Sustainability Report

2022
H+H International A/S

CVR-no: 49 61 98 12 | Lautrupsgade 7, 5th Floor. 2100 Copenhagen Ø

2 | H+H Su stainability Report 2022

Table of Contents
CEO letter 3 ESG performance data25 Forward-looking statements Integrated reports
Our purpose and promises4 SASB Construction Materials standard, The Sustainability Report contains forward-looking statements.
Highlights 5 content index26 Such statements are subject to risks and uncertainties, as
Accounting principles28 various factors, many of which are beyond the control of H+H,
Sustainability strategy  6
may cause actual developments and results to differ materially
Science-based Targets initiative7 H+H at a glance29
from the expectations expressed in this document. In no event
Task Force on Climate-related Business model30
shall H+H be liable for any direct, indirect, or consequential Annual Report
2022
Financial Disclosures10 EU taxonomy31 damages or any other damages whatsoever resulting from loss of H+H International A/S

Sustainable buildings13 EU taxonomy disclosure32 use, data, or profits, whether in an action of contract, negligence, CVR no: 49 61 98 12 | Lautrupsgade 7, 5th floor, 2100 Copenhagen Ø

Environmental15 Contact information35 or other action arising out of or in connection with the use of
information in this document. Annual report
Social18
[Link]/financial-reports
Governance21

Our commitment
The following pages constitute our Communication on Progress

15 18 (COP) as required by the UN Global Compact, information

required by the Danish Financial Statements Act §99a and Article
Remuneration Report
2022
H+H International A/S

Environmental Social 8 of the EU Taxonomy Regulation.

CVR-no: 49 61 98 12 | Lautrupsgade 7, 5th Floor. 2100 Copenhagen Ø

Remuneration report
[Link]/remuneration

21
Governance Corporate Governance
Statement 2022
H+H International A/S

CVR-no: 49 61 98 12 | Lautrupsgade 7, 5th Floor. 2100 Copenhagen Ø

Corporate Governance statement

[Link]/corporate-governance-reports
3 | H+H Su stainability Report 2022

CEO LETTER

Driving a sustainable future

In 2022, we delivered solid Our science-based targets set out the reductions we In line with our purpose to enable better homes and
will make as a company by 2030 in our Scope 1, 2 workplaces for our communities, we remain dedicated
progress on the targets set and 3 greenhouse gas emissions and align us to the to improving health and safety in our facilities through
out in last year’s Sustainability Paris Agreement and to the EU’s climate goals. Across our focus on zero harm. We continue to develop and
our supply chain there are a number of activities strengthen our internal programs and we can see that
Report. We have reduced our that makes us confident in achieving these reduction we are improving our safety performance. As a result of
carbon emissions in line with our targets. It will not be one big change, but gradual this, we had a record low Lost-Time Incident Frequency
improvements, maturing new technologies and a joint of 3.6 in 2022. We also continue local initiatives and
commitments under the Science supply chain effort to deliver blocks for walls with campaigns on mental health across the Group as part
Based Targets initiative (“SBTi"), less-than-zero carbon emissions. With the changing of our efforts to be an attractive employer.
macroeconomic sentiment, the cost aspect is even
engaged with suppliers to reduce more important to take into account - the transition is To further embed sustainability into our strategy
our Scope 3 emissions and not freely available, and H+H intends to pass-on the and processes, ESG targets have become part of our
costs. renewed financing agreement as well as our long- and
improved our safety performance. short-term incentive programs across the Group,
We expect the supply chain will be able to deliver low
During 2022 we implemented the Task Force on carbon products in the future. Our products are key It is our employees that drive our sustainability
Climate-related Financial Disclosures (“TCFD”) elements in delivering high volumes of low-carbon progress forward by delivering on our promises. I want
standard to provide transparency about the Group’s houses. Our products are durable, long-lasting to thank them for their commitment in 2022 and invite
climate-related risks and opportunities and to make and is only heated to 180 degrees celcius in our our customers, suppliers, and investors to continue on
sure that we are resilient towards the future. As part of manufacturing process. the sustainability journey with H+H.
the process, it was re-confirmed that carbon emissions
is the key ESG factor for H+H. Assessing against three In short, the industry is ready to deliver on the green
different climate scenarios (1.5°C, 1.8°C and 3+°C), the transition, but we need the support for our customers
conclusion of the process is that we have a resilient to realize the benefits of less-than-zero carbon Jörg Brinkmann
business model and no net material financial impact in products. CEO
any of the scenarios.
4 | H+H Su stainability Report 2022

We enable better homes for our communities

Partners in Wall Building Putting people first Performance driven Pushing the boundaries Part of a sustainable future

Being a part of H+H means you are in the The health and safety of our people, H+H strives to deliver results to all our To build better homes, we must stay Today we work with our partners to
business of people and teamwork. suppliers and customers, will never be partners and in the communities where we curious and eager to drive our industry reduce energy needs in homes and our
compromised. We are committed and have operate. forward. commitment is more than the long lasting
Our partners trust us to understand their the ambition of zero harm for our own and and insulating products we produce.
building needs from design, specification our partners' people. Even when times are difficult, we deliver We are continuously improving operations
and planning to delivery, assembly and quality products with the highest level of and products. Together with our partners We are part of the solution in creating
problem solving. We know that people are different. We service to our customers. Our operations we rethink supply chains, services and sustainable and carbon neutral buildings.
trust our differences enable us to see new run timely and effectively. We follow digital solutions. We are partnering with our customers,
With our partners, we enable better homes opportunities and be more effective. through on our commitment to serve our suppliers, and other stakeholders; finding
for our communities. communities. We are pushing to meet the needs of new production methods to lower the
People are the heart of H+H. tomorrow. environmental impact of homes.
You can trust us to deliver on our promises.
We act today to realise our vision of carbon
neutrality in 2050.
5 | H+H Su stainability Report 2022

Highlights
During 2022, we executed on our plans to meet our ESG commitments.
The results show a positive development towards our targets.

Results 2022 Long-term targets

Steady safety Reduced carbon Lower water H+H has carbon reduction Net-zero
performance emissions usage targets verified and by
approved by the SBTi

3.6 5% 3% 1.5°C 2050

Lost-Time Incident Frequency lower Scope 1 and 2 emissions reduction in water intensity We are on track in reducing our own We are committed to achieving
(LTIF) versus a target of 5. compared to our Science Based target. versus 2019 base year. emissions in line with the 1.5-degree net-zero emissions in our operations
scenario in the Paris Agreement. and products by 2050.

UN Global Compact

Sustainable Development Goals (SDGs)

Our products support SDG-11 (Sustainable cities and communities) and SDG-12 (Responsible consumption and production).
6 | H+H Su stainability Report 2022

Sustainability strategy
Environment Social Governance
Sustainable buildings Climate & environment Health, safety, and people Business ­integrity

By 2030, reduce By 2050, achieve By 2030, reduce By 2024, reduce By 2024, reduce By 2024, achieve By 2024, reduce By 2024, reduce Have gender diversity within
Scope 3 GHG net-zero emissions absolute Scope 1 and energy consumption water usage by 5% zero waste to landfill absenteeism to 9 lost-time incidents the Board of Directors of H+H
emissions 22% per in H+H's products 2 GHG emissions by per m3 by 7% vs. vs. 2019 base line of days per annum, frequency (LTIF) International A/S to minimum
m3 from a 2019 base 46% from a 2019 2019 base line of 565 382 litres per m3 By 2050, achieve including absen- to 3.5 25-40% of the under-repre-
year base year, equivalent MJ per m3 net-­zero emissions in teeism from long- sented gender
to a 4.2% reduction H+H’s operations term illness
each year

We want to enhance our product portfolio We aim to reduce our Scope 1 and 2 emissions, achieve net-zero emissions from operations, We strive for zero harm to our people We aim to always conduct
through more sustainable products and and continuously improve resource use through enhanced environmental management and through improved behavioural and our business in an honest,
application methods, that improve energy strategic sourcing of raw materials. automation levers, to provide a healthy ethical, and socially
efficiency and lower the life-cycle emissions working environment as well as continuing to responsible manner and to
of buildings. In regards to circular economy, we have three sub-streams focusing on this matter - a 'no be an attractive employer to attract, retain, drive compliance with laws,
waste of virgin materials' principle, a 'brick-to-brick' approach, and a 'building-to-building' and develop our talent pool. anti-trust guidelines, and
We partner with cement and lime approach. sustainable sourcing.
manufacturers to test low-carbon products
to reduce our Scope 3 emissions and are
committed to achieving net-zero emissions
from our products by 2050.
7 | H+H Su stainability Report 2022

Science Based Targets initiative

H+H is committed to an ambitious Science-based targets provide companies with a clearly • Scope 1 emissions are those that we as a company H+H’s total CO2e 2019 emissions used
1.5°C climate target, and our defined path to reduce emissions in line with the Paris can directly influence through our own operations— as a baseline for science-based targets
Agreement goals. Targets are considered ‘science- such as emissions produced in our factories.
targets have been validated based’ if they are in line with what the latest climate
science deems necessary to meet the goals of the Paris • Scope 2 emissions are indirect emissions from Energy Operational
by the Science Based Targets Agreement—limiting global warming to well-below 2°C operations, such as production of electricity and heat equipment
initiative. H+H became the first above pre-industrial levels and pursuing efforts to limit elsewhere. 75% and offices
warming to 1.5°C. Gas, coal, oil
manufacturer of aircrete (AAC) • Scope 3 emissions are indirect, and are largely 25%
and calcium silicate (CSU) to have H+H’s science-based targets set out the reductions driven by the manufacturers of the cement and lime Electricity, steam
that we will make as a company by 2030 in our Scope purchased by H+H. 25%
science-based targets approved in 1, 2 and 3 greenhouse gas emissions and align us to the
Emissions from operations
line with the 1.5-degree scenario. Paris Agreement and to the EU’s climate goals. Scope 1 and 2 emissions from our operations account
(Scope 1+2)
for about 25% of H+H’s carbon footprint, with about
The ten-year science-based target builds on the 75% of these emissions generated by the use of coal,
product life-cycle analysis (LCA) that we undertook oil, steam, and gas in our factories.
on our AAC and CSU products in line with the GHG Distributions
Raw materials
protocol. Together with our commitment to achieving About 75% of the emissions in H+H’s carbon footprint and embedded
net-zero emissions in our operations and products by are generated elsewhere along the value chain. The 95% energy emissions
2050, the science-based targets provide H+H with a majority of these emissions (approximately 95%) are
Lime, cement
strong foundation to reduce emissions. The levers by generated upstream by cement and lime manufacturers 5%
H+H’s commitments which we will achieve these reductions are discussed in as a result of the chemical reaction that occurs when Diesel
• By 2030, reduce absolute Scope 1 and 2 the Sustainable Buildings and Environmental sections carbon is removed from limestone when it is heated to

75%
GHG emissions by 46% by from a 2019 of this report. produce clinker for cement or lime. The CO2 released
base year is an unavoidable consequence of this reaction, as the
H+H’s carbon footprint limestone has absorbed CO2 during its formation.
• By 2030, reduce Scope 3 GHG emissions In 2019, H+H’s emissions amounted to approximately
Value-chain emissions
22% per m3 from a 2019 base year 950,000 tonnes of CO2e (rebased in 2022 to include
(Scope 3)
acquired subsidiaries/factories). In accordance with the
GHG Protocol, these are divided into three scopes:
8 | H+H Su stainability Report 2022

H+H's roadmap to achieve carbon reductions for Scope 1+2 in line with the Paris agreement

120
H+H’s science-based targets
– roadmap and performance 10% -17%
For our 2030 target on Scope 1 and 2, we have
developed a roadmap that illustrates how we will 100%
achieve carbon reductions in line with the Paris 100
Agreement. The roadmap was developed in 2020 and -4%
-35%
the reduction aspirations persist.

We will reduce carbon emissions by 80

• having an increased share of renewable electricity

• continuously implementing energy saving projects

60
54%
• improving our energy sources by converting from
coal to natural gas and from natural gas to fossil free
energy sources, e.g. green hydrogen
40
These activities are all integrated in our operational and
strategic design.

For our Scope 3 target, we focus on having a continuous 20

dialogue with our lime and cement producers and will
collaborate on carbon reduction projects with those
that have committed to a science-based target or which
have a credible emissions reduction pathway. We will
0
increase the demand for these low-carbon products in
the same order as we are able to pass on the additional 2019 baseline Organic growth and Increase share of Investments in Improved energy 2030
emissions improvements, net renewable electricity energy efficiency mix emissions
costs to our customers. (2019-2030) (2022-2025) (2020-2030) (2022-2030)
9 | H+H Su stainability Report 2022

Scope 1+2 – Actions & Results converting one factory in Poland from coal to natural Scope 3 – Actions & Results SBTi SBTi Actual
We are executing in line with our carbon strategy of gas. Additionally, we are seeing positive impacts from The Scope 3 intensity is at 156.8kg per m3, on par Emissions Unit 2019* 2022 2022
an emission-reduction of 27k tonnes and 10k tonnes the various current CO2-reducing projects being with last year but higher than the SBTi-target. As
Scope 1+2 Tonnes 212,997 186,275 176,250
compared to last year and the SBTi-target, respectively. implemented in all our factories and expect this to our progression is dependent on our suppliers, the
Scope 1+2 kg/m3 45.3 40.2
We have had a record low carbon intensity emission of continue into next year. For 2023, we will continue to anticipated improvements are not expected to happen
Scope 3 kg/m3 161.3 151.6 156.8
40.2kg per m3. The commitment has been embedded implement further CO2-reducing projects, increase our linearly but to come in stages. As a positive action, H+H
throughout the Group with a focus on lowering our renewable electricity and convert one additional factory has worked with cement suppliers to reduce clinker * Rebased in accordance with SBTi guidelines

energy and CO2 emissions. All factories are now from coal to natural gas. We also maintain our focus on content in cement used for AAC products.
consuming an average of 50% renewable electricity exploring potential options for hydrogen conversion
and we have begun our energy mix improvement by within this decade. For 2023, we continue collaboration with cement and
lime producers that have committed to a science-based
target or a credible emissions reduction pathway.

250,000

200,000

150,000

100,000
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Scope 1+2 SBTi   Scope 1+2 actual  

10 | H+H Su stainability Report 2022

Task Force on Climate-related Financial Disclosures

In 2022, H+H implemented Implementing TCFD The climate-related risks and opportunities identified in recognized in the standardised Environmental Product
During 2022, we performed an assessment of the the scenario analysis are described in more detail in our Declarations (EPDs) for AAC and CSU products. A
the TCFD recommendations to transition and physical climate-related risks and standalone 2022 TCFD disclosure available on H+H’s recent study published by the European Autoclaved
provide transparency about the opportunities that we face until 2050. The assessment website: [Link]/sustainability-reports Aerated Concrete Association (EAACA)1 shows that
used three climate scenarios (1.5°C, 1.8°C and +3°C) the absorption is up to 77 kg per m3. As outlined in the
Group’s climate-related risks and and defined short, medium, and long-term as 2025, Mitigating actions towards climate risks product roadmap for AAC, the product has the potential
opportunities and to make sure 2030 and 2050 respectively. As the main climate risk for H+H is related to the to become a ‘less-than-zero’ emissions building
progression of CO2 emissions, we have set five overall material. The fundamentals are the same for CSU
that we are resilient towards the The process included a workshop with the top 50 targets to drive the transition to a low-carbon economy. products.
future. leaders from across the company to consider the
three scenarios and identify climate-related risks and • 100% share of renewable electricity These building materials are therefore well suited for
opportunities. Existing climate-related risks from our (incl. PPAs / RECs) by 2025 growth in low carbon societies.
ERM system were included, and an analysis of risks
and opportunities identified by companies across the • Annually allocate funds to CO2-reducing projects
building materials sector were also completed. – currently DKK 20 million per year

The scenarios considered H+H's full value chain, • Convert five coal factories to natural gas by 2030
including upstream cement and lime producers, own
The risk assessment operations and downstream customers. • Continue to link executive management
remuneration to carbon-related measures
concluded that H+H Outcome from the TCFD process Have a least one
The findings from the scenario analysis were • Have a least one Scope 1+2 neutral factory by 2030
has no net-material incorporated into our strategy process to improve its Scope 1+2 neutral
resilience. Our mitigating actions towards the financial Climate-related opportunities
financial impact in the risk is to pass on costs incurred from carbon taxes Through recarbonation, cement-based products factory by 2030
to customers as well as continuously execute on absorb CO2 during their lifespan, acting as permanent
short, medium, and our carbon-reduction strategy. The risk assessment carbon sinks during the use phase of a building and
concluded that H+H has no net-material financial when it is pulled down and recycled. Recarbonation
long-term scenarios impact in the short, medium, and long-term scenarios. occurs over the full lifespan of our products and is

1 [Link]
11 | H+H Su stainability Report 2022

Generic product roadmap for AAC: From 180 kg to -70 kg of CO2e per m3 by 2050

Unavoidable
emissions
Decarbonising Switching to from cement
Low carbon Optimising industry Low emissions renewable and lime raw
Today cement and lime factories processes transport energy materials Circularity1 Recarbonation2

(Kg CO2e per % of reduction

m3 AAC unit) (CO2e per m3)

180kg -69%

% of reduction
(CO2e per m3)

% of reduction

-13% (CO2e per m3) % of reduction

(CO2e per m3)
% of reduction
(CO2e per m3)
% of reduction
% of reduction

-7%
(CO2e per m3)
(CO2e per m3)
(-125kg)

(-24kg)
-3% -3% 8kg -1% -43%
(-12kg) (-5kg)
Net-zero emissions
(-5kg) (-2kg)
Numbers have been rounded and may not add up

(-77kg)

-70kg
EAACA – Net-zero roadmap for autoclaved aerated concrete
1. Replacement of 20% cement and lime raw materials; 2. Derived from a representative AAC factory (normalized to an average dry density of 388 kg/m3, year under review 2020)
12 | H+H Su stainability Report 2022

Investing in state-of-the-art
energy equipment
Sustainability is an embedded part of our value
proposition and operations, and we allocate capital
specifically for CO2, NOx and greenhouse gas reduction
initiatives.

As part of this ongoing process, H+H UK was granted To ensure that we are prepared for future renewable
funds to install new gas burners at our Pollington site. energy sources, the new burners are compatible
Gas burners are an integral part of the boiler system with hydrogen as a base fuel. Furthermore, we are in
used to generate the steam which is used to ‘bake’ the continuous dialogue with local governments about
AAC block in our autoclaves. the possibility of changing to hydrogen supply, once
capacity becomes available in the UK.
Through thorough internal and external analysis,
replacing the 21-year-old old gas burners was identified As a result of the successful implementation of the
as a high impact investment for reducing our CO2 new burners, we are already preparing to replicate
emissions. This initiative was enabled by developments this initiative at our Borough Green site whilst also
in gas burning technologies. preparing separate analyses of potentially replacing
burners in our other regions.
The burners were successfully installed in Q3 2022 with
the subsequent data showing significant reduction in
gas usage. To date, we have already seen gas savings of
up to 4% in consumption levels, saving more than 600
tonnes in CO2 emissions on an annual basis. Picture of the newly
installed burners in
Pollington, which save
us up to 600 tonnes
CO2 annually.
13 | H+H Su stainability Report 2022

Sustainable buildings
We are reducing the carbon The decarbonisation of Europe’s buildings is essential As previously outlined, the majority of emissions in 2. Low emissions transport
to achieving the EU’s target of a 55% reduction in GHG our AAC and CSU products lie “upstream” with the We will also work with transport suppliers that have
intensity of our AAC and CSU emissions by 2030 compared to 1990 levels, and to cement and lime producers and are part of our Scope committed to a science-based target or provide low
products through our science- become the first climate neutral continent by 2050. 3, or indirect, emissions. Fortunately, our AAC and emissions transport services. The emissions-reduction
In Europe, the use of buildings alone accounts for a CSU products are on a path to achieve net-zero—and pathway for the transport industry requires transport
based target and our pathway to significant part of Europe’s energy consumption and possibly have less-than-zero — emissions by 2050. companies to reduce emissions by ~31% by 2030.
net-zero emissions by 2050 CO2 emissions. Around one third of the emissions As the haulage is heavy duty, the most advanced
come from the manufacture of building materials and Our science-based Scope 3 target is an intensity target technology is currently the use of hydrogen as fuel
the construction, usage, and demolition processes. which relies on progress made by the cement and lime instead of diesel and gas-fueled trucks. This will
Together, these represent a large and cost-effective manufacturers in their own decarbonisation pathways. require a modernisation of the fleet on the market
opportunity to reduce the EU’s overall emissions. and expansion of the refueling network for hydrogen
To deliver on the 2030 target of reducing Scope 3 together with a ramp-up of the capacity and generation
Capturing the opportunity emissions and thereby reducing the carbon intensity of green hydrogen.
We are committed to supporting the EU’s climate of our AAC and CSU products, we will implement the
targets and the sustainable transformation of Europe’s following CO2 reduction levers: 3. Recarbonation and thermal benefits
cities and communities. The characteristics of our AAC As described on page 10, cement-based products
and CSU products enable improved indoor climate, 1. Low carbon cement and lime absorb CO2 during their lifespan through recarbonation
better acoustics, and enhanced energy efficiency in We will collaborate on carbon reduction projects with as recognised by EAACA. Additionally, the thermal
homes and other buildings. In addition, the products cement and lime producers that have committed insulation benefits of our AAC products have the
are long-lasting, deliver fire safety benefits, and can to a science-based target or a credible emissions potential to drive even further gains in the form of
be integrated into a circular economy. To capture the reduction pathway. The Science Based Targets initiative avoided emissions as they reduce the energy required
opportunity in sustainable buildings, we are reducing industry pathway indicates an emissions reduction of for heating during a building’s use phase. This should
the carbon intensity of our AAC and CSU products approximately 19% by 2030 for cement manufacturers. be seen in the light of the general approach of assessing
H+H’s commitments and developing new sustainable products through the The European and global cement associations and the environmental impact of buildings by looking at
• By 2030, reduce Scope 3 GHG emissions Group Innovation Function. leading manufacturers have published plans that put the whole building over its full lifetime to get a full
22% per m3 from a 2019 base year cement producers on a path to net-zero emissions by understanding of the consequences.
Decarbonising H+H’s AAC and CSU products 2050. According to these, net-zero will be achieved
• By 2050, achieve net-zero emissions in Our ten-year science-based target and our mainly through the use of carbon capture storage Developing new sustainable products
H+H's products commitment to net-zero emissions by 2050 provide the and utilisation (CCSU) and lower carbon ingredients, In addition to decarbonising our products, the Group
framework to decarbonise our AAC and CSU products. switching from fossil fuels to renewable energy to heat Innovation Function will further enhance the application
kilns, and through recarbonation. of existing products and develop new sustainable
14 | H+H Su stainability Report 2022

products. This includes the development of products Internally, H+H has three sub-streams
as well as applications to support passive houses and focusing on how to advance the circular
other energy efficient building solutions. economy on a practical level:

Supporting a circular economy • A ‘no waste of virgin materials’ principle with

We support the principles of a circular economy and maximum utilisation of waste in our own production.
through our Group Innovation function, we are also This is ingrained in the layout of our factories.
investigating the recycling and re-use of raw materials
from AAC and CSU products. Waste occurring in the • A ‘Brick-to-brick’ approach where AAC waste
production process, from construction sites, and from from construction and demolition sites is being
demolition rubble has the potential to be recovered and re-introduced into the production mix. This can be
re-used as aggregate in the production of AAC and CSU achieved at a limited volume, but the value chain
products. By replacing some of the lime and cement needs to mature with regards to the practical
raw materials, the recycled aggregate has the potential handling of the logistics and the cleanliness of the
to reduce overall lifecycle emissions. returned materials. Increased costs for handling
of waste and increased requirements for recycled
However, there are a number of challenges in recovering materials in new buildings will help mature this
and sorting AAC and CSU waste from construction sub-stream.
and demolition sites that must be resolved in order to
provide aggregate of a consistent quality and to make • A ‘Building-to-building’ approach where AAC and
the practice of recycling economic for manufacturers or CSU waste from demolition of old buildings is being
third-party recyclers. In this regard, we are supporting introduced into a new block type. This is currently on
efforts to standardise circular processes at an industry- a R&D-level as a part of the initiatives in the Group
association level and through EU legislation. Innovation function.
15 | H+H Su stainability Report 2022

ENVIRONMENTAL
We want to continue our
improvement of resources
and significantly reduce our
carbon emissions.

H+H’s commitments
• By 2030, reduce absolute Scope 1 and 2 GHG
emissions by 46% from a 2019 base year,
equivalent to a 4.2% reduction each year

• By 2024, reduce energy consumption per m3

by 7% vs. 2019 base line of 565 MJ per m3

• By 2024, reduce water usage by 5% vs. 2019

base line of 382 litres per m3

• By 2024, achieve zero waste to landfill

• By 2050, achieve net-zero emissions in H+H’s

operations
16 | H+H Su stainability Report 2022

Picture of the Pollington lagoons, which take all condensate water from
the autoclaving process, all surface water from the yard, and all reject
water from any on-site water filtration systems we have. With these we
recycle an estimated 60% of our total water use on site.

Improving energy performance and 3. Optimising equipment

reducing Scope 1 and 2 emissions As factories are upgraded and equipment is replaced,
As highlighted on page 8, we have developed a roadmap there are inherent energy reductions that will be
until 2030 with specific actions to reduce our Scope 1 harvested. Such upgrades and modernisations are
and 2 emissions. The main three levers are described in essential in having an optimised manufacturing footprint
more detail as: and equipment, and the investments will not solely
rely on sustainability decision criteria. In addition,
1. Increasing the share of renewable electricity to 100% dedicated ESG investments to lower water and energy
Over the coming years our purchase of electricity consumptions and reduce carbon emissions have been
will increase to renewable electricity through either planned. These include targeted investments to insulate
Renewable Energy Certificates (RECs) or Power pipes, autoclave doors, and to replace the most energy-
Purchase Agreements (PPAs). By 2025, we expect consuming equipment.
to have fully transitioned into a 100% renewable
consumption of electricity. Water management
Most of our factories are located in rural areas, and none in
2. Improving energy mix areas with extremely high-water stress. Water is extracted
The current energy infrastructure has been chosen from our own wells in accordance with relevant legislation
based on its cost profile. Alternatives that will reduce and covered by permits. Two of our factories are located
the carbon emissions and investments are divided into in areas with high water stress. We aim to continuously
three main categories. These are expected to: improve our water resource by investing in water usage
efficiency and recycle wastewater to the extent possible.
• Phase out purchase of steam generated from coal
Waste management
• Reduce the number of coal-fired factories by We have robust waste management practices through
converting the fuel source to relatively more carbon a “reduce, reuse, and recycle” approach. We continue
light alternatives to focus on waste and resource efficiencies and take
practical steps in our operations to reduce waste.
• Convert the most optimal located factories to The continuous optimisation of recipes for products,
hydrogen recycling of failed batches and reduction of waste are
integral parts of normal business procedures. For excess
waste, we are on track to meet our commitment of zero
waste to landfill by 2024.
17 | H+H Su stainability Report 2022

Biodiversity well as continuously optimizing our recipes. We want to together with local management and along with our Waste
We do not operate quarries and mines, except in continue these actions and help to increase the supply other energy reducing projects, we plan to see a Waste to landfill was 5,670 and is higher compared to
Poland, where we operate a few sand pits to supply of low emission products by increasing our demand. positive development for next year and expect to still last year. The landfill derives primarily from ramp up of
sand into our own manufacturing process. In line with meet our 2024 target. factories, that have been upgraded. Two of our regions
our ESG policy, we are committed to ensuring that Energy will start to have zero waste to landfill in 2023 and we
environmental responsibility is always considered when As we have been impacted by production challenges Water still expect all regions to be zero waste to landfill by
we do business and to comply with all environmental in some key factories, our energy consumption per m3 For water consumption, we have already reached our 2024.
legislation with regards to operating the sand pits. increased compared to last year by 2% from 554 to 2024 target but continue to improve the efficiency of
567 and is 8% higher than our 2024 target. However, water usage in the production.
Results and plans a detailed gap plan has been developed on each site
Emissions
In 2022, we have emitted 176,250 tonnes CO2 from
Scope 1 and 2 versus our SBTi target of 186,275 SBTi and ESG targets
tonnes for the year while also lowering our emission
per produced m3. As described on page 9, the strong Actual Target Trend
performance comes from an increase in consumption SBTi targets Unit 2019 2020 2021 2022 2022
of renewable electricity and improvement of the energy
mix Scope 1 +2 emissions* Tonnes 199,209 178,363 191,806 176,250 186,275 Overperforming

Scope 3 intensity kg/m3 161.9 156.6 156.7 156.8 151.6 Underperforming

We plan to continue the progress on our SBTi roadmap
and have set five overall targets to reduce our Scope 1
and 2 emissions, as described under our TCFD section.
ESG 5 year targets Unit 2019 2020 2021 2022 2024

For Scope 3, the development is flat vs. last year. With

Energy consumption per m3 MJ 565 551 554 567 525 Underperforming
the H+H footprint and local sourcing of energy intensive
raw materials, the flat development for Scope 3 is Water consumption per m3 Litres 382 363 354 369 363 On track
impacted by the fact that both Germany and UK have
Waste to landfill Tonnes 1,409 1,932 1,258 5,670 0 On track
increased the use of coal in 2022 and this is expected to
persist in 2023 as well. Absenteeism Days per FTE 13 13 12 13 9 Underperforming

LTIF Incidents per mil hours 5.6 5.7 5.5 3.6 3,5 On track
Our own actions have been to start purchasing lower
* Rebased in accordance with SBTi guidelines
emission cement in key factories towards end of year, as
18 | H+H Su stainability Report 2022

SOCIAL
Our employees are our most important assets. We
strive for zero harm as we depend on their efforts,
competencies, and knowledge to achieve our goals.

H+H’s commitments
• By 2024, reduce our lost-time incidents
frequency (LTIF) to 3.5

• By 2024, reduce absenteeism to 9 days per

annum, including absenteeism from long-
term illness
19 | H+H Su stainability Report 2022

Health & safety

We put safety first and strive for zero harm to our people,
contractors, suppliers, and customers

We strive to operate the safest factories in Europe, as assessments, safety improvement plans and near miss Absence reduction • Where appropriate, lighter duties are offered to
we continue to increase production. reports, as well as training. Managing absence is an essential part of managing employees to assist in their return to work as soon as
health and well-being. Our target is to reduce the it is feasible.
In 2022, we had zero employee fatalities, marking During the year we rolled out an “Eyes On” behavioural average absence per employee to nine days a year
the eighth consecutive year with no fatalities across safety programme to all employees to help keep them by 2024, including absenteeism from long-term • All long-term sickness cases are offered appropriate
the Group. We improved safety performance with injury free, and we carried out intensive safety training illness. Interruptions caused by COVID-19 subsided support to help them return to work as soon as they
a significant reduction in the Lost-Time Incident for our factory management team to support them in significantly during the year and all our factories can.
Frequency (LTIF) from 5.5 in 2021 to 3.6, the lowest their leadership of safety improvement on their sites. remained open during 2022, with the company
level ever achieved by H+H. maintaining best practice hygiene procedures and Though progress is visible in several of our sites, we are
In line with our rolling three-year programme, we social distancing where necessary as defined by unfortunately trailing behind our overall target to lower
A Lost-time incident is a work-related injury or illness carried out 10 externally verified site audits and have the relevant government guidelines. Monitoring absence. Local initiatives are deployed to determine
to an employee for which a healthcare professional seen the overall average score for all factories improve was continued in our workforce with isolation and root causes and solutions, while also focusing on
recommends days away from work due to the incident. in 2022. Internal peer audits were also carried out and quarantine periods being used as needed. This included ensuring stable working conditions for the remaining
will continue in 2023. We see the self-assessment as a contractors working within our facilities. employees.
The LTIF measures the frequency of LTIs and fatality strong tool to share and reinforce the inherent culture
incidents per million man-hours divided by total hours of safety across the Group. While levels of absence differ from region to region and
worked. Our target is to reduce the LTIF to 3.5 by 2024. function to function, we employ a common approach to
In 2022, we held the second annual H+H Health & all absences:
25 of our 32 locations have recorded zero lost-time Safety Awards to reinforce the importance of safety in
incidents and 12 of our factories had been incident-free the workplace. The 2022 awards were held at a meeting • All absences are reported to HR via line management.
for over three years, including one factory which has of the Senior Management Team in Poland, with awards
been incident free for over seven years. delivered for “Best in Class”, “Most improved site” and • All absences are assessed for any work-related causes.
“Recognition” award for achievement in health and
The improved safety performance is anchored in the safety. • Upon their return to work, all employees have
safety improvement strategy launched in 2021 with an informal return-to-work discussion with their
nine key focus areas, including safety leadership, risk manager to ensure they are coming back to work in a
safe and controlled manner.
20 | H+H Su stainability Report 2022

People
People are the heart of H+H. We know that people are different. We trust our
differences enable us to see new opportunities and be more effective.

Organisation, collaboration & development Follow-up meetings are conducted throughout the to providing equal opportunities in employment and Gender split of our office workers
Headquartered in Copenhagen, we employ 1,739 FTEs organisation with employees and management to learn aim to recruit from a diverse mix of experience, skill, remains high with 41% of the
located in our three core regions: Central Western from the results and find ways to further improve. culture, age, nationality, educational background, and
underrepresented gender
Europe, the United Kingdom, and Poland. We believe way of working to create a dynamic organisation that
that having a lean HQ and decentralised management We want our employees to be able to develop their continues to advance the H+H Group in line with our
structure empowers and enables our regional competencies and skills and as a company we want strategic objectives.
management teams to act quickly and take on the to be prepared to tackle the challenges ahead which
challenges in their respective areas. include fewer young people joining industries with Every H+H manager is responsible for fostering an
factory-based production. To support this, we are inclusive and open working climate where diversity can
To actively strengthen our culture of collaboration and continuing the roll-out of our Talent Management be embraced, and we have a zero-tolerance approach
59%
trust and to ensure we are working towards the same process and expanding it to more levels of the to harassment. All H+H employees are encouraged to
Men
goals, we have introduced our purpose and five promises. organisation and we are also looking into how to best report any behaviour which is not in accordance with
With these we want to be clear on what is important to design our Performance Management. the Diversity Policy or Code of Conduct to their line
H+H as a business, both now and in the future.
We also started the implementation of a global Learning
manager, local management, or Group HR. Reports can
also be filed through our online whistleblower system.
41%
Women
We continuously strive to be an attractive place to work Management System which will become available to all
where our employees feel seen and respected, and employees. The system will be used to train employees While gender diversity for our non-office workers
we know that the success of our company depends in topics such as GDPR, compliance and ESG and remains low in traditionally male factory environments,
on their engagement. We are continuously working to give them the opportunity to develop their personal the gender diversity of our office workers remains high
increase the engagement level of our employees. competences. with 41% of the underrepresented gender.

In 2022, we started using digital employee engagement Diversity in H+H During 2022 the gender pay ratio decreased from 1.27
surveys in selected locations, covering topics such H+H has adopted a diversity policy encouraging to 1.08. As we operate in countries with materially
as motivation, satisfaction, work environment and diversity at all levels of the organisation, without different salary levels, comparison across regions can
collaboration. Engagement rates were at a satisfying compromising on competence, qualifications, and be difficult as well as setting specific targets - however
level of 84%, and we are working towards implementing quality. While we currently don’t have any set targets we believe that the current pay ratio is at a satisfying
a global digital survey across all regions and locations. for our overall gender diversity, we are committed level.
21 | H+H Su stainability Report 2022

GOVERNANCE
We conduct our business in a fair, ethical, and
socially responsible manner and we strive to
serve and enhance the communities in which
we operate.

H+H’s commitment
• Have gender diversity within the Board
of Directors of H+H International A/S of
minimum 25-40% of the under-represented
gender
22 | H+H Su stainability Report 2022

Governance
H+H is committed to acting and money laundering. It also covers employees,
business ethics, personal data protection and
professionally, fairly, and with sustainability.
integrity in all our business
Every employee at H+H is required to read and
dealings and relationships with adhere to the H+H Code of Conduct and managers
consideration for the needs are expected to serve as role models and inform and
encourage colleagues to discuss openly how to follow
of all stakeholders, including the principles set forth in the Code of Conduct and the
customers, employees, underlying specific policies.

shareholders, and wider Human rights

stakeholders. We strongly support human rights and employee rights
as set out in the UN Universal Declaration of Human
Rights and the International Labour Organization´s
To support this commitment, the Regional Managing eight fundamental convention.
Directors are required to sign a declaration every
quarter that to the best of their knowledge, the H+H We continuously assess the risk for human rights
entities that they are responsible for are conducting violations. We believe the inherent risk for human rights
business in a way that is compliant with all applicable violations is low due to the nature of the business and
H+H policies. The Board of Directors oversees as we only conduct business in European countries
compliance of the ESG policy. with strong institutions. Most of the people working
in our factories are directly employed by H+H, and
Code of Conduct consequently we can ensure that our staff are treated
The H+H Code of Conduct is the cornerstone of our fairly and in accordance with the above principles.
compliance programme and sets the tone with regard Temporary staff are either employed directly by us
to business integrity and ethical principles. or via reputable agencies which adhere to relevant
employment legislation. To mitigate risks for violation
The Code of Conduct includes principles related to of human rights throughout the value chain, we have
human rights, confidentiality and insider trading, a Code of Conduct for Suppliers which outlines our
conflicts of interest, fraud, fair and lawful competition, expectations for our suppliers.
bribery, political donations, entertainment and gifts,
23 | H+H Su stainability Report 2022

Anti-corruption Code of Conduct for Suppliers and violations of law are investigated, and retaliation If two candidates of different genders are equally
H+H has a zero-tolerance approach to bribery and We expect our suppliers to share our commitment against anyone who reports in good faith is not qualified for a board position, the candidate
facilitation payments. This is underpinned by our to conducting business in a fair, ethical, and socially tolerated. representing the under-represented gender, if any, will
Anti-corruption Policy which provides principles and responsible manner. Our Code of Conduct for Suppliers be chosen. The gender diversity target for the Board
information related to bribery, facilitation payments, addresses potential risks related to labour practices, In late 2022 there was one whistleblower report of Directors was achieved in 2022 as the number of
donations, and entertainment and gifts. human rights, health and safety, the environment, which is currently under investigation. It concerns an female board members was increased from one to two
bribery and corruption in the supply chain. We isolated incident with no significant impact on the rest out of six members.
While the building and construction industry is communicate the policy to all major suppliers and of the company. No other incidents relating to human
vulnerable to corrupt business practices, we consider request them to confirm and agree with the content. rights, fraud, corruption, bribery, breach of antitrust/ Management gender diversity
the risk of corrupt behaviour to be relatively small given competition laws as outlined in the Whistleblower Policy H+H International A/S has, due to its relatively small
that H+H operates in advanced European countries H+H may terminate a contract with a supplier who have been reported. size with less than 25 employees, opted to use the
with low incidence of corruption. violates this Code of Conduct for Suppliers or refuses, exemptions for companies with less than 50 employees
if asked, to take part in a remediation plan. H+H will Board diversity and not have a gender diversity policy for its different
Our main exposure to corrupt practices concerns also exclude suppliers who do not demonstrate that H+H International A/S is committed to gender diversity management levels or related gender diversity targets.
inappropriate types or levels of entertainment and they meet our high ethical and CSR standards or show within the Board of Directors as defined by the Danish
gifts provided to our employees from suppliers or compliance with relevant laws. Company Agency (Erhvervsstyrelsen). To meet the Executive remuneration linked to ESG targets
provided by our employees to customers with the gender diversity definition, each gender shall be H+H’s remuneration policy seeks to create a
intent of gaining special consideration or a business Whistleblower Policy represented in the Board of Directors as follows: remuneration framework that supports achievement of
advantage. In light of this, our Anti-corruption Policy Employees and stakeholders, such as suppliers and our strategy, with a focus on ensuring the continuous
includes a practical training element to raise awareness customers, are encouraged to speak up immediately in • By at least one shareholder-elected board member, long-term sustainable development of H+H’s business,
on business situations that may involve bribery case of suspected violations to our policies to a relevant when the Board of Directors consists of a total of four while creating long-term value for shareholders.
or corruption and the behaviour expected of H+H H+H Manager, Group HR, or for external stakeholders shareholder-elected board members;
employees. to their point of contact in H+H. Both the long- and short-term incentive remuneration
• By at least two shareholder-elected board members, of the executive board, is tied to the overall business
To raise awareness of and support compliance with However, if circumstances are such that the when the Board of Directors consists of a total of five performance, and how H+H is progressing towards
the Code of Conduct, Anti-corruption policy and other whistleblower prefers to report in confidence, they to seven shareholder-elected board members; and delivering stable and sustainable financial performances,
policies, we provide policy management and training can do so anonymously via H+H’s public online including progress on various strategic ESG targets. For
systems. All our policies are regularly reviewed and whistleblower system which is provided by an • By at least three shareholder-elected board 2023, the short-term ESG targets will be improvement
updated in accordance with relevant legislation, and independent third-party provider of whistleblower members, when the Board of Directors consists of a of our LTIF and reduction of our Scope 1+2 emissions.
we are continuously ensuring that employees read and solutions. All good faith reports of suspected violations total of eight shareholder-elected board members.
adhere to our policies. of the Code of Conduct or any underlying H+H policies
24 | H+H Su stainability Report 2022

ESG-related governance
ESG is integrated into several H+H Group Management
The Chief Strategy Officer is responsible for the Board of Directors
of our key processes, including development of H+H’s ESG strategy and reporting.
strategy development, risk
ESG targets are incorporated in the short-term
management, reporting, and in incentive plans across the Group, including for
several of our Group policies. Group Management. In 2022, Group Management
Audit Committee
was measured on H+H’s progress within energy
consumption, absenteeism and lost-time incident
frequency.
Board of Directors
The Board of Directors oversees compliance of the ESG ESG Committee
H+H Group management
policy and are regularly updated on the progress of our The ESG committee monitors new legal requirements
ESG strategy and reporting throughout the year. and trends around ESG and considers and makes
recommendations on key ESG initiatives to ensure H+H
Audit Committee complies with stakeholder expectation.
The Audit Committee is currently comprised of two
board members and is a permanent committee ERM Committee
ESG Committee ERM Committee
reporting to the Board of Directors. The Audit The ERM Committee oversees our Enterprise Risk
• Chief Strategy Officer • Chief Financial Officer
Committee is responsible for amongst other things Management (ERM) process and is responsible for
overseeing both the financial and non-financial communicating and ensuring ERM compliance as • Chief Operating Officer • Chief Operating Officer
reporting (i.e. the Annual financial report, Sustainability well as evaluating and reviewing the ERM system. • Chief Legal Officer • Chief Legal Officer
report and Remuneration report) as well as external Risks related to climate change are incorporated into
• Group Sustainability Lead • Chief Strategy Officer
audits, internal controls and risk management. The full our ERM process. In addition, the ERM Committee is
• Chief Information Officer
scope of the Audit Committee is described in the Audit responsible for developing the overall risk strategies
Committee Charter published at [Link]. and scoping of risk for the ERM system as well as • Head of Group Finance
reporting on assessed risks and mitigating actions to
the Audit Committee.
Illustrative reporting lines anchoring ESG at Board level – and including ESG in the
risk management process through the Audit Committee.
25 | H+H Su stainability Report 2022

ESG performance data

Environmental data Social data
Unit 2022 2021 2020 2019 2018 Unit 2022 2021 2020 2019 2018
CO2e Scope 1* Tonnes 142,796 132,345 121,598 142,319 134,791 Full-time workforce FTE 1,739 1,663 1,571 1,636 1,608
CO2e Scope 2 - Market based* Tonnes 33,454 59,461 56.765 56,890 55,992 Gender diversity % 16% 16% 15% 15% 14%
CO2e Scope 3* Tonnes 688,192 673,554 624,247 694,255
Gender diversity, non-office workers % 4% 6% 6% 6% 5%
CO2e Scope 1 (direct)* kg / m3 33 31 32 33 34
Gender diversity, office workers % 41% 47% 47% 44% 44%
CO2e Scope 2 (indirect emissions from the kg / m3 8 14 14 13 14
generation of purchased energy)* Gender diversity, Group Management % 0% 20% 20% 20% 0%

CO2e Scope 3 (indirect emissions from kg / m3 157 157 157 162 Gender Pay Ratio (Median) Times 1.08 1.27 1.26 1.15 1.03
the generation of purchased goods and Gender Pay Ratio (Average) Times 1.07 1.10 1.15 1.20 1.20
services)*
Employee Turnover Ratio % 15% 13% 14% 12% 13%
Energy consumption** GJ 2,487,149 2,380,949 2,195,301 2,419,731 2,350,953
Sickness Absence Days per FTE 13 12 13 13 10
1. Percentage grid electricity % 10% 10% 10% 10% 10%
Fatalities Headcount 0 0 0 0 0
2. Percentage alternative % 0% 0% 0% 0% 0%
Lost-time incident frequency (LTIF) Incidents per mil hours 3.6 5.5 5.7 5.6 9.0
3. Percentage renewable* % 5% 0% 0% 0% 0%
Total recordable incident rate (TRIR) Incidents per mil hours 25 35 38 43 50
Total energy per m3** MJ 567 554 551 565 593
Near Miss Frequency Rate (NMFR) Incidents per mil hours 3,294 2,988 2,712 2,265 1,364
Water consumption m 3
2,696,730 2.450.830 2.331.316 2.638.321 2.461.785
Number of reported cases of silicosis 0 0 0 0 0
1. Total fresh water withdrawn m3 1,618,038 1.519.616 1.446.375 1.637.094 1.535.768
Customer Retention Ratio % 78% 77% 76% 81% 79%
2. Percentage recycled % 60% 60% 60% 60% 60%
Volume Retention Ratio % 99% 96% 98% 97% 95%
3. P
 ercentage in regions with High or % 4% 5% 6% 6% 7%
extremely High Baseline Water Stress
4. Water reclaimed m3 44,458 23,240 19,311 19,089 0
Fresh water consumption per m3** Litres 369 354 363 382 387
Waste to landfill Tonnes 5,670 1,258 1,932 1,409
Governance data
Terrestrial acreage disturbed** Hectare 38 55 55 Unit 2022 2021 2020 2019 2018
Percentage of impacted area restored** % 25% 40% 37% Gender diversity, Board % 33% 17% 17% 17% 17%
Production volume: Board Meeting Attendance rate % 100% 100% 97% 97% 96%
- AAC Million m3 3.3 3.2 2.9 3.2 3.0 CEO Pay Ratio Times 41 37 35 39 39
- CSU Million m3 1.1 1.1 1.1 1.1 1.1 Total amount of monetary losses as a result of
legal proceedings associated with cartel activi-
ties, price fixing, and anti-trust activities DKK 0 0 0 0 0

* A more in-depth assessment of the Group's carbon emissions to ensure compliance with the GHG has led to changes in CO2e Scope 1 and 2 emissions for comparison
figures from 2019 to 2021.
** Some numbers have been slightly adjusted during the transition to a more transparent ESG reporting system.
26 | H+H Su stainability Report 2022

SASB Construction Materials standard, content index

Sustainability Disclosure Topics & Accounting Metrics
Page reference
Topic Accounting metric Category Unit of measure Code or disclosure Comment

Greenhouse Gross global Scope 1 emissions, percentage covered Quantitative Tonnes (t) CO2-e, EM-CM-110a.1 P. 25 Comparison figures have been adjusted.
Gas Emission under emissions-limiting regulations Discussion and analysis Percentage (%) EM-CM-110a.2 Scope 2 has been updated to reflect market-based
Discussion of long-term and short-term strategy or efficiency factors.
plan to manage Scope 1 emissions, emissions reduction
targets, and an analysis of performance against those
targets

Air Quality Air emissions of the following pollutants: (1) NOx Quantitative Tonnes (t) EM-CM-120a.1 H+H emits NOx, SOx and PM10 from steam boilers
(excluding N2O), (2) SOx, (3) particulate matter (PM10), (exhaust fumes).
(4) dioxins/furans, (5) volatile organic compounds Systems are not currently in place to capture data on a
(VOCs), (6) polycyclic aromatic hydrocarbons (PAHs), consolidated process. A formalised process to document
and (7) heavy metals this is expected to be implemented during 2023.

Energy Management (1) Total energy consumed Quantitative Gigajoules (GJ), EM-CM-130a.1 P. 25 No alternative energy consumed, besides potential share
(2) percentage grid electricity Percentage (%) from the electricity provided by grid.
(3) percentage alternative Share of renewable energy includes renewable energy
(4) percentage renewable from purchased REC's.
Energy intensity has been adjusted to reflect net-output
instead of gross output in some selected factories.

Water Management (1) Total fresh water withdrawn, Quantitative Thousand cubic meters EM-CM-140a.1 P. 25
(2) percentage recycled, (m3), Percentage (%)
(3) p
 ercentage in regions with High or Extremely High
Baseline Water Stress

Waste Management Amount of waste generated, percentage hazardous, Quantitative Tonnes (t), EM-CM-150a.1 P. 25 Non-conformative output from the production process
percentage recycled Percentage (%) can as a rule of thumb always be reused in production.
Hence, only limited waste is created. For waste handled by
a service provider the waste to landfill is estimated.
There is no hazardous waste.
27 | H+H Su stainability Report 2022

Page reference
Topic Accounting metric Category Unit of measure Code or disclosure Comment

Biodiversity Impacts Description of environmental management policies and Discussion and analysis n/a EM-CM-160a.1 P. 17
practices for active sites
Terrestrial acreage disturbed, percentage of impacted Quantitative Acres (ac), Percentage EM-CM-160a.2 P. 25
area restored (%)

Workforce (1) Total recordable incident rate (TRIR) and Quantitative Rate EM-CM-320a.1 P. 25 Systems are not currently designed on employee and
Health & Safety (2) near miss frequency rate (NMFR) for (a) full-time Quantitative Number contractor level, so aggregated number is provided.
employees and (b) contract employees EM-CM-320a.2 P. 25 All reported numbers are measured per million hours
produced.
Number of reported cases of silicosis Registration follows Anglo-Saxon practice.

Product innovation Percentage of products that qualify for credits in sustain- Quantitative Percentage (%) by ­annual EM-CM-410a.1 H+H’s products are not specifically certified under any of
able building design and construction certifications sales revenue the frameworks in the standard.
Due to the longevity of the product, the thermal properties
and predominantly consisting of sand, lime and water,
H+H assumes to qualify for credits in most certification
processes.
Further clarification will follow when H+H’s products will
be included in the EU taxonomy definitions.

Total addressable market and share of market for prod- Quantitative Reporting currency, EM-CM-410a.2 H+H has estimates of the global markets, but due to large
ucts that reduce energy, water, and/or material impacts Percentage (%) variations in product quality, building methods, access
during usage and/or production to raw materials, cost of substitute materials etc. it is not
possible to verify reliable numbers in this regard.

Pricing integrity Total amount of monetary losses as a result of legal Quantitative Reporting currency EM-CM-520a.1 P. 25
& transparency proceedings associated with cartel activities, price fixing,
and anti-trust activities
28 | H+H Su stainability Report 2022

Accounting principles
Reporting period emissions in accordance with the GHG Protocol. • Total freshwater withdrawn is calculated using meter • CEO pay ratio is calculated as CEO compensation, as
1 January 2022 to 31 December 2022. This included enhancements to the methodology as readings and invoices reported in the Annual Report, divided by the median
well as setting a recalculation policy and has led to salary
Reporting scope adjustments to the 2019 base year GHG emissions that • Percentage water recycled is calculated as Water
All entities under financial control by H+H International were previously reported. recycled divided by Fresh water withdrawn where • Employee turnover ratio is calculated as total leavers
A/S as referenced in the Annual Report 2022 except for Water recycled is calculated indirectly as Water divided by full-time workforce
factories and joint-ventures acquired during 2022. The Definitions consumed according to bill-of-materials less Fresh
exception does not apply when calculating the number Climate water withdrawn Health & safety
of full time employees. The comparison figures do not • CO2e Scope 1 is calculated as combusted fuel type x • A fatality is a work-related injury that results in death
include divested subsidiaries. conversion factor per fuel type. For 1 tonnes of coal a • H+H has three classifications for waste: green waste,
conversion factor of 20.64 to GJ is used white waste, and scrap. Waste to landfill is calculated • Lost-Time Incident Frequency (LTIF) measures
Reporting framework as the total quantity of scrap sent to landfill by H+H. the frequency of Lost-Time Incidents and fatality
The report was prepared using the Nasdaq ESG Guide • CO2e Scope 2 is calculated as purchased MWh x Reported data are based on invoices from external incidents per million hours divided by total hours
2.0 and the Sustainability Accounting Standards Board conversion factor of 3.6 to GJ is used suppliers and estimates where data is not available worked following the OSHA guidelines
(SASB) framework as guidance to determine report
content. Where relevant, definitions have been adapted • CO2e Scope 3 is calculated as purchased materials • Production volume is defined as produced AAC and • Near Miss Frequency Rate for employees (NMFR)
to generally accepted methodology in the UK and EU. in scope x efficiency factor. Where efficiency factors CSU (net) measured in m3 measures number of Near Miss Reports per million
are disclosed by the supplier this is used. If such are hours divided by total hours worked following the
Controls not available generic industry efficiency factors are Diversity & equality OSHA guidelines
Data regarding number of employees and gender applied • Full-time workforce is defined as full-time employees
are generated from our HR systems. Data regarding + temporary workers • Sickness absence is calculated as total sick days
fatalities and accidents, energy consumption, waste • CO2e per m³ (Scope 1) and CO2e per m³ (Scope 2) divided by average number of FTEs for the year
and water usage are reported through the operations are calculated as Scope 1 and Scope 2 divided by • Gender diversity is defined as (female FTEs + female
management system that follows normal financial net-production volume temporary workers) divided by FTEs Customer relations
processes to ensure consistency and is validated • Customer retention ratio measures the number
against the external financial reporting. The data is • Water reclaimed is calculated using meter readings • Gender diversity, Group Management includes of customers invoiced during 2022 divided by the
not subject to any formal internal auditing, but verified the Executive Board and Senior Executives at H+H number of customers invoiced during 2021
through business analysis, benchmarks, and interviews. • Total Energy is calculated as combusted fuel type x International A/S
power factor per fuel type + used electricity • Volume retention ratio measures how big a share of
Greenhouse gas protocol • Gender pay ratio is calculated as median salary of the sold volume that was invoiced to customers who
As part of the science-based target setting process, • Total Energy per m³ is calculated as Total Energy male staff divided by median salary of female staff also received invoices from H+H the year before
H+H undertook a detailed mapping of our GHG divided by production volume
29 | H+H Su stainability Report 2022

H+H at a glance
H+H is a leading provider of solutions and materials for wall building. Over the recent years, H+H has
grown significantly through acquisitions and now has a strong and diversified market position across
its geographies, serving as a solid foundation for continued growth.

Employees Revenue (DKKm) Sustainability Factories Acquisitions Revenue by product line (FY 2022)

1,739 3,604 46% 32 24 71% 29%

We have more than 1,700 In 2022, we generated total By 2030, reduce absolute We have 32 factories across Since 2014, we have acquired Both products are key components for energy-efficient
employees working across revenue of DKK 3,604 million Scope 1 and 2 GHG emissions Northern and Central Europe 24 factories. These have wall systems.
eight different countries in and organic growth of 14%. by 46% from a 2019 base with a total annual output contributed to a significant
Northern and Central Europe. AAC and CSU accounted year, equivalent to a 4.2% of close to 4.5 million cubic expansion of our factory Aircrete (AAC) Calcium silicate (CSU)
Approximately two-thirds for 71% and 29% of total reduction each year. metres of wall-building network and have more combines strength and is a heavy and dense wall-
work in our factories. revenue, respectively. materials. than tripled our white-stone durability with fire resistance, building material primarily
By 2050, achieve net-zero businesses in both Germany low weight and excellent used for residential high-rise
emissions. and Poland. thermal insulation making it the buildings. The product is fire
ideal material for the residential resistant and has a very high
low-rise housing market. degree of sound insulation.
30 | H+H Su stainability Report 2022

Business model
Resources Added value

People Customer value

We value our workforce, recognise the Quality manufacturing Value-added sales By understanding our customers, their
advantages of diversity, and believe in We follow a lean manufacturing We support our customers from local needs, and the industry trends,
the equality of people process to improve efficiency and the early planning stage and we help overcome challenges, elimi-
eliminate waste. Further, targeted throughout the wall-building nate waste, and manage complexities
Raw materials capital investments improve process. We aim to be the ideal throughout the wall-building process
Our products are made of sand, water, reliability, throughput and quality partner and a one-stop shop for
and lime, with cement and aluminium across the production platform every wall-building project Modern and carbon-friendly products
added for aircrete Our products offer improved indoor
climate and energy savings as well as
Factory network Our business fire resistance and better acoustic insu-
We have created a strong network of lation between rooms. In addition, the
factories and sales offices with national products are long-lasting and can be
reach within the countries in which we integrated into a circular economy
operate
We enable better homes for our Safe and attractive work environment
Unique market conditions for growth Employment and working conditions
Structural undersupply of housing,
communities must be safe, fair, and non-discrimina-
demographic growth, urbanisation, and tory to attract top talents and support
changing housing needs provide solid the development and career ambitions
growth platform of our employees

Solid capital structure Diversified market Strategy execution Shareholder value

Our strong and flexible capital structure Our product range is diverse We have a strong track record We will continue to pursue profitable
supports our continued growth journey and its flexibility allows for of strategy execution. Through growth through acquisitions and
and sustainable shareholder value various applications. As a consolidation of the European investments in the existing production
creation result, the customer segments white-stone markets, we have platform to generate robust, long-term
are also diverse and provide a realised significant synergies value for our shareholders. Further,
differentiated risk profile related to both pricing, sourcing, H+H may return excess capital to
and sales channels shareholders by means of dividends
and/or share buy-back programmes
31 | H+H Su stainability Report 2022

EU Taxonomy
Our products play an important However, the manufacture of concrete products for Revenue OPEX
construction purposes (NACE 23.6.1) which is where We screened the activities listed in the technical We screened the activities listed in the technical
role in supporting Europe to our products are classified is not yet included in annexes under the Delegated Act 2021/2139 and annexes under the Delegated Act 2021/2139 and
achieve carbon neutrality by 2050. the Taxonomy as a separate economic activity. The identified no material eligible revenues. Revenue identified no eligible operational expenditures, mainly
Taxonomy Technical Report (June 2019, p191- 192) is defined as revenue included in the consolidated due to our non-eligible revenue activities. Operating
The high resource efficiency gives states that concrete products are not included because financial statements for the year 2022, page 62. expenditures as per the EU Taxonomy are defined as in
them low environmental impact in the cement content and total GHG emissions can 2022 directly incurred, non-capitalizable cost relating
vary significantly based on the specifications of the CAPEX to research and development, building renovations,
all phases of their life cycle, from application that the concrete will be used for. For this We screened the activities listed in the technical short term leases, and the repair and maintenance of
processing of raw materials to the reason, the manufacture of concrete (NACE C.23.6) and annexes under the Delegated Act 2021/2139 and property, plant and equipment.
concrete products are not covered by the Taxonomy. identified 3% eligible capital expenditures. The
disposal of waste, thus making it Hence, H+H’s activities are not eligible, and revenue Taxonomy-eligible CAPEX primarily includes activities Other disclosures
the right building material to help derived from products or services eligible is 0. related to transport (6.5) as well as water treatment There is no CAPEX double counting in the numerator
systems (5.1). CAPEX is defined as additions of tangible across economic activities, as we have assessed each
meet the demands for circularity The EU Taxonomy is still under development and due assets and intangible assets (excluding goodwill) as material CAPEX individually.
and GHG emissions reduction. to the evolving aspect of the Regulation, we expect included in the consolidated financial statements for
that reporting will change and develpo over the the year 2022, note 13 & 14. No KPIs have been disaggregated in the reporting.
coming years. Therefore, we will reassess the reporting
requirement on an annual basis.

EU Taxonomy Disclosure

2022 Revenue CAPEX OPEX

Taxonomy-eligible activities 0% 3% 0%
Taxonomy-non-eligible activities 100% 97% 100%

Taxonomy-aligned activities N/A N/A N/A

Taxonomy-non-aligned activities N/A N/A N/A
32 | H+H Su stainability Report 2022

EU Taxonomy - Turnover
Sustainable contribution criteria DNSH criteria
Propor- Climate Climate Climate Climate Aligned Category
Absolute tion of Change Change Water & Change Change Water & Minimum Propor- Category (transi-
turnover turnover Miti­ Adap­ Marine Circular Bio- Miti­ Adap­ Marine Circular Bio- Safe- tion of (enabling tional
Economic activities - Turnover (m DKK) (%) gation tation Resources Economy diversity gation tation Resources Economy diversity guards ­Turnover activity) activity)

A. Taxonomy - Eligible Activities

A1. Environmentally sustainable acitivities
(Taxonomy-aligned)
Turnover of environmentally sustainable activities
(Taxonomy-aligned) 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0% 0% 0%
A2. Taxonomy-eligible but not aligned activities
Turnover of non-aligned activities 0 0%
Total (A1+A2) 0 0%
A. Taxonomy - Non-Eligible Activities
Turnover of non-eligible activities (B) 3.604 100%
Total (A+B) 3.604 100%

H+H does not have any eligible acitivities, hence no turnover is allocated to the numerator.
33 | H+H Su stainability Report 2022

EU Taxonomy - CAPEX
Sustainable contribution criteria DNSH criteria
Propor- Climate Climate Climate Climate Aligned Category
Absolute tion of Change Change Water & Change Change Water & Minimum Propor- Category (transi-
CAPEX CAPEX Miti­ Adap­ Marine Circular Bio- Miti­ Adap­ Marine Circular Bio- Safe- tion of (enabling tional
Economic activities - CAPEX (m DKK) (%) gation tation Resources Economy diversity gation tation Resources Economy diversity guards CAPEX activity) activity)

A. Taxonomy - Eligible Activities

A1. Environmentally sustainable acitivities
(Taxonomy-aligned)
CAPEX of aligned activities 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0% 0% 0%
A2. Taxonomy-eligible but not aligned activities
5.1 - Construction, extension and operation of water
­collection, treatment and supply systems 3 1%
6.5 - Transport by motorbikes, passenger cars and light
commercial vehicles 5 2%
6.6 - Freight transport services by road 19 7%
7.1 - Construction of new buildings 2 1%
CAPEX of non-aligned activities 28 10%
Total (A1+A2) 28 10%
A. Taxonomy - Non-Eligible Activities
CAPEX of non-eligible activities (B) 270 90%
Total (A+B) 298 100%

Primary source of CAPEX contributing to the numerator is lease of forklift trucks and passenger cars (DKK 19 and 5 mil respectively) as well as investment in water treatment system (DKK 3mil). Please refer to the annual report 2022
(note 13 & 14) for more information about additions.

No formal CAPEX-plan in relation to EU Taxonomy has been developed in 2022, but will be reassessed in 2023.
34 | H+H Su stainability Report 2022

EU Taxonomy - OPEX
Sustainable contribution criteria DNSH criteria
Propor- Climate Climate Climate Climate Aligned Category
Absolute tion of Change Change Water & Change Change Water & Minimum Propor- Category (transi-
OPEX OPEX Miti­ Adap­ Marine Circular Bio- Miti­ Adap­ Marine Circular Bio- Safe- tion of (enabling tional
Economic activities - OPEX (m DKK) (%) gation tation Resources Economy diversity gation tation Resources Economy diversity guards OPEX activity) activity)

A. Taxonomy - Eligible Activities

A1. Environmentally sustainable acitivities
(Taxonomy-aligned)
OPEX of environmentally sustainable activities
(Taxonomy-aligned) 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0% 0% 0%
A2. Taxonomy-eligible but not aligned activities
OPEX of non-aligned activities 0 0%
Total (A1+A2) 0 0%
A. Taxonomy - Non-Eligible Activities
OPEX of non-eligible activities (B) 170 100%
Total (A+B) 170 100%

H+H does not have any eligible OPEX, hence no OPEX is allocated to the numerator.
35 | H+H Su stainability Report 2022

Contact information
H+H Benelux H+H Sweden H+H Poland
Group Head Office Nikkelstraat 4 Mobilvägen 3 [Link] 6
6031 TR Nederweert 246 43 Löddeköpinge 03-046 Warsaw
H+H International A/S Netherlands Sweden Poland
Lautrupsgade 7, 5th Floor
2100 Copenhagen Ø Tel.: +31 49 54 50 169 Tel.: +46 40 55 23 00 Tel.: +48 22 51 84 000
Denmark [Link] [Link] [Link]

Telephone: +45 35 27 02 00
E-mail: info@[Link] H+H Denmark H+H UK H+H Czech Republic
Skanderborgvej 234 Celcon House, Ightham Beroun-Město 660
[Link] 8260 Viby J Sevenoaks, Kent TN15 9HZ 26601 Beroun
Company Reg. No.: 49 61 98 12 Denmark UK Czech Republic

Tel.: +45 70 24 00 50 Tel.: +44 17 32 88 63 33 Tel.: +420 311 644 705

[Link] [Link] [Link]/cs/

H+H Germany H+H Switzerland

Klaus-Bungert-Straße 6a Aarauerstrasse 75
40468 Düsseldorf 5200 Brugg
Germany Switzerland

Tel.: +49 45 54 70 00 Tel.: +41 56 46 05 466

[Link] [Link]
 Design and production: Noted
H+H International A/S
Lautrupsgade 7, 5th Floor
2100 Copenhagen Ø
Denmark

Telephone: +45 35 27 02 00
Email: info@[Link]

[Link]