EU Taxonomy

In 2020, the EU Taxonomy (EU 2020/852) entered into force. The EU Taxonomy was part of the EU Green Deal, Europe’s strategy to become the first climate-neutral continent in 2050. The EU Taxonomy serves as a classification system summarising what activities are and are not considered ecologically sustainable. For information on the content of the Taxonomy, please see the website of the European Union: EU taxonomy for sustainable activities - European Commission (europa.eu).

Heijmans falls within the scope of the EU Taxonomy. In the year under review, the EU Taxonomy required the company to conduct research into which part of the company’s turnover/capital expenditure (CapEx)/operational expenditure (OpEx) is eligible for the Taxonomy for all six environmental objectives stated in the EU Taxonomy. Furthermore, for the environmental objectives climate change mitigation and climate change adaptation, the EU Taxonomy required the company to assess which part is actually aligned with the criteria listed in the directive for all six environmental goals.

Eligibility

For the eligibility assessment based on the company’s primary business operations, Heijmans used the currently available EU documents that contain the definitions and clarifications for non-financial companies:

• The Climate Delegated Act (new window) (2021/2139)

• The Disclosures Delegated Act (2021/2178)

• The Complementary Climate Delegated Act (new window) (2022/1214)

• The Environmental Delegated Act (new window) (2023/2486)

• The amendments to the Climate Delegated Act (new window) (2023/2485)

• The seven Commission notice documents with EU Taxonomy Frequently Asked Questions

Based on the descriptions of activities in the ISO9001 and ISO14001 certificates of the various business areas, Heijmans made the most granular possible breakdown of its business operations (e.g. distinction between construction of infrastructure for rail traffic, road traffic, water traffic, etc.), and then mirrored these against the descriptions of the Taxonomy activities.

In summary, at the highest level of abstraction, Heijmans primarily engages in economic activities - whether or not through its subsidiaries - in the following operational areas:

• The design, realisation and maintenance of above-ground and underground infrastructure for the transport of people, goods and energy by land, air and water.

• The development, design, realisation, maintenance and renovation of (projects in) the built environment.

• The design, realisation and maintenance of energy systems in buildings, linked to the sale and invoicing of energy to users.

Based on this categorisation, Heijmans’ business activities have been mirrored against the economic activities within the Taxonomy. The documents published by the EU at the end of 2023 led Heijmans to classify additional environmental targets in which it carries out business activities as applicable when compared with the previous reporting year. Table TAXO1 lists the economic activities in which turnover is generated or investments are made.

 TAXO1 - Eligible economic activities linked to business areas

Eligibility of turnover

The total turnover to be assessed in the Taxonomy consists of the turnover from projects for third parties of the Group’s various business areas, Living, Working and Connecting, including turnover obtained from joint business activities (see financial statements 1. Consolidated statement of profit or loss).

Within the business areas, the turnover per company at project level has been categorised into one of the defined economic activities, based on the description and content of the project in question. Intercompany turnover has been excluded to prevent the double counting of turnover. At the same time, the turnover at project level has been tested for eligibility.

For economic activities that may be eligible for multiple environmental targets, Heijmans chooses to link these economic activities to the environmental target of Climate Change Mitigation (CCM) as much as possible, in line with the strategy aimed at limiting CO₂ emissions.

Unlike in reporting for the 2023 financial year, Heijmans does not report any eligible turnover with respect to the economic activities 6.15 CCA and 6.16 CCA. This is due to a different interpretation of the more detailed explanation of the Climate Delegated Act. This is due to a different interpretation of the delegated regulations and related FAQs, which specifically emphasise that no turnover may be allocated to ‘adapted’ economic activities without an enabling characteristic in the description of the economic activity.

This means that the share of eligible turnover for 2024 is lower than reported for the previous year, namely 72.0% in 2024 compared with 90.9% in 2023. If the same premises were to be applied, the share of eligible turnover in 2024 is virtually the same as the share of eligible turnover in 2023 (72.7%).

The main economic activities in which Heijmans generates eligible turnover can be categorised as economic activities 6.15 CCA Infrastructure enabling  low-carbon road transport and public transport (non-eligible), 7.1 CCM Construction of new buildings and 7.2 CCM Renovation of existing buildings. The environmental activity 7.1 CCM also includes the turnover from the sale of land intended for residential purposes.

The addition of extra environmental targets has created a situation in which turnover can be allocated to multiple economic activities. See table TAXO2 for an overview of the allocations.

TAXO2 - Eligibility and alignment share per environmental target

During the eligibility testing, any turnover that should be classified as non-eligible based on the available project information is identified immediately. As described above, Heijmans classifies the turnover in the economic activities 6.15 CCA and 6.16 CCA as non-eligible based on the more detailed explanation in the Climate Delegated Act. In addition, turnover from airside airport infrastructure and runway maintenance is structurally classified as non-eligible because Heijmans cannot demonstrate that the infrastructure in question is only used by aircraft without CO₂ emissions. The turnover of the business unit responsible for electrical installations in road infrastructure within the Connecting business area is classified as non-eligible because these electrical installations are specifically excluded within economic activity 6.15 CCA. In addition, turnover in telecommunications and turnover from work for clients in the petrochemical industry is classified as non-eligible in accordance with the conditions in the regulation.

Eligibility of Capital Expenditure

The Capital Expenditures (CapEx) consist of Lease additions in accordance with financial statement 6.11 Leases, as well as investments in property, plant and equipment (PPE) in accordance with financial statement 6.10 Property, Plant and Equipment and investments in intangible assets in accordance with financial statement 6.12 Intangible assets. In the 2024 financial year, the eligible CapEx consisted of € 47.8 million in lease additions, € 27.4 million in investments in property, plant and equipment, and € 1 million in investments in intangible assets.

In the CapEx-KPI eligibility analysis, Heijmans makes a distinction between leases and investments that are directly attributable to economic activities and other leases and investments. Directly attributable, and therefore eligible, are investments and leases related to passenger cars and light commercial vehicles (economic activity 6.5 CCM), investments and leases that are part of road transport of goods (economic activity 6.6 CCM), investments in the industrial building and housing production facility in Heerenveen (economic activity 7.1 CCM) and investments in housing and commercial buildings (economic activity 7.7 CCM).

The other leases and investments include investments that are related to a plan to make business operations more sustainable. Heijmans has categorised these investments as eligible. Heijmans makes a distinction between electrically and non-electrically powered equipment. Heijmans assumes that the former category contributes to the environmental target and for that reason this is included in the KPI analyses. These include investments in an electric tower crane in the Living business area and electrical equipment in the Living, Working and Connecting business areas. These investments help Heijmans to achieve the strategy targets related to Scope 1 and Scope 2 emissions.

Other leases and investments that cannot be categorised in a sustainability plan are labelled as non-eligible.

All CapEx items assessed have been directly allocated to the Living, Working and Connecting business areas.

On 1 October 2024, Heijmans acquired Van Gisbergen's shares. The acquired property, plant and equipment had a total carrying amount of € 1.7 million at the time of the acquisition (see also 6.2 Business combinations in the financial statements), consisting of € 0.6 million in owned property, plant and equipment and € 1.1 million in rights of use on leased assets. Due to the short period of time available to prepare the financial statements, Heijmans has not been able to complete the substantive analysis for allocation to eligible economic activities. This investment has therefore been classified as non-eligible in its entirety.

Developments in regulations and advancing insight into reporting requirements led Heijmans to review the CapEx eligibility analysis compared with previous reporting years. In the 2023 financial year, Heijmans reported 69.4% of its CapEx as eligible. The CapEx report for the 2023 financial year has been revised to align with the new principles. Assuming the same principles, the 2024 financial year will have a higher proportion of eligible CapEx compared with 2023 (63.9% in 2024 compared with 51.2% in 2023).

Eligibility of Operating Expenditure

The Operating Expenditure (OpEx) consists of short-term leases in accordance with financial statements note 6.11 Leases, as well as Research, Development and Innovation Costs and Management and Maintenance Costs in accordance with financial statements note 6.5 Staff costs, depreciation and costs for research and development. The eligible OpEx in the 2024 financial year consists of € 129.8 million in short-term leases, € 13.2 million in research, development and innovation costs, and € 3.4 million in management and maintenance costs.

In the OpEx eligibility analysis, Heijmans makes a distinction between leases and costs that are directly attributable to economic activities and other leases and costs. Directly attributable, and therefore eligible, are rental and lease costs related to passenger cars and light commercial vehicles (economic activity 6.5 CCM), office rental costs (economic activity 7.7 CCM) and Research, Development and Innovation Costs (economic activity 9.1 CCM).

Within the other leases and costs, the Asphalt Processing item, which covers the maintenance of machines for asphalt processing, is classified as eligible.

Other short-term leases and costs that cannot be categorised under a sustainability plan are labelled as non-eligible. This includes unspecified rental and lease costs for equipment and hardware, as well as costs for the management and maintenance of other business assets.

All OpEx items assessed are directly allocated to the Living, Working and Connecting business areas.

Developments in regulations and advancing insight into reporting requirements led Heijmans to review the eligibility analysis of the OpEx compared with previous reporting years. In the 2023 financial year, Heijmans reported 74.5% eligible OpEx. The OpEx report for the 2023 financial year has been revised to align with the new principles. Assuming the same principles, 2024 shows a higher share of eligible OpEx compared with 2023 (47.8% in 2024 compared with 44.7% in 2023).

Alignment

Heijmans investigated the relevance of the identified economic activities mentioned in the Eligibility section within its own strategy. This investigation revealed that two economic activities emerge as substantial business activities in both the strategy and the eligibility analysis.

These are activities 7.1 CCM Construction of new buildings and 7.2 CCM Renovation of existing buildings. Together, these two activities represent approximately 62% of Heijmans’ total turnover. In 2024, Heijmans carried out an investigation into all eligible economic activities to determine whether the alignment criteria had been met.

Turnover, investments and operating costs of activities for which there is as yet no proof and/or this proof is not available centrally are included as non-aligned. In addition, in the Living business area, Heijmans has not investigated the alignment potential of either Van Wanrooij, acquired in 2023, or Van Gisbergen, acquired in 2024, due to the lack of information and documentation. The turnover (a combined € 299 million), as well as the investments and operating expenses of both companies, have been included as non-aligned.

Alignment of turnover

In the case of the economic activity 7.2 CCM Renovation of existing buildings, individual projects have been assessed for alignment. The individual projects within these economic activities are so different that they have been assessed separately for alignment.

In the case of the economic activity 7.1 CCM Construction of new buildings, the projects developed and carried out in the Living business area are homogeneous in nature. This is due to the frequent use of similar housing products. Alignment of this economic activity was examined on the basis of sample projects. The alignment percentage resulting from the example projects assessed was then extrapolated to all similar projects in the Property development and Residential Building business units.

Project-related information is used as much as possible to demonstrate alignment. The main forms of evidence are as follows:

Economic activities 7.1 CCM and 7.2 CCM

• For the economic activities 7.1 CCM and 7.2 CCM, the most important Substantial Contribution Criteria are demonstrated using BENG calculations. For economic activity 7.1 CCM, the legally required calculation is used; for economic activity 7.2 CCM, the calculation has been corrected by omitting the renewable energy generated on the building.

• In addition to the climate adaptation measures prescribed by the competent authority in zoning plans, Heijmans will draw up a climate adaptation report for each DNSH-1 Climate Adaptation project. The report will define the relevant climate risks. In line with Heijmans’ housing products, the reports also indicate any applicable control measures.

• For DNSH-4 Circular Economy, the waste dashboard, set up together with waste processing partners, is used to demonstrate that more than 70% of construction and demolition waste is recycled. In addition, a detachability analysis according to ISO 20887 has been carried out for each housing product.

• The construction of new buildings and renovation of existing buildings have DNSH criteria with respect to pollution. Heijmans has assessed these criteria to the best of its ability, but points to the complexity of the requirements of Annex C to the Climate Delegated Regulation and the limitations of collecting data on all substances in all materials, products and equipment used by the company.

Economic activity 7.1 CCM shows a growth in turnover that is aligned with the Substantial Contribution Criteria and the DNSH criteria in absolute value (to € 365 million in 2024 from € 314 million in 2023). The addition of Van Wanrooij’s turnover in the 2024 Taxonomy assessment means that the eligible turnover of economic activity 7. 1 CCM has increased to such an extent that there is a slight contraction when the aligned turnover in this activity is related to Heijmans’ total turnover (from 14.8% in 2023 to 14.1% in 2024).

For economic activity 7.2 CCM, alignment was achieved for the first time in 2024 for two projects. Together, these projects account for a 0.5% contribution to Heijmans’ total alignment score.

In the coming years, Heijmans is committed to expanding both its own information collection systems at project and group level as well as information requests to clients with a view to increasing the inclusion of EU Taxonomy requirements in it business activities, in order to achieve the highest possible alignment percentage.

Table TAX03 shows the results of the eligibility and alignment analysis of Heijmans’ turnover-KPI.

Alignment of Capital Expenditure (CapEx)

The CapEx-KPI eligibility analysis shows that Heijmans’ eligible CapEx is divided into two categories. The first category includes CapEx items that are directly linked to an economic activity. The second category consists of investments linked to a plan to develop activities that are aligned with the Taxonomy.

In the first category, investments in three of the four economic activities are not aligned. The investments and leases related to passenger cars and light commercial vehicles (economic activity 6.5 CCM), investments and leases related to road transport of goods (economic activity 6.6 CCM) and investments in housing and commercial buildings (economic activity 7.7 CCM) are not aligned. There is insufficient evidence available to meet the Substantial Contribution criteria and the DNSH criteria. The investments in the fourth economic activity are aligned. These are investments in the industrial building and housing production facility in Heerenveen (economic activity 7.1 CCM) and are aligned with the Substantial Contribution criteria and the DNSH criteria.

For the investments categorised in the second category, which are related to a plan to develop activities that are in line with the Taxonomy (an electric tower crane in the Living business area and electrical equipment in the Living, Working and Connecting business areas), there is insufficient administrative evidence to show in which projects or economic activities these were used. Because it has been established that investments in electric vehicles designated as sustainable by Heijmans are used for EU Taxonomy activities, but the exact use per economic activity cannot be sufficiently proven, the investments in question are allocated proportionally to the eligible turnover within Living (the electric tower crane) and Living, Working and Connecting (the electric equipment), respectively. For economic activities where aligned turnover has been achieved, the investments are allocated proportionally as aligned. This results in a limited CapEx alignment for the economic activities 7.1 CCM Construction of new buildings (1.6%) and 7.2 CCM Renovation of existing buildings (0.1%).

Table TAX04 shows the results of the eligibility and alignment analysis of Heijmans’ CapEx.

Alignment of OpEx

The OpEx eligibility analysis shows that eligible OpEx is divided into two categories. The first category contains OpEx items that are directly linked to an economic activity within an environmental target. The second category consists of leases and costs linked to a plan to develop activities that are aligned with the Taxonomy.

In the first category, rental and lease costs related to passenger cars and light commercial vehicles (economic activity 6.5 CCM), office rental costs (economic activity 7.7 CCM) and Research, Development and Innovation Costs (economic activity 9.1 CCM) are classified. The rental and lease costs in these three economic activities are not aligned with the Taxonomy. There is insufficient evidence available to meet the Substantial Contribution criteria and the DNSH criteria.

In the second category, the Asphalt Processing item, which covers the maintenance of machines for asphalt processing is classified as eligible. The relevant expenditures are allocated proportionally to the asphalt-related economic activities 6.13 CCM and 6.15 CCA.

An alignment percentage of 0% applies to both the 2023 and 2024 financial years.

Table TAX04 includes the results of the eligibility and alignment analysis of Heijmans’ OpEx.

Minimum Social Safeguards

The EU Taxonomy requires Heijmans to at least guarantee that due diligence processes related to human rights (including labour and consumer rights), taxes, fair competition, bribery, requests for bribes and extortion are in place and complies with. Heijmans meets this criterion. For the justification of the Minimum Social Safeguards, see the ‘Social information’ section of the Sustainability Report.

Accounting policy

The KPIs turnover/CapEx/OpEx have been calculated in line with the requirements of Art. 8 of the EU Taxonomy legislation for the financial year 2024 (01/01/2024 - 31/12/2024). The tables are designed in line with the requirements in Delegated Regulation (EU) 2023/2486.

Turnover

The denominator comprises total turnover and the numerator comprises Taxonomy-eligible turnover. Total turnover is the turnover as shown in the consolidated statement of profit or loss (Financial statements 1).

The taxonomy-eligible turnover is the portion of the consolidated turnover from products or services, including intangible assets, that are related to economic activities aligned with the taxonomy and as such have been allocated to an economic activity.

CapEx

The denominator includes additions to property, plant and equipment and intangible fixed assets in the course of the financial year, before depreciation, amortisation and any revaluations, including those arising from upward revaluations and impairments, for the relevant financial year and excluding changes in fair value. The denominator also includes additions to property, plant and equipment and intangible fixed assets resulting from business combinations.

The numerator includes the portion of the CapEx related to economic activities aligned with the Taxonomy and as such allocated to an economic activity, as well as that portion of the CapEx linked to a plan to make business operations more sustainable in alignment with the requirements of the Regulation.

OpEx

The denominator comprises direct non-capitalised research and development costs, building refurbishment measures, short-term leases, maintenance and repair, and all other direct expenses related to the day-to-day maintenance of property, plant and equipment. Excluded expenses are overheads, raw materials, employees operating machinery, management costs and project development required to operate property, plants and equipment.

The numerator includes the part of the OpEx that is related to economic activities aligned with the Taxonomy and as such has been allocated to an economic activity, as well as that part of the OpEx that is linked to a plan to make business operations more sustainable in alignment with the requirements of the Regulation.

• 1 EU taxonomy for sustainable activities - European Commission (europa.eu)