rate to achieve the desired outcome over the long-term. Characteristics of short-, medium-, and long-term time horizons for climate issues at Enphase are de昀椀ned as follows: • Short-term (0-3 years) – rapid business growth; low-carbon transition planning and implementation; qualitative climate risk disclosures; improved emissions tracking and reporting; and setting and executing on near-term GHG reduction target. • Medium-term (3-7 years) – manage continued business growth; quantitative climate scenario analysis and strategic integration; setting and executing long-term GHG reduction targets. • Long-term (7-25 years) – manage continued business growth; quantitative climate scenario analysis integrated with strategic and 昀椀nancial planning; maintain operational alignment with global climate goals. Short-term risks (0-3 years) • Extreme weather events such as 昀氀oods, cyclones, hurricanes, wild昀椀res, and heatwaves could result in delays in product shipments, which could adversely a昀昀ect our revenue, competitive position, and reputation. • Delaying operational decarbonization could limit access to third-party capital and a昀昀ect operating costs or reputation. • Not evaluating potential climate risk impacts to key suppliers, contract manufacturers, and logistics partners may adversely a昀昀ect our ability to execute our strategy over the long-term. 90