How Verdo exercised corporate social responsibility in 2022

2022 was a turbulent year for the world, and helped to underscore in many ways the importance of the ongoing work with social responsibility and to advance the green transition.

Verdo’s full statement on corporate social responsibility is available on our website, but you can read an excerpt of Verdo’s key results below.

We have compiled a brief summary of some of the key results of Verdo’s work with corporate social responsibility in 2022. The results are divided into ESG categories (Environment, Social and Governance).

Environment: Decrease in fossil fuel consumption 2022 was a balancing act for Verdo. We focused on maintaining a stable and cost-effective supply to customers, while also keeping up the pace of the green transition towards a more decentralised energy sector that is less vulnerable and less dependent on individual energy sources.

You can see some of the key results for Verdo in 2022:

Drop in consumption of oil, coal and gas: While the energy crisis pushed many energy and utility companies towards fossil fuels with a larger carbon footprint, Verdo’s CO2 emissions at Randers CHP plant were actually reduced by around 45 per cent in 2022. There are several reasons for this: Consumers saved both heat and electricity – aided by a mild autumn and with new behaviour patterns. Verdo’s biomass-fired CHP plant in Randers also had stable operation during the year. This meant there was no need to draw on Verdo’s three emergency load plants, which use fossil fuels. However, the picture was a little different in Herning. There was more downtime at Herning CHP plant in 2022 than in the previous year. It was therefore necessary to make more use of our reserve load plants, which run on oil and gas. This resulted in higher CO2e emissions per kWh.

• Many new district heating customers: The drop in CO2 emissions in Randers also happened in a year during which Verdo helped many new and large customers to connect to the district heating network. A total of 1,265 new customers were connected in Herning and Randers –in industrial and residential areas alike.

• Accelerating conversion of the vehicle fleet: A decision has been made to pursue a greener vehicle policy. We therefore have a strong focus on our vehicle fleet, and continually replace diesel and petrol vehicles with electric vehicles where this makes sense.

The full report

Verdo’s full report on social responsibility, as required under section 99a of the Danish Financial Statements Act, can be found in our Report on Corporate Social Responsibility for 2022 on our website here: www.verdo.com/dk/om-verdo/ økonomi/

Social: Social contract set the direction

Based on Verdo’s social contract, the organisation focused in 2022 on improving and preparing the company for the future labour market. We have worked with Verdo’s role as a workplace and as a player in the local area, and with preparing employees for the future labour market.

You can see some of the key social results for Verdo in 2022 below:

• Employee satisfaction: In September 2022, Verdo conducted a Pulse Survey which showed that overall job satisfaction and motivation among employees had risen from 5.80 to 5.86 (on a scale from 1 to 7). We had not defined a target score for 2022, but towards 2025, our goal is to raise the employee job satisfaction and motivation score to 6.

We also measured Verdo’s eNPS (Employee Net Promoter Score). The eNPS score was 10 in 2021, and the target was 25 by 2025. We already achieved an eNPS of 22 in 2022.

• Employee turnover above benchmark: Verdo’s employee turnover during the past year was 18.4 per cent, above the public sector benchmark of 15 per cent. Verdo’s goal for 2023 is employee turnover of no more than 15 per cent. Verdo wants to be an attractive workplace. This is why we established Verdo Academy in 2022, expanding employees’ opportunities for competency development.

• Space challenges are a high priority: WPAs have revealed that after a major increase in the number of employees, there are space challenges at our head office in Randers and the office in Storvorde. These challenges have high priority, and an architectural firm began to identify needs and opportunities in 2022.

Governance: Policy for responsible management in value chains

If Verdo is to achieve major sustainable development advances, this will require anchoring and leadership. It was thus a paradigm shift when Verdo’s policy for responsible management in our value chains took effect at the start of 2022. The policy is anchored in a steering committee in which Verdo’s top management is represented.

Some of Verdo’s other Governance results for 2022 are listed below:

Revised Code of Conduct: The new policy for responsible management also places new demands on our suppliers. The ambitious new requirements are expressed in Verdo’s Code of Conduct. This was revised in 2022 and is being rolled out in Verdo’s divisions.

No corruption among suppliers: We saw no examples of corruption and identified no human rights violations among our suppliers in 2022.

• No reports made to whistleblowing scheme: Employees can use our whistleblower scheme to report concerns about actual or suspected matters that could impact Verdo or the well-being of its employees. No reports were lodged via the whistleblower scheme in 2022.

Report on the underrepresented gender, in line with section 99b of the Danish Financial Statements Act

At Verdo, we believe that diversity in our workforce makes us better able to understand our customers and partners. However, as the figures show, Verdo still has some way to go. We therefore have a strong focus on improving the gender distribution in the company.

You can see some of Verdo’s key results in 2022 in relation to the underrepresented gender below:

• Continued shortage of female managers: The proportion of women in management positions at Verdo decreases the higher up the ranks we go. At the top management level, the proportion of women is only 13 per cent.

• More women on the Board of Representatives: The proportion of women on Verdo’s Board of Representatives rose from 20 to 25 per cent in 2022.

You can read Verdo’s full report on the underrepresented gender, as required under section 99b of the Danish Financial Statements Act, in our Report on Corporate Social Responsibility on our website here: www.verdo.com/dk/ om-verdo/ økonomi

See also the report on the company’s data ethics policy, as required under section 99d of the Danish Financial Statements Act, in our Report on Corporate Social Responsibility on our website here: www.verdo.com/dk/om-verdo/ økonomi