Explanatory Information on the Content of the Report and the Framework
Corporate reporting is undergoing a process of far-reaching change, moving away from an exclusive focus on financial key figures and toward the provision of an integrated, entrepreneurial overview that takes into account the information needs of other interested parties, explicitly including topics relating to sustainability. New national and international reporting provisions are being established alongside the traditional standards set out in the German Commercial Code (HGB) and the German Stock Corporation Act (AktG). Going forward, further changes will arise as a result of the second shareholders’ rights directive (ARUG II) and the revised German Corporate Governance Code (GCGC). Digitalization is another factor that is increasingly influencing the manner in which companies report. These developments reflect the wider range of interests among financial market stakeholders, who are increasingly looking at non-financial key figures and sustainability aspects in order to comprehensively assess a company’s performance.
Ever since the CSR Directive Implementation Act (CSR-RUG) came into force in 2017, Vonovia SE’s corporate reporting has included a Non-financial Declaration, which has its legal basis in Sections 289a–e HGB in conjunction with Section 315b–c HGB (combined Non-financial Declaration).
This Non-financial Declaration is our way of responding to the changes referred to above. We also see it as an opportunity to showcase the company’s ability to perform in the area of sustainability to other interested stakeholders. The Declaration contains information on the main aspects of interaction between the company and the Environmental, Social and Governance framework. The Declaration is addressed to all of the company’s stakeholders and is designed to demonstrate Vonovia’s firm commitment to the greater good. Specifically, the Non-financial Declaration has to include statements on environmental issues, employee and social issues, respect for human rights and moves to combat corruption. In order to avoid data redundancy, reference is made, where appropriate, to other sections of the management report that contain non-financial information. In order to appropriately address the vast range of sustainability measures, Vonovia publishes a separate Sustainability Report in addition to this Non-financial Declaration. The Sustainability Report contains further extensive information on individual non-financial topics as well as corresponding project examples and key figures. It will be published in April 2020 for the 2019 reporting year.
The Non-financial Declaration is largely based on the structure of Vonovia’s Sustainability Report. This is, in turn, structured based on the GRI Standards of the Global Reporting Initiative (as valid in 2016) in accordance with the “core” option. The Sustainability Report is also based on the EPRA Best Practice Recommendations on Sustainability (in its third version from 2017).
The Non-financial Declaration has to report on the main relevant non-financial performance indicators, their individual target values and the underlying concepts. This information is set out in the individual chapters, which are structured by content. Not all of the performance indicators included in this Declaration correspond to the GRI set of standards. Rather, some of them have been adapted to reflect the specific circumstances prevailing in the housing industry.
As with other sections of this Annual Report, reporting in the Non-financial Declaration is also on a consolidated basis. This means that the company’s activities in Austria and Sweden (with the exception of Hembla) are also covered by this Non-financial Declaration. This initially concerns the qualitative presentation of the non-financial information of the acquired groups of companies. Due to the ongoing integration of the corresponding processes, the full consolidation of the key performance indicators is still in the implementation phase. We will refer to the extent to which the key figures have been integrated in the following chapters.
The Non-financial Declaration will be reviewed by the internal auditor of Vonovia SE on behalf of the Supervisory Board.