Align Technology : Switzerland GmbH - Sustainability Report Financial Year 2023

Align Technology Switzerland GmbH

Sustainability Report

Financial Year 2023

About This Report

This sustainability report discloses information on non-financial or sustainability and inclusion matters relevant to the business activities of Align Technology Switzerland GmbH ("Align Switzerland") in accordance with Articles 964a-c of the Swiss Code of Obligations: Transparency on Non-Financial Matters and the related Ordinance on Climate Disclosures. The disclosures in this report align with the international sustainability reporting standards of the International Financial Reporting Standards (IFRS), the Sustainability Accounting Standards Board (SASB), the standards for the Medical Equipment & Supplies Industry Standard Version 2023-12 and the Task Force on Climate-Related Financial Disclosures (TCFD), Version of June 2017. This report covers the period January 1, 2023, through December 31, 2023, unless otherwise noted ("Reporting Period").

About Align Technology

Description of the business model

a. Our ultimate parent company, Align Technology, Inc.

The ultimate parent company of Align Switzerland is Align Technology, Inc. ("Align," "we," or "our"). Align is listed on the NASDAQ Global Market under the ticker symbol "ALGN" and its global headquarters are in Tempe, Arizona USA. Align designs, manufacturers, and sells the Invisalign® System of clear aligners, iTero™ intraoral scanners, exocad™ CAD/CAM software and dentalXrai software for digital orthodontics and restorative dentistry among other products and services through Align and its affiliated companies, including Align Switzerland. Align also markets and sells consumer products that are complementary to Align's doctor-prescribed principal products under the Invisalign and other brands, including retainers, aligner cases (clamshells), teeth whitening products and cleaning solutions (crystals, foam, and other material) (collectively "Consumer Products"). Align's primary goals are to establish clear aligners as the principal solution for the treatment of malocclusions, or the misalignment of teeth, and Align's Invisalign system as the treatment solution of choice by orthodontists, general dental practitioners, and patients globally, our intraoral scanners as the preferred scanning technology for digital dental scans, and Align's exocad CAD/CAM software as the solution of choice for dental labs. During the Reporting Period, Align offered the following main products and services: Invisalign clear aligners, iTero intraoral scanners, exocad software, dentalXrai software and Consumer Products. To date, over 17 million people worldwide have been treated with the Invisalign system.

b. Align Technology Switzerland GmbH

Align Switzerland is a wholly owned subsidiary of Align and has 14 direct subsidiaries and 37 indirect subsidiaries ("Align Switzerland Group") whose operations are to design, manufacture, market,

distribute and service Align products and services globally. As the processes for sustainability for the global organization are primarily performed at the direction or guidance of Align, they are listed in this report as also applying to Align Switzerland. If a process only applies to Align Switzerland, the process will be specifically noted, when applicable.

Align strives to be a global leader in sustainability and environmental matters and, in the process, enable our customers and vendors to reduce the environmental impacts of their activities.

Environmental Matters

We are committed to environmental protection and continuously minimizing the environmental impacts of our supply-chain, processes, and services. To help us achieve these commitments, we integrate sustainability into our business operations and products in ways that help manage our environmental impact, mitigate risk, reduce costs, and increase stockholder value.

Climate Change

We prepared our climate-related disclosure in alignment with the recommendations of the Task Force on Climate-Related Financial Disclosure ("TCFD").

Governance

The Nominating and Governance Committee (the "Committee") of our Board of Directors ("Board") oversees our sustainability and inclusion strategy, initiatives, and disclosures, including climate-related matters. The Committee receives updates at least annually on these matters from members of our Executive Management Committee, other members of senior management and third parties, as and when appropriate.

We have a steering committee that is comprised of cross-functional members of our Executive Management Committee and other senior leaders who assess the regional and global impacts and environmental risks of our operations and the products we produce in the areas of sustainability, climate, human capital management, and philanthropy as well as coordinating our policies, practices and initiatives needed to meet our corporate goals.

Strategy

As part of our manufacturing resiliency design efforts, we have also considered climate change, climate- related risks - higher average global temperatures, rising sea levels and more frequent and severe wildfires, hurricanes, floods, winter storms, heat waves and other events and natural disasters (collectively, "climate-relatedrisks"). We view climate-related risks to be one of many operational challenges we face and factor them into our business continuity planning and strategic risk mitigation efforts. Some of these climate-related risks include, but are not limited to, impacts of natural disasters, effects on regional and global economies, impacts of extreme temperatures and weather and impacts of environmental regulations. Refer to our 2023 Annual Report on Form 10-K ("2023 Annual Report") for additional information on these risks.

In part to help mitigate risks to our manufacturing operations, we have strategically located our clear aligner production facilities in three facilities on different continents. This allows us to both respond more quickly to customer demand while also offering redundancy in the event natural disasters or climate- related events affect operations at one or more facilities. Moreover, each of our three key clear aligner manufacturing facilities are located at elevations less likely to be impacted by rising sea levels and at least two hundred miles inland.

Risk Management

Led by our CEO and senior executives, management implements and supervises day-to-day risk management processes and reports significant matters to the Board and its committees, including climate-related risks, as appropriate. Our Board encourages management to establish a culture that actively promotes risk identification as part of our corporate strategy and day-to-day business operations. Furthermore, our Board encourages full and open communication between it and management. The Chair meets regularly with our CEO and other members of executive management to discuss strategy and the risks we face. Our directors take a proactive, focused approach to their responsibilities by setting standards to ensure our business success is achieved through the highest standards of responsibility and ethics. Align proactively evaluates risks, coordinates periodic testing and learns from previous situations to continuously improve our processes, and prepare to respond to situations and emergencies that could impact the health and safety of employees, patients, customers, the environment and communities in which we serve and operate.

Metrics and Targets

We annually measure a range of environmental metrics which we use to inform the assessment and management of our climate-related risks, including carbon emissions, energy, water and waste.

Metric	2023	2022	2021
Scope 1 GHG Emissions (MT CO2e)	3,900	3,400	3,189
Scope 1 GHG Intensity (MT CO2e per million in net revenue)	1.0	0.91	0.81
Scope 2 GHG Emissions, (MT CO2e) *	39,200	36,000	37,855
Scope 2 GHG Intensity (MT CO2e per million in net revenue) *	10.05	9.72	9.58
* Market Based

Align is establishing baselines and evaluating emissions trends to determine appropriate carbon emissions reduction targets.

Product Design and Lifecycle Management

Align continues to innovate for a more sustainable future in ways that support the environment and align with our strategic growth drivers (see our 2023 Annual Report for additional information on our strategic growth drivers). Over the years, we have focused on reducing our impact on the environment with efforts to reduce product packaging, increase recycling of plastics, decrease waste and emissions, and increase renewable energy usage. At the production level, the scrap and waste generated by our manufacturing processes does not go into landfill. For example, the production scrap and waste from our facilities in Mexico and Poland is used for energy recovery for third parties. In China, we are repurposing 100% of the production scrap and waste for reuse in floor tiles.

Since 2016, in the aggregate we have reduced the net amount of polymer content consumed in our molds and clear aligners by more than 50% per device. We are focused on continuous improvement and expect to make further reductions over time.

Reducing the environmental impact of used and unused clear aligners is also a crucial aspect of sustainability and therefore we are continually exploring recycling options as well as ways to properly dispose of plastic waste, ensuring it is correctly sorted and recycled whenever possible.

Further, we continue to invest significantly in new technologies, materials, and ways of working that can minimize the environmental impact of plastic while reducing our carbon footprint. We support

innovations in recycling and waste management processes, and we are redesigning our packaging materials to decrease the impact of the materials used in the packaging and shipment of our products.

We are also helping doctors to operate more sustainably by reducing the need for traditional polyvinyl- siloxane (PVS) impressions and the mining of the materials used to make those impressions. The use of our iTero intraoral scanner, rather than taking a physical impression of a patient's teeth, removes the need for physical models to be produced, eliminating emissions associated with traditional manufacturing and shipping. As a result, since 2018 PVS impressions per case of clear aligners has decreased by 80%, thereby helping to avoid the consumption of more than four thousand metric tons of PVS in our process and reduced greenhouse gas emissions associated with such aspects as the mining, transportation, storage, energy necessary to convert the PVS impressions to digital images for molds and their disposal.

Social Matters

Our purpose is to transform smiles and change lives. Achieving our commitment starts by understanding and addressing the needs of the 22 million patients who begin orthodontic treatment every year and the 600 million potential patients/consumers who can benefit from treatment of their malocclusions. We are driving the evolution in digital dentistry through enhanced digital orthodontic and restorative workflows to improve patient outcomes and practice efficiencies. The topics below align to the IFRS Sustainability Accounting Standards Board (SASB) standards for the Medical Equipment & Devices industry and underpin our commitment to supporting and protecting our customers and patients.

Affordability & Pricing

Align determines pricing for products based on a variety of factors, including geography, customer type, and product type. We sell our primary products, the Invisalign system and related clear aligner accessories, iTero intraoral scanners and exocad CAD/CAM solutions both directly or indirectly (via distributors) to individual doctors, DSOs, hospitals, clinics and/or labs/dental professionals, depending on the product, and sell some accessories on our webstore. We generally do not establish the resale for our customers (sales from distributors to doctors/labs or from doctors to patients). Our distributors are free to determine the conditions under which they resell, including if they wish to sell our products in combination with third party products. Pricing information for our Invisalign system packages is generally communicated to doctors through our online order management system (IDS). Pricing information for our iTero scanners is established and communicated through direct contractual relationships with our dental customers based initially off the manufacturer's suggested retail price which is typically reduced following negotiations. Pricing for our exocad solutions is generally established and communicated to our resellers via our Reseller Newsletter and other electronic messaging who in turn communicate pricing to end users.

For Consumer Products, sales may be made directly to consumers via e-commerce on sites such as Amazon or through third party resellers. Pricing of Consumer Products sold directly by us to consumers is generally communicated on the applicable websites prior to placing the products in carts and at the time of purchase from the cart. Pricing for Consumer Products made indirectly through third parties is established through our direct contractual relationships with resellers based initially off the manufacturer's suggested retail price which is typically reduced following negotiations. Resellers are thereafter generally free to set their own sales prices.

Product Safety

As a medical technology company dedicated to helping dental practitioners transform smiles and change lives, Align is focused on delivering superior treatment outcomes and experiences. Part of accomplishing this goal includes providing high quality products and services that meet or exceed customer expectations. We use a Quality Management System that complies with the international standard ISO

13485 for medical device quality. We are regularly audited against this standard by our certification body who discloses the results to global regulators through the medical device single audit program.

We are committed to continually reassessing the safety of the products and making these results available to regulators. Our products have many years of demonstrated safe use in millions of patients. Our post-market surveillance program monitors the safety of all our medical device products and regularly produces reports on the results. We have annual quality objectives that are documented, tracked and reviewed by our executive management team. We regularly host audits from health authorities and certification bodies on our product safety and Quality Management System.

We conduct risk assessments in accordance with ISO 14971, the standard for risk management of medical devices. We do this, in part, by evaluating possible product risks, mitigating them where possible, disclosing residual product risks to end users, and performing post-market surveillance to ensure risks that emerge are fed back into the program. Management reviews the quality system including the product and process risk each year and adjusts, as needed. Each medical device product has a risk assessment on file as part of the design history file.

All employees participating in the creation of medical products are thoroughly trained in their role in the quality system. Employees whose roles expose them to manufacturing or environmental hazards are trained in standard safety processes that ensure that employee safety is maintained. Each business unit has a process to intake complaints or concerns from customers and the public and to investigate and respond as needed. We utilize a structured problem-solving methodology called CAPA (corrective and preventative actions) that helps us identify and fix problems at their root cause.

In 2023, Align did not take any product field actions that were reportable to the Food and Drug Administration in the United States.

Supply Chain Integrity

Align has enacted supplier evaluation and due diligence processes for new partners that seek to ensure the suppliers we work with are committed to quality and compliance. New Invisalign suppliers onboarded via our vendor management system undergo certain checks and assessment based on the expected type of engagement during the onboarding process. The supplier evaluation process also considers how the vendors will maintain appropriate controls and protections over our information and that of our customers.

As our suppliers work with us, they are also held to these standards of quality and accountability. Received materials used in production undergo an incoming inspection based on sampling protocols outlined in our product specifications. Materials found to be non-conforming to specifications are segregated and a non-conforming material report is sent to the supplier for investigation and disposition. Suppliers are continually reassessed to ensure that the strategic relationships we have established remain aligned with our expectations of conduct and quality.

Raw materials used in finished products are lot traced into the device history record. Each lot has an accounting of each sub-component's lot numbers. Finished goods have a lot number which we systematically track through our shipping carriers to the end customer. For information on our management of risks related to conflict minerals, please see "Respect for Human Rights" in this Report.

50% of our critical Invisalign suppliers and 86% of our iTero suppliers were certified to ISO 13485 standard for medical device quality.

Ethical Marketing

We are committed to developing marketing and sales activities, promotional communications, and product information that are up-to-date, accurate, based on facts and include any information required by law - remembering that laws vary by country. We have also adopted an on-label promotion policy intended to mitigate the risk of marketing considered off-label.

We are committed to educating consumers and other stakeholder groups (regulators, academic bodies, key opinion leaders, professional associations, lawmakers, and others) on the benefits of doctor- directed care in clear aligner therapy. Orthodontic treatment is a complex discipline involving the movement of a patient's teeth through bone which is why our products are highly regulated medical devices subject to various laws and regulations intended to prevent improper, fraudulent, and misleading claims that could harm patients or impair the sound exercise of medical judgment by dental practitioners.

Align markets our products and services to patients, where legally permissible, dentists or orthodontists and does not offer the Invisalign clear aligner system directly to consumers or patients. Additionally, to further our mission and facilitate our marketing and advertising efforts, we have established a Claims Committee comprised of a cross-functional team of professionals designed with the goal of ensuring the promotion of our products is performed in a manner consistent with our values and applicable laws. Working under our Standard Operating Procedure for Global Claims and Marketing Review, the Claims Committee has established a process for the review and approval of promotional materials for their accuracy, truthfulness, and potential to mislead readers. Our process relies on expert reviews and substantiation of each claim intended to be used in our marketing efforts. This review process includes controls to avoid claims concerning our products that are inconsistent with our product labels. Moreover, we expect our promotional materials to remain compliant with laws unique to each country as determined by regional legal counsels.

Monetary Losses as a Result of Legal Proceedings

In the normal course of business, we are involved from time to time in arbitrations, class actions, commercial, intellectual property, and product liability litigation; government investigations, investigations by competition/antitrust authorities and other legal, regulatory, or government actions. Some of those legal matters are described in Note 8 (Commitments and Contingencies) in our 2023 Annual Report.

Employee-Related Matters

We believe our culture and commitment to employees provide unique value that benefits Align, its stockholders and the communities and other stakeholders we serve. Every employee, and every job, is important to our success and helps us achieve our purpose of transforming smiles and changing lives. Align is committed to building a workforce of diverse cultural backgrounds and life experiences. Fostering a culture of dignity, integrity, open dialogue, open-mindedness, compassion, fairness, recognition, and shared goals allows us to attract and retain the best talent, which has ultimately led to the growth and success of our company.

As of December 31, 2023, we had approximately 21,610 employees, a decrease of approximately 6.7% and 4.1% over December 31, 2022, and December 31, 2021, respectively. The number of employees for each of the last three years and our employees' roles as of December 31, 2023, are as follows:

Human Capital Governance

Our commitment to improving the lives of our employees and the communities in which we live and work, including conducting our business ethically, responsibly and transparently through open and clear disclosures that allow us and others to hold us accountable, begins with our Board and management team. They set the tone for our organization by establishing and clearly communicating our core values of Agility, Customer and Accountability that inform our culture. Our Global Code of Conduct ("Code") and quality policies are designed to enable us to operate with integrity and deliver superior treatment outcomes and experiences to patients. We seek to create an environment that values the health, safety and well-being of our teams, and we work to equip them with the knowledge and skills to serve our business and develop their careers. We believe that by effectively managing our business with these values as the foundation, we will drive long-term value for our stockholders and all stakeholders.

The Compensation and Human Capital Committee of our Board regularly reviews and discusses key performance indicators regarding employee and human capital that allow it to monitor trends on issues such as our total headcount, recruiting, attrition, career development, diversity, inclusion and belonging, compensation, benefits, and other measures of employee engagement and interest to management and the committee.

Talent Recruitment and Engagement

We employ a variety of career development, employee benefits, compensation and other policies and programs designed to attract, develop, and retain employees. We focus on building a talent pipeline that nurtures those early in their careers, encourages continuous learning and growth, and incentivizes employees to stay and contribute to our success over the long term. Our programs include early recruitment at high schools and universities, initiatives such as internships, co-ops, apprenticeships, and training programs, quarterly performance management check-ins focused on individual goals and commitment to values and conducting regular employee surveys to build trust and strengthen relationships.

We believe it is imperative to provide a vibrant employee experience and we value our employees' collective voices. Accordingly, we conduct employee surveys to collect employee feedback critical to improving our culture. The process serves as a wellness check for us as the surveys cover a broad variety of topics including engagement, inclusion, development, leadership, compliance, alignment and

enablement. Our response rates to our annual surveys are consistently high, reflecting strong engagement by our global employees. In 2023, after years of focusing on an annual census survey where we consistently had high response rates and high scores in overall engagement, we moved to a continuous employee listening strategy. This listening strategy includes globally managed pulse surveys, employee lifecycle surveys, and a self-service feature to support listening efforts for our global employees. We use information learned from our surveys to improve the employee experience, including enhancements to our workplaces, focus on employee connections, increased career development opportunities, support for relocated employees, and growth in our recognition programs and experiences.

Training and Professional Development

Training is an integral part of developing and retaining our employees and creating a culture of leadership within the Company. Training at Align begins with our Code and our strong commitment to ethical business practices in all aspects of our operations. Every employee and contractor is required to review the Code and confirm they understand it. We routinely reference the Code in presentations and as part of everyday operations.

As a further part of our standard onboarding program, we train employees on important environmental health and safety topics to protect them and our environment as we operate our business. As a general practice, employees are trained to perform their jobs in accordance with all applicable statutory and regulatory requirements and that training is routinely refreshed and re-administered.

At Align, we believe employees learn best when skill development is driven by the changing and immediate needs of our employees and by the empowerment of all employees to act and take ownership of their careers. We also believe learning should be relevant and actionable as well as rooted in our purpose and values. Develop@Align enables our global employee population to access a diverse portfolio of approximately one thousand self-directed courses in up to 80 languages. We also offer a full suite of custom leadership development programs, beginning with aspiring leaders, continuing with managers and directors, and culminating with executive development opportunities. The ways in which we work, collaborate, and develop have transformed in recent years and will continue to change and evolve. We recognize we must provide employees with the resources to continue to learn, grow and thrive. We created Voyage as a global initiative to serve this purpose. Voyage offers a set of tools, resources and a new mindset, empowering employees to start thinking differently about career growth by embracing development opportunities in new and sometimes unexpected ways. Our Voyage Compass helps employees experience their career through four distinct lenses: Self, Networks, Experience and Skills.

Since its launch, over 45% of the employee population has interacted with Voyage, and there have been over 108,000 visits to the Voyage website. In addition to our navigation site, we host two Voyage Set Sail weeks annually, where we offer experiential learning for individuals and teams utilizing activities that help keep professional development front and center in employees' minds.

Compensation and Benefits

Our commitment to our employees starts with benefit and compensation programs that reflect the value and the contributions our employees make. In addition to competitive base pay, we offer an assortment of benefits that vary by country, including performance-based variable compensation programs, health and welfare benefit plans, retirement planning services and benefits, holiday and leave policies, equity participation programs such as our Incentive Plan and Employee Stock Purchase Plan, and charitable and community service opportunities. Besides these, we also offer discounts to our employees and their dependents when they undergo Invisalign treatment.

We are furthermore committed to pay equity practices. We exceed minimum pay requirements for our manufacturing employees, and we regularly review our pay equity practices globally and locally so that

we can appropriately address discrepancies.

Inclusion and Belonging

Fostering diversity and encouraging inclusion and belonging in the workplace makes Align a more welcoming and enjoyable place to work. Our products and services are used broadly across age groups, gender identities, races, ethnicities and cultures, so we aim to build a workforce that optimally reflects this diversity. We believe our success continues to be driven by our focus on integrating and welcoming employees of all different backgrounds, orientations, beliefs, perspectives and capabilities into our workforce.

Our management team is comprised of diverse individuals from varying countries and nationalities and who are committed to promoting and encouraging the health and well-being of our employees at work, at home and in society in general. We provide employee experiences that encourage inclusion and diversity. We were recognized in Newsweek's list of America's Greatest Workplaces for Diversity in 2024.

Our work culture is designed to create financial, health, career and personal benefits for our employees and organization. We sponsor diverse and cultural recognition events to increase awareness of inclusion and diversity, including its importance in creating an environment where every employee can thrive and feel they belong. We also sponsor employee resource groups based on shared characteristics or life experiences which are open to all employees, including those who do not directly identify with other members but are passionate in supporting the group's members in creating an educated, supportive and inclusive culture.

Our employees bring a positive mix of ethnic and culturally diverse backgrounds to the more than 40 different countries in which we operate. Our largest population of employees work in our Mexico site followed by Costa Rica and China. The United States represents less than 10% of our global population.

Location of Employees

Health, Wellness and Safety

Our employees are essential to us as a business and their health and well-being is critical to our success and their continuing achievements. Our objective is to prevent workplace injuries and occupational diseases by focusing first and foremost on creating and maintaining environments that are safe. We therefore implement a wide variety of robust Environmental Health and Safety ("EHS") programs and initiatives designed to promote the overall health and welfare of all our employees and their families. It is our responsibility to support the health and well-being of our employees. Every year, we have a month dedicated to well-being, called Month of Wellness, which is a worldwide movement fostering employee health. Throughout the Month of Wellness, employees participate in a variety of activities such as informational sessions and health fairs and receive useful resources aligned to our wellness pillars - mental resilience, physical well-being and healthy living, social/family connections and financial wellness. This provides employees with a variety of meaningful ways to embrace wellness and well-being through mindfulness, meditation, nutrition and mental wellness activities, exercise, hikes, yoga, volunteer activities, financial education sessions, social events and stress management.

We have environmental, health, safety and sustainability personnel who are responsible for ensuring health and safety programs and processes are implemented and maintained at each of our locations. Major worksites, such as our clear aligner fabrication sites, R&D labs, and large offices have dedicated EHS departments that ensure health and safety programs are maintained while contributing Best Management Practices and general input to corporate-wide programs. Each EHS department is responsible for ensuring all employees at their location are properly trained on various EHS topics and at the appropriate frequencies. All new employees receive a new hire EHS orientation. In addition, a training suite is determined for each employee depending on their responsibilities and function modeled off ISO 45001. Employees are also trained to report any occupational incidents and near-misses to the site EHS. All incidents are thoroughly investigated to determine the root cause and other contributing causes, followed by the implementation of CAPAs (Corrective and Preventive Actions).

We track occupational safety data monthly at our manufacturing, operations, and R&D sites to ensure proper safety standards are being implemented. Our goal is to maintain a low injury and illness incident rate which is well below the industry average.

Metric	Align 2023	Align 2022	Industry Average 2022*
OSHA Total recordable	0.05	0.07	1.70
incident rate (TRIR)

Align data represents total from manufacturing, operations, and R&D.

*Data provided by U.S. Bureau of Labor Statistics for Medical equipment and supplies manufacturing

Respect for Human Rights

We respect one another by protecting the human rights of others. We make sure our business partners understand Align's commitment to human rights and that they have the same respect for human rights that we do. We expect our business partners to treat their employees fairly and in compliance with labor and employment laws. We use our due diligence processes and our contracts to make sure recruiters or any business partners we work with comply with fair labor laws and are not using forced labor or child labor.

We expect our suppliers to respect human rights and treat others fairly, including complying with labor and employment laws, namely minimum wages, overtime, forced and child labors, not unlawfully confiscating immigration documents, and respecting the rights of individuals to return to their home countries.