The company declares whether or not it pursues a sustainability strategy. It explains what concrete measures it is undertaking to operate in compliance with key recognised sector-specific, national and international standards.

We firmly believe that acting sustainably is key to future-proofing Deutsche Wohnen as well as to the benefit of our stakeholders. Thus, we strive to play a leading role in this field within the residential property industry and to enhance the transparency and comparability of sustainable activities. Our strategic approach is to combine cost-effectiveness with housing quality and energy efficiency. We invest heavily in our portfolios, proactively modernise them and refurbish them. In doing so, we always pay attention to energy considerations and the use of environmentally friendly and long-lasting materials. Everything we do is based on our corporate culture, which centres on credibility, transparency and ethical behaviour. As part of our Group strategy, sustainability is also embedded in our day-to-day workflows.

As a primary area of action, responsible corporate management provides the framework for the other areas of action also set out in our mission statement. These include responsibility for our property portfolio and new construction as well as for our clients and employees. Furthermore, we pay attention to the impact of our business activities on the environment and the climate and are committed to supporting society in Deutsche Wohnen’s environment. A detailed description of the areas of action and the opportunities and challenges associated with them can be found in our Sustainability Report 2017, p. 12–13.
In addition to our sustainability mission statement, we have revised our sustainability programme from a strategic perspective.

A list of the goals and measures contained in our sustainability programme can be found under Criterion 3, Objectives.

2. Materiality

The company discloses the aspects of its business operations that have a significant impact on sustainability issues and what material impact sustainability issues have on its operations. It analyses the positive and negative effects and provides information as to how these insights are integrated into the company’s processes.

With its core line of business – providing housing – the real estate industry has a direct influence on how people live together and the way in which cities are designed. As one of Europe’s three largest real estate companies, Deutsche Wohnen therefore believes it has an obligation to act responsibly that goes beyond its economic objectives.

We understand the importance of a constructive dialogue with all relevant and interested parties as it enables us to recognise challenges and opportunities and approach them proactively. Ensuring transparency and intensive dialogue with our stakeholders allows us to pick up on directional impulses in the company’s environment as well as set our own.

In line with the GRI guidelines, we conducted our second stakeholder survey in autumn 2015. This entailed asking more than 500 employees, business partners, tenants, purchasers, analysts, investors, and figures from both politics and society for their opinions online. We asked them to identify and assess the issues they considered to be most important for Deutsche Wohnen within our areas of action. Deutsche Wohnen’s Management Board and senior executives then identified the most relevant topics from the company’s perspective at a subsequent third-party-moderated workshop. These form the focus of our sustainability management system and the related reporting. In conjunction with economic impact considerations, these have guided the selection of the GRI Aspects and Indicators included in our sustainability report.

Deutsche Wohnen SE has published a consolidated non-financial statement for the financial year 2017 in accordance with section 315b ff. of German Commercial Code (HGB) pursuant to the German Act Implementing the CSR Directive (CSR-Richtlinie-Umsetzungsgesetz – CSR-RUG). This statement addresses those material, non-financial matters which have been identified as being of relevance to the business activities of Deutsche Wohnen and as having a significant impact on the environment, the company’s employees, social issues human rights and the problem of corruption and bribery. On the basis of the GRI Standards, Deutsche Wohnen assessed the impact of its activities on the sustainability issues specified in the legislation and evaluated their relevance to understanding the business development and results of the company. Here you can find the non-financial statement.

As the concept of materiality is interpreted differently in GRI and CSR-RUG, we have continued to use the GRI guidance to determine material topics for our sustainability report. We have scheduled the next stakeholder survey for autumn 2018. Once this has been completed, we will also take into account an internal assessment of the issues based on the impact of our business activities, as required by the new GRI Standards.

List of material topics by area of action

Responsible corporate management
- Long-term economic stability
- Transparency and dialogue with stakeholders
- Clear corporate vision and strategy with regard to sustainability
- Compliance

Responsibility for the property portfolio and sustainable new construction
- Regular maintenance and modernisation
- Creation of housing in conurbations
- Dialogue with tenants
- Selection of sustainable suppliers and materials for our maintenance, modernisation and new construction work

Responsibility for employees
- Professional training and continuing education
- Promotion of work-life balance and family-friendly working conditions
- Diversity and equal opportunity
- Transparent structures and rights of co-determination

Responsibility for the environment and the climate
- Innovation in the context of the generation of heat and energy for our holdings
- Modernisation of our holdings with a view to energy conservation

Responsibility towards society
- Development of residential districts
- Safeguarding of historic building structures and preservation of historic buildings

For effects of our business activities in respect of the various sustainability aspects please see also Criterion 1, Strategic Analysis and Action.

3. Objectives

The company discloses what qualitative and/or quantitative as well as temporally defined sustainability goals have been set and operationalised and how their level of achievement is monitored.

Our sustainability programme consists of strategic and operationalised targets and associated measures. It also documents our progress in the relevant areas. The programme paves the way for steering our sustainability-related objectives, which also contribute towards achieving our corporate goals. At the beginning of this year, the various divisional managers worked with the Management Board to develop the new strategic sustainability programme, which is geared more heavily towards targets for specific areas of action and includes concrete measures and their management via key figures. The new sustainability programme is presented in our sustainability report 2017.

Sustainability programme

1. RESPONSIBLE CORPORATE MANAGEMENT
Strategic target	Operationalised targets	Deadline
Strategically manage sustainability activities	Initiate a strategic sustainability programme Establish a sustainability committee Make long-term targets a component of the remuneration system for the Management Board and executives	2018 2018 2019
Embed Deutsche Wohnen’s sustainability philosophy more strongly in the minds of business partners and suppliers	Initiate a Code of Conduct for business partners and suppliers Work predominantly with regional suppliers and business partners Pay greater attention to ecological aspects in conjunction with procurement (maintenance, modernisation, new construction)	2019 continous 2018
Expand stakeholder dialogue	Actively include sustainability issues in stakeholder communication Conduct regular stakeholder surveys in relation to sustainability activities and requirements (every three years) Develop new dialogue formats with political office-holders at national, state and local level	2018 2018 2018

2. RESPONSIBILITY FOR THE PROPERTY PORTFOLIO AND SUSTAINABLE NEW CONSTRUCTION
Strategic target	Operationalised targets	Deadline
High level of customer satisfaction	Derive measures after conducting regular tenant surveys every two years Constantly further develop tenant dialogue formats (especially by expanding digital	continous continous
Portfolio meets good, up-to-date, future-proof quality criteria, thereby exceeding the industry standard	Investment programme in excess of EUR 1.2 billion to refurbish and modernise 30,000 residential units	2022
Create new housing in conurbations	Investment programme to create 2,500 residential units in line with widely accepted sustainability criteria	2022

3. RESPONSIBILITY FOR EMPLOYEES
Strategic target	Operationalised targets	Deadline
Targeted recruitment and integration of new employees	Implement a staff recommendation programme Set up various talent pools Expand active sourcing	2018
Keep employee retention levels high	Conduct regular employee surveys every two years Digitalise and optimise processes to boost job attractiveness Introduce a needs-based digital health management system Expand long-term incentive systems	2018
Adjust staff development to the requirements of the new working world	Strengthen executives in their changing role Expand digital learning and communication formats Broaden the range of traineeships and dual courses of study Offer at least 90% of trainees a permanent contract following successful completion of their training Support junior staff at the company via a talent programme	2018
Ensure there is no discrimination	Comply with Code of Conduct Appoint women to at least 40% of executive positions within the Deutsche Wohnen Group	continous

4. RESPONSIBILITY FOR THE ENVIRONMENT AND THE CLIMATE
Strategic target	Operationalised targets	Deadline
Save 20,000 t of CO₂emissions from 2022 onwards	Carry out the refurbishment and modernisation of 30,000 residential units with a view to energy conservation Replace outdated heat generation plants with modern systems Initiate a mass pilot project for the smart home solution actuator/sensor technology to enable intelligent building management for 3,000 residential units in Berlin Gradually reduce the portfolio of oil-fuelled properties to a maximum of 1%, switching to eco-friendly energy sources	2022 2020 2018 2021

5. RESPONSIBILITY TOWARDS SOCIETY
Strategic target	Operationalised targets	Deadline
Expand, continue and structure corporate social responsibility activities	Implement a guideline for social and cultural activities Draft a concept for taking issues of construction culture into account more strongly when completing new construction and modernisation projects Commit to supporting youth sport	2021 2019 2018
Promote a vibrant neighbourhood structure	Make 4–5% of new letting space available for social and charitable purposes Actively shape (small) commercial sites within the portfolio	continous continous

The assessment and prioritisation of objectives and goals was carried out in a workshop together with the Management Board and the relevant specialists and managers. The continuous collection of key figures and the setting of deadlines in the sustainability programme are intended to monitor the achievement of objectives.

4. Depth of the Value Chain

The company states what significance aspects of sustainability have for added value and how deep in the value chain the sustainability criteria are verified.

Added value
Deutsche Wohnen’s supply chain centres on our core line of business: residential property management. We purchase energy, procure services from both tradespeople and technical firms, and award contracts for supply and disposal activities. Building materials are procured by the construction and planning companies we hire.

Overall, our supply chain can be broken down into nine sections:
- Ongoing maintenance and tenant turnover
- Refurbishment and modernisation projects
- Development and planning for new construction and redensification
- Energy management
- Multimedia
- Insurance policies
- Sub-metering
- Waste management
- Infrastructural facility management
(A breakdown of the supply chain as well as additional information on this topic can be found in our Sustainability Report 2017, p. 36.)

Ecological challenges primarily relate to resource consumption in our portfolio, in particular energy, heat and water, which depend to a large extent on the individual consumption and user behaviour of our tenants, which we have only little influence on. Additional challenges relate to maintenance and modernisation projects in the form of pre-existing site contamination, planning of new construction projects including sustainability criteria, and management of our residential properties (energy, waste and facility management). Social aspects that increasingly need to be taken into consideration during the planning and implementation of modernisation measures as well as in new construction and redensification projects, are mainly due to the megatrend of urbanisation. For further information on the measures we are taking, see Criterion 10, Innovation and Product Management, and Criteria 11 to 13, which deal with environmental aspects.

Supplier relationships
We primarily source services from Germany or the respective region. The uppermost level of our supply chain (tier 1) is located solely in Germany.

We use supplier scorecard software to assess our partner’s environmental and social performance. Scorecards are produced by DWB as part of its procurement and investment management processes. We have approximately 1,400 agreements with service providers, which are recorded and managed centrally in a Web-based contract management system. As well as enhancing transparency and efficiency, this digitised process improves our partner management through its flexible reminder mechanisms and escalation levels. As Deutsche Wohnen only operates in Germany, our suppliers’ business conduct is governed by the extensive legislation which applies here concerning ecological aspects, human rights and working practices. In addition to this, we have incorporated human rights and social issues such as preventing illicit work and ensuring payment of the minimum wage into our general agreements.

In future, environmental and social checks will not only be run on companies offering their services for the first time for new construction projects but also for refurbishment and modernisation work on existing holdings.

Additional information on our relationships with suppliers can be found under Criterion 17, Human Rights, and the corresponding performance indicators.

1. Strategic Analysis and Action en

2. Materiality en

3. Objectives en

4. Depth of the Value Chain en

Key Performance Indicators to criteria 1 to 4 en