Future Fitness and the Capital Market
Vonovia has been listed on the Deutsche Aktienindex (DAX) since 2015. It became the first residential real estate company to be listed on the EURO STOXX 50 index in 2020, and is currently the only real estate company on the index. Our company is focused on the capital market. The access that we have to external capital and funding opportunities through the capital market is a core aspect of our business operations and our commercial success. This gives us the robust foundation that we need to respond to the challenges facing the housing industry, both now and in the future. Sustainability, transparency and success are more closely intertwined than ever. We take care to weigh up the interests of our shareholders against those of other stakeholders – particularly our customers – to make sure that we retain this access in future. We also have an increasingly stringent legal framework to comply with.
- Stability of the business model proven – despite the pandemic
- Positive business development once again
- Sustainability risks integrated into risk management – implementation of TCFD recommendations
- Green Bond Framework published in February 2022 updated and first social bond (100% EU Taxonomy-compliant) issued
- Further improvement in some ESG ratings – ranking among the top 7% of all real estate companies worldwide in the Dow Jones Sustainability Index Europe
Both analysts and investors are taking greater notice of ESG (environmental, social and governance) criteria when deciding who to invest in. Investors can turn to a number of rating systems and benchmarks to assess the performance of a company from an ESG perspective. Failure to meet ESG expectations can sometimes even result in a company being excluded from an investor’s investment portfolio or other access to capital. On the other hand, Vonovia can secure itself access to a wide range of investors by providing transparent information about its excellent performance in the area of sustainability – particularly in terms of its ESG ratings.
ESG criteria are also gaining in relevance in the political sphere. The EU Committee has launched its Sustainable Finance action plan in order to pursue its main sustainability objectives. The EU Taxonomy for sustainable activities came into effect in mid-2020 on the basis of the Taxonomy Regulation as part of this action plan. From 2024 onwards, the Corporate Sustainable Reporting Directive will further increase the need for structured and transparent sustainability reporting as of the reporting year 2023.
The EU Taxonomy is covered in greater detail in our 2021 Annual Report in the Non-financial Group Declaration.
We want our business model to be sustainable and fit for the future. The digitalization trend has a significant role to play in making our company more sustainable and communicating about our sustainability performance in a transparent manner. The coronavirus pandemic accelerated this trend even further – leading both to new challenges and new opportunities for Vonovia. The high level of digitalization within the Group allows us to record and handle both opportunities and risks effectively while tying up fewer and fewer resources. We can secure the company’s long-term success by acting early to respond to challenges and make use of any opportunities that arise. Particularly in these times where opportunities for meeting in person are limited, this trend allows us to provide clear and reliable information about our activities, both to groups within the company and external parties. This allows us to establish and maintain long-term relationships with our business partners and tenants.
The section below covers our approach to handling these challenges, the measures we have taken to integrate this approach into our processes and the targets and measures derived from this approach, with a particular focus on the material topic Appeal on the Capital Market. Also covered are the important topics Sustainable and Long-term Growth, Digitalization of Processes, Management of Opportunities and Risks and Sustainable Relationships with Business Partners.