Sustainability risks and opportunities

Climate change and environment

Toromont has an opportunity to meet customers’ needs for environmentally sustainable products and services including energy-efficient equipment as the world transitions to a lower carbon economy. We also face risks as demand for certain existing products and services may change and diminish over time. Toromont is responding through the expansion and evolution of product and services offerings that address changing customer needs and preferences.

Toromont faces climate-change regulatory risk that could impact our operating costs. This includes but is not limited to carbon pricing. Toromont’s current costs of compliance, including under Federal and Provincial carbon tax regimes, are not material and we do not currently anticipate any material expenditures will be necessary to ensure future compliance with more stringent GHG regulations. Toromont also faces compliance risk related to environmental laws and regulations, which vary across our territories. We manage risks through our compliance efforts. To the extent more stringent regulations are enacted, Toromont intends to continue to address them in a proactive manner.

Climate-change events can pose physical risks to our operations – which serve markets throughout North America – and to the operations of our customers. Our footprint of ~165 locations diversifies this risk but does not eliminate it. Accordingly, we operate with business continuity plans. We do not currently expect physical risks to our facilities to add costs that are material to our business.

People

Toromont’s first core value is to maintain safe and respectful working conditions. By doing so, we create the foundation for growth. We depend on skilled labour, professionals and effective leaders to serve our customers and grow our business. Through detailed planning, smart investments and ongoing communications, we enhance our ability to attract, develop, retain and engage a healthy and committed workforce.

Governance

Good governance is a requirement for long-term growth, the success of our business, protection of Toromont’s assets and ability to contribute to our world in an ethical and responsible manner. Our Board of Directors is focused on providing good governance by understanding and applying sound governance practices, including in the areas of leadership accountability and compensation.

Cybersecurity and data privacy

Toromont depends on information technology infrastructure and systems, hosted internally or outsourced, to conduct day-to-day operations and for effective operation. Our business also requires the appropriate and secure utilization of sensitive and confidential information belonging to third parties such as our customers and suppliers. While we strive to leverage technology to meet the growing needs of customers and enhance the efficiency of our operations, doing so comes with information security and cybersecurity risks.

The security of the company’s data and other information is one of the operational risks overseen by our Board. Two members of the Board have knowledge and experience in technology, including cyber risk. Management reports to the Board regularly on information technology and security matters. To mitigate information security risks, we maintain cyber insurance policies, undertake preventative measures, including controlling access to network and applications using secure firewalls and limiting access. To identify information security risks, we use various detection methods, including monitoring event logs for firewalls, server, mail systems and applications. Third-party experts are utilized to perform testing and assessments. We also provide regular information security training to employees as applicable and appropriate.

Codes of Conduct

Toromont’s Code of Conduct, developed, regularly reviewed and approved by the Board of Directors, enshrines our corporate values including values that promote, protect and positively contribute to the betterment of Toromont and society as a whole. The Code applies to all who represent Toromont, including Directors, officers and employees. Everyone at Toromont is required to confirm in writing that they understand and comply with the Code each year. The Audit Committee and the Human Resources and Health and Safety Committee of the Board receive regular compliance reports and the Code is reviewed annually by the Board and amended when appropriate.

The Code encourages employees, customers, suppliers and shareholders to report any suspected violation to the company’s General Counsel or anonymously through an independent third-party Compliance reporting system without fear of reprisal. All members of the Toromont team must confirm their adherence to the Code of Conduct.

Toromont’s Supplier Code of Conduct enshrines the key values and principles found in our corporate Code of Conduct. We ask our business partners to embrace our Supplier Code of Conduct as part of contractor qualification and compliance programs. Please see our Report on Modern Slavery, which describes our efforts to combat forced labour and our focus on supply chain compliance.

2025 Board Governance Snapshot¹

Size of Board	10
Separate Chair and CEO Roles	Yes
Percentage of Independent Directors	90%
Code of Conduct for Directors, Officers, Employees	Yes
Director Stock Ownership Guidelines	Yes
Policy on Share Trading and Hedging	Yes
Comprehensive Board Assessment Process	Yes
Age Range of Directors	47-69 Years
Average Board Tenure	4.4 Years
Board and Management Succession Plan	Yes
Director Education Program	Yes
Board Diversity & Leadership Policy	Yes
Number and Percentage of Women on the Board	5 (50%)
Say on Pay Advisory Vote	Yes
Majority Voting Policy	Yes

¹Based on Board nominees standing for election on May 1, 2025.