PROFILE ANNUAL REPORT Heijmans Annual Report 2020 01 It is one of the busiest bus routes in Eindhoven: the Montgomerylaan. To solve problems at the crossroads, Heijmans constructed a grade separated intersection, ANNUAL REPORT complete with a light artwork to act as a landmark. Together with Signify and Heijmans, designer Frank Tjepkema built ‘the Swarm’, a flock of 700 birds taking flight that travel along with the road users. ANNUAL REPORT Reinforcement of the Lauwersmeerdijk (dyke), Friesland HEIJMANS AT A GLANCE About Heijmans Mission | Vision | Executive Board | Key figures | The Heijmans share Input Market analysis Trends in the market | Stakeholder analysis | Material aspects | Value creation Strategic operationalisation Strategy 2023: three pillars, eight themes Better Smarter Sustainable Foundation Differentiating potential License to operate Embedding Business model • Safety • Digitalisation • Energy • Risk management & • Production • Materials process improvement technology • Space • Quality of the Corporate governance & riskmanagement organisation Operationalisation & result KPIs for eight themes, reporting | Secondary indicators (mandatory) Output Impact Contribution Sustainable Development Goals Outcome Feedback loop CONTENTS 1. Foreword 06 16. Appendices 222 16.1 Appropriation of result 223 2. Profile Heijmans 12 16.2 Statement by the Executive Board 224 16.3 Risk matrix 225 3. The management 16 16.4 Independent auditor’s report 233 16.5 Assurance report by the independent auditor 240 4. Key figures 20 16.6 Remuneration report 243 16.7 Other appendices 251 5. The Heijmans share 26 16.7.1 Heijmans Share Administration Trust 251 16.7.2 The Heijmans Preference Share Trust 254 6. Sector developments and trends 34 16.7.3 Reporting methodology 255 16.7.4 KPI table 256 7. In dialogue with stakeholders 42 16.7.5 GRI Standards: general disclosures 261 16.7.6 Management Approach 262 8. Material aspects 48 16.7.7 GRI Standards: specific disclosures 264 16.7.8 EU Directive 265 9. Value creation 54 16.7.9 Sustainable Development Goals 266 16.7.10 Human rights 270 10. Strategy 58 16.7.11 Fiscal policy 270 10.1 Better 59 16.7.12 Heijmans BIM ladder 273 10.2 Smarter 71 16.7.13 Heijmans bold statements 274 10.3 Sustainable 74 16.7.14 Overview legal structure 274 16.7.15 Glossary of terms 275 11. The year in review per business area 82 16.7.15 Abbreviations 277 12. Financial results 96 13. Sustainable Development Goals 110 14. Corporate Governance 114 14.1 Report of the Supervisory Board 114 14.2 Corporate governance 122 14.3 Conduct and integrity 125 14.4 Risk management 128 The Report of the Executive Board as referred to in Part 9 of Book 2 of the Dutch Civil Code comprises sections 3. The 15. Financial statements 139 Management, 4. Key figures, 5. The Heijmans share, 8. Material aspects, 9. Value creation model, 10. Strategy, 11. The year in review per business area, 12. Financial results, 14. Corporate Governance and appendices 16.1, 16.2, 16.7.8 and 16.7.10. FOREWORD 1 Foreword The year 2020 was overshadowed by the Covid-19 pandemic. Heijmans was also affected by this crisis. The province of Brabant was hit particularly hard by Covid-19 in the first few months of the outbreak. Colleagues fell ill, colleagues lost loved ones and one colleague died; this made a huge impression on the whole organisation. Because of the enormous uncertainty in the early stages of the outbreak, we decided to withdraw our dividend payment for 2019 as a precautionary measure. This was a painful decision for us, as we were planning to pay a dividend for the first time since 2013. But our people and organisa- tion demonstrated enormous resilience. Both in the switch to working from home and on projects, where thanks to the ‘Continuing to work safely together in the construction industry’ protocol, we were able to keep production going. Because our work was classified as a vital profession, we were able to continue working. Some projects did suffer delays, but thanks to the commitment of all our employees and the agility of the organisation, no projects came to a halt. This enabled us, despite Covid-19 and the continuing nitrogen emissions problem, to record higher revenue than in 2019 and to strengthen our cash position and equity. Heijmans did not make use of any government support measures in 2020, such as the NOW wage compensation scheme or the option to defer tax payments. We are proud and pleased that we were able to close 2020 with good results. 06 Heijmans Annual Report 2020 FOREWORD It is not a given that this will continue, as a lot will depend on how the situation develops in the Netherlands. The Our mission is nitrogen emissions issue is still causing delays, mainly in tenders for major infrastructure projects. Delays in the to create a healthy execution of our projects have so far been limited. In living environment. addition to the nitrogen emissions problem, Covid-19 is expected to remain an external factor that will affect our We do this by working sector in 2021; it will be some time before we can return to normal. Covid-19 makes great demands on society as a better, smarter and whole, and we are also seeing how this is affecting our own people. more sustainably We have managed to bring our projects much more under every day, with a control in recent years. Our appointment of a Chief Risk Officer is paying off and we have seen a sharp increase in long-term view. risk awareness in our project teams. Thanks to Heijmans’ robust financial performance, we are now seen in the market as a reliable partner and an attractive employer. Safety Heijmans continues to devote attention to safety. In day from a bay window and whom he no longer saw 2020, the number of accidents we recorded was the after the accident was indescribable. Fortunately, there same as in the previous year. However, with 50 accidents were no physical injuries, although there was a lot of in the first half of the year and 35 in the second half, we material damage and it had a huge impact on those believe we have turned a corner, partly thanks to our involved. It was a very serious situation and a number of safety policy. The IF figure rose from 3.3. to 3.7. Our people were unable to enter their own homes for a ambition remains 0 accidents and safety remains our prolonged period. We devoted a great deal of attention first priority. Our employees know the rule: ‘We work and energy to our efforts to help local residents, keep safely or we don’t work’ and the Safety Ladder is now them informed and allay their fears of further disasters. embedded at every level of the organisation. All business units are at step three and a large part of Infra Calling each other out is already at step four. At step four, people think Heijmans stands for a healthy living and working proactively about safety, and the rest of the organisation environment. Everyone who works for us must feel safe will have to take that step in the coming years. The GO! and secure. We see society as a whole becoming (‘No Accidents) Compass helps to clarify parameters and increasingly individualistic and harsh, which manifests individual roles in our discussions with employees. itself in things like bullying and intolerance. There is no place for this at Heijmans. We are result-oriented, but we When safety is your number one priority, it is even more believe cooperation and trust are essential elements on painful when things go very wrong. The accident with this front. This is why an open culture, one in which we the construction crane in Katendrecht in February had a can call each other to account for our actions is essen- major impact on everyone involved. The crane operator's tial, and we devoted extra attention to this over the past uncertainty about the little boy who waved at him every year. It is only when we can call each other out that we Heijmans Annual Report 2020 07 FOREWORD know what is going on and we can change things. In Tangible realisation Heijmans strategy these times when we see each other much less, it is a Last year, we also saw the launch of new initiatives. At major challenge to maintain the feeling of working the end of 2020, Heijmans opened Hive. This is the together and being together. One of my biggest Heijmans innovation centre next to our head office in concerns is that we are losing social cohesion. In Rosmalen, where business developers, innovation and response to Covid-19, we saw the rapid emergence of data specialists from right across the organisation work new forms of working, and they were successful. together to share knowledge and accelerate innovations. Working from home is now commonplace for many. The I can now safely say that the terms innovation, smart, downside is that a lot of nuance and body language is nature-inclusive, climate-adaptive and circular are terms lost in online interactions. It is important to remain we use every day at Heijmans. Based on our strategy, we aware of this, also in the future. are taking a clear lead in making our industry more sustainable and anticipating new legislation on nitrogen Portfolio development and CO2 emissions. For instance, we are making our Our mission is to create a healthy living environment. equipment fleet more sustainable. And our bold We do this by working better, smarter and more statements for 2023, cited in last year’s annual report, sustainably every day, with a long-term view.