Non-financial Group Declaration*
Explanatory Information on the Content of the Report and the Framework
Sustainability reporting is experiencing a period of upheaval. Due in particular to increasing requirements at a European level – as a result of the EU taxonomy and the adoption of the Corporate Sustainability Reporting Directive – we are now increasingly seeing reporting on sustainability-related topics featured in the annual report.
For Vonovia, this integrated approach aligns well with our understanding of sustainability, which is a key component of our corporate strategy and business processes. Consequently, information on sustainability is not limited to the Non-financial Group Declaration, but can be found throughout this annual report, such as in the description of our business model or in the risk assessment. Corresponding references point to chapters in the management report in which the required disclosures are reported. As such, we are underscoring our understanding of a sustainable business model in which all three dimensions of sustainability (ESG) are embedded within our sustainability strategy (see Fundamental Information About the Group).
Vonovia SE’s (hereinafter referred to as Vonovia) corporate reporting includes a Non-financial Group Declaration, which has its legal basis in Sections 315b, 315c in conjunction with Section 289c to 289e HGB.
The frameworks provided by the Global Reporting Initiative (GRI) for sustainability reporting and the UN Global Compact were taken into account when preparing this declaration. These standards also serve as a guide for the separate sustainability report. We also use the recommendations made by the Task Force on Climate-related Financial Disclosures (TCFD), which we describe in the section entitled Environmental Issues.
The provisions of the delegated act for Regulation (EU) 2020/852, subject to application of Articles 8 and 10 (EU taxonomy), are explained in the Taxonomy section of this Non-financial Group Declaration and also include the subgroup Deutsche Wohnen SE (referred to in the following as Deutsche Wohnen).
Vonovia acquired control of Deutsche Wohnen on September 30, 2021. The subsequent integration process began at the end of 2021 and encompasses the consolidation of concepts, applied due diligence processes, and targets and outcomes relating to the non-financial topics pursuant to Section 289c of the German Commercial Code (HGB) determined in the Vonovia materiality process. The operational go-live date on January 1, 2023 marked the successful completion of this process. As of this date, Vonovia and Deutsche Wohnen shall operate using joint systems and structures in line with the Vonovia organizational and process model (see Fundamental Information About the Group).
Deutsche Wohnen is therefore included in the consolidated financial statements and the Non-financial Group Declaration of Vonovia. Deutsche Wohnen will not be issuing its own non-financial declaration for the 2022 fiscal year, as it is exercising its rights under the simplifying provision for CSR reporting pursuant to Sections 289b (2) and 315b (2) HGB.
In preparation for the integration process, the materiality assessments of the two companies were merged in 2021 and their validity was reviewed once again in the reporting year. Due to the high degree of concordance between the identified material sustainability topics and the non-financial key performance indicators, the selection of indicators already used by Vonovia and their definitions have been adopted by Deutsche Wohnen. This also applies to the description of concepts and their implementation.
The main relevant non-financial performance indicators are reported – together with information on the underlying concepts and objectives – in the individual chapters covering the content in question. These are allocated to the legally mandated aspects – environmental issues, social issues, employee issues, combating corruption and bribery, and observance of human rights. Consolidated reporting with Deutsche Wohnen is not possible for a few selected key performance indicators, as the company-wide criteria for determining these key figures will only be fully implemented in the course of the complete integration from the start of the 2023 fiscal year onwards. We refer to any existing differences in the disclosure for the key figure concerned. Deutsche Wohnen is included in the reported objectives for the 2023 fiscal year.
Six of the key figures listed in the Non-financial Group Declaration are non-financial performance indicators within the meaning of GAS 20, Paragraph 101 in conjunction with Paragraph 106. These are the key figures that together constitute the Sustainability Performance Index (SPI) since its introduction in 2021. The SPI, which is derived from the material sustainability topics, is a vital instrument in terms of managing our sustainable activities. It represents the leading non-financial performance indicator applicable for the Vonovia Group. For the 2022 fiscal year, the reported SPI does not include Deutsche Wohnen. This will only be reported on a consolidated basis for the 2023 fiscal year following full integration (see Management System).
The company’s activities in Austria and Sweden are also covered by this Non-financial Group Declaration. This initially concerns the qualitative presentation of the non-financial information of the business entities. Due to the ongoing integration of the corresponding processes, the full consolidation of a few of the key performance indicators is still in the implementation phase. With respect to each key performance indicator, we make reference to the degree of KPI integration.
Sustainability reporting is supplemented by a separate sustainability report. This contains further extensive information and key figures for individual non-financial topics as well as examples of implementation. The sustainability report for the 2022 reporting year will be published in the second quarter of 2023. Further information on commitments and guidelines, for example, can be found on the website of the Investor Relations department. The final aspect of sustainability reporting is participation in numerous ESG ratings.
Both the Non-financial Group Declaration and the additional quantitative disclosures in the sustainability report are audited by the auditor of the annual financial statements. All references to content outside the Non-financial Group Declaration are further information and are not covered by the audit performed by KPMG. An exception to this rule applies to references to further chapters of the management report. These are covered by the audit.
- * The content of the Non-financial Group Declaration is not covered by the audit of the annual and consolidated financial statements, but rather are subjected to a separate limited assurance audit conducted by KPMG AG Wirtschaftsprüfungsgesellschaft in accordance with ISAE 3000.