Restore plc Annual Report 2018

FY2018 Annual Report · Restore plc

Loading PDF…

C O R P O R AT E
R E S P O N S I B I L I T Y
R E P O R T 2 0 1 8

ABOUT THIS REPORT
[GRI 102-48, 102-49, 102-50, 102-51, 102-52, 102-56]

In line with the Luxembourg “Loi du 23 juillet
2016 concernant la publication d’informations
non financières et d’informations relatives à la
diversité par certaines grandes entreprises …”
Aroundtown SA and its investees (the “Company”
or “Aroundtown” or “AT”), including associates
and in particular Grand City Properties S.A.
(“GCP”), together the “Group”, have produced a
separate, consolidated non-financial report for
the financial year 2018 (January 1, 2018 to De-
cember 31, 2018). The report has been made
publicly available from April 30, 2019 under the
following web address in the form of a PDF doc-
ument: www.aroundtown.de/sustainability. The
report will be updated and the new version pub-
lished on a yearly basis. Each version of the re-
port will remain publicly available for ten years.
The non-financial report has not been externally
audited, but has been scrutinized by the Compa-
ny’s Board of Directors (the “Board”). A third-par-
ty assurance of the environmental data has been
carried out by GUT Certifizierungsgesellschaft
für Managementsysteme mbH according to As-
surance Standard AA1000, limited assurance.

This is Aroundtown’s second Sustainability Re-
port, its purpose being to demonstrate the
Group’s ongoing commitment to sustainability
as well as the progress it has made and mea-
sures it has implemented over the course of
2018. The Company’s activities and achieve-
ments are presented from a sustainability per-
spective and the report is aimed at the Group’s
investors, tenants, employees, business partners,
and other interested stakeholders.

CONTENT AND STRUCTURE OF THE
REPORT

[GRI 102-46]

This report lays the basis for Aroundtown’s Corpo-
rate Responsibility Strategy and provides the
structure, processes, and principles for future sus-
tainability reports.

Thematically, the report focuses on the following
topics: corporate governance, in particular data
protection; tenants; employees; environment;
and society. In addition to the online version of
the Sustainability Report, printed copies will be
distributed among key stakeholders.

ALIGNMENT WITH GRI STANDARDS AND
EPRA GUIDELINES

[GRI 102-54]

This report has been written using the guidelines
developed by the Global Reporting Initiative (GRI)
on GRI Standards as a reference. In particular,
when developing the concepts and compiling
KPIs, the GRI Standards have been considered.
In addition to this cross-sector initiative,
Aroundtown has also followed the EPRA (Europe-
an Public Real Estate Association) Best Practices
Recommendations on Sustainability Reporting.

Key figures have been collected by various de-
partments and have been collated centrally by
Aroundtown’s dedicated CR Team.

STAKEHOLDER FOCUS AND MATERIALITY

[GRI 102-43, 102-21]

In view of providing internal and external stake-
holders with transparency, a materiality assess-
ment has been performed to identify the Group’s
material topics. The assessment process included
a peer group analysis as well as a dialogue-based
survey of stakeholders. In the survey, stakeholders
were asked to provide both quantitative and qual-
itative assessments of various topics with respect
to the Group’s sustainability activities. These as-
sessments were further combined with an assess-
ment of
impact significance to generate a
cross-sectional matrix outlining the relative ma-
teriality of various topics within the broader area
of sustainable business. This matrix serves as the
Group’s guide in targeting its measures and com-
munication efforts appropriately. The assessment
will be reviewed at regular intervals.

EDITORIAL NOTES

With the aim of creating a user-friendly document
we have included indexes listing the references to
GRI and EPRA in the Facts and Figures section of
this report. In addition, references to specific GRI
standards and EPRA recommendations are included
at the beginning of each subchapter as and where
applicable.

TABLE OF CONTENTS

LETTER TO THE STAKEHOLDERS

GROUP PROFILE

01 CORPORATE GOVERNANCE

Management and Operations
Sustainability Strategy and Stakeholders
Compliance
Data Protection
Suppliers
Human Rights

02 TENANTS

Communication and Transparency
Tenant Satisfaction
Tenant Health and Safety

03 EMPLOYEES

Company Culture
Payment and Social Benefit
Education and Training
Diversity and Anti-discrimination
Occupational Health and Safety

04 ENVIRONMENT

Environmental Management
Energy and Emissions
Water Management
Waste Management

05 SOCIETY

Community Involvement and Development

06 FACTS AND FIGURES
GRI Content Index
EPRA Index
Key Figures

MEMBERSHIPS AND AWARDS

IMPRINT

8
10
12
15
16
17

20
22
23

26
27
28
29
31

34
35
38
38

45
46
49
50

Left to right: Sylvie Lagies (Head of ESG), Dr. Gerhard Cromme (Chairman of the Advisory Board)

LETTER TO THE
STAKEHOLDERS

[GRI 102-14]

DEAR READERS,

Around the world, we as a people are facing rapid
and fundamental shifts. Climate change, urbaniza-
tion, demographic change, and many other trends
continue to shape society on a global as well as
local scale. These transformations are long-term in
nature and pose many challenges for steering
them to our society’s shared benefit. In 2015 the
United Nations codified the crucial importance of
actively addressing these shifts in its 2030 Agenda
for Sustainable Development and corresponding
framework of global goals. As the literal founda-
tions for people’s homes and businesses, the real
estate industry likewise has a central role to play
in shaping how society takes on these issues.

LETTER TO THE STAKEHOLDERS | 3

Aroundtown SA is the largest listed German com-
mercial real estate company as well as the largest
listed buyer in German real estate and thus has a
clear responsibility to help address these chal-
lenges and foster sustainable property develop-
ment. With our focus on investing in and develop-
ing mid-life-cycle assets in predominantly German
as well as other major European cities, the
Aroundtown business philosophy is based on di-
versification, which is a unique selling proposition
and generates long-term growth. We have made a
conscious commitment to providing sustainable
value creation for tenants and shareholders alike.
This is the foundation of our performance.

Be they tenants, shareholders, or employees, stake-
holders of all kinds have high expectations of com-
panies’ commitment to addressing the challenges
of sustainable development. Responsible business
should and must comprise a critical assessment of
impact. Today’s business success should not be
achieved at an untenably high cost for future gen-
erations. Aroundtown aspires to find new forms of
success within these challenges that will generate
benefits for all stakeholders.

Assets of different types have different needs:
from retail and logistics to hotels and offices the
relevant sustainability issues cover a broad spec-
trum. As asset manager, we see our primary task as
being that of providing our tenants with environ-
mentally sound objects that will help them achieve
their own sustainability goals. Strategic asset de-
velopment and refurbishment activities at
Aroundtown pinpoint technological advancements,
energy efficiency potential, and other environmen-
tal improvements that will result in effective over-
all impact.

The Group continually strives to provide transpar-
ent and comprehensive information on its opera-
tions and management as well as on its successes
and challenges in regular reporting for sharehold-
ers and stakeholders. To structure our commitment
to sustainability and the environment effectively,
Aroundtown bases its commitment on ongoing
stakeholder dialogue and a careful consideration
of materiality of impact. We have furthermore in-
corporated ESG criteria throughout our manage-
ment functions and processes. As we continue to
report on our progress we will increasingly also be
applying the framework of the UN’s 17 Sustainable
Development Goals as a guide for our endeavors
and integrating this relationship into our report-
ing step by step.

Optimized cost structures and minimized environ-
mental impact help us as a company to consistent-
ly generate attractive returns. We invest in asset
development that prioritizes measures that lower
service costs, such as for energy or waste removal.
Wherever economically feasible, we select the
more environmentally sound alternative.
Aroundtown applies its ongoing commitment to
sustainability to its suppliers and their value chains
as well. Contractual commitments to ethical busi-
ness and low environmental impact are the foun-
dation of all our business relationships.

The needs of our human assets – tenants and em-
ployees alike – are another key factor that guides
our deployment of capital. Across the board, safety
and well-being are our highest concern as well as
an unconditional respect for the plurality of per-
spective that comes with diversity. Furthermore,
we have incorporated an explicit commitment to
stringent data protection throughout our process-
es. Transparency and reliability are fundamental
components of our commitment to optimal service.

In the Sustainalytics 2018 review, Aroundtown was
again formally recognized for its corporate respon-
sibility activities. In the peer group comparison (of
over 319 real estate companies), Aroundtown was
accredited the status of an “Outperformer” in the
categories of environmental and governance and a
“Leader” in social criteria.

With this second corporate responsibility report,
we wish to provide stakeholders with information
on the progress we have made, the measures we
have newly implemented, our ongoing commit-
ment to sustainability management and corporate
responsibility, and our vision for the future. We
hope that you will find this report informative and
will use it to engage with us on how we can shape
this ongoing journey.

Yours sincerely,

Dr. Gerhard Cromme
Chairman of the Advisory
Board

Sylvie Lagies
Head of ESG

GROUP PROFILE

VALUE CREATION THROUGH STRATEGIC
PROPERTY INVESTMENT

[GRI 102-1, 102-2, 102-3, 102-4, 102-6, 102-8]

CONCLUSIVE BUSINESS PERFORMANCE

[GRI 102-5, 102-7, 102-10]

Aroundtown SA is a real estate company with a
focus on income-generating quality properties
with value-add potential in central locations in
top-tier cities primarily in Germany and the Neth-
erlands. Founded in 2004 and headquartered in
Luxembourg, its consistently attractive perfor-
mance has developed a portfolio with limited
downside risk. Aroundtown now has a workforce
of over 330 employees. Throughout its operations,
its value-oriented business premise has led to on-
going high levels of portfolio growth. The Group’s
portfolio comprises both commercial and resi-
dential properties and is focused on top-tier cities
in Germany, the Netherlands, and other major Eu-
ropean cities. Overall, the portfolio has a distinct
commercial weighting and carries approximately
83% commercial and 17% residential assets. As of
end of 2018, the Aroundtown commercial portfo-
lio was distributed over 55% offices (2017: 61%),
28% hotels (2017: 19%), 6% retail (2017: 9%), and
11% logistics/wholesale/other (2017: 11%) (cal-
culated by asset value). The residential properties
in its portfolio are held via a substantial stake
(39%) in Grand City Properties S.A.

Aroundtown has based its performance strategy
on building a defensive portfolio with long-term
tenant relationships and limited dependence on
single tenants. Combined revenues from the top
ten tenants account for less than 20% of total
rental income. The Company prefers leases with a
long-term horizon and as of December 2018 had
a WALT (weighted average lease term) of eight
years. The large and varied tenant base of over
3,000 tenants (2017: 2,800) provides additional
security and scope for flexibility. A clear regional
focus on central locations in top tier cities and
strong investment orientation heighten the port-
folio’s attractiveness further.

Aroundtown’s aim as investment and asset man-
ager is to enhance value in existing assets
through targeted repositioning and best-in-class
tenant services. Acquisitions are carefully select-
ed for income-generating potential by the Group’s
team of experienced specialists. Their keen vision
of performance allows the Group to consistently
select objects with strong upside potential in rent
and/or occupancy increases. Following acquisi-
tion, Aroundtown undertakes intensive property
management in terms of both operational tenant
management and long-term repositioning. This
unique business model and exceptional team of
experts have allowed the Company to pursue a
mission of continual enhancement of shareholder
value for over 15 years.

Aroundtown SA is publicly listed on the Prime
Standard of the Frankfurt Stock Exchange.
Aroundtown’s portfolio has increased from
€ 2.4 billion in December 2015 to € 14.2 billion as
of December 2018 (2017: € 9.8 billion) supported
by its strong capital market activities. Most re-
cently these activities have culminated in a con-
firmation of the Group’s sustainability orientation
and enhanced presence on global capital markets,
as the Company was added to the MSCI index se-
ries, which includes the MSCI ACWI Index, MSCI
World Index, MSCI Germany Index, and others, in
December 2018. Aroundtown had already been a
constituent of key benchmark indexes, such as the
MDAX1 and FTSE EPRA index series since March
2018 and STOXX Europe 600 since December
2017. With a share price performance of over
150% since initial listing, the stock markets have
clearly recognized Aroundtown SA’s successful
value creation. The Company’s healthy capital
structure and conservative financial policy have
safeguarded liquidity and enhanced tradability,
making the share a highly attractive listing.

1 The MDAX includes the 50 Prime Standard shares from sectors,

excluding technology, that rank immediately below the companies
included in the DAX index. These comprise some of the largest
and most liquid companies of the Prime Standard.

FOR MORE DETAILS ON OUR COMPANY PROFILE AS WELL AS OUR PAST AND CURRENT
ECONOMIC PERFORMANCE, PLEASE SEE OUR LATEST COMPANY PRESENTATION AND
THE FINANCIAL STATEMENTS FOR 2018 ON OUR WEBSITE: WWW.AROUNDTOWN.DE.

TRANSPARENT RESPONSIBILITY

[GRI 102-12]

Robust corporate governance and high transpar-
ency guide the Company in its value creation. For
its excellence in the category of financial report-
ing, the Company was awarded the “Gold Stan-
dard” by the EPRA BPR committee for the second
time in 2018. Aroundtown has continually based
its performance on a philosophy of generating
strong, secure cash flows and a commitment to
ethical business.

GROUP PROFILE | 5

Frankfurt

CORPORATE
GOVERNANCE

Cologne

MANAGEMENT AND
OPERATIONS

PERFORMANCE FOUNDED ON
GOVERNANCE

[GRI 102-18, 102-19, 102-22, 102-24 / EPRA Gov-Board,

EPRA Gov-Selec]

Aroundtown pursues an ambitious vision of long-
term value creation and attractive returns. With
this ambition informing its philosophy, the Group’s
mission is to balance interests through alignment
with the core values of integrity, respect, perfor-
mance, accountability, and sustainability. The
Group’s dedication to exceptional shareholder
value is thus systematically oriented on a risk re-
duction philosophy that mitigates and hedges ex-
posure through value-oriented compliance. Going
forward, Aroundtown has set its sights on achiev-
ing a listing in the Dow Jones Sustainability Index
(DJSI).

Cultivating utmost structural and governance
transparency enables the Group to embed the
trust its shareholders have invested throughout
its operations and deliver on its value creation
promise. Operational oversight is administered by
the Board of Directors and appointed manage-
ment teams. The Board of Directors comprises
three dependent and three independent directors,
who are elected at the Annual General Meeting.
The number of directors, their term, and their re-
muneration are determined by the general meet-
ing of shareholders, and the maximum term of
directors’ appointment per election is six years
according to Luxembourg law.

The Board of Directors is supported in its steward-
ship of the Group’s operational activities by work
from the Risk Committee, the Audit Committee,
the Nomination Committee, and the Remunera-
tion Committee, with the Advisory Board provid-
ing additional oversight. In order to embed the
Group’s commitment to sustainability issues with-
in its governance structures, the Board of Direc-
tors has also established an ESG/CSR Committee.

CR STRUCTURES FOR EFFECTIVE
ENGAGEMENT

[GRI 102-20, 102-23, 102-26, 102-27, 102-32]

To ensure operational coherence with strategy,
Aroundtown has established a CR Steering Com-
mittee. It is charged with developing and super-
vising the Group’s CR activities. It is overseen di-
rectly by the CEO Mr. Shmuel Mayo, who is the
Head of the CR Steering Committee. The Head of
ESG and heads of all relevant departments also
sit on the committee. The committee meets at
regular intervals and is the first point of contact
for sustainability-related topics. The CR Depart-
ment actively assists relevant departments with
operational implementation of CR measures.
These streamlined structures ensure that sus-
tainability and environmental concerns receive
due consideration in strategic oversight as well
as operational management at the highest level.

MANAGEMENT AND OPERATIONS | 9

The primary function of the CR Department is to
act as a cross-departmental interface. Its overar-
ching structure allows developments and mea-
sures to be supervised with an interdisciplinary
perspective. The CR Department thus liaises
with all affected departments throughout the
Group to coordinate efforts related to both inter-
nal and external CR topics. It is also responsible
for preparing the Group’s reporting on ongoing
and future CR activities in line with EU require-
ments. Materiality analyses provide the basis for
the Group’s CR strategy as well as for determin-
ing reporting content. As a further component of
its activities, the ESG Department fields inquiries
from investors and other stakeholders on ESG
topics and coordinates with Investor Relations to
ensure rating agencies have all ESG-related in-
formation needed for preparing accurate assess-
ments.

CULTIVATING COMPLIANCE IN
OPERATIONS

Stringent corporate governance underpinned by
strong internal controls forms the foundation for
maintaining the trust of shareholders, bondholders,
and other stakeholders. Aroundtown has thus im-
plemented a comprehensive compliance framework
within which all employees and executives are ex-
pected to structure their actions. The Code of Con-
duct outlines the Company’s standards of behavior
and is a mandatory component of all employment
contracts. It is supplemented by a number of topical
policies on, for instance, anti-corruption measures,
avoiding conflicts of interest, preventing bribery,
and anti-discrimination practices. These policies
provide all staff with extensive guidance on stan-
dards of rightful behavior. The Group’s long-term
aim is for all construction project processes to be
monitored according to an internal “traffic light sys-
tem”. Moreover, Aroundtown has also implemented
a whistleblowing system to further strengthen its
commitment to ensuring ethical behavior by all
those who carry out operations in the Group’s name.

RISK MANAGEMENT FOR LONG-TERM
GROWTH

[GRI 102-29]

Aroundtown’s risk reduction strategy is to pursue
a philosophy of comprehensive compliance. The
Company monitors its risk position closely and
manages all internal and external risk areas with
a view to minimizing potential for negative im-
pact to the Group’s operations and financial posi-
tion. In respect of internal risks, the Group is sub-
ject to risks resulting from human negligence,
inadequate structural
unethical behavior, or

frameworks. External risks relate to interest rate
volatility, liquidity, the ability to attract credit, reg-
ulatory and legal factors, cyber criminality, market
behavior, and collection and tenant deficiencies.
Company risk management is overseen by the
Risk Committee, which stipulates risk manage-
ment structures, evaluates the internal control
system, and coordinates risk training for staff. The
Risk Committee provides reports to the full Board
of Directors on a regular basis.

The Risk Committee employs a variety of mecha-
nisms in its risk identification and control respon-
sibility. Regular risk assessments provide the basis
for the committee to analyze the Group’s organi-
zation and evaluate it for potential weaknesses.
Procedural structures are amplified by the em-
ployees’ and executives’ explicit commitment to
highest standards of ethical business. The disci-
pline guiding their behavior is rooted in the Com-
pany’s strong value system. This philosophical
foundation is furthermore underpinned by a sys-
tem of extensive controls, such as physical con-
trols, compliance checks, and cross-departmental
verifications. These controls place a strong em-
phasis on a separation of duties, whereby all key
actions, such as approval of payments, follow a
double-verification principle and must be signed
off by two different parties. Payments are addi-
tionally cross-checked for plausibility against
budgets and contracts. For payments exceeding a
certain threshold, approval by the respective head
of the department is required. Spot checks are
performed and all unusual entries are validated
through detailed monthly analysis of actual ver-
sus budget cost comparisons. This extensive
framework of controls and monitoring processes
enable Aroundtown to substantially reduce the
risk of errors through human negligence or dam-
ages as a result of misconduct.

Suboptimal performance in a variety of ESG-relat-
ed areas could potentially have negative impact
on Aroundtown’s operations and its ability to evi-
dence attractive performance. Hence, the Compa-
ny has embedded ESG topics throughout its risk
management structures. ESG risks are evaluated
as part of regular risk assessments and accounted
for in the Group’s risk position via commensurate
reserves. Risk planning and financial budgets
have been adjusted to account for these ESG fac-
tors in the form of reserves for potential financial
liabilities and the inclusion of ESG expenditures
in the Group budgets. Closely coordinated risk as-
sessment and conscientious long-term financial
planning provide the Group with an ongoing
sound basis for future performance.

SUSTAINABILITY STRATEGY AND STAKEHOLDERS

SEEKING DIALOGUE WITH STAKEHOLDERS

[GRI 102-42, 102-43]

REPORTING AND ENGAGEMENT ORIENTED
ON MATERIALITY

Aroundtown’s ambition of offering attractive,
value-based performance is predicated on main-
taining long-term support from investors and
other stakeholders. Transparency and openness
are key components in cultivating this relation-
ship. The Group sets great store by engaging in
continuous dialogue with a wide range of stake-
holders to be able to enhance and expand its
activities and communications for maximum ef-
fectiveness. An ongoing, productive exchange
with stakeholders is central to identifying the
best path forward and fully tapping the potential
the market has to offer.

TAILORED AND EFFECTIVE
COMMUNICATION

[GRI 102-40, 102-44]

By their nature, Aroundtown’s operations carry
broad daily relevance for a wide section of soci-
ety. Its varied stakeholder groups have a corre-
spondingly differentiated range of expectations
of the Group. Its main stakeholder groups are
tenants, employees, investors and analysts, local
communities and residents, suppliers and busi-
ness partners, as well as policy-makers and asso-
ciations. Aroundtown strives to tailor its commu-
nication activities and informational content
such that it provides effective means for hearing
and addressing stakeholders’ concerns. When it
comes to the communities of which the Group’s
properties are a part and other stakeholders in
Aroundtown’s wider framework, the respective
department heads maintain engaged relation-
ships with key contact persons and business part-
ners.

With respect to public policy, Aroundtown does
not engage in any lobbying activities and has a
strict policy not to support any political party or
policy-maker. The Group is involved in dialogue
with policy-makers related to approvals for its
respective projects and through its activities in
various industry associations. These associations
include in particular the German Property Feder-
ation (ZIA), the European Public Real Estate Asso-
ciation (EPRA), and the German Sustainable
Building Council (DGNB).

Aroundtown uses the aspect of materiality to
identify its most effective orientation with regard
to sustainability activities, strategy, and communi-
cation. The CR Steering Committee thus conduct-
ed a comprehensive materiality analysis in 2018
in order to gain a more detailed picture of how
stakeholders and internal experts assess various
topics. In the assessment, relevant topics were ex-
amined for their materiality in terms of both
stakeholder decision-making and their economic,
environmental, and social impacts. By analyzing
the intersection of these two dimensions of mate-
riality the Group can consolidate its reporting and
target and intensify its efforts appropriately.

STAKEHOLDER DIALOGUE HELPS
IDENTIFY MATERIAL TOPICS

[GRI 102-42, 102-43, 102-47]

To ensure the results of the assessment have practi-
cal applicability, the first step was to condense the
range of possible topics from a list comprising all
topics named in the GRI Standards, GRI Sector Dis-
closures, EPRA Best Practices Recommendations on
Sustainability Reporting, the GRESB Real Estate As-
sessment, and a peer group analysis. From this, a
short list of topics was produced by eliminating top-
ics of no relevance for Aroundtown, in consultation
with external experts and the CR Officers responsi-
ble. This yielded 19 topics, which were then grouped
into four topic areas.

Following topic selection, a group of stakeholders
was asked to evaluate the topics’ influence on their
view of the Company and their decision-making re-
garding it. The stakeholders were selected on the
basis of their high specialist expertise and were
representative of Aroundtown’s sphere of activity.
The stakeholders rated the topics using a quantita-
tive scoring system and were interviewed for an ad-
ditional qualitative assessment. All stakeholders
were treated with full anonymity, with no possibility
of results being attributed to any particular stake-
holder group, and were given equal weighting.

In the area of economy, the topics compliance and
fair business were named by the stakeholders as
highly relevant. Aroundtown’s performance here
was viewed as positive. In the area of the environ-
ment, stakeholders viewed the topic of energy as
especially important. The stakeholders expect of
Aroundtown that it develop and define an environ-
mental management strategy aimed at greater effi-
ciency in these efforts.

SUSTAINABILITY STRATEGY AND STAKEHOLDERS | 11

Where society is concerned, data protection and
customer health and safety were the highest rated
topics. Overall, customer-related topics were viewed
as being most relevant in this area. With regard to
suppliers and service providers, Aroundtown was
seen as having a positive relationship. The topic was
rated as less relevant, however.

IMPACT SIGNIFICANCE COMPLETES
FRAMEWORK

[GRI 102-47]

The second dimension of the analysis comprised
an assessment by Aroundtown department man-
agers and executive management of the likeli-
hood and severity of various impacts from the
Group’s operations on the three dimensions of
sustainability: economy, environment, and society.
In this context, “impact” is defined as referring to
all positive/negative, intentional/unintentional,
actual/potential, direct/indirect, and short-/long-
term effects.

The two sets of assessments were combined by
representing each dimension along one axis of a
matrix. The resulting mapping of the topics (see
below) indicates how relevance and impact from
the two lines of inquiry intersect.

MATERIALITY MATRIX STREAMLINES
FOCUS

The results of the assessment were subsequently
validated by the CR Steering Committee and the
Board of Directors. A review was also conducted
with respect to the German CSR Directive Imple-
mentation Act (CSR-RUG) to ensure that no topics
needed for understanding the Group’s course of
business, business result, or position had been
omitted.

The mapping of the results was then given priori-
tization by attributing values from 1.5 (not mate-
rial) to 4 (highly material) to each of the 19 topics.
The six topics placing above the highest priority
materiality rating then dictated the focus of this
report, allocated to one of three areas of action;
the areas of action correspond to the report’s
chapters.

Data Protection

Compliance

Fair Business

Customer Health and Safety

Customer Satisfaction

Future-oriented
(Work) Environment

Energy

Diversity and Equal Opportunities

Training and Development

Core Labor Standards

Impact of Regulatory Framework
on 2030 SDGs

Emissions

Occupational Health and Safety

Recognition of Sustainability Performance

Water

Climate Change Adaptation

Suppliers

Wastewater and Waste

Local Communities

ECONOMY

ENVIRONMENT

SOCIETY

SUPPLY CHAIN

SIGNIFICANCE OF ECONOMIC, ENVIRONMENTAL AND SOCIAL IMPACTS

S
N
O
I
S
I
C
E
D
D
N
A
T
N
E
M
S
S
E
S
S
A
R
E
D
L
O
H
E
K
A
T
S
N
O
E
C
N
E
U
L
F
N

Munich

COMPLIANCE

AMBITION ROOTED IN STRONG
CORPORATE CONTROLS

[GRI 102-25 / EPRA Gov-Col]

As Germany’s largest listed commercial real es-
tate company, stringent corporate governance is
central to Aroundtown’s value creation promise.
Aroundtown is committed to being a role model
of responsible business practice in its segment.
Compliance with all applicable laws and regula-
tions is a self-evident prerequisite for excep-
tional performance. The Company’s ability to at-
tract shareholders and bondholders, and
maintain attractive occupancy rates, is founded
on its reputation for transparency as well as
professional property development and man-
agement. Tenants, investors, suppliers, and cus-
tomers trust in Aroundtown’s responsible opera-
tions and base their decisions on this promise
being upheld. Safeguarding the Company from
reputational damage due to error or misconduct
is thus central to being able to deliver on
Aroundtown’s ambition. Stringent compliance
structures are the central management tool for
ensuring responsible behavior guided by integ-
rity throughout the Company’s dealings.

Right from
its first portfolio-building drive,
Aroundtown was thoroughly committed to creat-
ing a comprehensive compliance framework for
its repositioning operations. Carrying these struc-
tures forward and adapting them to effectively
navigate new challenges has never been more
important than in today’s environment. In view of
increasingly complex legal frameworks and rising
public expectations of ethical business, strong
operational control and management oversight
are critical to value-driven performance.

DEDICATED COMPLIANCE SHAPES
OPERATIONS

Compliance issues have relevant impact for all
aspects of the Group’s operations, and impact
can occur at all levels, be it employees and man-
agement or customers and stakeholders.
Aroundtown’s compliance and risk management
systems are structured accordingly and supple-
mented by extensive internal audit procedures.
The Company’s compliance framework covers all
steps of the property management process, from
acquisition to asset management through to ad-
ministrative and operative functions.

COMPLIANCE | 13

In designing its compliance management pro-
cesses, the Group prioritizes the prevention of
compliance violations and misconduct outright.
This precautionary approach is further augment-
ed by a definitive philosophy of risk minimization.
Aroundtown’s processes promote timely, com-
plete, and fault-free disclosures of conflicts of
interest and other sources of controversies. En-
suring ethical conduct by staff is crucial.

A wide range of corporate policies ensure the
Group’s structural-level controls are translated
into operational practice. Clear communication of
corporate standards and expectations provides
Aroundtown’s employees and executives with
targeted guidance on accepted behavior in day-
to-day dealings.

SAFEGUARDS FOR ETHICAL BUSINESS

[GRI 102-16]

The Aroundtown Code of Conduct forms the back-
bone of the Company’s explicit commitment to
ethical behavior in operations. The Code of Con-
duct was implemented in 2009 and is a mandato-
ry component of all Company employment con-
tracts. It applies equally to staff in all levels of
the organization. The standards of behavior laid
out in the Code are additionally supplemented by
topically oriented policies on key issues. These
policies include: Anti-corruption Policy, Anti-dis-
crimination Policy (see also pp. 26-30), Whis-
tleblowing Policy (see also p. 13), Data Protection
Declaration, and a User Policy for dealing with
digital content and devices. It is the Company’s
duty to protect its employees’ rights and data pri-
vacy as well as to safeguard its legitimate inter-
ests as a going concern.

Via a mandatory yearly training module and sign-
off procedure, all employees must regularly reaf-
firm their awareness of and commitment to the
Code of Conduct. The Company has also carried
out a comprehensive update of governance poli-
cies to align them with the results of the 2017
analysis of the compliance management system.
The Company’s anti-corruption policies have been
communicated to all employees as well as to all
members of the Group’s governing bodies.

EMBEDDING COMMITMENT IN THE
SUPPLY CHAIN

[GRI 102-9, 308-1, 414-1]

Comparable commitments to ethical conduct are
laid out in the Group’s Supplier Code of Conduct
thus ensuring relationships with business partners
are guided by the same standards of compliance.
The Supplier Code of Conduct is distributed to all

existing suppliers. The Code forms a binding con-
tractual commitment and is updated regularly by
the Legal Department. Aroundtown closely moni-
tors compliance with the law and Company policies
via on-site visits and an annual review of all suppli-
ers. Supplier selection is governed by the Green
Procurement Policy. For more information on sup-
plier management, please see pp. 16-17.

EFFECTIVE MANAGEMENT AND
ONGOING DEVELOPMENT

[GRI 102-17, 102-25 / EPRA Gov-Col]

Compliance issues at the Group are the respon-
sibility of the Compliance Management Team in
the Compliance Department. They manage and
evaluate these issues with direct oversight from
the Board of Directors. The Compliance Manage-
ment Team comprises one Chief Compliance Of-
ficer and four Compliance Analysts; the Chief
Compliance Officer reports directly to the CEO.
The Compliance Management Team is charged
with implementing measures to foster rightful
conduct and reviewing existing processes in co-
ordination with Risk Management to identify
areas for improvement. The Compliance Man-
agement Team bears responsibility for ensuring
that all current legal and market requirements
are reflected in Aroundtown’s policies and struc-
tures.

The effectiveness of the Group’s processes and
communication of policy expectations is clearly
borne out by operational results. To date, the
Group has registered zero compliance violations.
It further maintains a commitment to zero toler-
ance of compliance violations. The Company has
additionally performed an extensive review of
its compliance structures as a result of changes
to the EU regulations for sustainability report-
ing. Aroundtown’s goal for the future is to main-
tain its notable track record through careful
analysis of the evolving market and regulatory
environment in conjunction with further appro-
priate development of internal structures.

REPORTING MECHANISMS FOSTER
RESPONSIBLE CONDUCT

[GRI 102-17]

Internal compliance management structures at
Aroundtown are supplemented by a whistle-blow-
ing service operated by an external service provid-
er. Independence of this service provides an added
level of assurance against conflicts of interest. The
service is primarily aimed at enabling external
persons or bodies to report possible violations or
questionable conduct, but naturally may be used
by Aroundtown’s employees as well.

As a rule, Aroundtown would encourage employ-
ees to initiate personal and open discussion of
concerns related to the Code of Conduct or other
corporate guidelines. Anonymous reports may also
be made, however. Where possible, the decision for
or against anonymity lies solely with the informer.
The standard internal reporting procedure via de-
partment head and division head to the Chief
Compliance Officer is outlined in the Whistleblow-
ing Policy, including alternative routes should the
concern relate to an individual involved in the
normal reporting chain. Employees may discuss
compliance concerns in confidence with the Chief
Compliance Officer at any time.

The Group has specifically designed its reporting
mechanisms with the aim of empowering both ex-
ternal actors and employees to report any and all
violations or misconduct of which they become
aware. Violations relate to violations of the law,
Company policies, or contracts of all kinds. Materi-
al misconduct is defined as being any behavior
which could result in material (significant) damag-
es to the Company or its employees. In all cases,
investigation and reporting of violations are the
responsibility of the Chief Compliance Officer. The
Chief Compliance Officer is also charged with dis-
cussing events with all witnesses and involved
parties as well as providing updates on the pro-
ceedings. Disciplinary sanctions are implemented
should the preconditions for such measures be
fulfilled. Aroundtown’s whistle-blowing proce-
dures explicitly communicate that informers shall
not be subject to sanctions as a result of their re-
porting of another’s misconduct.

RISK ANALYSIS INFORMS COMPLIANCE
STRUCTURES

Companies face a wide range of challenges to
their drive to deliver on an ambitious vision of
long-term value creation. Aroundtown’s manage-
ment is highly cognizant of the risks and opportu-
nities these hurdles can entail. Processes and op-
erations are bounded by structures that allow for
agile reactions to changing market conditions
and an evolving risk environment. Compliance
risks can relate to environmental issues, work-
place health and safety topics, or potential for
corruption in the form of bribery or fraud.
Aroundtown’s control systems must effectively
hedge against and mitigate these risks. They must
also evolve as the Group grows and keep pace
with Aroundtown’s dynamic development.

Stuttgart

The Compliance Department performs a yearly re-
view of the Group’s risk position. With support
from the Risk Committee and other departments,
it provides a detailed risk analysis broken down
by department. The results of its analysis are re-
ported to the CEO and the Board of Directors. In
2018, the Group carried out an extensive risk as-
sessment as part of evaluating structures and re-
quirements for fulfilling its EU-mandated sus-
tainability reporting obligations. The compliance
system was adjusted and expanded as a result of
these findings.

Risk management measures are in place for all
aspects of due diligence as well as technical, en-
vironmental, legal, and community-related issues.

DATA PROTECTION

ONGOING COMMITMENT TO DATA
PRIVACY

The protection of individual privacy through ade-
quate data security provisions is an area of action
that is of key importance to the Group’s stake-
holders. As digital technology and workflows
have evolved, Aroundtown has long since main-
tained a stringent commitment to data privacy
throughout. The Group orients its activities and
measures in this area on ensuring best possible
transparency, self-determination, and security of
data.

Our stakeholders have high expectations of our
performance in this area. Aroundtown’s overarch-
ing aim is to ensure that all personal data stored
and/or processed in the course of the Group’s op-
erations is protected from manipulation and mis-
use. The relevant IT systems are reviewed regular-
ly and developed further in line with technological
advancement. Moreover, the Group has embedded
the topic throughout operations in the form of
corporate policies and by sensitizing all depart-
ments to how the subject specifically relates to
their daily workflows.

REVIEWS ENSURE COMPLIANCE WITH
NEW REGULATION

Though the Group had already implemented a
wide range of guidelines and provisions, with the
ratification of the EU General Data Protection
Regulation (GDPR) as of May 25, 2018, the topic of
data privacy was elevated considerably in terms
of media visibility in the reporting year. The Group
thus subjected its existing data privacy framework
to a thorough review in order to identify and im-
plement adjustments as necessary. Communica-
tion with stakeholders regarding this topic was
also intensified so as to ensure they remain com-
prehensively informed on the Group’s efforts in
this area.

In reviewing its internal data privacy framework,
the Group focused in particular on the topics of
transparency in the processing of personal data,
ensuring the possibility for self-determination
and providing stakeholders with corresponding
options, and assessing risks relating to data priva-
cy and the suitability of technologically aided
protection methods.

COMPLIANCE / DATA PROTECTION | 15

The Group has implemented Standard Operating
Procedures (SOPs) for a range of topics that lay
out how data protection is to be ensured in vari-
ous workflows. Going beyond legal stipulations,
all Aroundtown personnel are required to sign a
data protection commitment statement. To en-
able all staff to maintain these high standards,
compulsory video training is carried out, and ex-
ecutives are given additional input from legal ex-
perts. Clearly communicated internal policies and
relevant documentation informing tenants of
rights and measures ensure the Group’s efforts
are transparent for all stakeholders. Tenants also
have access via the website to the Group’s Privacy
Policy, wherein all rights, processes, purposes of
use, and options are laid out. The Privacy Policy
was additionally reviewed by a legal expert in
2018 to ensure ongoing compliance.

EXTERNAL AND INTERNAL OVERSIGHT
STRUCTURES

Responsibility for the topic of data protection
within the Board of Directors lies with the Chief
Compliance Officer. At an operational level, the
Group has engaged an external Data Privacy Offi-
cer, who reports to the Chief Compliance Officer,
and all executives are requested to provide feed-
back on areas of concern in their departments. All
deficits are subject to mandatory reporting. If a
potential breach of data protection is identified, a
committee is formed to investigate the matter
further. The Group takes its commitments here
very seriously as in addition to the potential legal
consequences, fines, and harm to its reputation,
the topic also relates to the very personal con-
cerns of individual stakeholders.

Rotterdam

SUPPLIERS

VALUE-ORIENTED SUPPLIER
RELATIONSHIPS

[GRI 412-3]

A company’s procurement activities are a decisive
factor in its responsibility as an ethically oriented
actor in the supply chain. This pertains equally to
which suppliers and other business partners
Aroundtown chooses to do business with as well
as to the standards of care to which it holds its
various partners. The core of Aroundtown’s val-
ue-oriented cooperation philosophy is a shared
commitment to maintaining high standards of
ethical, environmental, legal, and professional
business. All business partners of Aroundtown
should expressly distance themselves from cor-
rupt behavior and unethical practices.

100%

of contracted suppliers were
environmentally certified to ISO 14001
as of the end of 2018 (2017: 97%)

All Company suppliers are required to sign the
Supplier Code of Conduct as a prerequisite for do-
ing business with Aroundtown. In the Code of
Conduct, suppliers formally commit to upholding
standards of decent work (see
also p. 17). Human rights viola-
tions of any kind are not tolerat-
ed, and child labor and forced
labor are explicitly renounced.
Suppliers are obliged to provide
workplaces that are free of dis-
crimination and harassment (see
also p. 17). Aroundtown further expects suppliers
to mitigate negative environmental impact wher-
ever possible (see also pp. 34-35) and orient their
operations toward the environmental norm ISO
14001.

ASSESSING SUPPLY CHAIN
SUSTAINABILITY

[GRI 308-1, 414-1]

Aroundtown considers ongoing dialogue with
suppliers and close cooperation the most effec-
tive path to improving sustainability performance
at all points in the value chain. The Group thus
strives to build long-term supplier relationships
based on trust. Suppliers are selected on the basis
of the corporate Green Procurement Policy. This
policy defines the standards by which suppliers
are assessed and the criteria they must fulfill in
order to enter into dealings with Aroundtown. The
policy is communicated to all employees with
purchasing responsibility. Where specific risks are
identified, such as hazardous materials handling,
suppliers are required to provide evidence that
they possess the requisite certifications and per-
missions. The Group’s standards and expectations
of sustainability-oriented contract work are com-
municated in all requests for bids.

When a new supplier relationship is initiated,
Aroundtown performs a careful evaluation of the
supplier’s sustainability performance. The find-
ings from this assessment are then used to iden-
tify areas where the supplier and Aroundtown can
work together to achieve improvements. The as-
sessments cover both environmental impact as
well as social and compliance issues.

CONTRACTUALLY BINDING
COMMITMENTS

Aroundtown has furthermore taken care to struc-
ture its compliance processes so as to include
supplier management. Group project managers
liaise closely with contractors, and internal and
external experts perform on-site visits to ensure
standards are being upheld. Going forward, the
Group intends to increase its supplier audits. As
the Supplier Code of Conduct is a mandatory com-
ponent for all supplier contracts, failure to comply
with the commitments of the Code can be grounds
for termination of the business relationship. The
Company further reserves the right to exclude
specific suppliers from bidding on new projects if
they have committed past breaches of policy.

Hanover

SUPPLIERS / HUMAN RIGHTS | 17

HUMAN RIGHTS

UNEQUIVOCAL PLEDGE TO PROTECT
DECENT WORK

BINDING STANDARDS FOR SUPPLIERS

[GRI 412-3, 414-1]

Aroundtown applies its own standards of opera-
tions and expectation of human rights protection
to the work carried out by contractors and works
to minimize the risk of violations in the Compa-
ny’s supply chain. For its construction projects, the
Group gives preference to local medium-sized en-
terprises. Further, all business partners are re-
quired to sign Aroundtown’s Supplier Code of
Conduct, which stipulates contractually binding
standards of decent work and human rights pro-
tection. The Code was implemented in 2015 as a
mandatory component of all supplier contracts
and has been signed retrospectively in all exist-
ing supplier relationships as well. Project manag-
ers carry out periodic on-site visits to verify that
suppliers are complying with these standards,
both when accepting partial deliveries of work
completed and in a supervisory control function.
In 2018, 100% of the Group’s construction sites
were inspected by internal project managers.
Aroundtown aims to maintain its pleasing level of
zero human rights violations in the supply chain
and has duly incorporated these issues into its
risk assessment processes.

Aroundtown’s vision of value-based performance
is predicated on highest standards of ethical busi-
ness. The Company considers generally accepted
standards of decent work and respect for human
rights to be non-negotiable components of its
commitment to all stakeholders. Since the Group’s
asset development operations are carried out ex-
clusively in the EU,1 comprehensive human rights
laws of the European Union, supplemented by na-
tional-level regulations, govern
its activities.
Within this extensive legal framework, concrete
human rights violations are not a substantial risk
since statutory human rights protection is en-
sured at all localities in which Aroundtown oper-
ates.

As the Group’s operations focus on the reposition-
ing of growth-oriented commercial properties,
the majority of construction work resulting from
Aroundtown’s business is related to refurbish-
ment projects rather than new developments. The
Company engages contractors and construction
companies to carry out these projects, closely co-
ordinated by in-house project managers. Accord-
ing to the Company’s risk assessments, the main
area with potential for human rights violations
lies with subcontractors hired by these firms. Such
subcontractors would not fall under direct over-
sight from Aroundtown. There is also a risk relat-
ed to the treatment of migrant workers at large
construction firms.

London

1 The Group is active in the UK, which at the time of writing still fell under EU jurisdiction. Though this will foreseeably change in the
future, from a human rights standpoint, the Group does not expect this to substantially impact the risk of human rights violations.

TENANTS

COMMUNICATION AND TRANSPARENCY

BUILDING ADDED VALUE FOR TENANTS
AND SHAREHOLDERS

Aroundtown measures its performance in terms of
the value it creates – both for tenants and share-
holders. As an asset owner and property manager
with a vision of sustainable value creation, the two
are directly linked. Long-term tenant relationships
are the foundation for generating attractive yields
and the primary measure of the Group’s success. To
cultivate good tenant relations, the Group abides
by applying exacting standards of customer service
and considers its promise of outstanding, reliable
service a key responsibility. Aroundtown is commit-
ted to not only delivering on this promise, but to
also continually expanding and enhancing its ser-
vice offering.

Sound customer services provide value to tenants
through productive dialogue. Moreover, productive
tenant relations add company value through posi-
tive reputational effects. Exceptional customer ser-
vice is thus a driver of income generation for
shareholders and is instrumental in achieving
Aroundtown’s business aims. The Group aspires to
remain an industry leader in the area of tenant-ori-
ented customer service.

COMMITMENT TO ADDRESSING TENANTS’
CONCERNS

[GRI 203-1, 416-1]

Aroundtown’s tenants expect from the Group that,
in addition to structural facilities, it provide them
with effective support in its operational capacity.
These responsibilities relate to a broad range of
informational, advisory, and assistance services. In
turn, the Group must fully understand tenants’
needs in order to ensure its development and
management activities are effectual and benefi-
cial. Property Managers allocated to all assets are
the central point of contact for tenants, service
providers, utilities, and public authorities. As part
of a wider structural matrix, the Property Manag-
ers are responsible for the full gamut of adminis-
trative processes for the Group’s commercial hold-
ings and work in close cooperation with the
Accounting Department and Facility Management,
among others. Property Managers report to the
Head of Property Management as well as opera-
tionally to the designated Asset Manager for the
holding concerned.

The number of assets advised by a given Property
Manager varies depending on the complexity and
scope of requirements associated with a particular

holding. Property Managers deal with such issues
as tenant master data; invoice issuance, review,
and approval; budget preparation and tracking;
planning of technical and building maintenance
for commercial holdings; and acceptance of ser-
vices relating to maintenance or construction.

FRIENDLY AND ACCESSIBLE TENANT
SERVICES

[GRI 203-1, 402-2]

As the primary service contact entity, Property
Managers maintain ongoing contact with the ten-
ants of their respective holdings. Open communi-
cation and high levels of transparency are the
tool used to shape the relationship between ten-
ants and their respective Property Managers. Ten-
ants can contact their Property Manager regard-
lease
ing all
arrangement, including relating to the leased ar-
eas, the lease rate, operating costs, the term of the
lease, repairs, and even refurbishment or modern-
ization requests.

issues associated with their

CLOSELY MONITORED FEEDBACK DATA

[GRI 203-1, 416-1]

To augment its informational functions and fur-
ther enhance open lines of communication, the
Group’s tenant services unit also reviews the
service response to pinpoint areas of dissatis-
faction. Where issues become apparent, these
shall be eliminated as swiftly and effectively as
possible. Aroundtown has installed a number of
procedural and technical structures that facili-
tate optimal effectiveness in dealing with ten-
ants’ concerns.

All tenant care activities are fundamentally
aimed at enhancing tenant well-being and sat-
isfaction. Ongoing pleasing developments in
satisfaction overall are largely a result of the
Group’s concerted effort to reduce service times
and enhance the quality of work conducted.

Relationship Based on Trust and Reliability

Communication quality directly impacts satisfac-
tion levels. In turn, low tenant satisfaction levels
are associated with depressed occupancy levels
and thus a risk of burdens for asset yields. The
Group’s tenant communication activities are de-
signed to ensure that tenants can trust their voice
will be heard and that they view their relationship
with the Property Managers as one based on open
communication and reliability.

COMMUNICATION AND TRANSPARENCY | 21

Amsterdam

Baden-Baden

TENANT SATISFACTION

INVESTING IN TENANT SATISFACTION

[GRI 416-1]

100%

of our properties are reviewed an-
nually with respect to safety issues

retaining

Aroundtown’s delivery on its promise to share-
holders and ability to sustainably generate at-
tractive yields is fundamentally tied to attracting
and
tenants.
Tenant satisfaction is thus
an essential metric in as-
sessing and guiding the
It
Group’s performance.
governs not only
the
Aroundtown service phi-
losophy lived throughout
daily operations, but also strategic development
choices.

The Group leverages ongoing analysis to align
investment with achieving high levels of tenant
satisfaction. This allows the Group to develop
appropriate and effective measures in infrastruc-

ture, processes, and operations. Aroundtown
structures its investments with a view to creat-
ing sustainable value and social benefit.

MITIGATING OCCUPANCY RISK

Occupant turnover rates are closely linked with
satisfaction levels among tenants, with unsatis-
fied tenants evidencing reduced loyalty and a
greater likelihood of termination. Tenant satisfac-
tion is thus a crucial factor in maintaining occu-
pancy rates. Low satisfaction levels carry a risk of
vacancies, which can be augmented by reputation-
al factors if the media were to publish negative
reports on tenant issues. Tenant satisfaction activ-
ities are thus firmly integrated in Aroundtown’s
due diligence structures and operational manage-
ment. Aspiring to continually increasing tenant
satisfaction lays the strategic foundation for long-
term income generation and attractive yields.

TENANT SATISFACTION / TENANT HEALTH AND SAFETY | 23

TENANT HEALTH AND
SAFETY

SOUND FUNDAMENTALS

[GRI 416-1 / EPRA H&S-Asset, H&S-Comp]

Utmost assurance of infrastructural health and
safety compatibility is a prerequisite to tenant
satisfaction. Comprehensive compliance with all
statutory norms and safety requirements applica-
ble in Germany is a self-evident minimum stan-
dard for the Group. As such, the buildings
Aroundtown owns comply with the highest gen-
eral safety and fire safety standards. The Group’s
frequent physical presence at its properties and
close collaboration with construction and facility
management further ensure that factors with a
health and safety impact are given the highest
priority.

On top of its compliance with all statutory re-
quirements, Aroundtown regularly monitors and
assesses safety-related issues as part of its exten-
sive due diligence activities. The Group carries out
technical reviews of all properties in its portfolio
on an ongoing basis, in line with regulations in
Germany and to guide future investment planning.
Among other things, infrastructural measures re-
lated to facades, roofing, building exteriors, and
stair access points are covered with a special fo-
cus on fire safety regulations and other tenant
safety issues. The reviews evaluate safety benefits
and cost-effectiveness of the outcomes.

EXPERT ON-SITE ASSESSMENTS

[GRI 416-1, 416-2 / EPRA H&S-Asset, H&S-Comp]

To enhance alignment of budget planning,
Aroundtown conducts site visits at regular inter-
vals. On-site building management provides valu-
able input for identifying areas in need of en-
hancement, ensuring any issues are dealt with
promptly. Necessary repairs are commissioned
immediately and any dangers associated with the
issue eliminated. All safety-related incidents are
thoroughly investigated. Site management also
assists in carrying out regular tests of fire safety
systems.

Leipzig

Fire safety is a topic of particular priority.
Aroundtown uses external service providers for
fire safety assessments. The external assessors
prepare expert opinions on various fire safety is-
sues through on-site visits at all properties. Where
defects are identified, Aroundtown relays the is-
sue to the Head of Asset Management, who is
tasked with ensuring the defect is eliminated
swiftly. Comprehensive documentation of the pro-
cess, from identification to elimination and fol-
low-up ensure that transparency of all measures
and work conducted is maintained. Where neces-
sary, additional site visits are performed at multi-
year intervals.

EMPLOYEES

COMPANY CULTURE

HUMAN CAPITAL SHAPES SUCCESS

[GRI 102-8]

As a leading player in the German real estate in-
dustry and a growing company, Aroundtown’s long-
term success is predicated on its employees’ dedi-
cation and expertise. The quality and competence
of its over 330 employees as of December 31, 2018
(2017: 270) determine company performance.
Aroundtown aspires to provide its staff with a cor-
porate culture and working environment that cul-
tivates success and fosters a diverse array of tal-
ents. The Company views the synergies created by
actively supporting and promoting diversity to be
a key element of its competitive advantage on the
market.

EMPLOYEES – OVERVIEW1
Total number of employees
(permanent and temporary)

female

male

Total number of permanent employees

female

male

Total number of temporary employees

female

male

Total number of full-time employees

female

male

Total number of part-time employees

female

male

2018

2017

2016

337

182

155

205

106

132

300

152

148

270

141

129

154

116

239

118

121

157

101

134

1 The employee figures as re-
ported here relate to those
employees of Aroundtown
who are employed in Ger-
many. The Group additio-
nally employs 37 staff (as
of 31 December 2018) in
positions located outside of
Germany. This may result
in reporting differences as
compared with the informa-
tion provided elsewhere, for
instance in annual financial
reporting. For further de-
tails, please see the 2018
Annual Report.

Aroundtown is committed to attracting top-tier
talent and guiding its human capital to maxi-
mum growth and performance. In addition to
specialist skills and expertise, in order to com-
pete and serve its tenants, the Group needs
healthy and satisfied employees. To further rein-
force this commitment, the Group has set itself
the goal to be among the top ten most attractive
employers in the German commercial real estate
sector (as measured by the Immobilien Zeitung
index) by the year 2030 (see also p. 30).

NEW EMPLOYEES

Total number of new employee hires

female

male

Aroundtown reinforces high levels of motivation
throughout its staff by communicating a strong
commitment to a value-based corporate culture,
offering flexible working hours, promoting on-
going professional development, reinforcing
open communication, and expanding connec-
tions through networks, mentoring, and support
groups. Aroundtown has further set itself the
target of achieving health and well-being certifi-
cation by the year 2025 to provide independent
evidence of its commitment in this area.

Aroundtown expects its managers to live out this
promise to the Group’s employees. It is they who
serve as role models of value-based action. It is
managers’ duty to encourage employees through
mutual respect and clear communication of goal
expectations. Leadership quality plays a crucial
role in shaping the Group’s networks, structures,
and processes for success and pays into reducing
fluctuation through cultivation of satisfied
teams.

A WORKPLACE GOVERNED BY OPENNESS
AND RESPECT

Aroundtown continually reaffirms its responsibil-
ity as employer for shaping its staff’s work envi-
ronment so as to cultivate high levels of both
performance and well-being. This duty of care re-
lates to the health and human safety aspects of
their work as well as the values and behaviors
that define the daily working environment.
Through its Employee Code of Conduct, the Group
has aligned itself with certain fundamental stan-
dards of decency founded on the central value of
mutual respect. The Company expects all staff to
abide by the values of openness, trust, teamwork,
and acceptance of diversity in all their dealings
with one another and with its tenants and other
stakeholders. The Code of Conduct forms a com-
pulsory part of all employee contracts.

Having a diverse workforce is a key operational
advantage as it brings flexibility of perspective
and willingness to innovate. It is therefore in the
Group’s own interests to actively promote diversi-
ty in the workplace. Further, the staff’s diversity

2018

189

105

2017

126

2016

COMPANY CULTURE / PAYMENT AND SOCIAL BENEFIT | 27

contributes benefits of shared perspective in that
it reflects the diversity of the Group’s tenants. Dis-
crimination or harassment in any form are not
tolerated. Respect for individual personal differ-
ences applies to all stakeholders – be they em-
ployees, tenants, business partners, suppliers, or
shareholders – and is a non-negotiable expecta-
tion of all those who act in Aroundtown’s name.
The Group is firmly committed to offering impar-
tial treatment and equal opportunities to all. The
Diversity Policy and the Anti-discrimination Policy
further reinforce Aroundtown’s standards of de-
cent work.

DEVELOPING INTRINSIC POTENTIAL

[GRI 404-2]

Aroundtown views investment in staff develop-
ment as an investment in the potential that fos-
ters success and seeks to align personal and com-
mercial advancement. Learning should be an
ongoing pursuit and the Company has tailored its
development program to allow staff to tackle new
challenges, both those brought by career ad-
vancement and those resulting from market or
global megatrends. Openness to new ideas and
the ability to communicate effectively are key
skills for success in a highly competitive business
environment and are thus prioritized. As a rule,
the Group prefers to promote from within and
cultivates talent wherever it sees potential.

PAYMENT AND SOCIAL BENEFIT

COMPENSATING PERFORMANCE

FAIR PAYMENT ACROSS GENDERS

[GRI 102-35]

[GRI 405-2 / EPRA Diversity-Pay]

Hamburg

Performance is the result of the skilled application
of expertise and commitment. In order for an em-
ployer to leverage this potential performance, ade-
quate compensation for its employees is a self-evi-
dent
its
responsibility. Aroundtown provides
workforce with attractive, appropriate remunera-
tion for their contributions in line with their re-
spective competencies and range of duties.

Aside from its motivational role, commensurate pay
is a key component in Aroundtown’s attractiveness
as an employer. The Company’s payment strategy
thus heavily impacts its ability to draw and retain
qualified personnel. Compensation is structured ac-
cording to level of expertise and responsibility and
is supplemented by target-linked performance in-
centives. The Group’s ability to deliver on its value
creation promise is predicated on the company em-
ployees being equipped to innovatively and flexibly
find solutions to the market’s challenges.

56%

of new hires in 2018 were female
(2017: 55%)

Aroundtown’s payment structures across all em-
ployees break down by gender as 0.71 to 1 (2017:
0.78 to 1) on average for 2018. When narrowed to
management, this figure was 0.45 to
1 (2017: 0.89 to 1). This change over
the previous year was primarily a re-
sult of bonus payments. National
statistics for Germany show an aver-
age gender pay gap of 0.78 to 1 in
2014 for employees of all categories.
The figures and developments of the
past year indicate that Aroundtown must enhance
its efforts in this important area. The Group has
noted this displeasing trend and will be taking it
on board as key insight to focus efforts on regain-
ing the positive movement seen in prior years.
Overall the Company was made up of 54% female
(2017: 53%) and 46% male (2017: 47%) employ-
ees in 2018.

EDUCATION AND TRAINING

PREPARING STAFF FOR SUCCESS

Aroundtown’s business excellence would not
be possible without the contributions of its
highly qualified employees who are trained
specialists in their field. The merit of the
Group’s human capital will have significant im-
pact on all aspects of its sustainability perfor-
mance as it is the people in each case who are
charged with actively implementing the mea-
sures of the Group’s sustainability strategy. The
Group is also dependent on its staff to contin-
ually identify attractive opportunities and find
ways to outperform targets.

100%

of employees have access to
Aroundtown’s internal training
measures

As today’s world presents companies with ever
changing challenges, supporting staff with ef-
fective training and development
measures is the best means of en-
suring the workforce has the tools
needed for taking hurdles like
global digitalization in stride. Op-
portunities for ongoing profes-
sional development enhance per-
formance motivation for staff and
are compelling draws for attracting new em-
ployees. As Aroundtown prefers to promote
from within the Company wherever possible,
effective training measures additionally se-
cure the internal pipeline for talent advance-
ment.

SKILLS TRAINING TO LEVERAGE
POTENTIAL

[GRI 404-2 / EPRA Emp-Dev, EPRA Emp-Training]

The range of corporate development options the
Group offers directly impacts all staff that carry
out Aroundtown’s operational activities. The
Group has implemented a wide variety of training
measures, covering all levels of the organization
and all departments. Overall, Aroundtown has
found individualized training to be substantially
more effective than generalized training for all
employees. The limited effect achieved through
generalized training of this kind does not yield
the appropriate operational benefits. Where re-
quired, the Company also employs external spe-
cialist trainers to develop specific areas, such as
various soft skills and other competences.

Professional advancement within the Group is de-
pendent solely on ability and potential. The Com-
pany consciously prioritizes skill sets, both pro-
fessional and personal, over specific certifications
and invests where it sees particular talent.
Aroundtown does not view a specific university

degree or industry background as prerequisites
for performing well in a given role so long as the
individual has the right aptitude. Specialized
training is offered where needs and potential are
identified.

BROAD IN-HOUSE TRAINING OFFERING

[GRI 404-2 / EPRA Emp-Training]

Aroundtown has published a formal corporate
professional development philosophy in its state-
ment “Commitment to Human Capital Develop-
ment.” Since 2014, management of training and
development throughout the Group has been
bundled in the Training and Development Depart-
ment.

In 2018, training for managerial staff dealt with
topics likes strategy, compliance, risk management,
and soft skills development, in particular in the
area of communication and leadership. Further, all
staff at Aroundtown participated in training units
relating to current developments in data protec-
tion and information privacy. Employees also have
at their disposal e-learning units on sustainability,
occupational health and safety, fire prevention,
and various other internal policies and procedures.
Comprehensive onboarding of new colleagues is
ensured via the Welcome Day. All units were sub-
ject to mandatory completion in 2018.

Training and development is monitored and as-
sessed by HR management as part of the Group’s
due diligence procedures. The Group has imple-
mented a software-based Learning Management
System (LMS) that aids in tracking measures and
enhancing effectiveness. A key goal of training
management will be to further raise participation
levels throughout the Company. The system also
ensures that the entire workforce receives in-
struction on the Code of Conduct, informational
security, the handling of personal data, and safe-
ty-related guidelines.

TARGETED TRAINING INVESTMENT

When investing in professional development
measures, Aroundtown takes care to align activi-
ties with achieving continued improvement in the
business result. Operational benefit is thus re-
viewed at department level to ensure effective-
ness. Its commitment to training is also a key fac-
tor in achieving preferred employer status. An
attractive development offering improves em-
ployee motivation and lowers staff fluctuation.
Going forward, the Group intends to increase its
training participation rate.

EDUCATION AND TRAINING / DIVERSITY AND ANTI-DISCRIMINATION | 29

SECURING TALENTED PROFESSIONALS

[GRI 205-2 / EPRA Emp-Dev]

Aroundtown’s human capital – their stamina and
ability to work highly efficiently – is crucial to en-
suring ongoing strong corporate performance.
Long-term development of that capital is thus es-
sential to fulfilling the Group’s ambitious vision. A
failure to provide appropriate instructions carries
the risk that staff members have insufficient
knowledge of the business and their duties or
how to ensure compliance with legal require-
ments. Inadequate employee training is also
linked to staffing risks as a result of poor employ-
ee retention and low attractiveness to job seekers.
Superior professional development will fortify the
Group’s image as an employer of choice and safe-
guard Aroundtown’s long-term value creation.

Dortmund

DIVERSITY AND ANTI-DISCRIMINATION

PROTECTING DIVERSITY OF PERSPECTIVE

[GRI 405-1]

Leveraging the combined insight of Aroundtown’s
diverse workforce is a vital component in Group’s
ability to innovate, find flexible solutions, and
maintain ongoing impressive business success.
Diversity of perspective can stem from differences
in nationality, ethnicity, race, culture, age, gender,
religion, ideology, sexual identity, or physical abil-
ity. In all cases, the Group views these differences
as strengths that give the Company a competitive
edge on the market and aid it in providing top tier
service for its tenants. Aroundtown actively works
to strengthen diversity and reflect in its workforce
a wide breadth of cultural strengths.

Aroundtown is committed to protecting diversity
in all its forms. Discrimination on the basis of any
of the characteristics named above constitutes an
infringement of basic human rights and is explic-
itly prohibited. Moreover, discrimination in the
work environment demotivates employees and
puts the Company’s success at risk. The Group’s
zero-tolerance policy for discrimination and ha-
rassment applies equally to all departments and
all interactions with colleagues, management,
tenants, and other stakeholders.

ATTRACTIVE EMPLOYER FOR DIVERSE
TALENT

It is Aroundtown’s ambition to be an employer of
choice for a wide variety of highly qualified inter-
national professionals. Its multinational activities
go hand in hand with a clear dedication to open-

ness and inclusivity in the workplace. The Group
has pledged itself to providing equal opportuni-
ties to all in line with their professional qualifica-
tions. No individual shall be given preferential or
disadvantaged treatment on the basis of race,
gender, ethnicity, religion, sexual identity, or other
characteristics. As the Group hires exclusively
based on individual potential and qualifications,
however, this may at times have the effect of de-
creasing actual diversity of the workforce. Further,
Aroundtown expressly values the benefit of life
experience and know-how that workers over the
age of 50 can contribute. The tenets of inclusivity
and equal treatment also apply to professional
advancement, the arrangement of working condi-
tions, and access to occupational training.

A CULTURE OF RESPECT

[GRI 412-2, 412-3]

The Aroundtown corporate culture is founded
on consistently applied values of dignified and
respectful treatment of all. Aroundtown ex-
pects its executive staff to take the concerns of
employees seriously in their decision-making.
At the same time, the creation of a productive
working environment is a shared task and staff
are called on to make constructive contribu-
tions as well.

Aroundtown is a signatory of the German Di-
versity Charter. The German Diversity Charter is
a corporate initiative that promotes diversity in
companies and institutions. The Group expects
both staff and management to act according to

this philosophy in all their activities and ap-
plies especially high standards to its execu-
tives in this regard, as they serve as role mod-
els for others. This commitment is laid out in
the Company’s mission statement and further
defined in the Employee Code of Conduct. It
sets out clear guidelines for acceptable behav-
ior. The Code of Conduct is supplemented by
the topical guidelines, the Diversity Policy, and
the Anti-discrimination Policy.

DIVERSITY
Diversity of governance
bodies1

female

male

Diversity of employees

female

male

2018 2017 2016

The Group has instituted an explicit policy
framework that communicates clear definitions
and standards of conduct. Discrimination can
take either direct or indirect form and is de-
fined as any instance in which a person re-
ceives less favorable treatment than another in
a comparable situation based on one of the
factors named above. The Group also considers
harassment a form of discrimination and de-
fines it as any practice capable of violating a
person’s dignity on the basis of one of the
above-named.

Discrimination and harassment in the working
environment engender adverse impact on staff
and are thus highly detrimental to performance.
Aroundtown firmly rejects any and all actions
that would create a workplace characterized by
intimidation, hostility, humiliation, or system-
atic insult, either through personal contact or
through other means (e.g. electronic communi-
cation).

STRATEGIC ORIENTATION CULTIVATES
DIVERSITY

[GRI 412-2]

The HR Department is charged with overseeing
diversity topics and issues related to discrimina-
tion prevention. The Head of HR bears supervisory
responsibility for the department’s activities and
reports directly to the CEO. A Diversity Committee
also exists to help embed diversity
issues
throughout the Group’s operational and strategic
alignment.

To further enhance awareness and understanding
of the expectations outlined in the Code of Con-
duct, all employees participate in diversity train-
ing. This training includes modules designed to
develop diversity management capabilities. Staff
members are also instructed on how to report in-
cidents of discrimination or harassment via the
whistle-blowing service (see also p. 13). As the
commitment to eschewing discrimination forms a
component of all employment contracts, compli-
ance is compulsory.

INCLUSIVE ENVIRONMENT STRENGTHENS
BUSINESS POSITION

[GRI 401-1, 406-1 / EPRA Emp-Turnover]

Diversity management at Aroundtown is support-
ed by special software-based HR tools that en-
able the collection and analysis of relevant data
points. A process for recording incidents of dis-
crimination has also been implemented. In 2018,
Aroundtown registered no incidents of discrimi-
nation (2017: 0). The Group aspires to maintain
this record going forward and to be among the
top ten most attractive employers in the German
commercial real estate sector.2 Due to extensive
restructuring measures within the Group, staff
turnover for 2018 was 14%, which fell short of the
envisioned goal of 8%. Although Aroundtown was
unable to achieve its target for the reporting year,
the Group intends to keep its sights set on this
measure of progress for coming years and tailor
its efforts accordingly. The Company is developing
a retention program designed to continually en-
hance loyalty and reduce fluctuation.

Violations of the Company’s anti-discrimination
policies carry a legal risk for Aroundtown in re-
spect of compliance. They may also result in fi-
nancial impact through legal action or sanctions.
Moreover, a too-homogenous workforce can limit
flexibility of perspective and thereby impair inno-
vation and recognition of opportunities. Lack of
diversity or a company culture that stifles inclu-
sivity thus pose a risk to long-term growth in per-
formance.

1 The basis of calcuation was changed in that the management
team was no longer counted as a governance body; the previous
year‘s figures have been amended accordingly.

2 This ranking from the trade journal Immobilien Zeitung is car-
ried out annually on the basis of a survey of approximately 700
students as part of an effort to align communication between
the industry’s employers and its young professionals. Among
other things, students are asked to name their top three em-
ployers in the industry. Replies are unprompted and allocated
points according to a ranked scoring system; combined scoring
consolidates results to highlight a top ten of some 200 compa-
nies named overall. Participants must evidence current student
registration, and the results undergo validation. Previous years’
results are not taken into consideration.

DIVERSITY AND ANTI-DISCRIMINATION / OCCUPATIONAL HEALTH AND SAFETY | 31

OCCUPATIONAL HEALTH AND SAFETY

WORKING TOGETHER SAFELY

[GRI 403-3]

As their employer, Aroundtown must ensure on
behalf of its workforce that the environment in
which they carry out their tasks is safe and poses
no undue burden to health. The Group adheres to
a Company vision of high standards of health and
safety in the workplace and actively works to pro-
mote these. Healthy employees who feel safe in
their surroundings contribute higher value to the
Company’s performance. The Company views the
commitment to occupational health and safety as
a joint responsibility to create a pleasant, safe en-
vironment for all and expects its staff to support
its ambitious approach.

All positions and tasks are to be structured in
such a way that no employee is faced with signif-
icant threats to their health or with life-threaten-
ing situations in order to perform their duties. In
general, there are no positions within the Compa-
ny that entail occupational activities associated
with a high incidence of or risk for specific diseas-
es. As Aroundtown also collaborates with suppli-
ers and subcontractors in the construction sector,
occupational safety issues in the supply chain
cannot be fully ruled out. For more information
on supplier due diligence, please see Chapter 01
Corporate Governance.

PROMOTING SAFETY-CONSCIOUS
BEHAVIOR

The Group considers strict compliance with all
health and safety EU and national-level regula-
tions applicable to its operations a matter of
course. In accordance with EU provisions the
Company has two designated Safety Officers. Ev-
ery department has a designated person instruct-
ed in first aid measures. There are currently a to-
tal of 12 registered first aid helpers. Employees
also have access to a company physician via the
Group’s subsidiary Grand City Properties S.A. Man-
agerial responsibility for health and safety con-
cerns rests with the Head of HR. The Group has
also implemented formalized corporate guide-
lines in the form of a Health & Safety Policy.

Aroundtown’s ambitious standards of health and
safety in the workplace are, however, not simply a
matter of implementing regulations. They require
an understanding from all involved that health
and safety is a matter of shared duty of care. The
Group communicates and trains its staff on a wide
variety of safety measures and precautions. Yearly
safety training via an online tool is mandatory for

all staff. Staff also receive instruction on evacua-
tion procedure and proper reporting of work acci-
dents. Employees are requested to identify and
report any and all instances of unsafe working
conditions they may encounter or violations of
safety requirements. HR additionally tracks and
analyzes all work accident reporting via defined
processes and corresponding software.

The Group expects of its employees that they
maintain standards of behavior that eliminate the
risk of harm to themselves and others as far as
possible. As such, staff are for example expected
to accept responsibility for all objects they justifi-
ably bring to the premises. To further boost staff
health, Aroundtown has made a fitness center
available free of charge to employees at its Berlin
headquarters. The center offers a variety of class-
es as well as targeted coaching for specific topics,
such as lower back pain.

MAINTAINING A HEALTHY, COMMITTED
WORKFORCE

[GRI 403-2, 403-3 / EPRA H&S-Emp]

Overall, the real estate management sector is not
associated with high-risk activities or other particu-
lar safety concerns other than the standard health
impact of office work. Aroundtown had two inci-
dents of work accidents3 in 2018 (2017: 1) and will
further work on improving its measures to ensure
zero work-related accidents. Aroundtown has addi-
tionally set itself the goal of reducing the overall
number of sick days and increasing employee reten-
tion. The Group bases its notable performance on
the dedication of a healthy, satisfied workforce.

3 Aroundtown defines work-related incidents as incidents which
occur in direct relation to their employees’ activities at the
workplace.

ENVIRONMENT

ENVIRONMENTAL MANAGEMENT

STRATEGIC ENVIRONMENTAL
ORIENTATION

[GRI 102-11]

A clear commitment to environmental responsi-
bility is embedded in Aroundtown’s business
plan. The Group pursues a development strategy
that pairs minimized environmental impact with
attractive asset yields and strong performance.
ESG criteria guide investments, and the Group
regularly monitors its consumption and output
for a variety of indicators. A primary goal of the
strategy is to optimize the Group’s cost structures
through
implementation of environmentally
friendly refurbishments and advancements, in-
stallation of sustainable systems, and the use of
renewable energy sources.

When growing its portfolio, environmental fac-
tors play a crucial role in decision-making even
at the acquisition stage. The Group performs ex-
tensive technical audits of potential assets to
critically examine their environmental profile
and refurbishment potential. The results of these
audits form the basis for all investment deci-
sions. Following acquisition, a defined catalogue
of measures guides strategic implementation of
the Group’s asset repositioning activities.

ACHIEVING CONTINUAL IMPROVEMENT

10%

CO2 savings planned by
the year 2020 (as compa-
red to 2017 figures)

Environmental management strategy at
Aroundtown is supported by wide-ranging techni-
cal expertise in the related departments, efficient
operational procedures designed to
aid data collection, and extensive
instruction in environmental aware-
ness for staff. Staff at all levels are
trained to assess and document en-
vironmental performance in their
area of responsibility. The technical
departments scrutinize the environ-
mental impact of both operations
and the Group’s assets. Technical reviews identify
ways to continually improve environmental per-
formance on the basis of modern technology and
in line with statutory regulations. Additionally, as
of 2018 Aroundtown has reported the environ-
mental data for its headquarters separately,
thanks to a refined data collection process.

Strategically minded operational procedures un-
derpin effective monitoring of environmental
performance indicators. These systems are con-
tinually developed further so that the Group has
at its disposal a wide array of real-time data on
relevant parameters. Areas of particular focus in-

clude monitoring and minimizing GHG emissions
and increasing the use of renewable energy. When
undertaking asset refurbishment projects, im-
provements in these areas translate to savings for
the Group in the form of energy, materials, and
operating costs, in addition to their positive envi-
ronmental effect. Energetic improvements are
thus incorporated wherever feasible.

CLEARLY DEFINED COMMITMENTS

Aroundtown is committed to using renewable
sources of energy, reducing the emissions gener-
ated by its operations, lowering its wastewater
and waste output, and monitoring its environ-
mental performance over the long term. These
commitments are installed firstly in the Group’s
Environmental Policy, which extensively defines
all aspects of the Company’s energy management
actions and its environmental responsibility. As-
pects of this policy include, for instance, working
only with providers that monitor their energy
consumption and fully offset their respective CO2
emissions.

The Environmental Policy is further supplement-
ed by the Green Procurement Policy, which stipu-
lates specific corporate requirements with regard
to environmental aspects of operations. Among
other things, it explicitly states that preference is
to be given to suppliers that fulfill certain envi-
ronmental performance standards. Aroundtown
further maintains ongoing dialogue with its
shareholders and other stakeholders with regard
to environmental issues and includes its perfor-
mance in these areas in its corporate reporting.

Aroundtown makes concerted investment in mea-
sures that will lengthen a property’s residual life.
Regular risk assessments help Aroundtown to
continually optimize its asset management and
align its business plan. The Group includes envi-
ronmental risks in its risk management strategy
and performs environmental due diligence re-
views of its assets. These assessments take ac-
count of all aspects of environmental manage-
ment, such as energy efficiency, water and waste
management, climate risk, and GHG emissions.
The portfolio is monitored with regard to compli-
ance as well as potential for improving its envi-
ronmental footprint.

ENVIRONMENTAL MANAGEMENT / ENERGY AND EMISSIONS | 35

CONTRACTUAL ENVIRONMENTAL
COMMITMENTS

[GRI 308-1]

The Group’s selection of suppliers as well as the
management of ongoing collaboration are gov-
erned by the Aroundtown Green Procurement Pol-
icy. This policy clearly stipulates that suppliers
that work to high standards of environmental per-
formance be given preference in the awarding of
contracts. All Group suppliers are furthermore re-
quired to exhibit full compliance with all relevant
legal standards. Suppliers must also provide evi-
dence of external certifications in certain key ar-
eas of environmental management, as these cer-
tifications provide means by which to evaluate
the impact of a supplier’s activities and products
delivered. As of the end of 2018, 100% (2017:
97%) of the Group’s contracted suppliers were
certified in accordance with the environmental
norm ISO 14001.

Through a process of continual dialogue with its
suppliers, the Group works to systematically re-
duce the environmental burden of other opera-

tions in the value chain. Aroundtown encourages
its suppliers to present new and improved sys-
tems, technology, and methods, and via innova-
tion to achieve environmental targets. Moreover,
the Group strives to sharpen suppliers’ awareness
of their own procurement and selection activities
and to thereby boost environmental performance
throughout the entire supply chain.

RESPONSIBLE PROCUREMENT
STRENGTHENS VALUE CHAIN

[GRI 308-1]

Aroundtown’s selection of suppliers explicitly
pursues a policy of giving preference to the op-
tion with lowest environmental burden wherever
economically feasible. The Group is actively in-
creasing the share of energy for its operations
and assets procured from renewable energy
sources or from climate-neutral natural gas and
electricity. Where the Group has operational con-
trol, it is working towards achieving carbon-free
supply of its holdings. Among other things, pro-
curement is a key lever for achieving the Group’s
emissions reduction goal.

ENERGY AND EMISSIONS

RESPONSIBILITY FOR EFFICIENT
FOUNDATIONS

One third of all greenhouse gas emissions in de-
veloped countries are generated by the real es-
tate sector. Aroundtown is fully cognizant of the
responsibility it has to contribute to effectuating
sustainable development. The Group has set itself
the goal of reducing its total CO2 emissions by
40% by the year 2030. Achievement of this goal
will depend on successfully activating levers of
impact in multiple areas. In addition to procure-
ment (see above), the buildings’ structural sub-
stance and consumption by tenants are the main
areas affecting the Group’s emissions.

As a property owner and asset manager
Aroundtown has a duty to furnish an infrastruc-
tural foundation that will allow ongoing increas-
es in energy efficiency and continual reductions
of emissions. Since Aroundtown’s business opera-

tions are mainly investment-oriented, however, it
is not directly involved in the industrial produc-
tion processes of the real estate sector and does
not yet pursue greenfield development. In terms
of the property life cycle, the energy consumed
during a building’s operational phase accounts for
the lion’s share of emissions related to the Group’s
business.

Although the Group has only limited influence on
tenants’ consumption behavior, it utilizes a variety
of development strategies to enhance energy effi-
ciency in its buildings and help tenants reduce
their carbon footprint. The Aroundtown portfolio
comprises 83% commercial usage (2017: 80%)
and 17% residential usage (2017: 20%).1 Where
banks, retailers, or hotels are the tenants, the na-
ture of their operations has a significant impact
on consumption profiles. As these businesses are
often in constant operation, the Group’s proper-
ties continually consume energy and have corre-
sponding CO2 emissions production.

Berlin

1 As of December 2018

OPTIMIZING RETURNS BY DEVELOPING
POTENTIAL

The Group remains committed to creating value
through asset enhancement rather than new con-
struction. The majority of Aroundtown’s portfolio
consists of mid-life-cycle properties. The Group’s
primary focus is on developing assets to enhance
value and long-term returns. Nearly all properties
in the portfolio were existing buildings at the
time of purchase and thus only qualify to a limit-
ed extent for green building certification. Never-
theless, the company’s development decisions
can leverage significant potential for optimizing
assets with respect to energy efficiency and ten-
ants’ consumption. Aroundtown’s strategic focus is
to extend the life span of existing structures by
enhancing their sustainability and create an at-
tractive portfolio offering eco-friendly perfor-
mance data.

Wherever possible, Aroundtown bases its invest-
ment strategy and refurbishment activities on the
tenet that reducing operating costs benefits all
involved. Lower service costs are desirable for
tenants and provide an attractive operational ba-
sis for the Group’s value creation promise. En-
hanced energetic building profiles and efficient
heating systems translate to lower environmental
burden as well as lower operating costs.
Aroundtown thus firmly aligns its strategic prop-
erty development decisions with the aim of
heightening energy efficiency throughout its
portfolio.

40%

CO2 reduction of our assets by 2030

and

facade

improvements

Once the maintenance backlog of a newly ac-
quired asset has been eliminated, the Group in-
vests in a variety of energetic enhancements. In-
sulation
are
supplemented by installation of energy-efficient
heating systems. The Group has al-
ready switched over part of its port-
folio and will be systematically re-
moving
fossil-fuelled
heating systems step by step. Use of
more advanced heating systems will
reduce not only overall consump-
tion, but also decrease emissions
and other pollution. The Group further performs
technical audits of its assets on a regular basis to
continually identify potential for improvement.
Aroundtown has been a member of the German
Sustainable Building Council (DGNB) since 2017.

inefficient

SUSTAINABLE LIFE CYCLE INFORMS
ACQUISITIONS

Where acquisitions are concerned, life cycle as-
sessments and extensive technical due diligence

facilitate identification of attractive development
properties. Experienced specialists critically ex-
amine buildings’ energetic profiles, environmen-
tal impact, and the related cost of investment for
the refurbishment process. Resource consumption
and waste creation over a property’s entire useful
life are evaluated. In cases where properties do
not already meet the Group’s standards for sus-
tainability and environmental impact, necessary
refurbishment and repositioning investment is
included in the budgeting process. Should it be
necessary to tear down a building, environmental
impact of the removal process and waste is also
considered.

The weighing of commercial and environmental,
in particular energy balance, assessments is a key
component of the underwriting process.
Aroundtown pursues an investment philosophy
that uses flexibility and innovative solutions – for
instance changing a property’s use – to achieve
optimal returns with the lowest possible environ-
mental impact. As the Group does not currently
engage in greenfield development, environmen-
tal matters such as impact on biodiversity and
land use are a lesser concern. In the case of im-
pact on biodiversity, for instance, considered de-
velopment, refurbishment, and care of green ar-
eas is taken into account as well as a property’s
role in the community and benefit to local resi-
dents.

Insofar as due diligence returns a positive assess-
ment, it is corporate policy to prefer investment in
green buildings. The Group pursues green build-
ing optimization in its properties where such in-
vestment would yield an overall life cycle benefit.
Energetic enhancements include improving ther-
mal insulation and installing more efficient heat-
ing systems.

Further, in 2018, following its entry into the Ger-
man Sustainable Building Council, Aroundtown
completed a green building certification of new
construction as a pilot undertaking for the Group.
Two newly built warehouses – one a cooling ware-
house and one a logistics warehouse – were cer-
tified in accordance with the DNGB standards fol-
lowing construction completion in April 2018.
This certification takes into account a wide variety
of factors, but in particular the buildings’ ecologi-
cal balance sheet, risks for the local environment,
environmentally friendly materials procurement,
issued
and emissions. The buildings were
gold-level certification. Based on the success of
this certification process, the Group plans to con-
sider pursuing certification in similar construc-
tion projects as well.

ENERGY AND EMISSIONS | 37

ROBUST MANAGEMENT SUPERVISION

ENERGY CONSUMPTION (like-for-like)2

[GRI 307-1, 308-1]

UNIT

2018

2017

2016 % CHANGE

Energy management oversight responsibility lies
with the heads of the Energy Department and the
ESG Department. The heads of these departments
report directly to the CEO. Moreover, the Group con-
siders the risks related to climate change to be fun-
damentally relevant to its value creation perfor-
mance and thus includes them in its corporate risk
management processes. Environmental policy and
energy performance are thus embedded at highest
corporate level and subject to direct strategic over-
sight.

its structural

To supplement
investments,
Aroundtown takes a holistic view of environmental
impact. Staff awareness campaigns and information-
al drives for tenants target improvements in con-
sumption behavior, while technical upgrades such as
metering technology and indicator monitoring pro-
vide the data for quantitative target setting. Full
compliance with all legal statutes on the part of
Aroundtown is further extended to the entire value
chain thanks to the Group’s Environmental Policy.
This policy clearly defines energetic compliance ob-
ligations for all the Group business partners. The
Group expects all providers to monitor energy con-
sumption and environmental performance. Group
energy providers must possess gas or electricity cer-
tifications. Within contractual limits set by existing
agreements Aroundtown is continuing to switch its
entire portfolio to gas providers who fully offset
their CO2 emissions and to electricity providers with
100% renewable sources.

DATA MONITORING PROVIDES INSIGHT

[GRI 302-1, 305-1, 305-2 / EPRA Elec-LfL, DH & C-LfL,

Fuels-LfL, Energy-Int, GHG-Dir-Abs, GHG-Indir-Abs]

The Group sets itself performance targets based
on certain key indicators. Data collection is thus
central to monitoring goal achievement, efficacy
and consistency of the measure implemented,
and providing stakeholders with transparent re-
porting in line with industry standards. This data
is also required for the fulfillment of various cer-
tifications. Energy consumption and GHG intensity
data are controlled at regular intervals and
benchmarked against average data for buildings
of a similar type and occupancy level. Aroundtown
additionally assesses the effectiveness of mea-
sures it has implemented through comparison of
calculated expected benefit and actual benefit as
determined in technical energy audits.

In the area of electricity, heat, and fuel, in 2018 the
Group’s landlord-obtained electricity was
6,982,908 kWh (2017: 6,723,636 kWh), total land-

Landlord-
obtained
electricity
Landlord-
obtained
heat
Landlord-
obtained
fuels
Building energy
intensity

kWh

6,982,908 6,723,636

7,504,331

kWh 13,386,137 11,965,509 13,558,730

kWh

9,009,173 13,115,118 12,839,936

– 24

kWh/
m2/year

62.33

65.47

69.79

– 6

lord-obtained heat was 13,386,137 kWh (2017:
11,965,509 kWh) and total landlord-obtained fu-
els were 9,009,173 kWh (2017: 13,115,118 kWh).
This translates to a building energy intensity
of 62.33 kWh/m2/year (2017: 65.47 kWh/m2/year).
The indicator building energy intensity varies
strongly by type of building and management of
operating costs.

GREENHOUSE GAS EMISSIONS (like-for-like)2

UNIT

2018

2017 2016 % CHANGE

Total emissions

direct emissions (Scope 1)

indirect emissions (Scope 2)

GHG Scope 1 and 2 intensity
from building energy

tons
CO2e
tons
CO2e
tons
CO2e
kg CO2e/
m2/year

7,076

6,812 7,839

1,323

1,764 2,111

– 24

5,753

5,049 5,728

14.57

14.02 16.14

2 Due to changes

in the
portfolio, the
like-for-like
figures for 2016 and 2017
have been amended.
The like-for-like figures for
Aroundtown’s 2018 en-
vironmental performance
are based on data from 17
commercial assets (5 of-
fice use, 3 industrial use,
9 retail use), which cover-
ed a total of 485,775 m2.
The 2018 figures account
for 8% of the total net
lettable area under direct
administration of Around-
town as of the end of the
reporting year (total port-
folio: 6,112,000 m2).

The Group recorded CO2 emissions (t CO2e) in
2018 of 7,076 tons (2017: 6,812 tons). These emis-
sions relate solely to Scope 1 and Scope 2 emis-
sions as the Group does not report on Scope 3
emissions. Scope 1 emissions are those emissions
that are directly attributable to the Group’s own or
controlled sources; Scope 2 emissions are indirect
emissions generated from purchased energy. The
Group’s total 2018 emissions breakdown as
1,323 tons (2017: 1,764 tons) in Scope 1 and
5,753 tons (2017: 5,049 tons) in Scope 2. This
translates to a year-on-year rise of 4% on a like-
for-like basis. As the increase is primarily related
to heating requirements, the extended 2018 heat-
ing period as a result of weather conditions was a
contributing factor in this development. Going
forward, Aroundtown intends to continue to en-
hance efficiency throughout its portfolio and op-
erations and achieve ongoing emissions reduc-
tions. In line with EU requirements, Aroundtown
has set itself a goal of achieving a 40% reduction
in CO2 emissions by the year 2030 (as compared
with 2017 figures).

REGULAR REVIEW OF RISK POSITION

Efficient identification of risks and opportunities
and the ability to continually enhance energy per-
formance are dependent on quantitative data gath-
ering. Throughout 2018 Aroundtown continued to
expand and improve its technical monitoring capa-
bilities. The systems implemented now enable the
Group to include a greater number of properties in
its reporting. Furthermore, in 2018, the Group invit-
ed providers of energy management software to
tender offers. These offers and the IT systems they
related to are currently being reviewed for suitabil-
ity. Regular technical and energy audits provide the
basis for adjusting measures as needed to develop-
ments in technological advancement, changing risk
profiles, and actual energy performance.

Concrete risks from the effects of climate change
do not currently have high relevance for the Group’s
operations in Germany. Where non-physical risks
are concerned, the Group has extensive measures
in place in the form of explicit corporate policies
that eliminate as far as possible risks related to
suppliers or other business partners.

WATER MANAGEMENT

METERING REINFORCES RESPONSIBLE
CONSUMPTION

All over the world, water as a life-giving resource
is becoming ever-more critical in terms of avail-
ability and quality. As asset manager, Aroundtown
ensures for its tenants provision of sufficient wa-
ter in a quality that will meet their requirements.
The Group’s overall goals with respect to water
management are to reduce water consumption to
only that which is strictly necessary, to maintain a
high level of water quality provided, and to lower
water- and wastewater-related operating costs. In
its role as service provider, Aroundtown is not di-
rectly responsible for the majority of water con-
sumption related to its operations. It can, however,
influence tenant consumption indirectly via tech-
nical and information means.

WATER CONSUMPTION (like-for-like)2

UNIT

2018

2017

2016 % CHANGE

Water for landlord-
shared services

77,106 73,199 70,085

Building water intensity

m3/m2

0.159

0.151

0.144

2 Due to changes in the portfolio, the like-for-like figures for 2016 and 2017 have been amended.
The like-for-like figures for Aroundtown’s 2018 environmental performance are based on data
from 17 commercial assets (5 office use, 3 industrial use, 9 retail use), which covered a total
of 485,775 m2. The 2018 figures account for 8% of the total net lettable area under direct
administration of Aroundtown as of the end of the reporting year (total portfolio: 6,112,000 m2).

Insofar as structures allow, Aroundtown invests in
installation of technical improvements that facil-
itate lower water consumption. A key component
of consumption behavior is the ability to monitor
and record consumption. The Group is thus priori-
tizing installment of water meters in all assets in
its portfolio. In addition to technical capacities,
the Group undertakes to raise consumption
awareness among its tenants through a variety of
information measures.

BENCHMARKED DATA PROVIDES
GUIDANCE

[GRI 303-1 / EPRA Water-LfL, Water-Int]

The Head of the Environmental Department bears
responsibility for water management activities, re-
porting directly to the CEO on their measures and
results. Aroundtown continually monitors water
consumption at its properties. The Group assesses
its performance via benchmarking of actual con-
sumption data against expected average consump-
tion for a given building type and occupancy level.
Regular benchmarking is also used to assess the
effectiveness of any measures implemented by
comparing expected and actual efficiency results.
For 2018, operations resulted in water consumption
from landlord-shared services of 77,106 m3 (2017:
73,199 m3). As the Group has no other consumption
sources, this represents total consumption and a
building water intensity of 0.159 m3/m2/year (2017:
0.151 m3/m2/year).

WASTE MANAGEMENT

CREATING ATTRACTIVE ASSETS

[GRI 306-2]

Aroundtown pursues an operational philosophy
that savings from reduced service costs are at-
tractive to tenants and the Company alike. As a
form of enhancing assets’ value creation, all
stakeholders benefit. The Group invests effort and
capital in particular areas where environmentally
friendly behavior carries operational benefits in
addition to a positive environmental impact. On-
going reductions in waste output translate to a
clear reduction in environmental burden as well
as lower service costs.

Overall, the Group aims to consistently lessen
both the total amount of waste output and the
amount of residual waste not disposed of via re-
cycling programs. Aroundtown is structuring its
waste-related development strategy on boosting
recycling quotas by investing in infrastructural
measures to either provide recycling facilities or

ENERGY AND EMISSIONS / WATER MANAGEMENT / WASTE MANAGEMENT | 39

WASTE REPORTING ENHANCES CONTROL

[GRI 306-2]

The topic of household waste is the responsibili-
ty of the Asset Management Department. Asset
Management further reports regularly to the En-
ergy Department on household waste. Waste
with registered contamination is the responsibil-
ity of the Construction Department with direct
reporting to the CEO. Where larger refurbish-
ment projects are to be undertaken, assets are
assessed for problematic or contaminated waste
in order that proper waste removal and handling
can be accounted for in investment planning. As
far as possible, construction waste is recycled, in
accordance with the applicable national stan-
dards.

Waste reduction is a component in assets’ attrac-
tiveness profile. It is thus also linked to
Aroundtown’s ability to generate long-term re-
turns. The Group mitigates this corresponding
risk by enhancing awareness of waste minimiza-
tion among all stakeholders, suppliers, and other
business partners. Concrete corporate policies
ensure the Group’s strategy is underpinned with
strict contractual obligations. The Group’s refur-
bishment activities bear the risk of higher envi-
ronmental burden due to contaminated or haz-
ardous waste. In such instances, Aroundtown
engages specialist external service providers to
ensure proper handling and removal. The Group
maintains strict compliance with all applicable
legal statutes and requires that third parties pro-
vide evidence of appropriate certification, thus
minimizing risk as far as possible.

WASTE DISPOSAL (like-for-like)2

UNIT

2018

2017

2016 % CHANGE

Waste by
disposal route

liters

3,127,730

3,580,660 3,450,180

–13

enhance existing recycling motivation. Guided by
a commitment
responsible business,
Aroundtown aligns a responsibility for the envi-
ronment with sustainable tenant relations and
attractive portfolio returns.

LESS WASTE EQUALS LOWER COST
BURDEN

[GRI 306-2 / EPRA Waste-LfL]

To facilitate reductions in total waste output, the
Group reviews and audits all waste facilities and
waste handling procedures employed in its portfo-
lio. Waste consumption is monitored and bench-
marked against expected average rates. Outliers are
used to identify areas for potential improvement
and development- related measures. Where external
service providers are engaged for waste handling
needs, all assets are subjected to regular controls. In
particular in instances where waste handling costs
are higher than expected, the Group inspects opera-
tions to ascertain whether proper waste recycling is
being carried out. The Group and all external service
providers are contractually committed to full legal
compliance through the Group’s service agreements
and Environmental Policy.

In this area as well, much of the Group’s potential for
action is limited to indirect influence as asset man-
ager. The Group provides informational materials in
a number of languages aimed at raising awareness
among tenants and reducing consumption. The var-
ious publications, handouts, and videos emphasize
the dual benefit of waste-conscious behavior and
encourages them to act with environmental respon-
sibility in mind while also lowering their own cost
burden.

Where possible Aroundtown strives to leverage its
ability to influence tenant behavior through envi-
ronmentally aligned investment and refurbishment.
For instance, the Company has implemented a tech-
nologically supported waste handling system at se-
lect locations. At these locations, an electronic chip
records waste disposal and tenants receive a clearly
presented statement of their waste charges, allow-
ing them to see in monetary terms the specific ef-
fects of economizing residual waste. This height-
ened transparency and billing by actual usage has
yielded substantial reductions in residual waste
both by weight and by volume and higher recycling
quotas. In 2018, operations and properties produced
3,127,730 liters (2017: 3,580,660 liters) of waste.

WASTE MANAGEMENT

SOCIETY

Rotterdam

COMMUNITY INVOLVEMENT AND
DEVELOPMENT

DEVELOPING COMMUNITY VALUE

[GRI 413-1 / EPRA Comty-Eng]

In addition to structural considerations, a second
key component in Aroundtown’s strategy for en-
hancing assets’ value is portfolio development
that provides communities with concrete long-
term value added. Aroundtown considers itself
an active participant in its communities and

aligns its activities accordingly during the turn-
around process as well as throughout the further
management of the assets. Stable, strong com-
munities are beneficial to both the Group’s busi-
ness ambition and its tenants’ future prospects.
Aroundtown leverages its portfolio’s potential as
well as long-term relationships with local stake-
holders to create significant social benefit for its
communities.

COMMUNITY INVOLVEMENT AND DEVELOPMENT | 43

STRATEGICALLY ALIGNED COMMITMENT

The Group orients its community involvement
around four strategic pillars:

1. Social engagement with tenants
2. Active involvement of local authorities and

media

3. Construction, development,
and refurbishment projects

4. Pro-active dialogue with tenants

In all four areas, open exchange and finding
common ground via shared interests is the
Group’s main priority. Relationships built around
trust and credibility are a prerequisite for the
long-term development horizon that generates
greatest value added for all parties.

Aroundtown pursues a philosophy of leveraging
continuous dialogue as a tool for achieving mu-
tually beneficial development. The Group’s pri-
mary aim here is to actively build partnerships
with local stakeholders in order that their con-
cerns and input can be integrated to achieve
targeted impact within the assets’ communities.
The Group successfully tailors its investments
and engagement to regional needs via intensive
exchange and transparency. Its ongoing cooper-
ation and dialogue with a wide variety of part-
ners and affiliates allow the Group to focus its
activities on measures that generate direct, tan-
gible benefit for the well-being, health, safety,
and economic development of tenants and other
stakeholders.

ENHANCING ASSETS TO ENHANCE
COMMUNITIES

[GRI 413-1 / EPRA Comty-Eng]

The guiding principle behind the Group’s invest-
ment in community-building engagement is to
generate impact that combines positive social
impact with concurrent regional economic growth.
An asset’s potential contribution to the economic
and social development of a community is thus a
top concern when planning the turnaround pro-
cess. Input from local authorities and other stake-
holders is key in determining appropriate invest-
ment measures. Dialogue also ensures higher
levels of transparency, allowing the Group to ac-

tively manage and address concerns about possi-
ble negative outcomes.

Throughout asset takeover and repositioning,
Aroundtown actively seeks to engage local au-
thorities and media in dialogue by way of regular
consultations. Due to the Group’s focus on creat-
ing value added through enhancement of at times
previously neglected properties, the assets con-
cerned often have a preexisting negative reputa-
tion and image within the community. Open dia-
logue is crucial for managing any issues with
conflict potential or reputational risk components,
while effectively turning the asset into a commu-
nity benefit. These efforts are closely dovetailed
with the Group’s concrete refurbishment plans. In-
put is consistently sought and incorporated early
on. Key stakeholders are integrated at different
stages throughout development to ensure the
greatest possible success.

JOINT INTERESTS CREATE MUTUAL
BENEFIT

[GRI 413-1 / EPRA Comty-Eng]

Once an asset has been added to the portfolio,
stabilization of its value added and infrastructural
role is a top priority. Aroundtown views strong
communities as crucial to maintaining robust
tenant relationships. Throughout development
and management, Aroundtown strives to make
sure all stakeholders feel their concerns will be
heard and their issues taken seriously. The Group’s
complaint management system is designed to en-
sure complaints from an asset’s community are
leveraged in such a way that positive impact can
be achieved through an aspiration to ongoing im-
provement. All complaints are directed to the re-
spective Property Manager. Depending on the
complaint reason, they may be forwarded to ap-
propriate internal units, e.g. the Operational Cost
Department or the Facility Management Depart-
ment. The Property Manager stays in the chain of
communication as a central point of contact for
the tenant and to monitor resolution. In cases of
more serious complaints, these are reported to
the relevant Asset Manager and, if necessary, es-
calated to the Head of Asset Management and the
PR Department, as well as further responsible
personnel.

Amsterdam

REGIONAL RESPONSIBILITY WITH
PERSPECTIVE

[GRI 413-1 / EPRA Comty-Eng]

Involvement

Aroundtown has bundled regional engagement
under its Community Involvement and Develop-
ment Program. This ensures efficient implemen-
tation in this non-operational area of commit-
ment. The Community
and
Development Program has grown out of the
Group’s many years of community dialogue and
provides the structure at the core of Aroundtown’s
social commitment. An array of internal policies
and guidelines that define expectations of posi-
tive impact and ethical standards guide selection
of concrete measures. Generally speaking the
Group targets its activities to support measures
that will pay into achieving the United Nation’s
Sustainable Developments Goals (SDGs).1 En-
gagement related to SDGs 4 Quality Education, 10
Reduced Inequalities, 11 Sustainable Cities and
Communities, and 17 Partnership for the Goals
are a particular focus. The policies also stipulate
that activities and stakeholder engagement be
reviewed at regular intervals to assess impact
achieved and efficiency.

Operational management of community relations
are the responsibility of the relevant Asset Man-
agers, who coordinate where necessary with the
Head of Asset Management and/or the Head of
Commercial Operations. The CEO receives month-
ly reports on relevant community developments.
The Asset Managers orient their work on a check-
list-based community due diligence assessment
prepared before asset takeover. This assessment
is used to design targeted engagement plans as
the property moves through takeover, reposition-
ing, and its operational phase. The Group takes

care to align its assessment checklists with the
results of formal stakeholder identification pro-
cesses. This ensures that asset management is
carried out with appropriate consideration for the
needs of the respective community.

Annual operational budgeting takes investment
in community development measures into ac-
count. The Groups aims to allocate € 500,000 p.a.
to community-oriented initiatives. Development
plans are reviewed and amended at 12-month in-
tervals and require direct approval from the CEO
before implementation. In particularly urgent
cases, the investment requirement can be pre-
sented for approval immediately at occurrence.
Following asset takeover, the Group generally
aims to have completed the turnaround process
within three years. The Group sets yearly loca-
tion-specific targets for community impact and
development as part of this process.

With the aim of steering its deployment of re-
sources more efficiently, in 2018 the Group estab-
lished the Aroundtown Foundation. The Founda-
tion has successfully received official recognition
from the German government and can commence
pursuit of its charitable objectives with immedi-
ate effect. Going forward, it will be the central
entity tasked with managing, procuring, and allo-
cating funds to support charitable and communi-
ty development aims. It will be funded with an
annual budget of € 500,000 (see above) and will
focus primarily on supporting infrastructure, pro-
grams, and
initiatives that enhance health,
well-being, and education within the Group’s
communities. The Foundation will also work to-
gether with various local partners to augment its
impact.

1 The Sustainable Development Goals (SDGs) are a framework of goals adopted in 2015 by the United Nations as part of its 2030
Agenda for Sustainable Development. These 17 goals outline what standards the global community needs to set itself in order to
create a world that is sustainable, inclusive, and offers peace and prosperity for all.

FACTS AND FIGURES

GRI CONTENT INDEX
[GRI 102-55]

GENERAL DISCLOSURES

GRI STANDARDS 2016

Organizational Profile

102-01 Name of the organization

102-02 Activities, brands, products, and services

102-03 Location of headquarters

102-04 Location of operations

102-05 Ownership and legal form

102-06 Markets served

102-07 Scale of the organization

102-08 Information on employees and other workers

102-09 Supply chain

102-10 Significant changes to the organization and

its supply chain

102-11 Precautionary Principle

102-12 External initiatives

102-13 Membership of associations

Strategy

PAGE COMMENTS

4
26

Value Creation through Strategic Property Investment

Conclusive Business Performance

Value Creation through Strategic Property Investment

Conclusive Business Performance

Value Creation through Strategic Property Investment;
Human Capital Shapes Success

Embedding Commitment in the Supply Chain

Conclusive Business Performance

Strategic Environmental Orientation

Transparent Responsibility

Memberships

102-14 Statement from senior decision-maker

Letter to the Stakeholders

Ethics and Integrity

102-16 Values, principles, standards, and norms of behavior

102-17 Mechanisms for advice and concerns about ethics

Governance

102-18 Governance structure

102-19 Delegating authority

102-20 Executive-level responsibility for economic,

environmental, and social topics

102-21 Consulting stakeholders on economic,

environmental, and social topics

102-22 Composition of the highest governance body

102-23 Chair of the highest governance body

102-24 Nominating and selecting the highest governance body

Safeguards for Ethical Business

Reporting Mechanisms Foster Responsible Conduct

Performance Founded on Governance

CR Structures for Effective Engagement

Stakeholder Focus and Materiality

Performance Founded on Governance

CR Structures for Effective Engagement

Performance Founded on Governance

102-25 Conflicts of interest

Ambition Rooted in Strong Corporate Controls

102-26 Role of highest governance body in setting purpose,

values, and strategy

102-27 Collective knowledge of highest governance body

102-29 Identifying and managing economic,

environmental, and social impacts

102-32 Highest governance body’s role in sustainability

reporting

CR Structures for Effective Engagement

Risk Management for Long-term Growth

CR Structures for Effective Engagement

102-35 Remuneration policies

Compensating Performance

Stakeholder Engagement

102-40 List of stakeholder groups

102-42 Identifying and selecting stakeholders

102-43 Approach to stakeholder engagement

102-44 Key topics and concerns raised

Tailored and Effective Communication

Stakeholder Focus and Materiality

Materiality Provides Basis for Engagement

GRI CONTENT INDEX | 47

GENERAL DISCLOSURES

GRI STANDARDS 2016

Reporting Practice

102-46 Defining report content and topic boundaries

102-47 List of material topics

102-48 Restatements of information

102-49 Changes in reporting

102-50 Reporting period

102-51 Date of most recent report

102-52 Reporting cycle

PAGE COMMENTS

Content and Structure of the Report

Materiality Provides Basis for Engagement

About this Report

102-53 Contact point for questions regarding the report

Imprint

102-54 Claims of reporting in accordance with the

GRI Standards

102-55 GRI content index

102-56 External assurance

SPECIFIC STANDARDS

GRI STANDARDS 2016

Category: Economic Standards

Indirect Economic Impacts

Alignment with GRI Standards and
EPRA Guidelines

GRI Content Index

About this Report

PAGE COMMENTS

203-1

Infrastructure investments and services supported

20
20
20

Bilateral Dialogue Effects Real Benefit;
Friendly and Accessible Tenant Services;
Technological Support for Tenant Concerns

Anti-corruption

205-2 Communication and training about anti-corruption

Securing Talented Professionals

policies and procedures

Category: Environmental Standards

Energy

302-1

Energy consumption within the organization

303-3

Energy intensity

Water

37
52
52

Data Monitoring Provides Insight;
Key Figures Environment

Key Figures Environment

303-1 Water withdrawal by source

Benchmarked Data Provides Guidance

Emissions

305-1 Direct (Scope 1) GHG emissions

305-2 Energy indirect (Scope 2) GHG emissions

Effluents and Waste

306-2 Waste by type and disposal method

Environmental Compliance

307-1

Non-compliance with environmental laws
and regulations

Supplier Environmental Assessment

308-1

New suppliers that were screened using
environmental criteria

Data Monitoring Provides Insight

Less Waste Equals Lower Cost Burden

Robust Management Supervision

13
16
35
35
37

Embedding Commitment in the Supply Chain;
Assessing Supply Chain Sustainability;
Contractual Environmental Commitments;
Responsible Procurement Strengthens Value Chain;
Robust Management Supervision

SPECIFIC STANDARDS

GRI STANDARDS 2016

Category: Social Standards

Employment

401-1

New employee hires and employee turnover

401-3

Parental leave

Occupational Health and Safety

403-2

403-3

Hazard identification, risk assessment, and incident
investigation
Occupational health services

Training and Education

404-2

Programs for upgrading employee skills
and transition assistance programs

Diversity and Equal Opportunity

405-1

Diversity of governance bodies and employees

405-2

Ratio of basic salary and remuneration
of women to men

Non-discrimination

PAGE COMMENTS

30
50
51

Inclusive Environment Strengthens Business Position;
Key Figures Employees

Key Figures Employees

Maintaining a Healthy, Committed Workforce

31
31

20
27
28
28

29
51
27
51

Working Together Safely;
Maintaining a Healthy, Committed Workforce

Friendly and Accessible Tenant Services;
Developing Intrinsic Potential;
Skills Training to Leverage Potential;
Broad In-house Training Offering

Protecting Diversity of Perspective;
Key Figures Employees
Fair Payment across Genders;
Key Figures Employees

406-1

Incidents of discrimination and corrective actions taken

Inclusive Environment Strengthens Business Position

Human Rights Assessment

412-2

412-3

Employee training on human rights
policies or procedures
Significant investment agreements and contracts
that include human rights clauses or that underwent
human rights screening

Local Communities

413-1

Operations with local community engagement,
impact assessments, and development programs

Supplier Social Assessment

414-1

New suppliers that were screened using social criteria

Customer Health and Safety

416-1

Assessment of the health and
safety impacts of product and service categories

29
30
16
17
29

42
43
43
44

13
16
17

20
20
22
23
23

A Culture of Respect;
Strategic Orientation Cultivates Diversity
Value-oriented Supplier Relationships;
Binding Standards for Suppliers;
A Culture of Respect

Developing Community Value;
Enhancing Assets to Enhance Communities;
Joint Interests Create Mutual Benefit;
Regional Responsibility with Perspective

Embedding Commitment in the Supply Chain;
Assessing Supply Chain Sustainability;
Binding Standards for Suppliers

Commitment to Addressing Tenants´ Concerns;
Closely Monitored Feedback Data;
Investing in Tenant Satisfaction;
Sound Fundamentals;
Expert On-site Assessments

416-2

Incidents of non-compliance concerning the health
and safety impacts of products and services

Expert On-site Assessments

GRI CONTENT INDEX / EPRA INDEX | 49

EPRA SUSTAINABILITY PERFORMANCE MEASURES

CODE

PERFORMANCE MEASURE

UNIT OF MEASURE

PAGE

Environmental Sustainability Performance Measures

Elec-Abs

Elec-LfL

DH&C-Abs

DH&C-LfL

Fuels-Abs

Fuels-LfL

Total electricity consumption

Like-for-like total electricity consumption

Total district heating & cooling consumption

Like-for-like total district heating & cooling consumption

Total fuel consumption

Like-for-like total fuel consumption

Energy-Int

Building energy intensity

GHG-Dir-Abs

Total direct greenhouse gas (GHG) emissions

GHG-Indir-Abs

Total indirect greenhouse gas (GHG) emissions

kWh/year

kWh/m2

t CO2e
t CO2e
t CO2e/m2
m3

m3/m2

GHG-Int

Water-Abs

Water-LfL

Water-Int

Waste-Abs

Waste-LfL

Cert-Tot

Greenhouse gas (GHG) emissions intensity from building

Total water consumption

Like-for-like total water consumption

Building water intensity

Total weight of waste by disposal route

Like-for-like total weight of waste by disposal route

Type and number of sustainably certified assets

Total

Social Performance Measures

Diversity-Emp

Employee gender diversity

Diversity-Pay

Gender pay ratio

Emp-Training

Employee training and development

Emp-Dev

Employee performance appraisals

Emp-Turnover

New hires and turnover

H&S-Emp

Employee health and safety

H&S-Asset

Asset health and safety assessments

H&S-Comp

Asset health and safety compliance

Comty-Eng

Community engagement, impact assessments, and development
programs

Governance Performance Measures

Gov-Board

Composition of the highest governance body

Gov-Selec

Process for nominating and selecting the
highest governance body

Ratio

Ø hours
%

Total

Rate

Total

Narrative on process

Gov-Col

Process of managing conflicts of interest

Narrative on process

12, 13

27, 51

28, 29

30, 50

42, 43, 44

EMPLOYEES

KEY FIGURES

UNIT

2018

2017

2016

GRI

EPRA

Number of employees

Total number of employees
(permanent and temporary)

female

male

Total number of permanent employees

female

male

Total number of temporary employees

female

male

Total number of full-time employees

female

male

Total number of part-time employees

female

male

New employee hires and employee
turnover

Total number of new employee hires

female

male

Rate of new employee hires

female

male

age group < 30

age group 30–50

age group > 50

Employee turnover

Total number of employee turnover

female

male

Rate of employee turnover

female

male

age group < 30

age group 30–50

age group > 50

337

182

155

205

106

132

300

152

148

189

105

270

141

129

154

116

239

118

121

126

157

GRI 102-8

101

GRI 102-8

134

GRI 102-8

GRI 401-1

Emp-Turnover

GRI 401-1

Emp-Turnover

GRI 401-1

Emp-Turnover

GRI 401-1

Emp-Turnover

GRI 401-1

Emp-Turnover

GRI 401-1

Emp-Turnover

GRI 401-1

Emp-Turnover

GRI 401-1

Emp-Turnover

KEY FIGURES | 51

UNIT

2018

2017

2016

GRI

EPRA

337

182

155

270

141

129

157

GRI 401-3

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

GRI 405-1

Diversity-Emp

EMPLOYEES

KEY FIGURES

Parental leave

Employees that were entitled to parental
leave2

female

male

Employees that took parental leave

female

male

Employees that returned to work in the re-
porting period after parental leave ended

female

male

Employees that returned to work after
parental leave ended that were still em-
ployed 12 months after their return to
work3

female

male

Diversity of governance bodies

female

male

Diversity of management

female

age group < 30

age group 30–50

age group > 50

male

age group < 30

age group 30–50

age group > 50

Diversity of employees

female

age group < 30

age group 30–50

age group > 50

male

age group < 30

age group 30–50

age group > 50

Ratio of basic salary and remuneration
of women to men

employees

management

ratio

0.71:1

0.78:1

0.70:1

GRI 405-2

Diversity-Pay

0.45:1

0.89:1

0.68:1

GRI 405-2

Diversity-Pay

1 The employee figures as reported here relate to those employees of Aroundtown who are employed in Germany. The Group additionally employs 37
staff (as of December 31, 2018) in positions located outside of Germany. This may result in reporting differences as compared with the information
provided elsewhere, for instance in annual financial reporting. For further details, please see the 2018 Annual Report.

2 For data privacy reasons, we have not collected data on the exact number of individuals affected.
3 In 2018 the other two individuals included in the total made changes of position within the Group.

ENVIRONMENT

PORTFOLIO1

The like-for-like figures for Aroundtown’s 2018 environmental performance are based on data from 17 com-
mercial assets (5 office use, 3 industrial use, 9 retail use), which covered a total of 485,775 m2. The 2018
figures account for 8% of the total net lettable area under direct administration of Aroundtown as of the
end of the reporting year (total portfolio: 6,112,000 m2).

LIKE-FOR-LIKE

KEY
FIGURES

Energy

Electricity for
landlord-shared
services
Total
landlord-
obtained
electricity
Heat for
landlord-shared
services
Total
landlord-
obtained heat
Fuels for
landlord-shared
services
Total
landlord-
obtained fuels
Building
energy intensity

Greenhouse gas
emissions
(GHG)

Total
emissions

direct
emissions
(Scope 1)
indirect
emissions
(Scope 2)

GHG
Scope 1 and 2
intensity from
building energy

Water

Water for
landlord-shared
services
Building water
intensity

Waste (land-
lord-handled)
Waste by
disposal route

Recycled waste

Certified assets

Mandatory
(EPC)
energy
certificates1

UNIT

2018

2017

2016 % CHANGE GRI

EPRA

CRESB

kWh

6,982,908

6,723,636

7,504,331

4 GRI 302-1

kWh

6,982,908

6,723,636

7,504,331

4 GRI 302-1

kWh

13,386,137

11,965,509

13,558,730

GRI 302-1

kWh

13,386,137

11,965,509

13,558,730

GRI 302-1

kWh

9,009,173

13,115,118

12,839,936

–24 GRI 302-1

kWh

9,009,173

13,115,118

12,839,936

–24 GRI 302-1

Elec-Abs,
Elec-LfL

DH & C-Abs,
DH & C-LfL

Fuels-Abs,
Fuels-LfL

kWh/
m²/year

tons
e
CO
²

kg CO²e/
m²/year

62.33

65.47

69.79

–6 GRI 302-3 Energy-Int

CRE1

7,076

6,812

7,839

GRI 305-5

1,323

1,764

2,111

–24

GRI 305-1

GHG-Dir-Abs,
GHG-Dir-LfL

5,753

5,049

5,728

GRI 305-2

GHG-Indir-Abs,
GHG-Indir-LfL

14.57

14.02

16.14

m³

77,106

73,199

70,085

m³/m²

0.159

0.151

0.144

GRI 305-4

GHG-Int

CRE3

GRI 303-1 Water-LfL

GRI 303-1 Water-Int

CRE2

liters

3,127,730

3,580,660

3,450,180

–13

GRI 306-2 Waste-LfL

100%

Cert-Tot

CRE8

1 Due to changes in the portfolio, the like-for-like figures for 2016 and 2017 have been amended.

MEMBERSHIPS AND AWARDS

MEMBERSHIPS

[GRI 102-13]

Aroundtown is an active member of ZIA. The German
Property Federation (ZIA) pursues the objective of rep-
resenting the general, economic, and ideological inter-
ests of the entire property sector and of promoting
collaboration among its members. It supports and
accompanies measures suitable for sustaining and
improving the economic, legal, political, and fiscal
framework conditions of the property sector.

Aroundtown is an active member of EPRA. EPRA’s
mission is to promote, develop, and represent the
European public real estate sector. EPRA achieves this
through the provision of better information to inves-
tors and stakeholders, active involvement in the public
and political debate, improvement of the general operat-
ing environment, promotion of best practices, and the
cohesion and strengthening of the industry.

Aroundtown is an active member of DGNB. The German
Sustainable Building Council (Deutsche Gesellschaft
für Nachhaltiges Bauen – DGNB e. V.) sees itself as a
non- profit association with a goal of supporting sus-
tainable construction and sustainable operation of
the buildings around us. The DGNB is not driven
primarily by economic goals, instead its aims are of a
social nature. The organization is funded and sup-
ported by its members and it interprets sustainability
as an extension of their definition of democracy and
part of an obligation to future generations.

Aroundtown is a signatory of the Diversity Charter. The
Diversity Charter aims to promote the recognition,
appreciation, and integration of diversity into Germa-
ny’s business culture. Organizations are to create a
working environment free of prejudice. All employees
should be valued – regardless of gender, nationality,
ethnic origin, religion or worldview, disability, age, sex-
ual orientation, or identity.

MEMBERSHIPS AND AWARDS | 55

AWARDS

93rd percentile,
ranked as “Outperformer”,
as of August 2018

In August 2018 Aroundtown’s ESG measures were as-
sessed by Sustainalytics, a leading sustainability rat-
ing agency, who ranked Aroundtown in the 93rd per-
centile among 319 international real estate peers
worldwide, noting Aroundtown as an “Outperformer” in
the categories of environmental and governance and a
“Leader” in social criteria.

At the EPRA Conference in September 2018, EPRA
awarded Aroundtown with an EPRA sBPR Gold
award and an sBPR most improved award – yet an-
other testament to Aroundtown’s progress in sus-
tainability.

IMPRINT
[GRI 102-53]

PUBLISHER:
Aroundtown SA
1, Avenue du Bois
L-1251 Luxembourg
Phone: +352 2 85 77 41
Email: info@aroundtown.de
www.aroundtown.de

CONTACT BERLIN OFFICE
Aroundtown SA
Wittestraße 30, Haus F
13509 Berlin
Germany
Phone: +49 30 37 43 81 73 01

CONTACT CR DEPARTMENT
Sylvie Lagies
Head of ESG
Phone: +49 30 37 43 81 73 01
Email: sylvie.lagies@aroundtown.de

CONCEPT AND EDITING
Scholz & Friends Reputation, Berlin, Germany

PRINTED BY:
Das Druckteam Berlin, Germany

PICTURES
Aroundtown SA

NOTE ON THIS REPORT
The online version is available for download under:
www.aroundtown.de/sustainability

Aroundtown SA
1, Avenue du Bois
L-1251 Luxembourg
Phone: +352 2 85 77 41
Email: info@aroundtown.de
www.aroundtown.de