Sustainability Report 2020: Vonovia paving the way for sustainable future – greater responsibility for environment, customers and employees

Press Release

Sustainability Report 2020: Vonovia paving the way for sustainable future - greater responsibility for environment, customers and employees

• Sustainability Performance Index (SPI) introduced as key non-financial performance indicator.
• Binding climate path to carbon-neutral buildings.
• Further increase in customer satisfaction.

Bochum, May 18, 2021. Germany's leading housing company Vonovia has published its Sustainability Report for the 2020 reporting year, in which it underlines its commitment as an active player for sustainable energy and climate-neutral residential housing. Even before the Federal Constitutional Court gave its ruling on the German Climate Protection Act, the company had adopted a binding climate path and introduced a Sustainability Performance Index (SPI). The SPI, which sets specific sustainability targets, is a major non-financial performance indicator, paving the way for a sustainable, carbon-neutral future. Drawing on globally recognized GRI standards, the report shows that Vonovia has further increased its social responsibility for both tenants and employees since the start of the Covid-19 pandemic.

'Vonovia is part of society. As a responsible landlord and employer, we have a special duty to our customers - over one million across Germany, Austria and Sweden - as well as to society, the environment, shareholders, and of course our employees,' says CEO Rolf Buch, explaining Vonovia's commitment to sustainability.

The SPI sets specific sustainability targets linked to remuneration
The Sustainability Performance Index, which was first developed in 2020, contains specific sustainability targets and is Vonovia's major non-financial performance indicator. It highlights the importance of environmental, social and governance (ESG) considerations for Vonovia and is linked to remuneration. The SPI reflects the annual carbon savings achieved in existing buildings, energy efficiency in new buildings, and the number of residential units modernized to meet the needs of senior citizens, as well as customer and employee satisfaction, and also diversity at management levels.

Climate protection through innovation - electric heating
To achieve a climate-neutral housing stock by 2050, Vonovia is combating climate change through innovation. Under this policy, Vonovia's neighborhoods are key components in working towards sustainable transport, energy and climate protection. The focus is on a decentralized energy supply where energy is generated, stored and consumed as autonomously as possible on site. This is precisely what the housing provider is exploring at its housing estate in Weitmar, Bochum.

Vonovia's vision for the future is to have electricity for heating generated by solar panels. To achieve this, the company is continuing to expand its use of renewable energy and photovoltaics. Vonovia currently has a portfolio of 420 installations with a rated peak output of 15.9 MW. Last year, this enabled the company to save around 2,700 tons of CO2e.

'Our climate protection measures in existing buildings will reduce our carbon intensity from today's 39.5 kg CO2e/m² to well below 10 kg CO2e/m² by 2050,' says Catrin Coners, Head of Sustainability and Strategy. She explains that Vonovia has set itself an interim target of 30 kg CO2e /m² by 2030. This means that Vonovia is within the target spectrum for nearly climate-neutral building stock as defined, among others, by a housing initiative called Initiative Wohnen 2050 (IW.2050). In addition, the company will include the amendment of the German Climate Protection Act in the further development of its climate strategy.

Helping tenants during Covid-19 pandemic
Vonovia is widening its responsibility within society even more. Throughout the pandemic, for instance, it temporarily suspended all rent increases and terminations of rental agreements. Thanks to Vonovia's active hardship management scheme, tenants with financial difficulties are continuing to receive support, so that no one loses their home.

Vonovia waives claw back of foregone rents in Berlin
Although the Federal Constitutional Court has declared the Berlin rent freeze to be unconstitutional, Vonovia is not clawing back foregone rents from its tenants, thus effectively waiving up to € 10 million in rental income. 'Our first priority is the welfare of the people who live in our properties. We don't want them to suffer any financial disadvantages resulting of political decisions', says Rolf Buch.

Further increase in customer satisfaction
This decision has also had an impact on customer satisfaction, reflected in an 8.6% year-on-year rise in the company's customer satisfaction index (CSI). Moreover, despite the pandemic, Vonovia has completed 2,088 residential units in Germany, Austria and Sweden. In addition, Vonovia has made its own contribution to climate protection through energy upgrades in 11,300 residential units, thereby increasing the residential quality of each unit.

Increase in number of employees and trainees
Vonovia clearly appreciates the dedication of its workforce, which was reflected in last year's € 1,500 Covid bonus per employee, the highest possible tax-free amount. Also, despite the pandemic, the company further increased its number of employees and trainees. The number of employees rose to 10,622 (up 2.7%) by the end of the reporting period. Trainees, in particular, can find long-term career prospects at Vonovia. 510 budding specialists (up 7.8%) are currently receiving training at Vonovia - more than ever before.

Further development of Vonovia's sustainability strategy
In 2020, the company continued to develop its sustainability management and strategy. This has led to a new materiality analysis, developed through wide-ranging consultations with stakeholder groups. Furthermore, Vonovia set up a separate Sustainability and Strategy Department in the second quarter of 2020, expanding its systematic, cross-departmental approach to sustainability issues. The Sustainability Report 2020, which is both a review and a forecast, clearly shows that Vonovia has explicitly taken its cue from specific UN Sustainable Development Goals (SDGs) that cover sustainable development as well as economic, social and environmental factors.

In the second half of 2020, Vonovia adapted its existing risk management system to reflect its corporate strategy, which itself had been supplemented to include aspects of sustainability. This involved adding and, as a result, assessing sustainability risks not only for their impact on Vonovia itself, but also on the environment and on society at large. The Sustainability Report therefore also deals with climate-related risks.

Improved externally validated performance figures show that Vonovia is making an active contribution to ESG solutions. For example, Vonovia was included in the highly prestigious Dow Jones Sustainability Index for Europe and achieved an excellent position in the sustainability rankings of the Sustainalytics rating agency. Also, since September 2020, Vonovia has been listed in the European blue-chip share index EURO STOXX 50 as the only real-estate company and indeed as the very first residential property company.

GRI standards:
The international GRI standards for sustainability reporting are published by the Global Reporting Initiative (GRI) and are continually under review. The development of these standards involves not only governmental organizations but also NGOs such as environmental and human rights groups and, last but not least, the companies themselves. GRI was founded in 1997 with the help of the United Nations Environment Program and has its office in Amsterdam.

Vonovia's Sustainability Report is only published online - as a contribution to the sustainable use of resources. The German version can be downloaded at the following web address:
http://reports.vonovia.de/2020/nachhaltigkeitsbericht/

The English version is available via the following link:
http://reports.vonovia.de/2020/sustainability-report/