Non Financial Reporting: What Differences Accross European Countries?

Non Financial reporting: What differences accross European countries?

October 3rd 2019 Table

Context and methodology

Major findings

Conclusions

• Revised NF Reporting Directive project • French initiative for a non financial standard at European 8 countries with detailed results level following Mr de Cambourg report on representative sample of companies

FRANCE SPAIN ITALY PORTUGAL

GERMANY BELGIUM NETHERLANDS GREECE

4 countries with information on the EU directive local transposition

UK SWEDEN FINLAND DENMARK

• Data collected among annual and sustainability reports from 156 European companies and compared to the 102 French DPEF (SBF120)

Number of companies included in the European analysis : 156

FRANCE SPAIN ITALY NETHERLANDS GERMANY BELGIUM PORTUGAL

102 31 16 17 20 20 18

FINLAND GREECE UK SWEDEN DENMARK

19 12 3 n.a n.a

12 material topics on average in Talent management, health and safety comparison with 10 in France Climate change and management • Shared topics across countries of resources allowing alignment of non-financial reporting despite diversity of approaches, materiality or CSR risks Responsible supply chain, human rights assessment

• Alignment of the number of material Ethic and corruption topics covered Customer satisfaction, innovation and • New topics on responsible supply products chain, customer satisfaction and products

• Philanthropy developed in most countries but less covered in France Philanthropy and community

ACS Group Schneider Electric • Most companies report on CO2 emissions on scope 1, 2 and 3

• Often based on Intesa Sanpaolo GRI standards

and CDP Signify requirements

• Often quantitative objectives set to support carbon UCB reduction strategies

France: 75% of DPEF are based on a CSR risks analysis

Rest of Europe: 90% of companies use materiality analysis to address material issues

FRANCE SPAIN ITALY NETHERLANDS GERMANY BELGIUM PORTUGAL GREECE

Materiality analysis

CSR risks assessment

Intesa Sanpaolo

Solvay

France, Spain, Italy and Belgium: 100% of companies present a business model

Rest of Europe: 75% of companies present a business model

FRANCE SPAIN ITALY NETHERLANDS GERMANY BELGIUM PORTUGAL GREECE

Presented

Infographic form

Legend: Always Almost always Sometimes Almost never 11 © 2019 Property of EY & Associés More and more companies set quantitative objectives on material sustainability topics but still progress to be made on the relevance of the KPIs

France: 75% of companies have quantitative objectives

Rest of Europe: 62% of companies have quantitative objectives

FRANCE SPAIN ITALY NETHERLANDS GERMANY BELGIUM PORTUGAL GREECE

Quantitative Objectives

KPIs

Intensity ratio and no absolute values

Growing trend toward integrated The NF Statement is mostly reporting of financial and non- published in Annual reports across financial information all countries

FRANCE UK NETHERLANDS ITALY

The business model is often published in the first part of the Separate NF statement or a stand- Annual Report in the Group’s alone sustainability reports still presentation chapter exist in some countries: 65% of companies in France

44% in the rest of Europe SPAIN ITALY BELGIUM PORTUGAL GERMANY

51 pages in France on average (4 pages increase vs. Grenelle 2)

43 pages on average in other European Countries

18 pages on average in Germany because of country guidelines (Nachhaltigkeitsrat)

Still existing need to work on synthetic NF Statement focused on material sustainability issues

Need to reconcile synthetic non financial information focused on material issues and non-financial rating agencies expectations

reporting GERMANY

Checklist on all sustainability matters Comply or explain logic

“The declaration of conformity is composed of descriptive sections of texts and performance indicators that are backed up by figures. It should be as long as necessary and as short as possible in order to draw readers’ attention to the essentials. By way of orientation, the short reports on the individual criteria should be between 500 and 3,000 characters long” 15 © 2019 Property of EY & Associés Focus on the UK Strategic report

The non financial reporting is already covered by the strategic report UK

Dedicated NF statement chapter in the strategic report included in the annual report

• The Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013 enforced the strategic report

• It should: • highlight linkage between the content elements • be focused on materiality • be concise • have a forward looking orientation

• The NF Statement has been included in the strategic report

Mandatory reliability check by a third independant party

Mandatory presence check + market practice of voluntary reliability check by a third party*

Mandatory presence check**

* NL: mandatory check of presence and consistency ** Possible occasional voluntary verification

FRANCE SPAIN ITALY

Standards and Company specific common by law suitable criteria reporting protocols practice

More than 50% with Almost no observations observations Qualification or Almost no observations observations in the Mostly on policies and verifier's report due diligence on CSR Mostly on missing risks required information

Mainly Statutory Verification by Statutory auditor Statutory auditor auditor Accounting brands

NETHERLANDS* GERMANY BELGIUM PORTUGAL DANEMARK

Standards and suitable criteria

Qualification or Almost no Almost no Almost no Almost no Almost no observations in the observations observations observations observations observations verifier's report

Statutory auditor Statutory auditor Statutory auditor Statutory auditor Statutory auditor Verification by Or Accounting firms

Calculation methodology

Detailed definitions for each sub indicators with : - Definitions - Inclusions - Exclusions - Examples

Calculation methodology

Guidelines on each disclosure

There are numerous shared practices in Europe on sustainability reporting: 1 • Large use of materiality analysis to identify NF topics that matter • Shared material topics and similar average number of material topics identified

• Similar NF Statements in terms of form

There is a need for harmonisation on sustainability verification in order to get comparable data: 2 • Numerous countries with different voluntary verification schemes • Need for more precise and common suitable criteria

Are we going towards a possible common standard ?

• Some shared topics with the same level of reporting such as CO2 emissions 3 (scope 1, 2, and 3) or Accident rate • Complemented by Industry specific requirements

24 © 2019 Property of EY & Associés Annex Companies included in the study ACCOR France CREDIT MUTUEL France KLEPIERRE France SANOFI France ADP France DANONE France KORIAN France SCHNEIDER ELECTRIC France AIR FRANCE -KLM France DASSAULT AVIATION France LA POSTE France SCOR France AIR LIQUIDE France DASSAULT SYSTEMES France LAGARDERE France SOCIETE GENERALE France ALSTOM France EDENRED France LEGRAND France SODEXO France ALTEN France EDF France L'OREAL France SOPRA STERIA GROUP France ALTRAN TECHN France EIFFAGE France LVMH France SPIE France ARKEMA France ELIOR GROUP France MAISONS DU MONDE France SUEZ France ATOS France ELIS France MERCIALYS France TARKETT France AUCHAN France ENGIE France METROPOLE TV France TECHNICOLOR France AXA France ERAMET France MICHELIN France TELEPERFORMANCE France BEL France ESSILORLUXOTTICA France NATIXIS France THALES France BIC France EURAZEO France NEOPOST France TOTAL France BIOMERIEUX France EUROPCAR MOBILITY France NEXANS France TRIGANO France BNP PARIBAS France FAURECIA France NEXITY France UNIBAIL-RODAMCO-WE France BOLLORE France FNAC DARTY France ORANGE France VALEO France BOUYGUES France GECINA NOM France ORPEA France VALLOUREC France BPCE France HERMES INTL France PEUGEOT France VEOLIA France BUREAU VERITAS France ICADE France PLASTIC OMNIUM France VICAT France CAPGEMINI France ILIAD France PUBLICIS GROUPE France VINCI France CARREFOUR France IMERYS France RENAULT France VIVENDI France CASINO GUICHARD France INGENICO GROUP France REXEL France VYV France CGG France IPSEN France ROTHSCHILD & CO France WENDEL France CNP ASSURANCES France IPSOS France S.E.B. France WORLDLINE France COVIVIO France JC DECAUX France SAFRAN France CREDIT AGRICOLE France KERING France SAINT GOBAIN FrancePage 25 © 2019 Property of EY & Associés Annex Companies included in the study

AB Inbev Belgium Ilmarinen Finland Evonik Germany AEGEAN Airlines Greece Ackermans & van Haaren Belgium Citycon Finland Vonovia Germany Alpha Bank Greece Ageas Belgium Nokian Tyres Finland Jostwerke Germany FOURLIS HOLDINGS Greece Aperam Belgium Keva Finland HeidelbergCement Germany SA Argen-X Belgium Cargotec Finland Deutsche Bank Germany GEK TERNA Greece Barco Belgium Wärtsilä Finland Leoni AG Germany Hellenic Petroleum Greece Cofinnimo Belgium Kesko Finland Continental Germany Quest Group Greece Colruyt Group Belgium Kone Finland Allianz Germany Lamda Development Greece Galapagos Belgium Konecranes Finland Deutsche Post Germany MARFIN GBL (Groupe Bruxelles Lambert) Belgium Fortum Finland Greece ING Group Belgium Neste Finland Adidas Germany INVESTMENT GROUP KBC Belgium UPM Finland Deutsche Telekom Germany Mytilineos Greece Ontex Group Belgium Elisa Finland Fuchs Petrolub Germany PIRAEUS BANK Greece Proximus Belgium DNA Finland SAF Holland Germany Public Power Greece Sofina Belgium Tikkurila Finland Henkel Germany Corporation Solvay Belgium Kemira Finland CTS Eventim Germany Karamolegkos S.A. Greece Telenet Belgium Fiskars Group Finland Fresenius Germany UCB (Union Chimique Belge) Belgium Sampo Group Finland Munich RE Germany Valmet Finland Umicore Belgium XING Germany WDP (Warehouses De Pauw) Belgium Deutz Germany Fraport Germany

Amplifon Italy A.S.R. Netherlands Altri, SGPS, S.A. Portugal Brembo S.p.A. Italy Aalberts Netherlands Impresa Portugal Brunello Cucinelli Italy ABN AMRO N.V. Netherlands Corticeira Amorim, SGPS Portugal De'Longhi Italy Aegon Netherlands Correio de Transporte Terrestre Portugal Eni Italy Ahold Delhaize Netherlands Fiera Milano Italy Akzo Nobel Netherlands EDP - Energias de Portugal Portugal Assicurazioni ASML Netherlands Galp Portugal Italy Generali DSM Netherlands Ibersol Portugal Il Sole 24 Ore Italy Galapagos Netherlands Jerónimo Martins Portugal Interpump Group Italy ING Groep Netherlands Martifer Portugal Intesa Sanpaolo Italy KPN N.V. Netherlands Media Capital Portugal LUVE Italy NN Group Netherlands Mota-Engil Portugal Massimo Zanetti Randstad N.V. Netherlands Italy NOS Portugal Beverage Group Royal Philips N.V. Netherlands Saipem Italy Royal Vopak N.V. Netherlands Ramada Portugal Snam S.p.A. Italy Signify Netherlands Redes Energéticas de Portugal Portugal TXT E-solutions S.p.A Italy Wolters Kluwer N.V. Netherlands Semapa Portugal Unicredit Italy Sonae Portugal The Navigator Company Portugal Toyota Caetano Portugal

Acciona, S.A. Spain INTERNATIONAL CONSOLIDATED Capita plc UK Spain Acerinox, S.A. Spain AIRLINES GROUP, S.A. Lloyds Banking Actividades de Construcción y MAPFRE S.A. Spain UK Spain Group Servicios, S.A. Mediaset España Comunicación, S.A. Spain Pearson plc UK AENA S.M.E., S.A. Spain Melia Hotels International, S.A. Spain Amadeus IT Group, S.A. Spain Naturgy Energy Group, S.A. Spain BANCO SABADELL, S.A. Spain RED ELECTRICA CORPORACION, S.A. Spain BANCO SANTANDER, S.A. Spain REPSOL, S.A. Spain Bankia, S.A. Spain TECNICAS REUNIDAS, S.A. Spain BANKINTER, S.A. Spain TELEFÓNICA, S.A. Spain BBVA, S. A. Spain VISCOFAN S.A Spain CaixaBank, S.A. Spain Cellnex Telecom, S.A. Spain CIE AUTOMOTIVE, S.A. Spain ENAGAS, S.A. Spain ENCE Energía y Celulosa S.A. Spain Endesa, S.A. Spain FERROVIAL, S.A. Spain Grifols, S.A. Spain IBERDROLA S.A. Spain INDRA Sistemas, S. A. Spain INDUSTRIA DE DISEÑO TEXTIL Spain

Since 1994, EY France's Sustainable Performance and Transformation team has been working with clients on sustainable development issues. With more than 100 specialized consultants, EY France's Sustainable Performance & Transformation team relies on an international network of more than 700 consultants, 400 of them are based in Europe.

Eric Duvaud Partner – Sustainable Performance & Transformation +33 1 46 93 64 77 +33 6 09 24 25 20 [email protected]

Hélène Odic Manager – Sustainable Performance & Transformation +33 1 46 93 51 58 +33 6 99 21 78 26 [email protected]

About EY EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities.

EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com.

Document printed in compliance with EY’s commitment to reduce its environmental footprint.

This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax or other professional advice. Please refer to your advisors for specific advice. ey.com