"Compliance risks The company’s global presence exposes it to regional and local regulatory rules, changes to which may affect the realization of business opportunities and investments in the countries in which the company operates. The company has established subsidiaries in over 70 countries and is subject to compliance with local laws and regulations. These subsidiaries are also exposed to changes in governmental regulations and enforcement and unfavorable political developments. For example, policy actions in response to the Paris Agreement, which looks to constrain the adverse effects of climate change and policy actions that seek to promote adaptation to climate change. Possible implications include the implementation of carbon-pricing mechanisms to reduce GHG emissions, obligatory shifting of energy use toward lower emission sources, and adopting energy-efficiency solutions. Based on the Task Force on Climate-related Financial Disclosures (TCFD) recommendation and a scenario analysis reflecting several degrees of global warming, Signify found that most direct financial impact from climate change arises from carbon pricing.";"Through either cap-and-trade schemes or carbon taxes, carbon pricing is accepted as the policy instrument most likely to be deployed on a global scale. In our analysis, we assumed that additional costs incurred by our suppliers of materials, goods and services would be transferred to us. Considering a 2⁰C scenario and a global price on carbon of EUR 100 per tonne CO2-equivalent, Signify would face increased costs due to impact of energy and transportation systems. The failure to comply with applicable laws and regulations, including as a result of any such changes, may affect the realization of business opportunities or impair the company’s local investments. In addition, the effects of policy implementations could result in unforeseeable fluctuations in prices of parts, components, and services from our suppliers and could also lead to supply chain interruptions if suppliers are unable to meet the demands of policy regulations implemented."