Report on the EU Taxonomy objectives

In order to meet the EU’s climate and energy targets for 2030 and reach the objectives of the European green deal, the EU has created the EU Taxonomy.

The aim is to provide a tool to support in directing investments towards sustainable projects and activities. The taxonomy is a classification system, detailing what the EU constitutes as sustainable economic activities.

The taxonomy applies to listed and large public interest companies with more than 500 employees. Companies must report the share of revenue from taxonomy eligible activities, and the share of operating and capital expenditures. In EU’s first version of the taxonomy, sectors that are assessed to have the greatest impact on CO2 emissions - forestry, manufacturing, power generation, water and waste management, transportation, construction and real estate, and ICT (data centers - have been included. As a listed company Munters must report the taxonomy related KPIs as of 2021.

During 2021, Munters has performed an analysis in several steps to identify taxonomy-eligible economic activities. The analysis has classified 35% of the turnover, 37% of the operating expenditures and 49% of the capital expenditures as taxonomy eligible for the financial year 2021. The included business span five economic activities as defined in the EU Taxonomy and includes both business areas.

For more information see the Annual and Sustainability Report 2021 pages 50-53.

Included economic activities

EU Taxonomy economic activity	Munters’ business	Business Area
3.4 Manufacture of batteries	Dehumidification - Battery segment	AirTech
3.5 Manufacture of energy efficiency equipment for buildings	Controllers	FoodTech
3.6 Manufacture of low carbon technologies	Dehumidification - Industrial segment	AirTech
7.3 Installation, maintenance and repair of energy-efficient equipment	Service	AirTech
8.2 Data-driven solutions for GHG emissions reductions	Software	FoodTech

 

Turnover

			Substantial contribution criteria
Economic activities	Turnover, MSEK	Proportion of turnover, %	1. Climate change mitigation, %	2. Climate change adaption, %	Taxonomy eligible proportion of turnover, %
A. Eligible activities	2,541	35%	100%		35%
B. Non-eligible activities	4,806	65%
TOTAL A+B	7,348	100%

 

Specification of disclosure - turnover

Accounting policy

Turnover is defined as net turnover derived from products or services, including intangibles, associated with taxonomy-eligible economic activities.

When determining and allocating the taxonomy-eligible net turnover, business lines and underlying products and services were grouped according to economic activities. Thereafter assessments according to the delegated acts adopted pursuant to Article 10(3), Article 11(3), Article 12(2), Article 13(2), Article 14(2), and Article 15(2), of Regulation (EU) 2020/852, were made. ‘Taxonomy-non-eligible economic activity’ means any economic activity that is not described in the delegated acts adopted pursuant to Article 10(3), Article 11(3), Article 12(2), Article 13(2), Article 14(2), and Article 15(2), of Regulation (EU) 2020/852.

All the taxonomy-eligible net turnover relates to the objective climate change mitigation, no turnover has been defined as derived from products and services associated with the objective climate change adaptation.

For more information see the Annual and Sustainability Report 2021 pages 50-53.

Capital expenditure

			Substantial contribution criteria
Economic activities	CapEx, MSEK	Proportion of turnover, %	1. Climate change mitigation, %	2. Climate change adaption, %	Taxonomy eligible proportion of CapEx, %
A. Eligible activities	173	37%	100%		37%
B. Non-eligible activities	293	63%
TOTAL A+B	466	100%

 

Specification of disclosure - capital expenditure

Accounting policy

Capital expenditure is defined as the proportion of capital expenditure related to assets or processes associated with economic activities that qualify as any of the following:

• related to assets or processes that are associated with taxonomy-aligned economic activities, or
• part of a plan to expand taxonomy-aligned economic activities or to allow taxonomy-eligible economic activities to become taxonomy-aligned (‘CapEx plan’), or
• related to the purchase of output from taxonomy-aligned economic activities and individual measures enabling the target activities to become low-carbon or to lead to greenhouse gas reductions. Notably, activities listed in sections 7.3 to 7.6 of Annex I of the [Climate Delegated Act], as well as other economic activities listed in the delegated acts referred to in Articles 10(3), 11(3), 12(2), 13(2), 14(2), 15(2) of Regulation (EU) 2020/852 and provided that such measures are implemented and operational within 18 months.

The CapEx plan meets the following conditions:

• the plan aims either to expand Munter’s taxonomy-aligned economic activities or to upgrade taxonomy-eligible economic activities to render them taxonomy-aligned within a period of five years;
• the plan has been disclosed at economic activity aggregated level and approved by the Group Management Team.

Research and development costs accounted for in the capital expenditure KPI has not been counted as operating expenditure. All the reported taxonomy-eligible capital expenditure relates to the objective climate change mitigation.

For more information see the Annual and Sustainability Report 2021 pages 50-53.

Operating expenditure

			Substantial contribution criteria
Economic activities	OpEx, MSEK	Proportion of turnover, %	1. Climate change mitigation, %	2. Climate change adaption, %	Taxonomy eligible proportion of OpEx 2021, %
A. Eligible activities	82	49%	100%		49%
B. Non-eligible activities	87	51%
TOTAL A+B	168	100%

 

Specification of disclosure - operating expenditure

Accounting policy

Operating expenditure is defined as the proportion of operating expenditure related to assets or processes associated with economic activities that qualify as environmentally sustainable. The denominator is direct non-capitalized costs that relate to research and development, building renovation measures, short-term leases, maintenance and repair, and any other direct expenditures relating to the day-today servicing of items of property plant and equipment by the undertaking or third party to whom activities are outsourced that are necessary to ensure the continued and effective functioning of such assets.

For more information see the Annual and Sustainability Report 2021 pages 50-53.