Value Beyond
The Surface
Report by the Board of Directors
and Financial statements 2025
1
Annual Report 2025
Contents
Contents
Report by the Board of Directors . . . . . . . . . . . . . . . . . 1
Key figures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Key figures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Calculation of key figures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Financial statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
Consolidated income statement . . . . . . . . . . . . . . . . . . . . . . . . . 85
Consolidated statement of comprehensive income . . . . . 85
Consolidated statement of financial position . . . . . . . . . . . . 86
Consolidated statement of cash flows . . . . . . . . . . . . . . . . . . . 87
Consolidated statement of changes in equity . . . . . . . . . . . . 88
Notes to the consolidated financial statements . . . . . . . . . 89
Financial statements of the parent company . . . . . . . . . . . 126
Proposal by the Board of Directors for distribution
of profit and Auditor’s Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135
Auditor’s Report . . . . . . . . . . . . . . . . . . . . . . . . . . . 136
Annual Report 2025
Report by the Board of Directors
1
Report by the
Board of Directors
Financial performance and governance .................................1
Shares and shareholders .................................................................5
Risks and risk management ..........................................................7
Sustainability Report ..........................................................................10
Key figures..................................................................................................80
Annual Report 2025
Report by the Board of Directors
1
Financial performance and governance
Financial performance
Continuing operations financial performance
Net sales for 2025 amounted to EUR 346.0 million (349.5). Net sales decreased
by 1.0%. The adjusted EBITA for 2025 was EUR 7.0 million (1.2), representing 2.0%
(0.3%) of net sales. The adjusted operating profit for 2025 was EUR 5.5 million (-0.3),
and operating profit totalled EUR 3.0 million (-31.8). Net sales increased in Facility
Services Sweden and decreased in Facility Services Finland. The decline in net sales
in Facility Services Finland was influenced by the low-snow early months of 2025
and the planned streamlining of the contract portfolio. Demand for data-driven
cleaning services and AI-assisted energy efficiency services remained strong. In
Facility Services Sweden, net sales increased due to newly won customer accounts
and the strengthened Swedish krona. In Finland, measures to streamline the cost
structure and improve operational efficiency continued, and the division’s operating
profit improved clearly. Statutory social costs increased compared to the reference
period.
Profitability improved compared to the reference period, particularly in property
maintenance services. In the cleaning service line, profitability remained at a good
level.
Division reviews
Facility Services Finland
Net sales for Facility Services Finland in January–December were EUR 224.4
million (238.0). The decline in net sales was affected by the planned streamlining
of the contract portfolio as well as the low-snow early months of 2025. Demand for
data-driven cleaning services and AI-assisted energy efficiency services remained
strong. Adjusted EBITA was EUR 12.6 million (9.9). Measures to streamline the cost
structure and improve operational efficiency continued, and the division’s operating
profit improved clearly. Statutory social costs increased compared to the reference
period. Profitability improved compared to the reference period particularly in
property maintenance services. In the cleaning service line, profitability remained
at a good level. Adjusted operating profit was EUR 12.4 million (9.6). Operating profit
totalled EUR 11.1 million (9.4). Operating profit was adversely affected by a total of
EUR 1.3 million in items affecting comparability, mainly related to the efficiency
programme.
Facility Services Sweden
Net sales for Facility Services Sweden in January–December increased to EUR 121.9
million (111.9). Net sales grew as a result of newly won customer accounts as well
as the strengthened Swedish krona. Adjusted EBITA was EUR –2.7 million (–6.3).
The division’s loss decreased as expected. Measures to simplify and streamline
operating models and to adjust the cost level are continuing. In 2025, profitability
improved in the cleaning service line as well as in technical property services in
both the public and private sectors. The adjusted operating profit was EUR –3.9
million (–7.5). Operating profit totalled EUR –5.3 million (–35.1). Operating profit was
improved by the reversal of provisions related to loss-making contracts, amounting
to EUR 2.9 million in total. Operating profit was adversely affected by items affecting
comparability totalling EUR 4.3 million, mainly related to the ongoing legal process
and the efficiency programme.
Discontinued operations
The Extraordinary General Meeting of Lassila & Tikanoja plc held on 4 December
2025 approved the partial demerger. On 18 December 2025, the Board of Directors
of Lassila & Tikanoja plc decided to implement the partial demerger. On 31
December 2025, Lassila & Tikanoja plc announced that the partial demerger had
been registered in the Trade Register. The circular economy businesses transferred
to the new Lassila & Tikanoja plc in the partial demerger have been presented as
discontinued operations in accordance with IFRS 5. The operating profit of the
discontinued operations for January–December was EUR 44.2 million (41.6). The
net sales of the discontinued operations were EUR 426.7 million (424). The income
statement for the discontinued operations includes the net sales and the costs
directly attributable to the circular economy business, which will be eliminated from
the Group after the demerger. In addition, the result of the discontinued operations
includes the demerger gain and the demerger-related expenses as well as the
translation differences accumulated from the circular economy business that were
recognised in the result in connection with the demerger.
MEUR 2025 2024 Change %
Net sales
Facility Services Finland 224.4 238.0 -5.7
Facility Services Sweden 121.9 111.9 9.0
Interdivisional net sales -0.4 -0.4
Group, continuing operations 346.0 349.5 -1.0
Discontinued operations 426.7 424.0 0.6
Operating profit
Facility Services Finland 11.1 9.4 18.1
Facility Services Sweden -5.3 -35.1 84.8
Group administration and others -2.7 -6.1 55.1
Group, continuing operations 3.0 -31.8
Discontinued operations 44.2 41.6 6.6
MEUR 2025 2024 Change %
Adjusted Operating Profit
Facility Services Finland 12.4 9.6 29.8
Facility Services Sweden -3.9 -7.5 -47.7
Group administration and others -2.9 -2.4 -24.6
Group, continuing operations 5.5 -0.3
% 2025 2024
Operating margin
Facility Services Finland 4.9 3.9
Facility Services Sweden -4.4 -31.3
Group administration and others 0.9 -9.0
Adjusted operating margin
Facility Services Finland 5.5 4.0
Facility Services Sweden -3.2 -6.7
Group administration and others 1.6 0.1
MEUR 2025 2024
Gross capital expenditure
Facility Services Finland 0.9 1.1
Facility Services Sweden 0.1 0.1
Group administration and others 0.3 0.1
Group, continuing operations 1.3 1.4
MEUR 2025 2024
Capital employed
Facility Services Finland 12.1 17.0
Facility Services Sweden 31.0 29.9
Group administration and others 17.8 349.2
Group 60.9 396.1
Annual Report 2025
Report by the Board of Directors
2
% 2025 2024
Return on capital employed (ROCE)
Facility Services Finland 80.2 51.4
Facility Services Sweden -17.2 -77.9
Group 77.8 3.3
The figures include continuing and discontinued operations
Research and development
The continuing operations had no research and development activities during the
financial period.
Information on key intangible assets
The continuing operations have no key intangible assets.
Financing and capital expenditure
The balance sheet at the reporting date includes the continuing operations, while
the comparative period balance sheet includes both continuing and discontinued
operations. The cash flow for the financial year includes both continuing and
discontinued operations. The net cash flow from operating activities for January–
December 2025 was EUR 75.6 million (81.4). Net cash flow from operating activities
after investments was EUR 44.2 million (40.8). The net cash flow after investments
for the review period was improved by lower operational investments compared
to the reference period and weakened by the change in working capital. During
the review period, EUR 4.7 million of working capital was tied up (released 3.2).
The increase in trade receivables was the main factor tying up working capital in
January–December.
Interest-bearing liabilities totalled EUR 19.8 million (186.9) at the end of the review
period. Interest-bearing net debt amounted to EUR 4.1 million (153.0). The average
interest rate of long-term loans excluding lease liabilities was 3.2% (3.8). On 27
June 2025, Lassila & Tikanoja plc entered into unsecured financing arrangements
consisting of a EUR 35 million term loan and a EUR 15 million combined term
loan and revolving credit facility agreement with OP Corporate Bank plc. On 30
June 2025, the company drew a total of EUR 40 million under these facilities and
simultaneously repaid a EUR 40 million bank loan. In addition, the company
entered into a EUR 40 million revolving credit facility agreement with Danske
Bank A/S, Finland Branch. Through these financing arrangements, Lassila &
Tikanoja plc refinanced its long-term debt that would have matured during 2026.
The agreement on the EUR 35 million term loan with OP Corporate Bank plc also
included an uncommitted additional financing option, which Lassila & Tikanoja
utilised to draw a EUR 15 million term loan on 16 September 2025. The drawn loan
was automatically converted, in accordance with its terms, into part of the EUR 35
million term loan.
The EUR 35 million and EUR 15 million term loans, the EUR 15 million combined
term loan and revolving credit facility, and the EUR 40 million revolving credit facility
will mature in the second quarter of 2028, and the agreements include a two-year
extension option. The financing arrangements are subject to the following financial
covenant conditions: equity ratio and net debt to EBITDA. Compliance with the
covenant conditions is monitored quarterly.
The company has planned a partial demerger in which its circular economy
businesses will be separated into a new listed company. In connection with this, the
agreement on the EUR 35 million term loan concluded with OP Corporate Bank
plc also included an EUR 80 million bridge loan. The bridge loan was entered into to
finance the repayment and/or redemption of the previously issued EUR 75 million
unsecured bond to the extent that bond investors exercise their early redemption
right related to the partial demerger in accordance with the bond terms.
On 7 August 2025, Lassila & Tikanoja announced that it would initiate a written
procedure concerning its EUR 75 million sustainability-linked bond maturing in
2028, with a fixed annual coupon of 3.375 per cent, in order to obtain the necessary
consents, waivers and decisions relating to amendments of the bond terms in
connection with the partial demerger of Lassila & Tikanoja announced on 7 August
2025. In the partial demerger, all assets, liabilities and responsibilities of Lassila &
Tikanoja relating to, or primarily serving, the circular economy business would be
transferred to a newly established independent company to be named the new
Lassila & Tikanoja plc (‘the Receiving Company’). According to the proposal, all
obligations and liabilities of the issuer arising from or relating to the bonds would be
transferred solely to the Receiving Company, which would become the new issuer of
the bonds.
On 29 August 2025, Lassila & Tikanoja announced that the required majority of
the bondholders participating in the written procedure had voted in favour of the
proposal, and the proposal was therefore approved. One hundred per cent of the
votes cast supported the proposal, representing 99 per cent of the outstanding
bonds. Following the approval of the proposal in the written procedure, Lassila &
Tikanoja cancelled the EUR 80 million bridge loan in September 2025.
On 31 December 2025, Lassila & Tikanoja announced that the issuer change
related to its EUR 75 million sustainability-linked bond had been completed. As of
31 December 2025, the amended terms and conditions of the bond apply, and all
obligations and liabilities of the issuer arising from or relating to the bond have been
transferred exclusively to the new Lassila & Tikanoja plc, which has become the new
issuer of the bond.
As a result of the partial demerger, Luotea retained a EUR 5 million term loan and
a EUR 10 million revolving credit facility. These will mature in the second quarter
of 2028, and the related agreements include a two-year extension option. The
financing arrangements are subject to the following financial covenants: equity ratio
and net debt-to-EBITDA.
Compliance with the covenant conditions is monitored quarterly. At the end of
the review period, the EUR 100.0 million commercial paper programme was entirely
undrawn (undrawn). Two EUR 10.0 million overdraft facilities and the EUR 10.0
million committed revolving credit facility were also undrawn (in the comparison
period, the EUR 40 million revolving credit facility was undrawn).
Net finance expenses for the review period decreased to EUR –0.7 million (–0.8).
The equity ratio was 29.1% (35.4%) and the gearing ratio 10.1% (73.2%). The Group’s
equity totalled EUR 41.1 million (209.2). Net debt-to-adjusted EBITDA was 0.2.
Equity was reduced by the EUR 19.1 million dividend distributed for the 2024
financial year, which was paid to shareholders on 7 April 2025 in accordance with
the resolution of the Annual General Meeting held on 27 March 2025. The impact of
translation differences arising from changes in the Swedish krona exchange rate on
equity was EUR –1.9 million.
Cash and cash equivalents totalled EUR 15.7 million (33.9) at the end of the review
period. The company’s equity includes an equity-increasing entry related to the
distribution of cash resulting from the partial demerger (+EUR 1.0 million); at the
balance sheet date, this EUR 1.0 million had been recorded as a receivable from the
new Lassila & Tikanoja. During the financial year, equity was increased by the result
of discontinued operations amounting to EUR 160.4 million and, on the other hand,
reduced by the fair value of the assets transferred in the demerger amounting to
EUR –313.3 million. The net effect of these items weakened the Company’s equity by
EUR –152.9 million during the financial year.
Other operating income includes the share of the new Lassila & Tikanoja of the
partial demerger costs (+EUR 4.2 million) as well as other expenses attributable to
the new Lassila & Tikanoja (EUR 0.7 million). These items, totalling EUR 4.9 million,
were recorded as a receivable from the new Lassila & Tikanoja at the balance sheet
date.
Loans, liabilities and contingent liabilities to related parties
Related party transactions are disclosed in Note 5.4 Related Party Transactions
to the consolidated financial statements. Subsidiary loans and their terms are
presented in Note 11 to the parent company’s financial statements.
Outlook
Adjusted EBITA for 2026 is expected to increase or to increase significantly
compared to the adjusted EBITA for 2025 (EUR 7.0 million).
Resolutions by the Annual General Meeting
The Annual General Meeting of Lassila & Tikanoja plc held on 27 March 2025
adopted the financial statements and the consolidated financial statements for
2024, discharged the members of the Board of Directors and the President and
CEO from liability, and addressed the remuneration report of the governing bodies.
The Annual General Meeting resolved on the use of the profit shown on the
balance sheet and the distribution of dividends, amendments to the Articles of
Association, the composition and remuneration of the Board of Directors, the
election and remuneration of the auditor, the election of the assurance provider
for sustainability reporting, and authorised the Board of Directors to acquire the
company’s own shares and to decide on a share issue and on the issuance of
special rights entitling to shares. The Annual General Meeting resolved that, based
on the balance sheet adopted for the 2024 financial year, a dividend of EUR 0.50 per
share will be paid.
The dividend payment date was set at 7 April 2025. The Annual General Meeting
approved the proposal of the Board of Directors to amend Sections 4, 6 and 13 of
the Articles of Association as follows:
• Section 4 shall be amended so that the Board of Directors may consist of a
minimum of three (3) and a maximum of eight (8) members, instead of the
previous maximum of seven (7) members.
Annual Report 2025
Report by the Board of Directors
3
• Section 6 shall be amended so that, in addition to an auditor, the company
shall have a sustainability reporting assurer.
• Section 13 shall be amended so that, in addition to the matters previously
specified in Section 13, the assurance report on sustainability reporting shall be
presented at the Annual General Meeting and a sustainability reporting assurer
shall be appointed.
The Annual General Meeting confirmed the number of members of the Board
of Directors as eight (8), in accordance with the proposal of the Shareholders’
Nomination Board. The following current members of the Board of Directors
were re-elected to serve until the end of the next Annual General Meeting:
Teemu Kangas-Kärki, Sakari Lassila, Jukka Leinonen, Juuso Maijala, Anna-
Maria Ronkainen and Pasi Tolppanen. In addition, Tuija Kalpala and Anna-Maria
Tuominen-Reini were elected as new members. Jukka Leinonen was elected Chair
of the Board and Sakari Lassila Vice Chair. The audit firm PricewaterhouseCoopers
Oy was elected as the company’s auditor to serve until the end of the next Annual
General Meeting, and has announced that APA Samuli Perälä will act as the
principal auditor.
PricewaterhouseCoopers Oy was also elected as the company’s sustainability
reporting assurer to serve until the end of the next Annual General Meeting, and has
announced that CRA Samuli Perälä will act as the principal sustainability reporting
assurer. Further details on the resolutions of the Annual General Meeting are
provided in the stock exchange release issued on 27 March 2025.
Partial demerger
On 13 December 2024, the company announced that the Board of Directors
of Lassila & Tikanoja plc had decided to initiate the planning of separating the
company’s circular economy businesses—Environmental Services and Industrial
Services—and its facility services businesses into two independent listed companies.
The intention is to separate the circular economy businesses into a new listed
company through a partial demerger of Lassila & Tikanoja plc.
According to the assessment of the Board of Directors, the separation of the
circular economy and facility services businesses could increase shareholder
value by enabling both businesses to pursue their own strategies and growth
opportunities more effectively.
On 9 June 2025, the company announced that, as part of the plan published on 13
December 2024 to separate the circular economy businesses of Lassila & Tikanoja
plc into a new listed company through a partial demerger (‘the Demerger’), the
Board of Directors proposes that Eero Hautaniemi be appointed President and CEO
of the independent circular economy businesses, should the partial demerger be
completed. At the same time, the Board of Directors proposes that Antti Niitynpää
be appointed President and CEO of the facility services businesses remaining with
Lassila & Tikanoja after the Demerger, conditional upon the implementation of the
Demerger.
Eero Hautaniemi has served as President and CEO of Lassila & Tikanoja and as
a member of the Group Executive Board since 2019, and, according to the proposal,
will continue in his current role as President and CEO of Lassila & Tikanoja until the
implementation of the planned Demerger, at which point the appointments related
to the Demerger will take effect. Antti Niitynpää has served as Senior Vice President
of Facility Services at Lassila & Tikanoja since 2021 and has more than 10 years
of experience in leadership roles within the company’s facility services operations.
Before that, he held several managerial positions at ISS for more than 10 years.
The Board of Directors of Lassila & Tikanoja plc also proposes that M.Sc. (Econ.)
Joni Sorsanen be appointed Chief Financial Officer of the independent circular
economy businesses and M.Sc. (Econ.) Mika Stirkkinen be appointed Chief
Financial Officer of the facility services businesses, should the partial demerger
be completed. Joni Sorsanen has served as CFO of the Lassila & Tikanoja Group
and as a member of the Group Executive Board since 2024 and, according to the
proposal, will continue in his current role until the implementation of the planned
Demerger, at which point the appointments related to the Demerger will take
effect. Mika Stirkkinen has more than 20 years of experience in senior financial
management positions, including serving as CFO of Finnair.
On 7 August 2025, the company announced that the Board of Directors of Lassila
& Tikanoja plc had approved, at its meeting on the same day, the demerger plan
for separating the circular economy businesses into a new listed company. The
demerger plan and its appendices were published on 7 August 2025.
The Extraordinary General Meeting held on 4 December 2025 approved the
demerger plan. On 18 December 2025, the company announced that the Board of
Directors of Lassila & Tikanoja plc had decided to implement the partial demerger
of Lassila & Tikanoja. It was noted that, based on the recommendation of the
Shareholders’ Nomination Board, the Board of Directors had proposed that Pasi
Tolppanen, Anna-Maria Ronkainen and Juuso Maijala continue as members of the
Board, and that Johan Mild, Timo Karppinen and Soile Kankaanpää be elected as
new members of the Board for a term beginning on the date of the implementation
of the demerger and ending at the end of the next Annual General Meeting of the
company.
On 31 December 2025, the company announced that the partial demerger of
Lassila & Tikanoja plc had been registered with the Trade Register. In connection
with the implementation of the demerger, Nasdaq Helsinki Ltd (‘Nasdaq Helsinki’)
approved the listing application for the shares of the new Lassila & Tikanoja to be
admitted to trading on the Nasdaq Helsinki stock exchange list. In accordance with
the demerger plan, the name of the Demerging Company was changed to Luotea
plc (‘Luotea’) on 31 December 2025. Trading in Luotea’s shares will continue on the
Nasdaq Helsinki stock exchange list.
In connection with the demerger, the parent company’s share capital was reduced
by EUR 18 million in accordance with the demerger plan, and the reduction of share
capital was transferred to the reserve for invested unrestricted equity. The reserve for
invested unrestricted equity decreased by EUR 19 million as a result of the demerger,
resulting in a net change of EUR –1 million. In addition, retained earnings of EUR 7
million were transferred in the demerger. The total impact of the demerger on the
parent company’s equity was EUR –26 million.
Efficiency program
At the beginning of 2025, Lassila & Tikanoja launched an efficiency programme
aimed at improving profitability. During January–December 2025, the comparable
costs of the continuing operations decreased by approximately EUR 3 million
compared to January–December 2024 as a result of the measures implemented
under the efficiency programme. In 2026, the programme’s measures will focus
primarily on improving the efficiency of the operations in Sweden.
Events after the reporting period
At 13 January 2026, the company announced that the Shareholders’ Nomination
Board proposes to the Annual General Meeting to be held on 29 April 2026 that
the Board of Directors should consist of six (6) members. The Nomination Board
proposes that all current members—Johan Mild, Pasi Tolppanen, Anna-Maria
Ronkainen, Juuso Maijala, Timo Karppinen and Soile Kankaanpää—be re-elected
to the Board. The Nomination Board further proposes that Johan Mild continue
as Chair of the Board and Pasi Tolppanen as Vice Chair. All candidates have given
their consent to the election and are independent of the company and its significant
shareholders.
The Shareholders’ Nomination Board consists of representatives appointed by the
company’s three largest shareholders as well as the Chair of the Board of Directors
of Luotea plc. The members of the Shareholders’ Nomination Board have been
Miikka Maijala, Chair (shareholder group), Juhani Lassila (Evald and Hilda Nissi
Foundation), Dag Marius Nereng (Protector Forsikring ASA) and Johan Mild (Chair
of the Board of Directors of Luotea plc).
On 9 February 2026, the company announced that Luotea has appointed
Hanna Inget, M.Sc. (Econ.), as Chief Commercial Officer and member of the
Group Executive Board. She will assume her position on 1 March 2026. Inget will be
responsible for Luotea’s growth, commercial operations and the development of the
customer experience.
Long-term financial and customer-related targets
The table below presents the long-term financial targets for the continuing
operations.
Indicator Ta rge t 2025 2024
Organic growth in net sales, % 4-5% -1% N/A
Adjusted EBITA % 5% 2% 0.3%
Operating free cash flow / Adjust-
ed EBITA >90% N/A N/A
Shared dividend of result 50% 216.4% N/A
Board proposal
Changes in the Group Executive Board
On 9 June 2025, the Demerging Company announced that the Board of Directors
of the Demerging Company had proposed that Antti Niitynpää be appointed
President and CEO of Luotea and that Mika Stirkkinen be appointed Chief Financial
Officer of Luotea, should the Demerger be completed.
Antti Niitynpää has served as Senior Vice President of Facility Services of the
Demerging Company since 2021 and has more than 10 years of experience in senior
leadership positions within the Demerging Company’s facility services operations.
Prior to that, he held several managerial roles at ISS for more than 10 years. Mika
Stirkkinen has more than 20 years of experience in senior financial management
positions, including serving as CFO of Finnair plc and, most recently, CFO of
Annual Report 2025
Report by the Board of Directors
4
Forenom Group.
The Board of Directors of the Demerging Company has also, conditional upon
the implementation of the Demerger, appointed the following individuals to form the
Executive Management Team of Luotea together with the President and CEO and
the CFO, effective as of the date of implementation of the Demerger:
Erja Heiskanen as Senior Vice President, Cleaning and Support Services.
Heiskanen has served as Senior Vice President, Cleaning and Support Services of
the Demerging Company since 2021, and prior to that as Regional Director in the
facility services business. Before joining the Demerging Company, she held several
leadership positions at Honkarakenne plc, the Kährs Group and ABB.
Jani Lindström as Senior Vice President, Property Maintenance and Technical
Services.
Lindström has served as Senior Vice President, Property Maintenance and
Technical Services of the Demerging Company since 2021. Before that, he held
various leadership positions at Transval Group Oy, Posti Group Corporation and the
K Group.
Mikko Taipale as Senior Vice President, Facility Services Sweden.
Taipale has served as Senior Vice President of Facility Services Sweden of the
Demerging Company since 2023. Previously, he worked as a Partner at AIMS
International Sweden, as HR Director at Veoneer and Autoliv, and held various
leadership roles within the Telia Company Group.
Tom Lindgren as Senior Vice President, Strategy, Sustainability and Development.
Lindgren has served as Strategy Director of the facility services business of the
Demerging Company and as a member of the division’s management team since
15 January 2025. Previously, he held leadership positions as Director of Digital
Services at Haltian Oy and in various senior roles at Lindström Oy, Samsung and
Nokia.
Jami Pohja as Senior Vice President, Human Resources.
Pohja has more than 15 years of experience in HR leadership. He has served as HR
Director of the facility services business of the Demerging Company since 2020.
Prior to that, he held HR management positions at Alko Oy and the Demerging
Company, and worked as a lawyer at the Trade Union Erto.
Heikki Eskola as Senior Vice President, Legal Affairs and EHSQ.
Eskola has served in senior legal roles at the Demerging Company since March
2025. Before that, he held senior legal positions at Wärtsilä plc and ISS Services, and
worked as in-house counsel at the Demerging Company.
Dividend policy
The company’s long-term objective is to distribute at least 50% of the profit for the
financial year as dividends.
Proposal for profit distribution
The distributable funds of Luotea plc in the financial statements amount to EUR
14,346,297.25, of which the profit for the financial year is EUR 683,830.79. There
have been no material changes in the company’s financial position after the end of
the financial year, nor does the liquidity test referred to in Chapter 13, Section 2 of the
Finnish Companies Act affect the amount of distributable funds.
The Board of Directors proposes to the Annual General Meeting that a dividend
of EUR 0.07 per share be distributed for the 2025 financial year. The dividend will
be paid to a shareholder who, on the record date for the payment, 4 May 2026, is
registered in the company’s shareholder register maintained by Euroclear Finland
Ltd. The Board proposes that the dividend be paid on 11 May 2026. No dividend will
be paid on the company’s own shares held by the company on the record date.
On the date of the dividend proposal, the number of shares entitled to dividend is
38,211,724, resulting in a total dividend amount of EUR 2,674,820.68. Earnings per
share for the Group were EUR 4.23.
Annual Report 2025
Report by the Board of Directors
5
Shares and
shareholders
Share capital and number of shares
The company’s registered share capital is EUR 1,000,000, and the number of
outstanding shares at the end of the review period was 38,211,724.
Shareholders
At the end of the review period, the company had 24,235 (24,523) shareholders.
The proportion of nominee-registered holdings was 13.0% (13.9%) of the share
capital.
Holdings of the Board of Directors, the President and CEO and the
Executive Board
As at 31 December 2025, the members of the Board of Directors, the President
and CEO, and the members of the Group Executive Management Team of Luotea,
together with entities under their control, held a total of 82,596 shares in the
company. This corresponds to 0.2 per cent of the total number of shares and votes.
Share-based incentive plans
In December 2022, the Board of Directors of Lassila & Tikanoja plc established two
new long-term share-based incentive schemes for key employees of the Group.
The purpose of the new schemes is to align the objectives of the company, its
shareholders and key personnel in order to increase the company’s value over
the long term, to strengthen the commitment of key employees to the company,
and to offer competitive incentive structures based on earning and accumulating
company shares as well as on the appreciation of the share price.
The share-based incentive scheme for 2023–2027 comprises three (3) performance
periods, each lasting three (3) years: calendar years 2023–2025, 2024–2026 and
2025–2027.
During the 2023–2025 performance period, the earning of rewards is based on the
following performance criteria: return on capital employed, total shareholder return
and reduction of the carbon footprint. The target group of the share-based incentive
scheme for the 2023–2025 performance period consists of approximately nine
key employees, including the President and CEO and the members of the Group
Executive Board.
The share-based incentive programme with a performance period covering
the financial years 2024–2026 is based on the following performance criteria:
the Group’s average return on capital employed for the years 2024–2026 with a
weighting of 50 per cent, the relative total shareholder return of Lassila & Tikanoja
plc’s share compared to the Nasdaq Helsinki general index with a weighting of 30
per cent, and the reduction of the carbon footprint with a weighting of 20 per cent.
The reward under this share-based incentive programme will be paid after the
three-year performance period in 2027.
Number of
shareholders Percentage Number of shares
Percentage of
shares and votes
Breakdown of shareholding by sector on 31 December 2025
Corporations and housing associations 911 3.8 3,799,596 9.8
Financial and insurance corporations 47 0.2 8,413,697 21.7
General government 15 0.1 2,718,622 7.0
Households 23,007 94.9 16,531,229 42.6
Non-profit institutions serving households 185 0.8 5,731,862 14.8
Foreign shareholders 69 0.3 976,190 2.5
Shares not transferred to the book-entry securities system 0 40,528 0.1
Own shares 1 587,150 1.5
Total 24,235 100 38,798,874 1.5
Nominee-registered 10 5,059,005 13.0
Breakdown of shareholding by size of holding on 31 December 2024
Number of shares
1–1 000 21,671 89.4 4,710,175 12.1
1,001–5,000 2,092 8.6 4,450,877 11.5
5,001–10,000 254 1 1,811,223 4,7
10,001–100,000 181 0.7 4,923,984 12.7
100,001–500,000 23 0.1 4,995,375 12.9
over 500,000 13 0.1 17,279,562 44.5
Shares not transferred to the book-entry securities system 0 40,528 0.1
Own shares 1 587,150 1.5
Total 24,235 100 38,798,874 100
Nominee-registered 10 5,059,005
Major shareholders on 31 December 2025, excluding nominee-registered shares
Shareholder Number of shares Percentage of shares and votes
1 Evald and Hilda Nissi´s Foundation 3,496,487 9.0
2 NORDEA NORDIC SMALL CAP FUND 2,009,300 5.2
3 MAIJALA JUHANI 1,529,994 3.9
4 BERGHOLM HEIKKI LAURI HERMAN 895,057 2.3
5 Ilmarinen Mutual Pension Insurance Company 790,000 2.0
6 MAIJALA MIKKO JUHANI 730,000 1.9
7 Varma Mutual Pension Insurance Company 729,791 1.9
8 Åbo Akademi University Foundation 645,282 1.7
9 LUOTEA PLC 587,150 1.5
10 SIJOITUSRAHASTO AKTIA CAPITAL 580,218 1.5
11 Elo Mutual Pension Insurance Company 574,180 1.5
12 The State Pension Fund 512,000 1.3
13 TURJANMAA KRISTIINA AIRA 469,000 1.2
14 OY CHEMEC AB 420,000 1.1
15 Capital fund SELIGSON & CO PHOEBUS 405,000 1.0
16 MAIJALA EEVA KYLLIKKI 370,000 1.0
17 SAMFUNDET FOLKHÄLSAN I SVENSKA FINLAND RF 336,800 0.9
18 SECURITY TRADING 330,000 0.9
19 BROTHERUS ILKKA JOHANNES 285,000 0.7
20 MAIJALA INVESTMENT OY 210,000 0.5
20 largest owners total 15,905,259 41.0
Annual Report 2025
Report by the Board of Directors
6
The share-based incentive programme with a performance period covering
the financial years 2025–2027 is based on the following performance criteria:
the Group’s average return on capital employed for the years 2025–2027 with a
weighting of 30 per cent, the relative total shareholder return of Lassila & Tikanoja
plc’s share compared to the Nasdaq Helsinki general index with a weighting of 30
per cent, the reduction of the carbon footprint with a weighting of 20 per cent, and
revenue growth for the years 2025–2027 with a weighting of 20 per cent. The reward
under this share-based incentive programme will be paid after the three-year
performance period in 2028.
As a result of the partial demerger of Lassila & Tikanoja plc on 31 December
2025, the content of the ESG metric (i.e. reduction of the carbon footprint) included
in the performance periods 2024–2026 and 2025–2027, as well as the target levels
of the metric for the years following the demerger, will be redefined by the Board of
Directors of Luotea plc after the demerger. The metrics themselves (ROCE, TSR,
ESG, revenue) and their respective weightings will remain unchanged regardless of
the demerger until the end of the performance periods.
Trading in shares in 2025
The company’s shares are listed on the Nasdaq Helsinki Ltd Mid Cap list in
the Industrial Products and Services sector. The trading code is LAT1V and the
ISIN code is FI0009010854. Luotea’s trading code is LUOTEA and its ISIN code is
FI4000592464.
During 2025, a total of 6.6 million shares were traded, corresponding to 17.4%
(22.5%) of the average number of outstanding shares. The total value of the shares
traded was EUR 62.9 million (75.8). The highest share price was EUR 10.7 and the
lowest was EUR 7.7. The closing price at the end of the review period was EUR 10.62.
The market capitalisation of the company’s share capital, excluding the company’s
own shares, was EUR 405.8 million (300.5). This figure does not yet reflect the
impact of the demerger on the company’s market value.
Flagging notifications
On 31 January 2025, Lassila & Tikanoja plc received a notification pursuant to
Chapter 9, Section 5 of the Finnish Securities Markets Act, according to which
the number of voting rights held by Nordea Funds Ltd in Lassila & Tikanoja
exceeded the 5 per cent threshold on 30 January 2025. Nordea Funds Ltd’s direct
shareholding in Lassila & Tikanoja amounted to 1,912,244 shares, representing
4.93% of the total number of shares, and the total number of voting rights held
increased to 1,946,154 votes, representing 5.02% of the total voting rights.
On 17 March 2025, Lassila & Tikanoja plc received a notification pursuant to
Chapter 9, Section 5 of the Finnish Securities Markets Act, according to which the
number of voting rights held by Nordea Funds Ltd in Lassila & Tikanoja fell below the
5 per cent threshold on 14 March 2025. Nordea Funds Ltd’s direct shareholding fell
below 5 per cent of the total number of shares in Lassila & Tikanoja, and the number
of voting rights decreased to below 5 per cent of the total voting rights.
On 7 April 2025, Lassila & Tikanoja plc received a notification pursuant to Chapter
9, Section 5 of the Finnish Securities Markets Act, according to which the number
of voting rights held by Nordea Funds Ltd in Lassila & Tikanoja reached the 5 per
cent threshold on 4 April 2025. Nordea Funds Ltd’s direct shareholding amounted to
1,911,570 shares, representing 4.92 per cent of the total number of shares in Lassila &
Tikanoja, and the number of voting rights increased to 1,942,180 votes, representing
5 per cent of the total voting rights.
On 19 May 2025, Lassila & Tikanoja plc received a notification pursuant to
Chapter 9, Section 5 of the Finnish Securities Markets Act, according to which the
number of voting rights held by Nordea Funds Ltd in Lassila & Tikanoja fell below
the 5 per cent threshold on 16 May 2025. Nordea Funds Ltd’s direct shareholding fell
below 5 per cent of the total number of shares in Lassila & Tikanoja, and the number
of voting rights decreased to below 5 per cent of the total voting rights.
On 1 September 2025, Lassila & Tikanoja plc received a notification pursuant to
Chapter 9, Section 5 of the Finnish Securities Markets Act, according to which the
number of voting rights held by Nordea Funds Ltd in Lassila & Tikanoja exceeded
the 5 per cent threshold on 29 August 2025. Nordea Funds Ltd’s direct shareholding
increased to 1,951,870 shares and 1,982,480 votes, representing 5.03% of the total
number of shares and 5.11% of the total voting rights in Lassila & Tikanoja.
Own shares
At the end of the review period, the company held 587,150 of its own shares,
representing 1.5% of all shares and votes. On 26 February 2025, the company
transferred 8,399 of its own shares to nine key employees covered by the Group’s
share-based incentive scheme. The transferred shares constitute the share-settled
portion of the reward payable under the 2024 share-based incentive scheme. On
5 May 2025, the company transferred 14,392 of its own shares to members of the
Board of Directors as part of their remuneration. No own shares were repurchased
during the financial year.
Authorisations for the Board of Directors
The Annual General Meeting of Lassila & Tikanoja plc held on 27 March 2025
resolved to authorise the Board of Directors to repurchase the company’s own
shares using the company’s unrestricted equity. In addition, the Annual General
Meeting resolved to authorise the Board of Directors to decide on a share issue as
well as on the issuance of special rights entitling to shares.
The Board of Directors is authorised to repurchase a maximum of 2,000,000 of
the company’s own shares (corresponding to 5.2% of the total number of shares).
The authorisation to repurchase shares is valid for 18 months.
The Board of Directors is authorised to decide on a share issue of new shares or
on the transfer of shares possibly held by the company, and/or on the issuance of
option rights or other special rights entitling to shares as referred to in Chapter 10,
Section 1 of the Finnish Companies Act, so that a total of no more than 2,000,000
shares, corresponding to 5.2% of the total number of shares, may be issued and/or
transferred under the authorisation. The authorisation is valid for 18 months.
Luotea has established a risk management process that covers financial and
funding risks, strategic risks, operational risks, sustainability-related responsibility
risks, and hazard risks.
Key risk management principles
The objective of Luotea’s risk management is to identify significant risk factors,
prepare for them and manage them optimally. The role of risk management is to
support management and decision-making in achieving the company’s objectives.
Comprehensive risk management aims to manage the Group’s overall risk
exposure rather than merely individual risk factors.
Risk management is carried out by the various functions in accordance with the
defined responsibility matrix. The risk assessments conducted at Group level are
consolidated, and the prioritised development actions are identified.
In accordance with the risk management process, risks are assessed annually in
the following categories
• Strategic risks
• Financial risks
• Operational risks
• Sustainability risks
• Supply chain risks, and
• ICT-risks
The risk management process also seeks to assess the opportunities arising from
risks.
Responsibilities
The Board of Directors approves the principles of risk management, monitors
the implementation of risk management and evaluates the effectiveness of
the methods used. The President and CEO is responsible for organising and
implementing risk management. Risk management in the Luotea Group is guided
by the risk management and insurance policy approved by Luotea’s Board of
Directors, as well as the related risk management principles, which are updated
regularly. The policy defines the objectives and principles of the Group’s risk
management, the organisation and responsibilities, and the operating procedures.
The management of financial risks complies with the Group’s financing policy
approved by Luotea’s Board of Directors. The principles for managing insurance
risks are defined in the risk management and insurance policy.
Identification, assessment and reporting of risks
Risks are identified regularly and systematically at both the business-unit and
company level, as well as within critical Group functions. The assessment also
covers risks related to the collection and reporting of sustainability information,
such as potential errors in data collection or consolidation. The significance of risks
is evaluated using a risk matrix, and actions are defined and assigned to manage
and minimise the identified risks. The impact of risks is analysed, among other
things, through their potential EBIT effects, and the probability of risks materialising
is assessed based on operational quality and the risk-mitigating measures already
implemented. The most significant identified risks and the preparedness measures
related to them are reported regularly to the President and CEO and to the Board of
Directors.
Risk analysis
Pages 7–8 describe the most significant strategic, operational and sustainability
related risks in Luotea’s business operations which, if realised, could jeopardise or
prevent the achievement of the company’s business objectives. Financial risks are
described in Note 4.2 Financial Risk Management to the consolidated financial
statements.
Near-term risks and uncertainties
Luotea’s business is exposed to economic cycles, and changing market conditions
as well as fluctuations in the industries of Luotea’s customers may affect the
demand for Luotea’s services and solutions.
Luotea operates in highly competitive markets, and increased competition or
failure to respond effectively to competitive pressures may lead to a loss of market
share. In its operations, Luotea is also exposed to fluctuations in the pricing and
availability of materials, raw materials and production inputs.
Luotea operates in a labour-intensive sector, and failure to recruit skilled
personnel, the loss of senior executives or other key employees, or disruptions in
the availability or work ability of personnel may have an adverse effect on Luotea’s
business, and the company may not always succeed in recruiting and/or retaining
employees with the required competence.
Luotea’s operations and service delivery are highly dependent on data networks
and digital solutions, and disruptions, breaches or attacks targeting them—along
with potential failures in IT development projects or insufficient data processing
agreements—may adversely affect Luotea’s business and financial position and
cause reputational harm.
The geopolitical situation involves uncertainty due to Russia’s war of aggression
and U.S. trade policies. Indirect impacts on general economic activity in Finland and
Sweden could negatively affect net sales and profitability.
The Extraordinary General Meeting of Luotea resolved to separate the circular
Risks and risk management
economy and facility services businesses into two independent listed companies
as of 31 December 2025. As a result of the partial demerger, the operating models,
processes and systems of the two companies were separated. The demerger may
involve risks related, for example, to the retention of skilled personnel, customer
relationships, costs or the execution of potential transactions.
Luotea’s mergers, acquisitions and corporate restructuring activities expose the
company to various risks that may adversely affect its business.
The Group company Luotea FM AB is both plaintiff and defendant in legal
proceedings in Sweden concerning unpaid receivables invoiced from a former
customer of the Group. In June 2022, Luotea FM AB filed a claim with the Solna
District Court against the former customer, seeking payment of outstanding
receivables. At the end of the review period, the company had no receivables related
to the case recognised on the balance sheet. The former customer has disputed
Luotea FM AB’s claims and payment obligation and has filed a counterclaim
demanding approximately SEK 144 million from Luotea FM AB. The legal
proceedings were concluded in December 2025, and a ruling is expected during
the second quarter of 2026. Luotea considers the counterclaim unfounded and has
made no provisions related to it.
Annual Report 2025
Report by the Board of Directors
7
Strategic, operational and sustainability risks
Strategic risks
Risk Risk description Risk management
Markets • The general economic development in Luotea’s operating countries and changes in the competitive landscape aect the
company’s business. Changes in customers’ tendering criteria towards solely price-based selection may negatively impact the
company’s business and the size of the overall market.
• Changes in the markets and the market environment, such as fluctuations in material prices, may negatively aect the busi-
nesses and business growth. Changes in the intentions of the social and healthcare regions (SOTE) regarding the outsourcing
of services may aect the company’s growth outlook. Developments in market-based energy costs may increase production
costs.
• Creating and regularly updating scenarios, regularly reviewing, refining and updating the strategy, taking into account indus-
try developments and identifying the need for renewal as part of the continuous strategy process.
• Continuous monitoring and analysis of market developments and the operating environment.
• Developing the company’s own competitiveness factors. Luotea is not dependent on any single major customer, and its ser-
vice oering is diversified.
• Developing new service models.
• Customer contracts that allow price increases when production costs rise.
• Price adjustment clauses in supplier contracts and a flexible resourcing model that enables rapid response to changes.
Regulation • The political environment in Luotea’s operating countries and changes in regulation may aect the company’s business. • Active monitoring of legislative developments, anticipating upcoming changes and engaging in dialogue with authorities and
lawmakers.
Technology • The competitiveness of Luotea’s oering aects the Group’s future growth. Errors in assessing technology choices for service
production and equipment may weaken the company’s profitability.
• Loss of competitiveness due to falling behind in AI development.
• Continuous monitoring and analysis of the operating environment related to Luotea’s business and equipment.
• Temporal diversification of equipment investments.
• Implementing the AI strategy, for example by training personnel.
Employees • Challenges related to the availability and turnover of labour may hinder service delivery and increase the company’s costs
• Changes in collective bargaining agreements may increase the company’s costs.
• When collective agreements are expiring, there may be a threat of strikes or industrial action, which could lead to temporary
interruptions in work.
• A decline in employee satisfaction may aect Luotea’s competitive advantage, which is largely built on the work of skilled and
motivated personnel.
• Increases in disability pension and occupational accident pension costs may negatively aect Luotea’s competitiveness and
profitability.
• Improving the employee experience by oering training, enhancing onboarding and leadership practices, and promoting job
rotation and career advancement opportunities.
• Cooperation with municipal employment services, state organisations and educational institutions to ensure access to
labour.
• Promoting labour-based immigration and the employment of special groups.
• Regular task- and site-specific risk assessments, workplace surveys and support for employees’ work ability and well-being
through work ability management activities.
• Luotea’s own health fund, which supports the company’s work ability management and complements occupational health
services.
• The ‘Suitable Work’ model, aimed at rehabilitating and employing individuals at risk of disability pension.
Strategic
development
projects
• Luotea is carrying out several strategic development projects aimed at driving growth and improving operational eiciency
and operating models. Slower-than-planned progress or other challenges in these projects could weaken Luotea’s competi-
tiveness.
• The regular monitoring of the implementation of strategic projects is assigned to responsible parties, and corrective actions are
taken when necessary. Alternative paths forward are explored as part of the projects. Luotea continuously assesses the capabilities
required for the execution of strategic development projects and develops or acquires them where needed from external providers.
Annual Report 2025
Report by the Board of Directors
8
Operational risks
Risk Risk description Risk management
ICT systems,
data security
and data pro-
tection
• Due to the partial demerger, disruptions, delays and operational challenges related to information and communication sys-
tems and their implementation may aect Luotea’s operations and customer service.
• Renewal of business-critical systems may cause disruptions in service delivery.
• Cybercrime may compromise the company’s information security and data protection and disrupt business continuity, for
example through data breaches, malware or denial-of-service aacks.
• Developing the system environment and ensuring the reliability of the ICT environment by, for example, identifying busi-
ness-critical systems and defining and clarifying responsibilities between system suppliers and Luotea.
• Thorough planning of the deployment of new systems and related operating models.
• Instructions on information security and data protection, and training for personnel.
Damage-
related risks
• Occupational accidents may lead to a significant increase in insurance premiums and, in the worst case, aect the compa-
ny’s ability to participate in public procurements.
• Loss of keys to a customer site may result in additional costs, for example due to lock replacements, and may weaken cus-
tomer trust and damage the company’s reputation.
• Goal-oriented proactive occupational safety work and thorough induction of personnel into safe working practices.
• A clear and comprehensive key management process and continuous insurance coverage that encompasses all operating
countries and subsidiaries.
Procurement
risks
• Increases in fuel, electricity and other procurement costs may weaken Luotea’s profitability. • Managing the procurement chain and diversifying energy sources for equipment, as well as improving pricing and eiciency
• Customer contracts that allow price increases when production costs rise.
Weather
conditions
• Extreme weather conditions, such as significantly increased annual rainfall and snowfall, may lead to higher costs as service
delivery becomes more diicult. For example, variations in winter snowfall levels can have a substantial impact on the costs and
resourcing needs of winter maintenance.
• The company manages this risk by allocating its resources flexibly, using a subcontractor network to balance demand peaks,
and actively monitoring weather forecasts and snow conditions to support operational planning. In addition, contracts aim to
take weather variability into account whenever possible.
Financing
risks
• A potential rise in interest rates may increase the company’s interest expenses. Investments in foreign currencies (SEK). • More detailed information on the management of financial risks is presented in Note 4.2 to the financial statements.
Sustainability risks
Risk Risk description Risk management
Environmental
risks
• Changes in climate legislation, national and international targets and political steering may slow down the development of
low-emission equipment technology or have a negative impact on fuel prices or emissions.
• Luotea’s own climate targets, the measures taken to advance them, and the separate climate targets set for the supply chain
are aligned with the findings of the scenario analysis. Luotea manages transition risks by assessing market developments
and responding to them in a timely manner.
Social risks • Safety is at the core of working at Luotea. Accidents are possible despite comprehensive processes and training related to
occupational safety.
• Human rights violations and occupational accident risks occurring in the supply chain.
• Comprehensive training, communication, and guidelines and principles related to safety management, as well as regular
safety assessments and proactive safety work.
• Careful compliance with laws and collective agreements. Thorough risk assessment and the implementation of preventive
measures based on identified risks.
• Ensuring the fulfilment of the duty of care, updating the human rights risk assessment in 2026.
• Considering supply chain responsibility: Code of Conduct guidelines for suppliers, supplier self-assessments, a risk assess-
ment tool for audit prioritisation, KPI metrics, and monitoring via the Vastuu Group Reliable Partner service.
Ethical
business
• Participation in corruption or bribery. • Determined prevention of corruption and bribery, for example through regular training for personnel.
• A whistleblowing channel available on the intranet and the company’s website.
Annual Report 2025
Report by the Board of Directors
9
Sustainability
report
ESRS 2 General disclosures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
EU taxonomy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
E1 Climate change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49
E4 Biodiversity and ecosystems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
E5 Resource use and circular economy . . . . . . . . . . . . . . . . . . . . . . . 61
S1 Own workforce . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .64
S2 Workers in the value chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
G1 Business conduct . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Annual Report 2025
Sustainability Report
11
Sustainability report
Annual Report 2025
Report by the Board of Directors
BP-1 – General basis for preparation of the
sustainability statements
Luotea Plc's consolidated Sustainability Report has been prepared in accordance
with Commission Delegated Regulation (EU) 2023/2772 (hereinafter referred to as
"Sustainability Reporting Standard") and European Parliament and Council Direc-
tive 2013/34/EU (CSRD), the provisions of which concerning sustainability have
been implemented in chapter 7 of the Finnish Accounting Act (1336/1997). This
Sustainability Report covers all Luotea group companies presented in the consoli-
dated financial statements for the financial year 1 January–31 December 2025, (Note
5.2), unless otherwise stated in connection with the reported information.
On 31 December 2025, a partial demerger was completed at Luotea, separating the
facility services business and the circular economy business into two independent
listed companies. In accordance with the demerger plan published in August 2025,
a new parent company to which the circular economy business are transferred was
established for the circular economy company on 31 December 2025, and it will
continue under the company name Lassila & Tikanoja Plc. The facility services busi-
ness will remain in the demerging company, which continues under the new com-
pany name Luotea Plc as of 31 December 2025.
According to the assessment of the demerging company's Board of Directors’, the
separation of the circular economy and facility services businesses could increase
shareholder value by enabling both businesses to pursue their own strategies and
growth opportunities more effectively. Starting from 2026, the partial demerger will
have a significant impact on sustainability themes that are material to Luotea as
the circular economy business, which has a more significant environmental impact,
is removed from the Group. With the demerger, Luotea will revise its strategy and
strategic goals, including the non-financial sustainability targets, in 2026. The pol-
icies, operating principles and action plans related to the material sustainability
topics will be updated to meet the needs of the demerging company. Updates will
be made in particular to the company’s environmental policy and transition plan
related to Luotea's climate change mitigation measures.
The information in the Sustainability Report is reported for two entities: Luotea con-
tinuing operations and Luotea total (hereinafter referred to as "Luotea" or "the com-
pany"). Unless otherwise stated, Luotea’s continuing operations include the parent
company Luotea Plc, Luotea Siivous Oy, Luotea Kiinteistöhuolto Oy, Luotea Kiin-
teistötekniikka Oy, Luotea Service Ab and Luotea FM Ab. Luotea total covers Luotea's
continuing operations and the discontinued operations L&T Ympäristöpalvelut
Oy, L&T Teollisuuspalvelut Oy and Sand & Vattenbläst i Tyringen AB for the entire
year 2025 and Recond Konsept Ab and Viemärihuolto Reinikka Oy for December
2025 (hereinafter referred to as "discontinued operations" or "the circular economy
business"). Luotea does not report information on a company-specific basis. The
information concerning the company's own workforce is also divided into coun-
try-specific figures. Luotea reports value chain information in accordance with dis-
closures in relation to specific circumstances. Information concerning trade secrets
and intellectual property rights has not affected the reporting of information that is
material to Luotea.
BP-2 – Disclosures in relation to specific
circumstances
The reported sustainability topics and sustainability indicators are based on
Luotea's double materiality assessment, which was updated in 2025. The definitions
of short-, medium- and long-term presented in paragraph 6.4 of ESRS 1 have been
applied in the double materiality assessment. The same time horizon definitions are
applied in this Sustainability Report. With regard to the metrics, the Sustainability
Report applies the reporting period used in the financial statements. More informa-
tion on the double materiality assessment and its results is provided in paragraph
ESRS 2 IRO-1, pp. 22-24.
The assessment of impacts, risks and opportunities made in the double materi-
ality analysis as well as the company’s related policies, actions, targets and metrics
apply, as a rule, to Luotea's own operations, with the exception of the following dis-
closures which apply to the value chain:
ESRS E1 Climate change
• Luotea reports Scope 3 emissions in accordance with the GHG Protocol
(upstream and downstream).
• The carbon handprint describes the emissions avoided through the services
provided to Luotea’s customers.
• Luotea has set a separate climate target for the value chain.
ESRS E4 Biodiversity and ecosystem services
• The metrics concerning the remediation of contaminated soil sites and meadow
restoration projects are related to services provided to customers.
ESRS E5 Resource use and circular economy
• Luotea's recycling rate target applies to materials collected from customers.
ESRS S2 Workers in the value chain
• The information applies to Luotea’s direct suppliers and their employees.
The reported Scope 3 emission data is largely estimated using indirect sources
and the data involves uncertainties. The background data used in the accounting
is mainly based on euro-denominated procurement data and emission factors in
accordance with the sector classification. The basis of calculation for greenhouse
gases includes the background information used in the supply chain emissions
calculation provided by the supplier or third party and assumptions made in the
accounting. As a change to the previous reporting period, the company’s remote
work policy has been taken into account in the calculation of Scope 3 category 7 in
this Sustainability Report. The basis of GHG calculation and changes in accounting
are described in more detail in paragraph ESRS E1-6, pp. 52-58.
The reported carbon footprint is partly estimated using indirect sources and the
reported data involves a high degree of uncertainty. The calculation method, the
assumptions made therein and the uncertainty included in the calculation are
described in more detail in paragraph ESRS E1-6, pp. 52-58.
The targets for managing the impacts on supply chain workers have been changed
from the reporting year 2024 to the reporting year 2025. The targets relate to the
coverage of the Supplier Code of Conduct and Supplier Self-Assessment processes.
The target level and scope have been revised. The targets are described in para-
graph S2-5, p. 68.
The calculation principles applicable to each topic and the background data used
in the calculations are presented in connection with each topic. The disclosure
indexing related to the European Sustainability Reporting Standards (ESRS) is
reported in paragraph ESRS 2 IRO-2, pp. 31–36.
Luotea has certified its quality, occupational health and safety and environmental
management systems in accordance with the ISO9001, ISO 45001 and ISO 14001
standards. In addition to the assurance of sustainability reporting, Luotea has not
certified or obtained third-party assurance for the metrics presented in the sustain-
ability report.
The Sustainability Report presents comparison data for Luotea (continuing and
discontinued operations total) and Luotea's continuing operations.
With regard to transitional provisions, the list set out in Amendment C to ESRS 1
has been applied, and Luotea uses the Commission’s "quick-fix" delegated act con-
cerning the ESRS standard of 11 July 2025 in calculating the anticipated financial
effects for the SBM-3, E1-9, E4-6 and E5-6 disclosure requirements. These are listed
in the disclosure index ESRS 2 IRO-2, pp. 31–36. In addition, Luotea applies the tran-
sitional provision related to the value chain presented in ESRS 1 paragraph 10.2 in
the following topics:
• E1 Biogenic CO2 emissions in all scope 3 categories
• E1 Emission data in scope 3 category 2 (capital goods)
• S2 Consultation of value chain workers
The Sustainability Report is published annually. The reporting period is the same as
for financial reporting, i.e. 1 January 2025–31 December 2025.
GOV-1 – The role of the administrative, management
and supervisory bodies
The Board of Directors and Board committees
Luotea’s Board of Directors is the most senior body responsible for sustainability.
The Board of Directors is responsible for the management of the company, the
proper arrangement of the company’s operations, and the proper arrangement and
supervision of the company’s accounting and financial management. The Board of
Directors decides upon matters that are of major importance, in view of the scope
and size of the operations of the company. The Board of Directors is also respon-
ESRS 2 General Disclosures
12
Sustainability report
Annual Report 2025
Report by the Board of Directors
sible for the duties specified in the Companies Act and the Articles of Association,
and in other regulations.
The duties of the Board of Directors include overseeing the company’s strategy,
major business decisions and the risk management process, and approving key
policies and principles pertaining to business conduct. The Board of Directors
approves the company’s strategic sustainability targets and metrics, the key policies
that guide the company's operations and the results of the company’s double mate-
riality assessment, for example. Progress towards strategic targets is presented to
the Board of Directors four times per year, in connection with each interim report. In
addition, the Board of Directors annually reviews the results of the company’s risk
management, which also cover the company’s climate risks.
A separate CSRD-related training session was organised for the Board of Direc-
tors in 2025. The training sessions provided the Board members with information on
the company's most material sustainability-related impacts, risks and opportunities
of changes in the company's business environment. The company does not have
a separate control procedure in place for managing sustainability-related impacts,
risks and opportunities. Instead, the company assesses them as part of the stra-
tegic risk management process. The company’s climate risks, for example, are
assessed in accordance with Luotea's risk management process.
The Board of Directors has two committees: an Audit Committee and a Per-
sonnel and Sustainability Committee. In 2025, the Audit Committee consisted of
four Board members, and the Personnel and Sustainability Committee consisted of
four Board members. The committee members must have the expertise and expe-
rience required by the duties of the committee. The Board of Directors confirms the
charters of the committees annually. The committees have no independent deci-
sion-making authority; the Board of Directors makes the decisions based on the
preparation work by the committees. The Personnel and Sustainability Committee
prepares the double materiality assessment on behalf of the Board of Directors.
The double materiality assessment is then discussed by the Audit Committee and
approved by the Board of Directors. The double materiality assessment is updated
and approved annually by the Board of Directors. The chairman of the committee
reports on the work of the committee at the Board meeting following the committee
meeting. Minutes of the committees’ meetings are provided to the Board members
for information.
Personnel and Sustainability Committee
The new focus areas and future development areas of sustainability are discussed
regularly by the Personnel and Sustainability Committee of the Board of Direc-
tors. Based on a presentation by Luotea's Sustainability Director, the Committee
prepares the results of the company’s double materiality assessment, which are
based on an assessment of the company’s impacts, risks and opportunities. The
Personnel and Sustainability Committee also monitors and assesses the develop-
ment of Luotea's business environment, regulation and stakeholder support. The
Personnel and Sustainability Committee met four times in 2025.
Audit Committee
The charter of the Audit Committee includes monitoring and assessing the devel-
opment of sustainability in the company and the results of the company's ESG
assessments and analyses, and assisting the Board of Directors in the preparation
and monitoring of sustainability reporting. The Committee monitors and evaluates
sustainability-related target setting in the short and long term and the effectiveness
of risk management systems. In 2025, the Audit Committee monitored the progress
of sustainability reporting as part of the process of working on the Report by the
Board of Directors at each meeting.
Diversity and expertise of the Board of Directors
Both genders have been represented in the Board of Directors and its committees
for a long time. In 2025, the Board of Directors had right members, of whom 5/8
(62.5%) were male and 3/8 (37.5%) were female. The age range of the Board mem-
bers was 45–70 years. The Board of Directors had one more member than in 2024,
and the gender distribution of the Board of Directors also levelled out from the pre-
vious year, when two out of five members of the Board of Directors were female. The
term of the Board of Directors ended on 30 December 2025. The current Board of
Directors, which started on 31 December 2025, consists of six members, of whom
4/6 are male and 2/6 are female, aged 50-61. None (0%) of the members of the
Board of Directors are in an employment relationship with the company. The Board
of Directors has assessed that all (100%) of its members are independent of the
company.
The members of the Board of Directors are familiar with the circular economy and
facility sectors. They have extensive experience in different business areas and an
understanding of different markets and their special characteristics through their
previous experience. The experience and competence of the members of the Board
of Directors support the strategic development of the service business. The Board
of Directors has assessed its own performance and expertise in the areas that are
the most significant to the company. The members of the Board of Directors have
assessed the extent to which their expertise corresponds to the company’s business,
industry, services, geographical scope and material aspects of sustainability. From
the perspective of sustainability, the key areas of expertise of the Board of Directors
in 2025 were
• environmental responsibility (ESRS E1 Climate change, ESRS E4 Biodiversity
and ecosystems, ESRS E5 Resource use and circular economy),
• human resource management (ESRS S1 Own workforce),
• corporate governance (ESRS 2 General Disclosures, ESRS G1 Business con-
duct),
• supply chain management (ESRS S2 Workers in the value chain, ESRS G1 Busi-
ness conduct),
• international market knowledge (Finnish and Swedish markets) and
• industry expertise (ESRS E5 Resource use and circular economy, ESRS S1 Own
workforce).
CEO and Group Executive Board
The President and CEO is responsible for Luotea's operations in keeping with the
instructions of the Board of Directors, and is in charge of the company's strategy
process. The President and CEO reports to Luotea’s Board of Directors. The Pres-
ident and CEO is assisted by the members of the Group Executive Board, each of
whom is, in their own area of responsibility, in charge of the development of sus-
tainability and the management and implementation of the identified development
themes. These include, among other things, the policies, strategic targets and tar-
gets set for sustainability work submitted to the company's Board of Directors for
approval, as well as the results of the double materiality assessment. Luotea’s Presi-
dent and CEO monitors the implementation of the sustainability targets and reports
to the Board of Directors and its committees on their impacts, risks and opportuni-
ties. The members of the Group Executive Board report to Luotea's President and
CEO. In 2024, the members of Luotea’s Group Executive Board participated in the
Board of Directors’ training sessions that covered CSRD reporting.
At Luotea, the management and development of sustainability work is integrated
into business management. Sustainability is incorporated into the company’s
strategy and taken into account in key indicators. Therefore, the material aspects of
sustainability have been taken into account and measurable and monitored objec-
tives have been set for them. Luotea has identified the key sustainability themes
related to its operations through a double materiality assessment. The focus areas
of sustainability have been determined based on the impacts of Luotea’s oper-
ations, the expectations of key stakeholders and the Group’s strategic priorities.
Luotea’s Board of Directors approves the sustainability targets in connection with
the strategy and sets the company’s long-term targets. Luotea has also taken into
account the special characteristics of the operations and business environment of a
service company in the environmental sector as well as the UN’s sustainable devel-
opment principles and the objectives of the Global Compact initiative in its sustain-
ability work.
The Group Executive Board assesses the development of sustainability quarterly.
Development primarily takes place in business-driven working groups, but the Sus-
tainability Director and Sustainability and the sustainability organisation operating
under their supervision are in charge of the practical coordination and reporting of
sustainability efforts. The businesses and other functions are in charge of the sus-
tainability and compliance of their operations in accordance with the Group’s man-
agement system. Luotea’s management system has been certified in accordance
with the ISO 9001, ISO 14001 and ISO 45001 standards. Luotea Group Executive
Board from 1 January 2025 and 30 December 2025 consisted of eight members, of
whom 12.5% were female and 87.5% were male. The Group Executive Board that
started on 31 December 2025 has six members, of whom 33.3% are female and
66.7% are male.
Compliance task force
Policies and principles are prepared by the compliance task force, which operates
under Luotea’s Senior Vice President, HR and Legal, and meets at least four times
per year. The President and CEO and the Group Executive Board approve all policies
and principles, and some are also subsequently approved by the Board of Directors.
The compliance task force also reviews compliance related to sustainability
reporting, develops the company's monitoring activities related to legislation, and
monitors incidents reported via the company's whistleblowing channels. The com-
pliance task force consisted of the Senior Vice President, HR and Legal, and the
Compliance Officer as permanent members, as well as the HR and HSQ Manager,
Environmental Manager, Head of Sustainability and the SVP, Corporate Relations
and Responsibility.
Luotea's compliance task force ensures that the company’s policies are up to
date. Most of the company’s sustainability-related policies are public and can be
found on the company’s website. Luotea also has internal plans that guide its oper-
13
Sustainability report
Annual Report 2025
Report by the Board of Directors
customer accounts
governance
operational management
internal control and risk management
HR management
international market insight
ICT and data analytics
strategy and M&A
supply chain management
finance
technologies
industry expertise
sustainability
0 1 2 3
4 5
Main areas of expertise
The areas of expertise of the Board of Directors
Name
Board
member
since
Area of expertise Independent of the company
Independent of the sharehold-
ers
Audit Committee
Personnel and Sustainability
Committee
Concurrent Board member-
ships in listed companies
Jukka Leinonen 2021
Customer accounts, environmental responsibility, HR man-
agement, ICT and data analytics, operational management,
strategy and M&A
Chairman 2
Sakari Lassila 2011
Governance, internal control and risk management, strategy
and M&A, finance and supply chain management
Member
Tuija Kalpala 2025
Sustainability, customer accounts/customer experience, in-
dustry knowledge, strategy and acquisitions and operational
management
Member
Teemu Kangas-Kärki 2016
Governance, ICT and data analytics, internal control and risk
management, strategy and M&A, finance
Chairman 1
Juuso Maijala 2024
Customer accounts, HR management, ICT and data analyt-
ics, technologies and supply chain management
Member Member
Anna-Maria
Ronkainen
2023
Customer accounts, HR management, ICT and data analyt-
ics, technologies
Member 4
Pasi Tolppanen 2020
Customer accounts, international market insight, operation-
al management, industry expertise and technologies
Member
Anna-Maria Tuominen
Reini
2025
Sustainability, governance, international market insight, in-
dustry knowledge and supply chain management
Member
The table presents the key areas of expertise of the members of the Board of Directors on 30 December 2025. A particular area of expertise not being specifically mentioned for a Board member does not mean that the member in question lacks expertise in that area.
Duration of Board membership in years
(number of persons)
1–2 years, 3
3–5 years, 3
6–9 years, 1
>10 years, 1
Gender distribution (number of persons)
Male, 5
Female, 3
Diversity and expertise of the Board of Directors 1 January 2025–30 December 2025
12.5%
37.5%
37.5%
62.5%
37.5%
12.5%
14
Sustainability report
Annual Report 2025
Report by the Board of Directors
Main areas of expertise
The areas of expertise of the Board of Directors
Name
Board
member
since
Area of expertise Independent of the company
Independent of the sharehold-
ers
Audit Committee
Personnel and Sustainability
Committee
Concurrent Board memberships
in listed companies
Soile Kankaanpää 2025
Customer accounts, operational management, international
market insight, strategy and M&A and industry expertise
Member 1
Timo Karppinen 2025
Governance, internal control and risk management, strategy
and M&A, finance and supply chain management
Chairman 1
Juuso Maijala 2024
Customer accounts, HR management, ICT and data analyt-
ics, technologies
Member 1
Johan Mild 2025
Customer accounts, HR management, operational manage-
ment, strategy and M&A, finance and industry expertise
Chairman
Anna-Maria
Ronkainen
2023
Customer accounts, HR management, ICT and data analyt-
ics, technologies
Member 3
Pasi Tolppanen 2020
Customer accounts, governance, international market in-
sight, operational management, industry expertise
Member 2
The table presents the key areas of expertise of the members of the Board of Directors on 31 December 2025. A particular area of expertise not being specifically mentioned for a Board member does not mean that the member in question lacks expertise in that area.
Duration of Board membership in years
(number of persons)
1–2 years, 4
3–5 years, 2
Gender distribution (number of persons)
Male, 4
Female, 2
Diversity and expertise of the Board of Directors 31 December 2025
33.3%33.3%
66.7%66.7%
customer accounts
governance
operational management
internal control and risk management
HR management
international market insight
ICT and data analytics
strategy and M&A
supply chain management
finance
technologies
industry expertise
0 1 2 3
4 5
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Sustainability report
Annual Report 2025
Report by the Board of Directors
Subject area Policy Responsibility The most senior approval body Training intended for personnel
Corporate governance Employee Code of Conduct Senior Vice President, HR and Legal Board of Directors Online training
Corporate governance
Anti-corruption and anti-bribery
policy
Senior Vice President, HR and Legal CEO and Group Executive Board Online training
Corporate governance Information security policy Chief Information Officer CEO and Group Executive Board Online training
Corporate governance Data protection policy Senior Vice President, HR and Legal Board of Directors
Part of online training on the data
protection policy
Corporate governance Tax policy Chief Financial Officer Board of Directors
Part of the induction of separately
identified experts
Corporate governance
Policy on supplier gifts and hos-
pitality
Senior Vice President, Corporate
Relations and Sustainability
CEO and Group Executive Board
Part of the induction of separately
identified experts
Society HR policy Senior Vice President, HR and Legal CEO and Group Executive Board Part of induction
Society Occupational Safety Policy Senior Vice President, HR and Legal CEO and Group Executive Board Online training
Society Human rights policy Senior Vice President, HR and Legal Board of Directors
Part of online training on the Code
of Conduct
Society Supplier Code of Conduct Chief Purchasing Officer CEO and Group Executive Board Part of the contractual requirements
Society Sanctions control policy Senior Vice President, HR and Legal Board of Directors
Part of the induction of separately
identified experts
Environment Environmental policy
Senior Vice President, Corporate
Relations and Sustainability
CEO and Group Executive Board
No specific training, implementation
through objectives, targets, metrics
and monitoring
ations, such as business-specific diversity plans and guidelines that supplement
policies, which can be found via the company’s internal communication channels.
Policies are updated at two-year intervals in collaboration with specialists.
Responsible parties and approvers have been designated for each policy. The gov-
ernance-related Employee Code of Conduct, anti-corruption and anti-bribery policy,
data protection policy, information security policy, guidelines on gifts and hospitality
in procurement activities, and related targets and metrics are described in more
detail in paragraph ESRS G1-1, pp. 77–79. The occupational safety policy, personnel
policy and human rights policy are described in more detail in paragraph ESRS S1-1,
pp. 64–65. The Supplier Code of Conduct is described in more detail in paragraph
ESRS S2-1, pp. 74–75. The environmental policy is described in more detail in section
ESRS E1-2, p. 50.
Luotea also requires that employees complete online training on policies and
principles on a job role-specific basis. Statistics on the completion of these training
activities are monitored by the compliance task force and the Group Executive
Board. The development of competence is the responsibility of the Senior Vice
President, HR and Legal, together with the HR organisation. The HR organisation
also prepares company-specific personnel development plans. The company's key
policies and principles with relevance to the sustainability report are listed below. All
of the listed policies and principles, with the exception of the information security
policy, are publicly available on Luotea’s website.
Shop steward organisation and European Works Council
At Luotea, employees are mainly represented by shop stewards or representatives
elected from among the personnel.
The election and duties of shop stewards are laid down in collective agreements
and, in part, in labour law. The election and duties of the shop steward are, on the
other hand, provided for in labour law.
European Works Council meetings are held twice a year, and they bring together
employee representatives from both operating countries to discuss various issues.
GOV-2 – Information provided to and sustainability
matters addressed by the undertaking’s
administrative, management and supervisory
bodies
Sustainability matters are taken into account in the company’s strategy, in con-
nection with major business decisions and in risk management processes to the
extent that they are material to the strategy, decision or process. This also includes
the assessment of material impacts, risks and opportunities. The Board of Direc-
tors additionally monitors, as part of the risk management process, that Luotea has
sufficient capabilities to identify, assess and manage risks effectively. The Board of
Directors annually approves the results of Luotea’s double materiality assessment,
which address Luotea’s material impacts, risks and opportunities. Luotea's key sus-
tainability targets are reported to the Board of Directors four times per year in con-
nection with interim reports, and they are part of the company's strategic objectives.
In connection with interim reports, the Board of Directors assesses the measures
necessary for achieving the targets and metrics. The sustainability risk manage-
Key policies 2025, responsibilities and training related to policies
16
Sustainability report
Annual Report 2025
Report by the Board of Directors
ment process is part of the company’s overall risk management process. The due
diligence process related to acquisitions is described in more detail in section ESRS
2 GOV-4, p. 16.
During the reporting period, the following sustainability-related topics, among
others, were discussed in the meetings and training sessions of the Board of Direc-
tors and its committees:
• Organisation of and allocation of resources ot sustainability work
• Review of policy updates (data protection policy)
• Approval of the results of the double materiality assessment
• Monitoring the development of sustainability reporting by Audit Committee
meetings
• Development work related to sustainability reporting at the Board of Directors’
training sessions
• Monitoring regulation concerning sustainability
• The pressures, risks and opportunities caused by the geopolitical situation and
the development of regulation for business and sustainability - review by the
Board of Directors’ training sessions
• Development of the key sustainability targets.
During the reporting period, the following sustainability-related topics, among
others, were discussed in the meetings of the Group Executive Board:
• Organisation of and allocation of resources ot sustainability work
• Procurement policy
• Results of the double materiality assessment
• Supplier Code of Conduct
• EHSQ Manual
• Monitoring regulation concerning sustainability
• Information security policy
• Progress of the key sustainability targets
• The Group's climate transition plan
GOV-3 – Integration of sustainability-related
performance in incentive schemes
The Personnel and Sustainability Committee of Luotea’s Board of Directors has
drafted, and the Board of Directors has approved, the Remuneration Policy, which
was presented to the Annual General Meeting on 21 March 2024. The aim is to follow
the policy for four years until the Annual General Meeting in 2028. The Remunera-
tion Policy describes the remuneration principles concerning the Company’s gov-
erning bodies, namely the Board of Directors and the President and CEO. During the
financial year 2025, Luotea complied with the Remuneration Policy presented to the
Annual General Meeting. There were no deviations from the Remuneration Policy
and no clawback of remuneration.
In accordance with the Remuneration Policy, the aim of the remuneration
scheme of the Board of Directors and the President and CEO is to contribute to the
positive development of shareholder value, as well as to enhance the Company’s
competitiveness, long-term financial success, and fulfilment of the strategy and
goals set by the Company. An analysis of the total compensation of the Board of
Directors, the President and CEO and the Group Executive Board is prepared annu-
ally by an external consultant that is independent of the company. The analysis is
reviewed by the Personnel and Sustainability Committee.
On 4 December 2025, the Extraordinary Annual General Meeting decided on the
remuneration of the members of Luotea's Board of Directors. The remuneration of
the Board of Directors did not include remuneration components related to sustain-
ability matters.
The remuneration of the President and CEO consists of a fixed monthly salary
and benefits, and a separate annually decided short-term incentive. The objectives
of the short-term incentive scheme are set – and their achievement assessed –
annually. In addition, the President and CEO is included in the share-based incen-
tive scheme, which serves as a long-term incentive scheme. The Board of Directors
decides on the remuneration and financial benefits payable to the President and
CEO. Prior to the decision-making of the Board of Directors, the matter is prepared
by the Personnel and Sustainability Committee of the Board.
The short-term incentive scheme and the share-based incentive scheme that
serves as a long-term incentive scheme constitute the variable components of the
President and CEO’s remuneration.
The President and CEO’s short-term incentive bonus for the earnings period
that corresponds to the financial year 2024 was based on the Group’s profit perfor-
mance and strategic targets defined by the Board of Directors as follows: consoli-
dated operating profit (70% weight), improving working capital (20% weight) and the
employee Net Promoter Score (eNPS, 10% weight). Based on the achievement of
the earnings criteria for the earnings period that corresponded to the financial year
2025, the incentive bonus was earned at 38.0% of the maximum amount. The Presi-
dent and CEO will be paid a short-term incentive bonus of EUR 103,658 in the finan-
cial year 2026 for the earnings period that corresponds to the financial year 2025.
The long-term incentive scheme includes a share-based incentive programme
that covers the financial years 2023–2027. Luotea’s emission reduction targets
(scope 1 and 2) are part of the company’s strategic goals and they have been taken
into account in the long-term incentive scheme for senior management. As a rule,
the earnings period of the plan is three calendar years. Luotea's Board of Directors
decides on the earning criteria for each earnings period based on the Personnel and
Sustainability Committee’s proposal. The Board of Directors monitors and evaluates
performance annually.
The share-based incentive schemes with the financial year 2024 and the financial
years 2023–2025, 2024–2026 and 2025–2027 as the earnings periods, are described
below:
• The share-based incentive scheme with the financial year 2024 as the earnings
period. The reward is based on the Group’s return on capital employed (ROCE)
with a weight of 80% and carbon footprint reduction with a weight of 20%. The
earnings criteria for the earnings period that corresponds to the financial year
2024 were achieved to such an extent that the reward represented 23.51% of the
maximum amount. In the financial year 2025, the President and CEO was paid
a total of EUR 60,827.68 under the long-term incentive scheme (corresponding
to 7,382 L&T shares to be transferred and including the cash component) for the
earnings period that corresponded to the financial year 2024, calculated at the
average share price on 25 February 2025.
• The share-based incentive scheme with the financial years 2023–2025 as the
earnings period. The reward is based on the Group’s average return on capital
employed (ROCE) for 2023–2025 (50% weight), the total shareholder return (TSR)
of the Lassila & Tikanoja plc share relative to the stock market index for the Hel-
sinki Stock Exchange (30% weight), and carbon footprint reduction (ESG, 20%
weight). The earnings criteria for the earnings period that corresponds to the
financial years 2023–2025 were achieved to such an extent that the reward repre-
sented 20% of the maximum amount. The President and CEO was paid a short-
term incentive bonus of EUR 49,560 in the financial year 2026 for the earnings
period that corresponds to the financial years 2023–2025.
• The share-based incentive scheme with the financial years 2024–2026 as the
earnings period. The reward is based on the Group’s average return on capital
employed (ROCE) for 2024–2026 (50% weight), the total shareholder return (TSR)
of the Lassila & Tikanoja plc share relative to the stock market index for the Hel-
sinki Stock Exchange (30% weight), and carbon footprint reduction (20% weight).
Payment of the rewards under the share-based incentive scheme in question will
take place after the three-year earnings period, in 2027.
• The share-based incentive scheme with the financial years 2025–2027 as the
earnings period. The reward is based on the Group’s average return on capital
employed (ROCE) for 2025–2027 (30% weight), the total shareholder return
(TSR) of the Lassila & Tikanoja plc share relative to the stock market index for
the Helsinki Stock Exchange (30% weight), carbon footprint reduction (ESG, 20%
weight), and net sales growth for the period 2025–2027 (20% weight). Payment of
the rewards under the share-based incentive scheme in question will take place
after the three-year earnings period, in 2028.
As a result of the partial demerger of Lassila & Tikanoja Oyj completed on 31
December 2025, the Board of Directors decided in early 2026 to make necessary
updates to the ongoing performance periods for the years 2026 and 2027. The
update concerned the content of the ESG criterion. For the remaining years of the
performance period, the ESG criterion was changed from reducing carbon foot-
print to an employee experience–based eNPS metric. The amounts of the rewards
and the other performance criteria remained unchanged. For performance periods
commencing in 2026, Total Shareholder Return (TSR) and Return on Capital
Employed (ROCE) are linked to the performance of Luotea.
GOV-4 – Statement on sustainability due diligence
Luotea applies due diligence in its operations. Information related to sustainability
themes has been taken into account as part of the company’s processes con-
cerning acquisitions, procurement and human rights risk assessment.
Due diligence process in the context of acquisitions
In connection with acquisitions, various practices of the company being acquired
are identified and assessed. Examples of these include employment contracts,
occupational safety management and occupational health. Depending on the
nature of the operations, compliance with environmental permits and the current
state of production are also examined, provided that they may have impacts related
to Luotea’s climate targets, for instance. Due diligence always includes a financial
and legal evaluation. Luotea's due diligence obligation concerning acquisitions is
fulfilled at the business management level, in collaboration with the company's
17
Sustainability report
Annual Report 2025
Report by the Board of Directors
Legal Affairs function. If necessary, external M&A professionals are utilised to assist
in the evaluation of the subject of the acquisition. The due diligence reports are
available to the President and CEO, the Group Executive Board and the Board of
Directors when they make the investment decision.
Due diligence process in procurement
Supplier due diligence is taken into account at different stages of the procurement
process. Luotea’s compliance-related expectations are set out in the Supplier Code
of Conduct, which is included in the appendices to Luotea’s procurement agree-
ments. Compliance is verified during the cooperation through self-assessment
questionnaires, audits and monitoring in accordance with the Contractor’s Liability
Act. In addition, the supplier’s financial and legal information is reviewed in con-
nection with contract negotiations. Luotea uses many long-term suppliers, which
promotes the transparency of the chain and enables the long-term development of
various operating models. The Group’s Chief Purchasing Officer is responsible for
supplier cooperation and its development. The policies, actions and objectives are
described in more detail in paragraph ESRS S2, pp. 74–76.
Due diligence process in human rights risk assessment
Luotea observes the Universal Declaration of Human Rights, workers’ rights as
defined by the International Labour Organization (ILO), international agreements
and the UN Guiding Principles on Business and Human Rights. The company is
committed to supporting the UN Global Compact initiative and its principles per-
taining to human rights and labour rights. Human rights are also taken into account
in Luotea’s public policies and plans, such as the Employee Code of Conduct, Sup-
plier Code of Conduct, human rights policy, occupational safety policy and internal
diversity plan. Luotea's human rights principles have been approved by the Presi-
dent and CEO and the Group Executive Board.
In 2024, Luotea carried out a company-wide human rights risk assessment that
covered not only the company's own operations but also the impacts of Luotea’s
supply chain. The assessment was based on the UN Guiding Principles and the
OECD Guidelines for Multinational Enterprises. The estimated direct and potential
human rights impacts of Luotea in its own operations and value chain have been
taken into account in Luotea's double materiality analysis 2025. In order to manage
the potential impacts related to the value chain that were assessed in 2025, Luotea
specified its requirements related to respecting human rights in the Supplier Code
of Conduct.
Luotea’s President and CEO and the Group Executive Board decide on the focal
points and approach to sustainability work, including human rights, and related
targets as part of the company’s sustainability programme. The President and
CEO and the Group Executive Board also approve Luotea's policies together with
the Board of Directors. Each division is responsible for allocating resources to the
policies and putting them into action. Luotea’s sustainability organisation is respon-
sible for assessing human rights impacts in close cooperation with the company’s
HR and procurement functions. Human rights issues have also been taken into
account in personnel training, such as the online training on the Code of Conduct
and occupational safety training.
Luotea has an anonymous whistleblowing channel in place. All workers and other
operators in the value chain can use it to report suspected misconduct related
to working conditions or human rights violations. The whistleblowing channel is
described on Luotea’s public website, intranet, Employee Code of Conduct and Sup-
plier Code of Conduct. A more detailed description of whistleblowing practices and
reports is provided in paragraph G1-1, pp. 77-79.
Due diligence process for compliance with international sanctions
In order to identify and comply with international sanctions, Luotea signed an agree-
ment on continuous sanctions monitoring with sa service provider in 2025. In 2025,
Luotea also drafted a Group-wide sanctions control policy.
GOV-5 – Risk management and internal controls
over sustainability reporting
Risk management pertaining to sustainability reporting takes into account the pro-
cesses related to sustainability reporting, the data used and its quality, as well as the
necessary internal and external systems and resources. The aim of the risk man-
agement model is to ensure the identification, assessment and management of
key risks related to the sustainability report. Risks are monitored at all stages of the
sustainability reporting process so that they are identified and assessed proactively
and any deficiencies can be addressed in a timely manner.
The risk assessment is the responsibility of Luotea's sustainability organisation
together with Luotea's CFO. Its key results are reported annually to the President
and CEO and the Group Executive Board, as well as the Audit Committee. This
ensures that risk management measures are implemented consistently and sup-
port the company’s sustainability targets.
The risk assessment model in use includes risk prioritisation methods that involve
the assessment of risks based on their impacts and likelihood. The final results also
take into account the company’s existing policies and practices. The most signif-
icant risks are related to topics that are material in terms of their impact or likeli-
hood.
In the 2025 risk assessment, the most significant risk related to sustainability
reporting concerns the partial demerger prepared in Luotea and completed on 31
December 2025. The partial demerger affects the collection of reported information
and required special arrangements for the reporting of quantitative data in Jan-
uary 2026. The company has carefully prepared for the partial demerger, reviewed
its data collection process and taken into account the special arrangement in the
reporting schedule.
There may be risks related to the completeness and integrity of data, as some of
the environmental indicators are compiled manually from several of the company’s
information systems. Luotea has increased the specificity of the related instructions,
clarified the process descriptions and developed internal control to ensure that any
data errors are detected at a sufficiently early stage.
Luotea conducts internal audits to ensure that the risk management and control
systems function as expected and that they are complied with. The risk manage-
ment process related to sustainability reporting can also be addressed in connec-
tion with internal audits. Internal audit results are reported to the President and CEO
and the Group Executive Board, as well as the Audit Committee.
SBM-1 – Strategy, business model and value chain
Business model and value chain
Luotea’s business model builds sustainable future growth related to the digitalisa-
tion of properties, energy efficiency and biodiversity, creating added value for cus-
tomers, investors and other stakeholders. The company had three divisions in 2025:
• Facility Services in Finland and Sweden improve the value of our customers’
properties and aim for the continuous improvement of energy efficiency and
increase in biodiversity
• The Circular Economy business keeps customers’ materials in circulation as
efficiently as possible and with the highest possible degree of processing, as
recycled or secondary raw materials, and offers cleaning and restoration ser-
vices. The division operates in Finland and Sweden.
From the beginning of 2025, Luotea has two divisions: Facility Services Finland and
Facility Services Sweden.
Luotea operates in the service sector and is a significant employer. With this in mind,
the occupational well-being and work ability of the personnel are key success fac-
tors for the company's business. Effective frontline management, good induction
and offering development opportunities have an impact on the retention of per-
sonnel. On 31 December 2025, Luotea had a total of 5,007 employees. The break-
down of personnel by country is presented in paragraph S1-6, p. 69.
In Facility Services, the company aims to extend the lifespan of properties through
efficient and timely cleaning and maintenance, and improves the efficiency of, and
reduces, the energy consumption of properties. Luotea’s key customers include
operators in the fields of social welfare and health care, manufacturing, construc-
tion, commerce and logistics, as well as public sector entities and property sector
operators.
Until the end of 2025, Luotea operated in circular economy businesses in the waste
and side stream value chain. The circular economy business covers waste genera-
tion, supporting the customer in the sorting of waste and the selection of waste col-
lection containers, as well as transport, recycling, secondary use and reuse. Together
with its customers and partners, the operations ensure efficient waste logistics and
the recycling of raw materials.
The upstream value chain of activities related to the circular economy includes the
waste and side streams generated in different customer industries, such as heavy
manufacturing, construction, commerce, the public sector and other properties. In
2025, the Circular Economy business was responsible for the waste management
of tens of thousands of companies and households in Finland, supporting them
in sorting at source and waste reporting. Partners in the downstream value chain
of the circular economy business that carry out the recycling and other recovery of
raw materials. The recycled materials processed by the circular economy business
are sold to industrial customers that use them as raw materials in their production
activities.
Other key partners in Luotea’s value chain are subcontractors that provide ser-
vices.
Strategy
Climate change and biodiversity loss are megatrends whose mitigation creates
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business opportunities for Luotea. Mitigating climate change and biodiversity loss
requires energy efficiency and circular economy actions from society, businesses
and individuals. Businesses need responsible partners to support the transition to a
circular economy and to improve the energy efficiency of properties and biodiversity.
Cities continue to grow, and the expectations concerning the built environment are
increasing, which creates demand for Luotea’s services. Properties are expected to
have long life spans, and changes in needs and the use of buildings over the years
must be taken into account in maintenance and new construction.
In December 2025, the Annual General Meeting of Luotea decided to separate
the company’s circular economy business operations into a new listed company
through the partial demerger of Lassila & Tikanoja Plc. According to the Board of
Directors’ assessment, the separation of the circular economy and facility services
businesses increases shareholder value by enabling both businesses to pursue their
own strategies and growth opportunities more effectively.
In 2025, Luotea implemented the Leader of the Regenerative Society strategy for the
strategy period 2022–2026. In accordance with the strategy, the company's mission
is to make the circular economy a reality, and the company helps its customers
achieve their sustainability targets. During 2025, Luotea's continuing operations
northwest prepared a new strategy that has been specified further for the Facility
Services businesses in Finland and Sweden. Luotea's continuing operations will
focus on facility services and offer comprehensive solutions for the entire life cycle of
properties.
The new mission of Luotea’s continuous services is: We create deeper value for
people, businesses and society. Our facility services make everyday life smoother
and strengthen our customers’ business. Continuous improvement is part of our
day-to-day routine. Our passion is to do our work more responsibly and with higher
quality – to constantly improve. The new vision for Luotea's continuing operations is:
Leading the way to a smarter tomorrow. In line with our vision, we are developing a
new era of property maintenance. In our work, technology and human competence
work seamlessly together to make buildings more ecological, smart and functional
for their users.
Our strategic initiatives are taking us towards Luotea's vision. We grow in our core
business by providing high-quality and responsible services that generate measur-
able value for the customer. We improve the efficiency of our operations through
modern and uniform operating models. At the same time, we are building a work-
place where people feel good, develop and stay – our goal is to be the best workplace
in the industry. In addition, we are strengthening our competitiveness by utilising dig-
ital services and artificial intelligence with a pioneering approach.
The Facility Services Finland and Facility Services Sweden divisions focus on devel-
oping paths to profitable growth alongside improving their profitability.
Growth is sought through spearhead services that create significant cost and sus-
tainability benefits for customers, bring new profitable customers to Luotea’s con-
tinuing operations and improve customer retention. Competitive spearhead ser-
vices enable faster growth than the market in current operations.
The spearhead services include data-driven property services, energy efficiency
services and sustainability expert services. The services improve customers’ sus-
tainability, for example, by reducing the carbon footprint, increasing biodiversity and
offering solutions for climate change adaptation. Data-driven services provide high-
er-quality reporting, enhance the efficiency of property use and improve conditions
and energy efficiency.
Luotea's continuing operations continuously develop the sustainability of their core
services. The development work meets the needs of customers and provides a
competitive advantage. A reporting portal has been created for customers for mon-
itoring the quality of the service and the carbon footprint, for example. The develop-
ment and management of sustainability work uses its own tool, the sustainability
index, which describes the progress of the work. The sustainability index regularly
monitors the development of social responsibility, environmental impact, carbon
handprint and the quality of operations using selected metrics.
The strong balance sheet and the favourable development of the contract portfolio
create excellent conditions for organic and inorganic growth during the strategy
Strategic sustainability targets 2025
Indicator The goal 2025 2024
Employee Net Promoter Score,
eNPS
>50 by 2026 24 21
Carbon footprint (Scope 1 and 2) -50% by 2030, using
2018 as the baseline
-53 -42
Carbon handprint grows faster than net
sales
-378.8 -438.2
Total recordable incident frequen-
cy
19 by 2026 18 19
Sickness-related absence rate less than 4.3% by
2026
5.0 5.0
Code of Conduct training cover-
age among personnel
100% of own person-
nel
68 64
Increase the recycling rate of col-
lected and processed materials
to 70% by 2030 49.8 55.2
period. Luotea wants to be the best sustainability partner for its customers and
an excellent workplace for the best experts in its field. During the strategy period,
Luotea will invest in the renewal of operating models, which will enable even more
cost-efficient service production.
Luotea measures the success of its strategy by financial, sustainability and stake-
holder targets.
Business environment
The business environment in the facility services market in Finland was quite dif-
ficult. Economic uncertainty was reflected in the demand for facility services and
the market. Customers actively tendered the services and sought cost-efficient
solutions for the provision of services. On the other hand, customers’ cost focus
was reflected in the growth in the volume of Luotea's spearhead services, such as
data-driven cleaning and energy efficiency solutions.
The focus on costs was particularly clear in the public sector, municipalities and
social welfare and healthcare areas. Market dialogues on cost-efficient service
solutions for various support services were actively conducted. The opening up
of the public sector support services market seems to be accelerating in Finland,
which is still clearly behind the Swedish situation.
In Finland, the aim is to accelerate the opening up of the public sector service
market to competition by amending the Procurement Act. From Luotea’s point
of view, the reform proceeded in line with expectations and wishes. The aim of the
Act is to set a minimum ownership threshold of 10% for a municipality’s in-house
entity, which will have a significant impact on the opening up of the market. The
public sector still has a large number of unhealthy in-house structures that arti-
ficially seek to close the market and avoid competition. The Procurement Act is
planned to enter into force in 2026.
The difficult employment situation in Finland and Sweden has provided tempo-
rary relief to the availability of labour in Cleaning Services. Over the past few years,
personnel turnover has fallen to a record low. The structural challenge of the suf-
ficient availability of labour remains a significant challenge for the industry, which
will require investments in the future as well.
Towards the end of the year, there was a social debate on sustainable working
life policies in Finland. Journalist Paavo Teittinen’s book Pitkä vuoro ("Long shift")
highlighted dramatic misconduct in the treatment of employees in the cleaning
industry. Luotea believes that discussion and raising concerns are important,
and they concretely illustrate the importance of sustainability work throughout
the value chain.
The EU is currently reviewing sustainability regulations. The aim is to improve the
competitiveness of European companies by reducing the administrative burden,
clarifying sustainability regulation and targeting it at large undertakings with sig-
nificant impacts.
Regulatory simplification is implemented through Omnibus initiatives, the
most material of which for Luotea are related to the directives on sustainability
reporting (CSRD) and corporate responsibility (CSDDD) and the EU Taxonomy
Regulation.
The EU’s goals of streamlining regulation are correct and welcome. The Cor-
porate Sustainability Reporting Directive in particular is too ambitious in terms
of the scope and detail of the reporting obligation. Sustainability work has
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become too reporting-oriented, leaving behind the strategic work of undertakings
to reform their business activities to align with sustainable development.
With its own responsible cleaning and property maintenance development pro-
grammes, Luotea has sought to integrate sustainability into its service solutions.
The concepts guide Luotea and its customers to choose sustainable policies in
property maintenance.
In Finland, the requirements of the Energy Efficiency Directive and the Energy
Efficiency of Buildings Directive are currently being implemented in national legis-
lation. The Member States have been given a lot of leeway as to how high the bar
is set. In accordance with Finland’s Government Programme, the national imple-
mentation of the Directive will be carried out with as few changes as possible to
the current regulations. As a provider of energy efficiency solutions, Luotea sup-
ports ambitious goals.
Improving energy efficiency should be seen not only as a means of mitigating con-
sumption and emissions, but also, and in particular, as a way to improve the value
of properties.
Luotea sustainability work supports the company's strategy
The targets of Luotea’s sustainability programme take into account the potential
impacts of the business environment. The targets of the current sustainability pro-
gramme contribute to Luotea’s goal of being the most responsible partner in the
industry.
• Through its services, Luotea creates solutions to mitigate climate change and
biodiversity loss, promotes the circularity of materials and creates solutions for
the sustainable use of the built environment.
• Luotea values diversity and equality at the workplace and invests in well-being at
work and occupational safety.
• Luotea acts appropriately and transparently throughout the value chain. Good
corporate governance is a cornerstone of Luotea’s sustainability.
Luotea’s sustainability programme includes targets extending to 2030. The key
measurable targets of the sustainability programme for 2025 concern Luotea’s cli-
mate targets, the recycling rate, the occupational safety frequency of the personnel,
the health and job satisfaction of the personnel and the coverage of training on the
Code of Conduct. Compliance in the supply chain is measured by the coverage of
the Supplier Code of Conduct and related self-assessments.
Relevant SDGs
Luotea is committed to supporting the UN Sustainable Development Goals (SDG)
in its operations. The company has identified the following SDGs as especially rele-
vant to its operations:
• SDG 7: affordable and clean energy
• SDG 8: decent work and economic growth
• SDG 10: reduced inequalities
• SDG 11: sustainable cities and communities
Stakeholder
Key areas of interest in
2025 Responding to expectations Engagement
Customers Customer service and sat-
isfaction, delivery reliability,
communication and
reporting, pricing, working
conditions in the value
chain, circular economy,
recycling and restoration,
energy efficiency.
• Luotea developed sustainability-promoting business solu-
tions related to the restoration of nature and the promotion
of diversity.
• Luotea has continued to develop the effectiveness of its
digital service channels and business-specific measures
to optiimse the efficiency of services in the customer inter-
face.
A customer survey (NPS) to measure the net pro-
moter score (NPS) among corporate customers, and
several customer-specific surveys. Customer service
(telephone, digital service channels) and dialogue with
customer relations officers and sales. Marketing com-
munications, digital events and other events.
Personnel The employees’ physical
and mental well-being,
ability to cope with work,
training and competence
development, as well as
job satisfaction and the
employee experience.
• Luotea provided diverse physical and mental well-being
services to employees along with learning-on-the-job
opportunities, career paths and training.
• Luotea expanded its training offering by strengthening
themes that support the well-being of employees in the
training offering, including time management, team skills
and self-development.
Feedback and development discussions, Fiilinki per-
sonnel surveys, co-operation and European Works
Council activities, workshops, digital events and other
events as well as internal communication channels
such as the intranet and Teams.
Potential employees Employer brand and the
employee experience.
• As in the previous years, Luotea made extensive use of
digital avenues to reach potential job applicants and share
information about working at Luotea. The company also
participated in various career and recruitment events.
Co-operation with educational institutions, recruit-
ment and career events, development of the employer
image and sharing information through social media
channels.
Investors and share-
holders
Partial demerger, financial
performance, the strategy
and its progress, the sus-
tainability of operations
and ESG ratings, customer
satisfaction and employee
satisfaction.
• Luotea has provided up-to-date information on the prog-
ress of the partial demerger
• Luotea participated in select ESG surveys and developed
sustainability reporting.
• Luotea also engaged in active dialogue with investors on
sustainability-related topics.
Stock exchange releases, financial reports, annual
reporting, the Group’s website, webcasts, regular
investor meetings and the Annual General Meeting.
Decision-makers
and influencers
(including national
and regional deci-
sion-makers),
industry organisa-
tions and employer
organisations
Circular economy and
climate change mitigation,
employment, working con-
ditions and the functioning
of the market and compet-
itive neutrality.
• Luotea participated in the activities of industry and labour
market organisations.
• Luotea promoted initiatives aimed at strengthening the
green transition and developing the labour market.
• Luotea took initiatives in Finland to accelerate the circular
economy
• Luotea has promoted the employment opportunities of
people with partial work ability and work-related immigra-
tion
Participation in associations, dialogue with the public
authorities and decision-makers, co-operation proj-
ects, other projects, responding to surveys, the com-
pany website and annual reporting.
Media and NGOs Practical steps related to
the circular economy,
actions to promote biodi-
versity, working conditions
and human rights.
• Luotea published numerous press releases and partici-
pated in interviews.
Press releases, interviews, publications, media events,
the company website and social media channels. Dia-
logue and responding to surveys.
Suppliers and sub-
contractors
Quality, responsible pro-
curement, value chain
workers.
• Luotea engaged in dialogue and carried out audits and
self-assessments.
Dialogue, responding to surveys, audits and self-as-
sessments.
Key stakeholders and their interests, expectations and engagement
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Luotea also takes the interests, views and rights of value chain workers and
respecting their human rights into account in its operations. Luotea’s Supplier Code
of Conduct lays down minimum requirements that suppliers must respect and
adhere to in their own operations and the supply chain. The Supplier Code of Con-
duct covers topics including respect for workers' rights, occupational safety and the
prohibition of the use of child labour and forced labour, for example. Luotea requires
its suppliers to commit to the Supplier Conduct, and they are also incorporated
into Luotea’s procurement agreements. Luotea also uses a separate self-assess-
ment model to monitor and assess compliance with the Supplier Code of Conduct.
The company has also identified and assessed potential human rights risks in the
supply chain in cooperation with the procurement function (carried out in 2024).
The assessment is part of the company’s human rights principles.
Luotea has a separate, public and anonymous whistleblowing channel through
which value chain workers can report misconduct. Luotea processes potential
human rights violations in accordance with clear procedures and carries out cor-
rective measures as necessary. Value chain workers are described in more detail in
paragraph ESRS S2, pp. 74–75.
SBM-3 – Material impacts, risks and opportunities
and their interaction with strategy and business
models
The material impacts, risks and opportunities of Luotea are based on the double
materiality analysis updated in 2025. The update work assessed changes in
Luotea’s business operations and business environment and the significance of the
changes to the previous materiality assessment carried out in 2024. The update
reviewed the materiality both with regard to the company’s sectors facility services
and circular economy business and the company as a whole. Luotea's material
impacts, risks and opportunities and their focus within the company’s operations
and value chain are summarised in a table, pp. 25-28.
Impact of the partial demerger on Luotea's material impacts, risks
and opportunities
Based on the results of the double materiality analysis, the material impacts, risks
and opportunities for the environment, society and governance occur in the short
term. The partial demerger will have a significant impact on the materiality of
Luotea’s impacts, risks and opportunities in terms of continuing operations in the
medium and long term. The material impacts and opportunities of the sustain-
ability themes E4 Biodiversity and ecosystems and E5 Resource use and circular
economy focus on discontinued operations (circular economy business) and its
upstream and downstream value chain, and are only material for Luotea in the
short term. With regard to sustainability topic E1 climate change, the company’s
positive impact on climate change mitigation is assessed using the entity-specific
metric carbon handprint (tCO
2
eq). The carbon handprint is mainly created in the
circular economy business and its value chain, and the impact is also only material
for Luotea in the short term. The transition risks of climate change are largely tar-
geted at the circular economy business and its upstream value chain and are only
material for Luotea in the short term.
• SDG 12: responsible consumption and production
• SDG 13: climate action
• SDG 15: life on land.
Commitment to national and international initiatives
Luotea is committed to supporting the following key declarations and agreements:
• UN sustainable development principles since 2018
• Global Compact principles since 2018
• ILO Declaration on Fundamental Principles and Rights at Work
• Universal Declaration of Human Rights
• Society’s commitments to sustainable development
• Science-based emission targets (SBTi)
Value creation
By investing in sustainable solutions, Luotea aims to create increasing value for all
of its key stakeholders.
Resources
• Luotea has robust expertise in the development of low-carbon, resource-saving
services.
• Luotea continuously develops new solutions to promote energy efficiency,
smart cleaning, industrial side streams, nature-related services and the circular
economy. The solutions improve the efficiency of the customers’ operations,
increase the value of properties and reduce environmental impacts.
• Luotea looks after the well-being and safety of employees and invests in work
ability and well-being. Training opportunities and certifications, such as ISO
9001, ISO 14001 and ISO 45001, support the quality and sustainability of opera-
tions.
Results
• The reuse and recycling of materials saves virgin natural resources and reduces
waste and emissions.
• With its business solutions, Facility Services promotes the energy efficiency, pro-
ductivity and value of properties, as well as biodiversity.
• Occupational safety has improved from each year to the next, and Luotea also
introduces good practices to its subcontractors and partners.
• Luotea is the first workplace for many young people.
SBM-2 – Interests and views of stakeholders
Luotea's stakeholder engagement is focused on the stakeholders who are the most
affected by the impacts of the company's operations and whose actions have the
greatest influence on the achievement of Luotea's business objectives and sustain-
ability targets. Stakeholder expectations are taken into account in Luotea’s strategy
development and business choices. Stakeholder views were also a key part of
Luotea’s double materiality assessment.
The company's key stakeholders include customers, current and potential
employees, and investors, as well as national and regional policymakers and influ-
encers, non-governmental organisations, the media, and suppliers and subcontrac-
tors.
Luoeta engages in active dialogue with its key stakeholders. The company regu-
larly measures stakeholder support by means of customer and employee satisfac-
tion surveys and a reputation survey carried out by a third party. Luotea also par-
ticipates in the Ecovadis corporate responsibility assessment, which measures the
quality of Luotea’s sustainability work and through which Luotea receives questions
and development suggestions related to corporate responsibility from its customers.
Through dialogue and measurements, Luotea identifies stakeholder expectations
and determines what development measures are necessary. The results of the cus-
tomer and employee satisfaction survey and the reputation survey, as well as any
related development areas, are reported at least once a year to the President and
CEO and the Group Executive Board, as well as the Personnel and Sustainability
Committee of the Board of Directors. In 2025, no reputation survey was carried out
due to preparations for the partial demerger.
Luotea's current strategy and the targets of the sustainability programme are
in line with stakeholder expectations. No changes have been made to Luotea’s
strategy or business model during 2025 due to the interests and views of stake-
holders. The sustainability targets are updated regularly, taking into account any
changes in the business environment and stakeholder expectations. The key future
development areas are described in connection with each topic as part of the com-
pany’s sustainability reporting.
Luotea has summarised stakeholder expectations into the following three perspec-
tives:
• A leader in sustainability: As a leader in its field, Luotea is expected to develop
the entire industry in the right direction for society and to conduct itself correctly
and sustainably in environmental matters.
• A good employer: As a large employer and service company, Luotea is expected
to be a responsible employer that looks after the well-being of its personnel
and treats its personnel responsibly and fairly while exercising special care with
regard to the employment of people who are in vulnerable positions.
• A useful partner Luotea is expected to be a useful partner to its customers,
developing new services and supporting the customers in their work towards
their goals as well as keeping its promises.
Luotea takes the interests, views and rights of its own workforce into account in
its strategy and business model in many ways. Luotea has identified and assessed
the impacts, risks and opportunities related to its own workforce. The key themes
include employment security; working time; adequate wages; freedom of associ-
ation; the information, consultation and participation rights of workers; social dia-
logue; work–life balance; health and safety; and gender equality. Attracting the best
professionals in the industry is a strategic priority for Luotea, and the well-being of
the personnel is a key success factor for the company's business. Luotea engages in
extensive and diverse dialogue with its personnel, and the views of the personnel are
taken into account in drawing up the business strategy. In addition, Luotea’s Code
of Conduct for Personnel, personnel policy, human rights policy and occupational
safety policy guide operations and ensure respect for employees’ rights. The compa-
ny’s own workforce is described in paragraph ESRS S1, pp. 64–65.
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Impacts, risks and opportunities related to own workforce, value
chain workers and business conduct
As a large operator in the service sector, the company's own workforce is a key
resource in the implementation of the company’s strategy and services. Luotea’s
operations are also dependent on the supply chain and the services and products it
produces. Through its operating practices, the company influences the well-being,
occupational safety, occupational health, diversity and work practices of its own
workforce and value chain workers.
The strong legislation and social structure in Finland and Sweden provide a good
foundation for promoting positive work-related practices in the value chain. Through
its operating practices, the company also influences the human rights and working
practices of workers in the value chain and thereby mitigates potential risks that, if
realised, could weaken the Luotea’s reputation, have an adverse impact on labour
availability and increase employee turnover.
Good corporate governance practices provide the foundation for Luotea's busi-
ness activities. The key positive impacts associated with business conduct are
related to Luotea’s good corporate culture, such as the company’s Code of Conduct,
anti-corruption and anti-bribery practices and whistleblowing processes. The com-
pany’s policies, principles and instructions guide operating practices in both its own
operations and the value chain, and the related measures strengthen the compa-
ny’s reliability in the eyes of customers and stakeholders.
Risks related to corruption and bribery can cause negative reputational and
financial impacts on the company. Luotea uses regular training, audits and strict
rules to engage the commitment of the parties concerned. Compliance with the
Code of Conduct is of utmost importance to Luotea. It strengthens the compa-
ny’s reputation as a responsible operator and creates trust among customers and
stakeholders.
Impacts, risks and opportunities related to the environment
Luotea's environmental impacts are largely related to the strategy and business
models of the circular economy business that belonged to the Group until the end
of 2025. The services produced in the circular economy business for customers
reduce emissions (carbon handprint) and promote the recycling of materials. At
the same time, they promote the sustainable use of natural resources and reduce
the value chain’s dependence on virgin raw materials. For the customers, this is
reflected in efficient waste management in which the recycling of materials is the
priority, regardless of the type of waste.
With regard to continuing operations, the energy efficiency solutions produced by
Luotea have a positive impact on the electricity consumption of customers’ proper-
ties, while also reducing emissions arising from energy use. Luotea believes that the
strong demand for energy consumption management services will continue and
expects growth in its related service business. The nature-related services produced
by the company, such as contaminated soil remediation projects in environmental
construction, meadow restoration projects in facility services and the removal of
invasive species have a positive impact on biodiversity. These measures support the
preservation of biodiversity and improve the state of the environment, and they are a
growth opportunity.
Luotea’s business units are dependent on energy with regard to logistics and
property operations, for example. This also generates a significant amount of
carbon dioxide emissions. However, most of the emissions are generated in the
supply chain. Climate change mitigation measures are key to reducing these
impacts.
The entity-specific carbon handprint is created through services produced for
customers. The carbon handprint reveals the extent to which a company has,
through conscious choices and decisions, avoided emissions and adverse environ-
mental impacts compared to its previous operating practices. Until 2025, Luotea's
aim was to continuously increase the positive climate impact of its operations.
The potential risks in the short term are related to tighter regulation of circular
economy operations and changes in markets and financial drivers, such as
financing. Regulatory changes can increase costs, for example as the company
transitions towards lower-emission operations. At the same time, however, regula-
tory changes create new opportunities, particularly with regard to energy efficiency
and renewable energy, as well as the development of recycling solutions and mate-
rial efficiency.
Changes in impacts, risks and opportunities compared to the
previous reporting period
Based on the double materiality analysis, there was no change in sustainability
themes that are material to Luotea during the reporting period. Changes in Luotea's
material impact, risks, and opportunities compared to the previous reporting period
are summarised in table on pages 25-28.
With regard to sustainability topic E4 Biodiversity and ecosystem services sub-topic
Impacts on the extent and condition of ecosystems sub-sub-topic example Soil
sealing , the scoring of financial effects did not exceed the materiality threshold,
nor was there a reported opportunity identified for circular economy business.
The materiality of the topic was not confirmed by stakeholder interviews or the
assessment of nature impacts and dependencies in 2025. The sub-sub-topic was
selected for reporting in 2024 in a qualitative review.
In the materiality assessment of sustainability toipc S2 Workers in the value chain,
the results of Luotea's human rights risk assessment conducted in 2024 were taken
into account. The assessment identified potential material human rights risks to
workers in the value chain related to occupational safety, working conditions and
discrimination were taken into account in the scoring of the sub-topics in such a
way that the severity of the impact is prioritised over its likelihood. The sub-topics
where the identified human rights risk was taken into account included all sub-sub-
topics of sub-topicworking conditions and the sub-topic Equal treatment and equal
opportunities for all sub-sub-topic Measures against violence and harassment in the
workplace. The scoring changed so that sub-sub-topic Measures against violence
and harassment in the workplace emerged as a new material impact. With regard to
working conditions, only sub-sub-topic Health and safety exceeded the materiality
threshold. In 2024, the potential negative impacts related to the working conditions
of value chain workers emerged as material in their entirety in the qualitative review.
However, Luotea’s current assessment is that Luotea’s impacts and risks with regard
to this sub-topic are low, especially with regard to direct suppliers.
The impact scoring of sustainability topic G1 Business Conduct sub-topic
Relationships with suppliers did not exceed the materiality threshold in the internal
assessment, and the materiality of impacts was not confirmed by the stakeholder
interviews in 2025. Therefore, Luotea does not report the information required by
disclosure requirement ESRS 2 G1-2 Relationships with suppliers and ESRS 2 G1-6
Payment practices in 2025. In 2024, the impacts related to the sub-topic emerged in
the qualitative review. Luotea's development work related to supplier management
was actively continued in 2025, with dedicated category managers in charge of
supplier relationship management.
The scoring of the impacts of sub-topic Protection of whistleblowers did not exceed
the materiality threshold in the internal assessment. The materiality of the topic
was not confirmed in stakeholder interviews in 2025. No changes that would
have affected the assessment were identified in the business environment or in
our own operations. In 2024, the impacts related to the sub-topic emerged in the
qualitative review. Luotea has existing policies that are followed to keep personal
data confidential. Luotea has not become aware that Luotea’s WB channel would
be considered unreliable.
The financial effects of the material impacts, risks and
opportunities, and their effects on strategy and business
The company annually assesses opportunities and risks, as well as their financial
effects and related risk management measures.
During the reporting period, Luotea has managed the material impacts, risks
and opportunities related to its financial position, financial results and cash flows
by means of the company’s existing risk management methods and policies. The
material sustainability risks did not create significant financial effects during the
reporting period, and the financial effects of risks are expected to remain low in both
the short and the long term. No related adjustments to carrying values are expected
over the next financial period.
Luotea estimates that the resilience of its strategy and business models regarding
its capacity to address its material impacts and risks and to take advantage of its
material opportunities is good during the strategy period 2022–2026. The com-
pany has well-established risk management practices and the capacity to adapt
to market changes, and the company engages in close monitoring of the business
environment. Luotea is seeking growth in energy efficiency services by investing in
the development of the Smartti service. Growth will be sought through business
development and potential complementary acquisitions.
Based on the double materiality assessment, Luotea’s material impacts on society
and the environment (impact materiality) and sustainability-related risks and
opportunities (financial materiality) are related to climate change (E1) , biodiversity
and ecosystems (E4), resource use and circular economy (E5) with regard to the
environment, and the company’s own workforce (S1) and workers in the value chain
(S2) with regard to society. In addition, the topic of business conduct (G1) is material
to Luotea. All of these topic areas are also included in Luotea’s current sustainability
programme and they are linked to the company’s strategy.
The environmentally material sustainability matters (E1, E4 and E5) are in line with
Luotea’s strategy followed in 2025, which aims to mitigate climate change and biodi-
versity loss and promote the sustainable use of raw materials. The circular economy
plays a key role in achieving these goals. Luotea’s strategy is also dependent on
society and people, which is reflected in the impacts, risks and opportunities asso-
ciated with both its own workforce (S1) and workers in the value chain (S2). Luotea’s
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aim is to provide employees with a balanced daily life in which everyone can be who
they are, and to promote human rights in the supply chain. The policies concerning
business conduct (G1) and Luotea's corporate culture provide the foundation for
sustainable business. Luotea aims for good and fair governance.
The current and anticipated effects of the company's material impacts, risks and
opportunities on its business model, value chain, strategy and decision-making are
subject to continuous monitoring. The impacts on the environment, own workforce
and value chain arise from Luotea's strategic objectives and business model, while
the issues that fall under business conduct are perceived as basic preconditions
for good corporate governance. The company responds to these effects by making
changes to its strategy, business model or governance models as necessary. The
company has set comprehensive sustainability targets that apply to the entire value
chain, especially with regard to the climate. The sustainability of the supply chain is
also promoted through requirements set out in procurement agreements and their
monitoring.
Luotea has also described the material impacts, risks and opportunities related
to climate change, biodiversity and ecosystems, own workforce and workers in the
value chain, and their interaction with the company's strategy and business model,
as part of the following topical ESRS standards:
• The impacts, risks and opportunities related to climate change are described
in paragraph E1 Climate change, under disclosure requirement SBM-3 Material
impacts, risks and opportunities and their interaction with the strategy and busi-
ness model, p. 50.
• The impacts and opportunities related to biodiversity and ecosystems are
described in paragraph E4 Biodiversity and ecosystem services under disclo-
sure requirement SBM-3 Material impacts, risks and opportunities and their
interaction with the strategy and business model, p. 59.
• The impacts and opportunities related to own workforce are described in
paragraph S1 Own workforce, under disclosure requirement SBM-3 Material
impacts, risks and opportunities and their interaction with the strategy and busi-
ness model, p. 64.
• The impacts related to workers in the value chain are described in paragraph
S2 Workers in the value chain under disclosure requirement SBM-3 Material
impacts, risks and opportunities and their interaction with the strategy and busi-
ness model, p. 74..
IRO-1 – The process to identify and assess material
impacts, risks and opportunities
Luotea's double materiality assessment focused on Luotea’s impacts on society,
the environment and governance, as well as the financial risks and opportunities
associated with these impacts. The analysis is based on the sustainability topics
presented in the European Sustainability Reporting Standards, and their sub-topics
and sub-sub-topics.
In 2025, the company’s double materiality assessment was updated as internal
expert work. The materiality analysis covered all Luotea Group companies.
The company’s sustainability, business, EHSQ, procurement, legal and human
resources management from both divisions participated in the update.
The update work assessed the coverage and timeliness of the impacts, risks and
opportunities arising from the company’s operations identified by Luotea in the pre-
vious assessment, and assessed whether there have been changes in the business
environment or Luotea’s business model that would change the previous assess-
ment. The update work was carried out as a workshop. In the workshop, the expert
groups reassessed the scoring of the latest double materiality analysis and supple-
mented the existing list of identified impacts, risks and opportunities. The materiality
of the ESRS-aligned themes for the company was analysed bi-directionally and
through two business segments. The review was extended to Luotea's value chain
and its sustainability impacts.
In addition to own operations, the value chain review included contractual suppliers
and waste treatment partners as well as customers. No material changes were
identified in the value chain or stakeholders for 2025, so the stakeholder analysis or
value chain description were not updated in connection with the update work of the
double materiality analysis.
The assessment took into account the results of the human rights risk assess-
ment conducted by Luotea in 2024. With regard to the double materiality results, it
has been verified that they do not conflict with the human rights assessment.
The views of key stakeholders were collected through targeted interviews. The
interviews presented an updated list of material impacts, risks and opportunities for
the company to the stakeholders and asked the stakeholders for their assessment
of the coverage of the list. More in-depth stakeholder interviews were conducted with
key suppliers, customers and other stakeholders, and the aim was to survey stake-
holder sustainability expectations and potential development needs more broadly.
Stakeholder views were taken into account in the scoring. Stakeholders’ views on
sustainability topics, impacts, risks and opportunities that are material to Luotea
were consistent with the company’s own internal assessment.
An updated list of the company’s material impacts, risks and opportunities was
presented to Luotea's European Works Council, discussed by Luotea's Group Exec-
utive Board and the Personnel and Sustainability Committee, and finally the Board
of Directors confirmed the double materiality of Luotea. The update process was
carried out by the Group Head of Sustainability, who reported on the methods used
in the process, the progress of the process and the results to the steering group
assigned for the double materiality analysis three times during the process.
Impact materiality
Luotea’s assessment of impact materiality took into account the scale, scope and
irremediable character of the impacts on a five-point scale where a score of five was
deemed significant for each aspect. The assessment took into account changes in
potential impacts in the short term (reporting period), medium term (2–5 years) and
long term (over 5 years) and examined the likelihood of occurrence of the poten-
tial impacts. The assessment took into account potential negative human rights
impacts, the severity of which takes precedence over their likelihood. The materiality
threshold was defined as a score of eight (maximum score 15), which meant that
the impact would be deemed significant for the company. In addition, the results of
stakeholder surveys and interviews were taken into account in the assessment.
Financial materiality
The assessment of Luotea’s financial effects was based on Luotea’s risk assess-
ment process. The impact of risks is analysed in terms of their effects, and the
assessment of the likelihood of their realisation took into account the nature of
operations and the risk mitigation measures taken. The aim of the application of
Luotea’s risk assessment process was to ensure that sustainability-related risks are
identified in a similar way to the company’s strategic and operational risks. Changes
in the markets for recycled raw materials, the development of regulation with regard
to waste management, for example (E5 Circular Economy) and challenges related
to the availability and turnover of labour (S1 Own workforce) have also been taken
into account in Luotea’s strategic risks.
The assessment took into account changes in potential impacts in the short term
(reporting period), medium term (2–5 years) and long term (over 5 years) and exam-
ined the likelihood of occurrence of the potential impacts. The materiality threshold
was defined as a score of eight (maximum score 15), which meant that the risks and
opportunities would be deemed significant for the company.
During the double materiality assessment process, Luotea reviewed its impacts
and dependencies as well as their links to risks and opportunities by analysing the
impact of each sustainability topic on the company’s business model, current risk
management methods, processes and personnel. Luotea has also assessed the
risks and opportunities caused by changes in legislation. The assessment also
took into account dependencies on natural resources, human resources and social
resources.
Financial risks related to climate change mitigation are managed by the compa-
ny’s climate-related transition plan, which includes emission reduction targets and
the investments required for them. Investments in workplace safety and well-being,
in turn, can improve the availability and retention of personnel, which reduces the
risks arising from these factors.
Description of the processes to identify and assess material
climate-related impacts, risks and opportunities
Luotea's material impacts, risks and opportunities related to climate change have
been assessed as part of the update of Luotea's double materiality in 2025. Luotea
did not update the previously prepared scenario analyses in 2025.
Climate impact assessment
The assessment of the company’s material impacts related to climate change
mitigation is based on the company’s energy consumption and the calculation
of the carbon footprint and carbon handprint. Luotea’s management and
sustainability organisation monitor the direct emissions arising from own
operations and the company’s carbon handprint, which was material in 2025,
at quarterly levels. The emissions generated in the company’s value chain are
assessed on an annual basis.
Assessment of climate risks and opportunities
The Task Force for Climate-related Financial Disclosures (TCFD) recommenda-
tions have been applied in assessing the risks and opportunities related to climate
change. Climate risks are assessed in accordance with Luotea’s risk model in the
short term (reporting period), medium term (2–5 years) and long term (over 5 years).
The impact of risks is analysed through EBIT effects and likelihood, taking into
account the nature of the risk and the existing mitigation measures. The short and
medium-term horizons correspond to the time horizons applied for the company’s
strategic risks. The actions are described in more detail in paragraph ESRS E1-3, pp.
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50–51.
The assessment took into account physical risks and transition risks as well as
their impact on Luotea’s own personnel and business. The risks and opportuni-
ties in the value chain are mainly focused on the service offering of discontinued
operations. Physical risks may arise from the effects of natural phenomena, such
as temperature changes (chronic risk) or potential flooding (acute risk). These are
expected to intensify due to climate change. Transition risks include the possible
effects of regulatory and market changes. With regard to Luotea's continuing oper-
ations, these focus on the development of the energy efficiency market and, with
regard to discontinued operations, the effects of new technologies on the develop-
ment of low-emission equipment.
Physical risks
Luotea has assessed physical risks related to climate change as part of its resilience
analysis. Chronic climate risks, such as rising temperatures and an increase in
extreme weather, have been identified as potential impacts on the company’s logis-
tics and the energy efficiency of properties. The analysis is based on IPCC’s RCP
scenarios (1.5°C, <2°C and 4°C) and IEA’s APS, NZE2050 and STEPS scenarios,
which have been mirrored to weather fluctuations in Finland and Sweden. The
review covers the short-term (5 years) and long-term (until 2035) impacts.
The impacts of acute climate risks, such as flooding, on Luotea's properties have
been estimated to be minimal, as the sites are not located in particularly flood-sen-
sitive areas. The geographical review covered operations in Finland and Sweden.
Based on the analysis, no significant risks were identified that would prevent the
achievement of the company’s climate targets.
According to Luotea’s assessment, the company’s assets and businesses are
sensitive to these climate-related risks to a significant extent. Luotea’s operations
are evenly distributed across Finland and Sweden, which means that operations
can be temporarily relocated as necessary in the event of a disturbance. In addition,
Luotea’s properties and movable property are insured.
Transition risks
Previous analyses have identified Luotea's significant transition risks in a climate
scenario where global warming can be limited to 1.5 degrees Celsius. With regard to
the identified transition risks, the materiality assessment was updated in connection
with the company’s double materiality update. The material transition risks were
focused on discontinued operations, changes in regulation related to the industry
and market development. In Luotea’s risk assessment, the background factors
behind regulatory risks include the price development of emission rights, bioeco-
nomy and low-carbon economy scenarios, the development of circular economy-re-
lated legislation, potential changes in national waste legislation and national recy-
cling and reuse targets.
Luotea has assessed the exposure and sensitivity of its businesses to identified
transition events. The assessment takes into account the likelihood, scope and
duration of transition risks. Investments made by energy sector operators, particu-
larly in renewable fuels, or the growing adoption of new technologies in equipment,
for example, will, in turn, influence the achievement of Luotea’s emission targets and
the company’s climate transition plan.
The current targets, operating models and measures increase Luotea’s resilience
in the changing business environment. The company has a strong market position
in all of its business areas. In addition, the climate transition plan enables the effec-
tive implementation of changes. Increasing the use of renewable energy sources
and decarbonisation, particularly in transport, will continue to be key focal points.
Risk management is enhanced by assessing regulatory and market changes and
reacting to them in a timely manner. The company participates in advocacy work
related to legislative processes through key industry advocacy organisations.
The climate transition creates a significant business opportunity for Luotea.
Luotea creates value for customers with its energy management services that
reduce the energy consumption of properties and help customers to achieve their
energy efficiency targets. Luotea regularly assesses climate risks as part of its risk
assessment and adapts its strategy accordingly. The climate scenarios and the
related assumptions have not had significant impacts on the company’s financial
statements or key financial figures.
Regulatory and market-related transition risks have been taken into account as
part of Luotea’s strategic risks for the period 2022–2026.
Description of the processes to identify and assess material
impacts, risks and opportunities related to pollution and water
and marine resources
In the double materiality analysis, Luotea also examined the sub-topics and sub-
sub-topics of ESRS E2 Pollution and ESRS E3 Water and marine resources. The
assessment of pollution and water and marine resources took into account the
location and ownership of the sites. Luotea's actual and potential impacts, risks
and opportunities were assessed on the basis of the location, the assessment of
environmental aspects related to the operations of the sites and the environmental
observations made at the sites. Sufficiently high-quality data was not available for
the value chain, which meant that the assessment was superficial. Luotea did not
organise a separate stakeholder consultation related to these sustainability topics
in connection with the assessment.
Description of the processes to identify and assess material
biodiversity and ecosystem-related impacts, risks, dependencies
and opportunities
The material impacts, risks and opportunities related to biodiversity and eco-
systems of Luotea’s own operations were updated in connection with the double
materiality analysis and were estimated to focus mainly on discontinued operations.
The identification of environmental impacts used the company’s environmental
assessments, information obtained from the environmental permit process, cus-
tomer feedback, particularly with regard to production sites, and geographical infor-
mation on the locations of the sites in relation to valuable natural sites. Luotea has
consulted the affected communities regarding potential negative environmental
impacts related to the sites during the environmental permit applications. No actual
impacts on local communities have been identified in the consultations. Luotea did
not organise a separate stakeholder consultation related to the sustainability topic
in connection with the double assessment.
In 2025, the impacts and dependencies related to the circular economy business
divisions and their value chain were examined using the TNFD leap framework and
the ENCORE analysis tool. The analysis clarified the understanding of the indus-
try’s nature impacts with regard to own operations and aimed to identify significant
nature impacts with regard to the value chain. A corresponding review was not car-
ried out for Facility Services, as divisions’s impacts on biodiversity and ecosystems
were assessed to be minor in the internal impact assessment carried out in connec-
tion with the double materiality analysis. Luotea is considering extending the review
to Facility Services in 2026.
Based on geographical data analysis, Luotea has identified sites that are located
close to biodiversity-sensitive areas. With regard to the operations of sites in the
vicinity of biologically sensitive areas, the impact materiality of negative impacts
on thedeterioration of natural habitats and the habitats of specieswas assessed
as internal expert work based on the environmental permit entries, internal control
procedures and stakeholder feedback received. Based on the assessment, it is esti-
mated that Luotea's sites have a low impact on the environment in biologically sensi-
tive areas. The sites have not been found to have a negative impact on the biodiversi-
ty-sensitive areas in their vicinity, and no mitigation measures related to biodiversity
have been separately specified for the sites by the authorities.
Luotea has not assessed the physical, transition and systemic risks of the compa-
ny's identified impacts and dependencies on biodiversity and ecosystems, but they
have been considered indirectly as part of climate risks. Climate change is a signifi-
cant driver of biodiversity loss and the deterioration of ecosystem services, on which
Luotea has a direct impact through its own emissions and those of its value chain.
The climate risk assessment assesses the financial effects of extreme weather on
the company’s own operations. The deterioration of ecosystem services may also
lead to an increase or intensification of extreme weather and related effects, such as
flooding.
Description of the processes to identify and assess material
resource use and circular economy-related impacts, risks and
opportunities
Luotea updated and assessed material impacts, risks and opportunities related to
resource inflows and outflows and waste as part of the double materiality assess-
ment. Luotea analysed its operations to identify and assess the actual and poten-
tial impacts, risks and opportunities in its own operations and the value chain.
The material impacts and opportunities related to resource use and the circular
economy are focused on discontinued operations and are listed in the table in para-
graph ESRS 2 SBM-3, p. 26, and these are discussed in more detail on p. 61.
Luotea has analysed its assets and operations to identify the actual and potential
impacts, risks and opportunities in its own operations and the upstream and down-
stream value chain. The information used in the analysis included environmental
permits concerning the company’s operations, information about inflows and out-
flows of waste received from customers, general national and international reports
and studies, and stakeholder consultations in various forums.
Luotea did not separately consult the local communities around recycling plants
or processing centres as part of the double materiality assessment. With regard to
the circular economy businesses, the company engages in regular dialogue with
local residents about the environmental impacts of its sites within the environmental
permit processes for sites and regional cooperation.
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Description of the processes to identify and assess material
impacts, risks and opportunities related to the company's own
workforce
In its double materiality assessment, Luotea has identified and assessed the
impacts, risks and opportunities related to its own workforce. Luotea has estab-
lished an understanding of the impacts and risks related to workers through, for
example, regular dialogue, the identification of special groups and the assessment
of occupational safety risks and observations and the human rights review of 2024.
Material impacts and opportunities related to the following sub-sub-topics were
identified and assessed: employment security, occupational health and safety,
working hours, adequate wages and pay equality, work-life balance, freedom of
association, the existence of works councils, employees’ access to information,
rights of consultation and participation, competence development, support for
diversity and prevention of harassment, inappropriate behaviour and discrimina-
tion. These topics play a key role in Luotea’s strategy and business model, and they
have a direct impact on the company’s operations and its adaptation. The mate-
rial impacts, risks and opportunities related to the company's own workforce are
described in more detail in paragraph S1 SBM-3, p. 64.
Description of the processes to identify and assess material
impacts, risks and opportunities related to value chain workers
Luotea has identified and assessed the material impacts, risks and opportunities
concerning value chain workers as part of the double materiality assessment. The
assessment was based on the results of the human rights risk assessment pre-
pared in 2024, an assessment of the nature of Luotea’s subcontracting work and
risks related to occupational safety, procurement cooperation and Luotea’s own
supplier risk assessment. Material impacts related to the following sub-sub-topics
were identified and assessed: occupational safety and well-being of value chain
workers and discrimination against value chain workers. The material impacts
related to value chain workers are described in more detail in paragraph ESRS S2
SBM-3, p. 74.
Luotea has identified that certain value chain workers who possess particular
characteristics, who work under particular conditions, or who engage in particular
activities, may be at greater risk of harm. Among workers in subcontracting, workers
with a foreign background may have inadequate language proficiency in partic-
ular, which can make it more difficult to understand and implement the appro-
priate occupational safety practices. They may also have inadequate knowledge of
national work practices. Young employees who lack previous work experience can
also be more vulnerable to various types of violations. In addition, workers who work
at Luotea’s or customers’ premises, particularly in logistics, environmental construc-
tion projects and process cleaning and property maintenance in production-related
tasks which may involve an actual elevated occupational safety risk, may be at risk
of harm. Potential impacts may also be related to the inadequate implementation
of work practices, such as unclear records of working time.
Description of the processes to identify and assess material
impacts, risks and opportunities related to business conduct
The material impacts and risks identified in the double materiality assessment
were related to the following sub-topics and sub-sub-topics: corporate culture and
the prevention, detection and incidents of corruption and bribery. The geograph-
ical location, activities, industry and business structure of Luotea’s businesses have
been taken into account as background data in the assessment of the related
material impacts.
Corporate culture emerged as a material topic on the basis of impact materi-
ality in the double materiality assessment. With regard to financial materiality, the
prevention of corruption and bribery emerged as a material risk related to business
conduct.
Updating the double materiality assessment
The double materiality assessment process is integrated into Luotea’s risk manage-
ment process and implemented in cooperation with business-level specialists, risk
management functions and financial organisations. The impacts, risks and oppor-
tunities associated with sustainability matters are assessed during the process,
taking into account potential changes in the business environment. The results of
the assessment will be updated annually, and they will be discussed and approved
by Luotea’s Group Executive Board and Board of Directors. The next update to the
double materiality assessment will be carried out in 2026.
IRO-2 – Disclosure Requirements in ESRS covered by
the undertaking's sustainability statements
The following tables provide a list of the disclosure requirements of the Sustainability
Reporting Standard (ESRS) that Luotea has complied with in preparing this sus-
tainability report on the basis of double materiality, as well as information on the
disclosure requirements that Luotea has assessed as not material on the basis of
double materiality. The table also includes Luotea’s entity-specific disclosures. The
tables can be used to navigate to information on a specific disclosure requirement
in the Sustainability Report.
If Luotea has not had to report information related to a specific disclosure require-
ment on the basis of double materiality, this is indicated by a dash. The absence of
information with regard to material disclosure requirements is specified in an expla-
nation.
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Material sustainability topics and sub-
topics Sub-sub-topics Impact, risk or opportunity Location in the value chain Description Time horizon (Short, Medium, Long)
E1 Climate change
Climate change mitigation Actual negative impact across the value chain GHG emissions from own operations and value
chain (Scope 1–3)
SML
Climate change mitigation Potential positive impact across the value chain Material recycling services can avoid emissions in
value chain and customers' operations. The avoided
emissions constitute the company's carbon hand-
print.
S
Climate change mitigation Risk own operations, upstream
value chain
Transition risks related to related to regulation,
financing, fuel markets and the development of
low-emission technology related to the green transi-
tion and circular economy . Regulation may cause
changes in the pricing of energy and emissions. The
market may develop more slowly than expected in
terms of low-emission heavy equipment. Failure to
meet the climate targets will affect the fulfilment of
the loan terms.
S
Energy Opportunity own operations Regulation and customers’ increasingly ambitious
climate targets create opportunities for energy effi-
ciency solutions.
SML
ESRS E4 Biodiversity and ecosystems
Impacts and dependencies on ecosystem
services
Self-classified sub-topic: Nature
services offered by the company
and circular economy
Potential positive impact own operations, downstream
value chain
The service offering includes the restoration of con-
taminated soil, meadowing and removal of invasive
species, which have a positive impact on the state
of ecosystems. Recycling promotes the sustainable
use of natural resources and thereby reduces the
pressure on ecosystem services.
S
Impacts and dependencies on ecosystem
services
Self-classified sub-topic: Nature
services offered by the company
and circular economy
Opportunity own operations Business opportunities concerning transition risks
and regulation related to environmental construc-
tion and customer restoration projects
S
E
Environment
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Material sustainability topics and sub-
topics Sub-sub-topics Impact, risk or opportunity Location in the value chain Description Time horizon (Short, Medium, Long)
E5 Circular economy
Resource inflows Actual positive impact upstream value chain Customers are instructed in the separate collection of
waste so that the materials can be recycled in accor-
dance with the principles of the circular economy, which
reduces the value chain’s dependence on fossil and pri-
mary raw materials.
S
Resource inflows Opportunity own operations The recycling and recycled raw material targets arising
from regulation create opportunities for customer rela-
tionship development and expert services.
S
Resource outflows Actual positive impact downstream value chain Recycling of materials with partners to create raw mate-
rials for new products and packaging.
S
Resource outflows Opportunity own operations The recycling and recycled raw material targets arising
from regulation create opportunities for material pro-
cessing and development of recycling.
S
Waste Actual negative impact across the value chain The amount of energy waste, mixed waste and waste
directed to final disposal.
S
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Material sustainability topics and sub-
topics Sub-sub-topics Impact, risk or opportunity Location in the value chain Description Time horizon (Short, Medium, Long)
S1 Own workforce
Working conditions Secure employment Actual positive impact own operations High percentage of permanent employees SML
Working conditions Working time Actual negative impact own operations Amount of part-time work in some tasks SML
Working conditions Adequate wages Actual negative impact own operations Some divisions in low-wage sectors SML
Working conditions Freedom of association, the exis-
tence of works councils and the
information, consultation and
participation rights of workers
Actual positive impact own operations Freedom of association, shop steward systems SML
Working conditions Social dialogue Actual positive impact own operations Dialogue meeting systems and EWC body SML
Working conditions Collective bargaining Actual positive impact own operations Almost all personnel are covered by collective agree-
ments
SML
Working conditions Health and safety Potential negative impact own operations Deficiencies in occupational health and safety prac-
tices could affect the physical and mental work ability of
employees.
SML
Working conditions Health and safety Opportunity own operations Investing in occupational safety is essential for cus-
tomers
SML
Working conditions Work–life balance Actual positive impact own operations Flexible working hours policy and shift planning SML
Equal treatment and equal opportunities for
all
Gender equality and equal pay Actual positive, negative own operations Pay equality higher than national average SML
Equal treatment and equal opportunities for
all
Training and skills development Actual positive impact own operations Competent workforce and diverse training offering SML
Equal treatment and equal opportunities for
all
Measures against violence and
harassment in the workplace
Potential negative impact own operations Potential harassment, inappropriate behaviour and dis-
crimination in industries with employees from different
countries and cultures.
SML
Equal treatment and equal opportunities for
all
Diversity Actual positive, negative own operations the work community is multinational with an even age
distribution
SML
S
Social
28
Sustainability report
Annual Report 2025
Report by the Board of Directors
Material sustainability topics and sub-
topics Sub-sub-topics Impact, risk or opportunity Location in the value chain Description Time horizon (Short, Medium, Long)
S2 Workers in the value chain
Working conditions Health and safety Potential negative upstream and downstream
value chain
Health and safety of value chain workers in subcon-
tracting and agency work
SML
Equal treatment and equal opportunities for
all
Measures against violence and
harassment in the workplace
Potential negative upstream and downstream
value chain
Potential harassment, inappropriate behaviour and
discrimination in subcontracting and agency work in
industries with employees from different countries and
cultures.
SML
G1 Business conduct
Corporate culture Actual positive across the value chain Good and transparent governance and business ethics SML
Bribery and corruption Prevention and detection,
including training.
Risk own operations, upstream
value chain
Participation in bribery or corruption SML
29
Sustainability report
Annual Report 2025
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Changes IROs
ESRS sub-topic/sub-sub-topic Impact/Financial effect Material 2025, not reported 2024 2024 reported, did not become material to report in 2025
E4 Biodiversity and ecosystem services/e.g. soil sealing
Opportunity x
S2 Working conditions/Employment security Potential negative impact x
S2 Working conditions/Working hours Potential negative impact x
S2 Working conditions/Adequate wages Potential negative impact x
S2 Working conditions/ Freedom of association, the existence of works councils and the infor-
mation, consultation and participation rights of workers
Potential negative impact x
S2 Working conditions/ Social dialogue Potential negative impact x
S2 Working conditions/ Collective bargaining Potential negative impact x
S2 Working conditions/ Work–life balance Potential negative impact x
S2 Equal treatment and equal opportunities for all/Measures against violence and harassment
in the workplace
Potential negative impact x
G Whistleblower protection Potential negative impact x
G Relationships with suppliers and service providers Potential negative impact x
30
Sustainability report
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Report by the Board of Directors
Results of the double materiality assessment
Overview of the results
The double materiality assessment separately examined the impacts, risks and
opportunities of each sustainability topic, sub-topic and sub-sub-topic on Luotea’s
operations. In addition, the impacts, risks and opportunities of Luotea's operations
on the environment, people and society were examined for each sustainability topic,
sub-topic and sub-sub-topic, on a scale of 0–15.
All sub-topics and sub-sub-topics whose score exceeded the threshold value for
impact materiality or financial materiality were considered to be material topics.
The threshold value was eight for both impact materiality and financial materiality.
The materiality threshold is indicated by a blue background colour in the graph. In
the graph, the X and Y axes take into account the maximum scores assigned to
each ESRS sustainability topic, even if they consist of different sub-topics.
The average score of the impact assessment of the ESRS sustainability topics is
expressed in the graph by the size of the point. This makes it possible to identify how
large a proportion of the sub-topics or sub-sub-topics under each topic were identi-
fied as material in the double materiality assessment. For example, E4 Biodiversity
and ecosystems is a topic that is identified as material, but the average score for the
topic is relatively low, which means that only a few sub-sub-topics were identified as
material in the assessment.
Colour coding
Material sub-topics
Non-material sub-topics
Environment (E)
Society (S)
Governance (G)
FINANCIAL EFFECTS
IMPACTS ON THE ENVIRONMENT AND SOCIETY
Low materiality
Non-material
High
materiality
0
8 18
15
8
Resource use and
circular economy
E5
Biodiversity and
ecosystems
Climate change
E1
Own workforce
S1
S2
Business conduct
G1
S3
Affected communities
Water and marine
resources
Pollution
E2
Consumers
and end-users
E4
Workers in the
value chain
E3
S4
31
Sustainability report
Annual Report 2025
Report by the Board of Directors
Disclosure requirement Paragraph/included reference and page number Material /Non-material
ESRS 2 General Disclosures
BP-1 General basis for preparation of sustainability statements Sustainability Report: ESRS 2 General Disclosures, p. 11 Material
BP-2 Disclosures in relation to specific circumstances Sustainability Report: ESRS 2 General Disclosures, p. 11
Material
GOV-1 The role of the administrative, management and supervisory bodies Sustainability Report: ESRS 2 General Disclosures, p. 11
Material
GOV-2 Information provided to and sustainability matters addressed by the undertaking’s administra-
tive, management and supervisory bodies
Sustainability Report: ESRS 2 General Disclosures, p. 15
Material
GOV-3 Integration of sustainability-related performance in incentive schemes Sustainability Report: ESRS 2 General Disclosures, p. 16
Material
GOV-4 Statement on due diligence Sustainability Report: ESRS 2 General Disclosures, p. 16
Material
GOV-5 Risk management and internal controls over sustainability reporting Sustainability Report: ESRS 2 General Disclosures, p. 17
Material
SBM-1 Strategy, business model and value chain Sustainability Report: ESRS 2 General Disclosures, p. 17
SBM-2 Interests and views of stakeholders Sustainability Report: ESRS 2 General Disclosures, p. 20
Material
SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model Sustainability Report: ESRS 2 General Disclosures, p. 20
Material
IRO-1 Description of the processes to identify and assess material impacts, risks and opportunities Sustainability Report: ESRS 2 General Disclosures, p. 22
Material
IRO-2 Disclosure requirements in ESRS covered by the undertaking’s sustainability statement Sustainability Report: ESRS 2 General Disclosures, p. 24
Material
32
Sustainability report
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Disclosure requirement Paragraph/included reference and page number Material /Non-material
ESRS E1 Climate change
E1 ESRS 2 GOV-3 Integration of sustainability-related performance in incentive schemes Sustainability Report: ESRS 2 General Disclosures, p. 15 Material
E1-1 Transition plan for climate change mitigation Sustainability Report: ESRS E1 Climate change, p. 49
Material
E1 ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model Sustainability Report: ESRS E1 Climate change, p. 50
Material
E1 ESRS 2 IRO-1 Description of the processes to identify and assess material climate-related impacts, risks and
opportunities
Sustainability Report: ESRS 2 General Disclosures, p. 22
Material
E1-2 Policies related to climate change mitigation and adaptation Sustainability Report: ESRS E1 Climate change, p. 50
Material
E1-3 Actions and resources in relation to climate change policies Sustainability Report: ESRS E1 Climate change, p. 50
Material
E1-4 Targets related to climate change mitigation and adaptation Sustainability Report: ESRS E1 Climate change, p. 51
Material
E1-5 Energy consumption and mix Sustainability Report: ESRS E1 Climate change, p. 52
Material
E1-6 Gross Scopes 1, 2, 3 and Total GHG emissions Sustainability Report: ESRS E1 Climate change, p. 52
Material
E1-7 GHG removals and GHG mitigation projects financed through carbon credits Luotea has no plans to purchase climate units from the voluntary market, and Luotea does not
promote greenhouse gas emissions removal or storage projects in its own operations or value
chain. Non-material
E1-8 Internal carbon pricing Luotea does not use an internal carbon pricing mechanism
Non-material
E1-9 Anticipated financial effects from material physical and transition risks and potential
climate-related opportunities
Luotea makes use of the transitional provision with regard to the required disclosures and does not
report for 2025
Material
ESRS E2 Pollution
E2 ESRS 2 IRO-1 Description of the processes to identify and assess material pollution-related impacts, risks and Sustainability Report: ESRS 2 General Disclosures, p. 22
Material
E2-1 Policies related to pollution -
Non-material
E2-2 Actions and resources related to pollution -
Non-material
E2-3 Targets related to pollution -
Non-material
E2-4 Pollution of air, water and soil -
Non-material
E2-5 Substances of concern and substances of very high concern -
Non-material
E2-6 Impact metrics related to biodiversity and ecosystems change -
Non-material
33
Sustainability report
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Disclosure requirement Paragraph/included reference and page number Material /Non-material
ESRS E3 Water and marine resources
E3 ESRS 2 IRO-1 Description of the processes to identify and assess material water and marine resources-related
impacts, risks and opportunities
Sustainability Report: ESRS 2 General Disclosures, p. 22
Material
E3-1 Policies related to water and marine resources - Non-material
E3-2 Actions and resources related to water and marine resources - Non-material
E3-3 Targets related to water and marine resources - Non-material
E3-4 Water consumption - Non-material
E3-5 Anticipated financial effects of impacts, risks and opportunities
related to water and marine resources
-
Non-material
ESRS E4 Biodiversity and ecosystems
E4-1 Transition plan and consideration of biodiversity and ecosystems in strategy and business model Sustainability Report: ESRS E4 Biodiversity and ecosystems, p. 59
Material
E4 ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model Sustainability Report: ESRS E4 Biodiversity and ecosystems, p. 59
Material
E4 ESRS 2 IRO-1 Description of the processes to identify and assess material biodiversity and ecosystem-related
impacts, risks and opportunities
Sustainability Report: ESRS 2 General Disclosures, p. 22
Material
E4-2 Policies related to biodiversity and ecosystems Sustainability Report: ESRS E4 Biodiversity and ecosystems, p. 59
Material
E4-3 Actions and resources related to biodiversity and ecosystems Sustainability Report: ESRS E4 Biodiversity and ecosystems, p. 59
Material
E4-4 Targets related to biodiversity and ecosystems Sustainability Report: ESRS E4 Biodiversity and ecosystems, p. 59 Material
E4-5 Impact metrics related to biodiversity and ecosystems change Sustainability Report: ESRS E4 Biodiversity and ecosystems, p. 60 Material
E4-6 Anticipated financial effects from biodiversity and ecosystem-related risks and opportunities Luotea makes use of the transitional provision with regard to the
required disclosures and does not report for 2025
Material
ESRS E5 Resource use and circular economy
E5 ESRS 2 IRO-1 Description of the processes to identify and assess material resource use and circular econo-
my-related impacts, risks and opportunities
Sustainability Report: ESRS 2 General Disclosures, p. 22
Material
E5-1 Policies related to resource use and circular economy Sustainability Report: ESRS E5 Resource use and circular economy, p. 61 Material
E5-2 Actions and resources related to resource use and circular economy Sustainability Report: ESRS E5 Resource use and circular economy, p. 61 Material
E5-3 Targets related to resource use and circular economy Sustainability Report: ESRS E5 Resource use and circular economy, p. 62 Material
E5-4 Resource inflows Sustainability Report: ESRS E5 Resource use and circular economy, p. 62 Material
E5-5 Resource outflows Sustainability Report: ESRS E5 Resource use and circular economy, p. 62 Material
E5-6 Anticipated financial effects of impacts, risks and opportunities
related to resource use and circular economy
Luotea makes use of the transitional provision with regard to the required disclosures and does not report for
2025
Material
34
Sustainability report
Annual Report 2025
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Disclosure requirement Paragraph/included reference and page number Material /Non-material
ESRS S1 Own workforce
S1. ESRS 2 SBM-2 Interests and views of stakeholders Sustainability Report: ESRS 2 General Disclosures, p. 20
Material
S1. ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model Sustainability Report: ESRS S1 Own workforce, p. 64
Material
S1-1 Policies related to own workforce Sustainability Report: ESRS S1 Own workforce, p. 64
Material
S1-2 Processes for engaging with own workers and workers’ representatives about impacts Sustainability Report: ESRS S1 Own workforce, p. 65
Material
S1-3 Processes to remediate negative impacts and channels for own workers to raise concerns Sustainability Report: ESRS S1 Own workforce, p. 65
Material
S1-4 Taking action on material impacts on own workforce, and approaches to mitigating material risks
and pursuing material opportunities related to own workforce, and effectiveness of those actions
Sustainability Report: ESRS S1 Own workforce, p. 66
Material
S1-5 Targets related to managing material negative impacts, advancing positive impacts, and manag-
ing material risks and opportunities
Sustainability Report: ESRS S1 Own workforce, p. 68
Material
S1-6 Characteristics of the undertaking’s employees Sustainability Report: ESRS S1 Own workforce, p. 69
Material
S1-7 Characteristics of non-employee workers in the undertaking’s own workforce Sustainability Report: ESRS S1 Own workforce, p. 70
Material
S1-8 Collective bargaining coverage and social dialogue Sustainability Report: ESRS S1 Own workforce, p. 70
Material
S1-9 Diversity metrics Sustainability Report: ESRS S1 Own workforce, p. 70
Material
S1-10 Adequate wages Sustainability Report: ESRS S1 Own workforce, p. 70
Material
S1-11 Social protection Sustainability Report: ESRS S1 Own workforce, p. 71 Material
S1-12 Persons with disabilities - Non-material
S1-13 Training and skills development metrics Sustainability Report: ESRS S1 Own workforce, p. 71 Material
S1-14 Health and safety metrics Sustainability Report: ESRS S1 Own workforce, p. 72 Material
S1-15 Work–life balance metrics Sustainability Report: ESRS S1 Own workforce, p. 73 Material
S1-16 Compensation metrics (pay gap and total compensation) Sustainability Report: ESRS S1 Own workforce, p. 73 Material
S1-17 Incidents, complaints and severe human rights impacts Sustainability Report: ESRS S1 Own workforce, p. 73 Material
35
Sustainability report
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Disclosure requirement Paragraph/included reference and page number Material /Non-material
ESRS S2 Workers in the value chain
S2 ESRS2 SBM-2 Interests and views of stakeholders Sustainability Report: ESRS 2 General Disclosures, p. 20 Material
S2 ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model Sustainability Report: ESRS S2 Workers in the value chain, p. 74 Material
S2-1 Policies related to value chain workers Sustainability Report: ESRS S2 Workers in the value chain, p. 74 Material
S2-2 Processes for engaging with value chain workers about impacts Sustainability Report: ESRS S2 Workers in the value chain, p. 75 Material
S2-3 Processes to remediate negative impacts and channels for value chain workers to raise concerns Sustainability Report: ESRS S2 Workers in the value chain, p. 75 Material
S2-4 Taking action on material impacts on value chain workers, and approaches to managing mate-
rial risks and pursuing material opportunities related to value chain workers, and effectiveness of
those actions
Sustainability Report: ESRS S2 Workers in the value chain, p. 75 Material
S2-5 Targets related to managing material negative impacts, advancing positive impacts, and manag-
ing material risks and opportunities
Sustainability Report: ESRS S2 Workers in the value chain, p. 76 Material
ESRS S3 Affected communities
ESRS 2 SBM-2 Interests and views of stakeholders - Non-material
ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model - Non-material
S3-1 Policies related to affected communities - Non-material
S3-2 Processes for engaging with affected communities about impacts - Non-material
S3-3 Processes to remediate negative impacts and channels for affected communities to raise con-
cerns
- Non-material
S3-4 Taking action on material impacts on affected communities, and approaches to managing
material risks and pursuing material opportunities related to affected communities, and effective-
ness of those actions
- Non-material
S3-5 Targets related to managing material negative impacts, advancing positive impacts, and manag-
ing material risks and opportunities
- Non-material
36
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Disclosure requirement Paragraph/included reference and page number Change from the previous year Material /Non-material
ESRS S4 Consumers and end-users
ESRS 2 SBM-2 Interests and views of stakeholders -
Non-material
ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model -
Non-material
S4-1 Policies related to consumers and end-users - Non-material
S4-2 Processes for engaging with consumers and end-users about impacts -
Non-material
S4-3 Processes to remediate negative impacts and channels for consumers and end-users to raise
concerns
-
Non-material
S4-4 Taking action on material impacts on consumers and end-users, and approaches to manag-
ing material risks and pursuing material opportunities related to consumers and end-users, and
effectiveness of those actions
-
Non-material
S4-5 Targets related to managing material negative impacts, advancing positive impacts, and manag-
ing material risks and opportunities
-
Non-material
ESRS G1 Business conduct
G1 ESRS GOV-1 The role of the administrative, management and supervisory bodies Sustainability Report: ESRS 2 General Disclosures, p. 11 Material
G1 ESRS IRO-1 Description of the processes to identify and assess material impacts, risks and opportunities Sustainability Report: ESRS 2 General Disclosures, p. 22 Material
G1-1 Corporate culture and business conduct policies and corporate culture Sustainability Report: ESRS G1 Business conduct, p. 77 Material
G1-2 Management of relationships with suppliers - Non-material
G1-3 Prevention and detection of corruption and bribery Sustainability Report: ESRS G1 Business conduct, p. 79 Material
G1-4 Confirmed incidents of corruption or bribery Sustainability Report: ESRS G1 Business conduct, p. 79 Material
G1-5 Political influence and lobbying activities - Non-material
G1-6 Payment practices - Non-material
37
Sustainability report
Annual Report 2025
Report by the Board of Directors
The following table contains all other data points derived from EU legislation listed in Appendix B of ESRS 2. The table shows where the data points can be found in our report and which data points have been assessed to be non-material on the basis of the double
materiality assessment. If Luotea does not yet have information related to a specific data point, it is indicated with a dash (-).
Disclosures stemming from other legislation
Reference to other EU legislation
Disclosure requirement Data point Sustainability disclosure Location and page SFDR Pillar 3
Benchmark
Regulation EU Climate Act
ESRS 2 GOV-1 21 (d) Board's gender diversity
GOV-1 – The role of the administrative, management and supervisory bod-
ies, p. 11 x x
ESRS 2 GOV-1 21 (e) Percentage of board members who are independent
GOV-1 – The role of the administrative, management and supervisory bod-
ies, p. 11 x
ESRS 2 GOV-4 30 Statement on due diligence GOV-4 – Statement on sustainability due diligence, p. 16 x
ESRS 2 SBM-1 40 (d) i Involvement in activities related to fossil fuel activities Non-material x x x
ESRS 2 SBM-1 40 (d) ii Involvement in activities related to chemical production Non-material x x
ESRS 2 SBM-1 40 (d) iii Involvement in activities related to controversial weapons Non-material x x
ESRS 2 SBM-1 40 (d) iv
Involvement in activities related to cultivation and production of
tobacco Non-material x
ESRS E1-1 14 Transition plan to reach climate neutrality by 2050 E1-1 – Transition plan for climate change mitigation, p. 49 x
ESRS E1-1 16 (g) Undertakings excluded from Paris-aligned Benchmarks Non-material x x
ESRS E1-4 34 GHG emission reduction targets E1-4 – Targets related to climate change mitigation and adaptation, p. 51 x x x
ESRS E1-5 38
Energy consumption from fossil sources disaggregated by sourc-
es (only high climate impact sectors) E1-5 – Energy consumption and mix, p. 52 x
ESRS E1-5 37 Energy consumption and mix E1-5 – Energy consumption and mix, p. 52 x
38
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Reference to other EU legislation
Disclosure requirement Data point Sustainability disclosure Location and page SFDR Pillar 3
Benchmark
Regulation EU Climate Act
ESRS E1-5 40–43
Energy intensity associated with activities in high climate impact
sectors E1-5 – Energy consumption and mix, p. 52 x
ESRS E1-6 44 Gross Scopes 1, 2, 3 and Total GHG emissions E1-6 – Gross Scopes 1, 2, 3 and Total GHG emissions, p. 52 x x x
ESRS E1-6 53–55 Gross GHG emissions intensity E1-6 – Gross Scopes 1, 2, 3 and Total GHG emissions, p. 52 x x x
ESRS E1-7 56 GHG removals and carbon credits Non-material x
ESRS E1-9 66
Exposure of the benchmark portfolio to climate-related physical
risks
Luotea makes use of the transitional provision with regard to the required
disclosures x
ESRS E1-9 66 (a); 66 (c)
Disaggregation of monetary amounts by acute and chronic
physical risk; Location of significant assets at material physical
risk
Luotea makes use of the transitional provision with regard to the required
disclosures x
ESRS E1-9 67 (c)
Breakdown of the carrying value of the undertaking's real estate
assets by energy-efficiency classes
Luotea makes use of the transitional provision with regard to the required
disclosures x
ESRS E1-9 69
Degree of exposure of the portfolio to climate-related opportuni-
ties
Luotea makes use of the transitional provision with regard to the required
disclosures x
ESRS E2-4 28
Amount of each pollutant listed in AnnexII of the E-PRTR Regu-
lation emitted to air, water and soil Non-material x
ESRS E3-1 9 Water and marine resources Non-material x
ESRS E3-1 13 Dedicated policy Non-material x
ESRS E3-1 14 Sustainable oceans and seas Non-material x
ESRS E3-4 28 (c) Total water recycled and reused Non-material x
ESRS E3-4 29
Total water consumption in m3 per net revenue on own opera-
tions Non-material x
ESRS 2 SBM-3 – E4 16 (a) List of material sites in own operations Non-material x
ESRS 2 SBM-3 – E4 16 (b) Sites located in affected biodiversity-sensitive areas Non-material x
ESRS 2 SBM-3 – E4 16 (c) Operations that affect threatened species Non-material x
39
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Reference to other EU legislation
Disclosure requirement Data point Sustainability disclosure Location and page SFDR Pillar 3
Benchmark
Regulation EU Climate Act
ESRS E4-2 24 (b) Sustainable land/agriculture practices or policies E4-2 – Policies related to biodiversity and ecosystems, p. 59 x
ESRS E4-2 24 (c) Sustainable oceans/seas practices or policies E4-2 – Policies related to biodiversity and ecosystems, p. 59 x
ESRS E4-2 24 (d) Policies to address deforestation E4-2 – Policies related to biodiversity and ecosystems, p. 59 x
ESRS E5-5 37 (d) Non-recycled waste E5-5 – Resource outflows, p. 60 x
ESRS E5-5 39 Hazardous waste and radioactive waste E5-5 – Resource outflows, p. 60 x
ESRS 2 SBM-3 – S1 14 (f) Risk of incidents of forced labour
S1 SBM-3 – Impacts, risks and opportunities from the perspective of the
strategy and business model, p. 64 x
ESRS 2 SBM-3 – S1 14 (g) Risk of incidents of child labour
S1 SBM-3 – Impacts, risks and opportunities from the perspective of the
strategy and business model, p. 64 x
ESRS S1-1 20 Human rights policy commitments S1-1 – Policies related to own workforce, p. 64 x
ESRS S1-1 21
Due diligence policies on issues addressed by the fundamental
International Labour Organization Conventions 1 to 8 GOV-4 – Statement on sustainability due diligence, p. 16 x
ESRS S1-1 22
Processes and measures for preventing trafficking in human
beings S1-1 – Policies related to own workforce, p. 64 x
ESRS S1-1 23 Workplace accident prevention policy or management system S1-1 – Policies related to own workforce, p. 64 x
ESRS S1-3 32 (c) Grievance/complaints handling mechanisms
S1-3 – Processes to remediate negative impacts and channels for own
workforce to raise concerns, p. 65 x
ESRS S1-14 88 (b) & (c)
Number of fatalities and number and rate of work-related acci-
dents S1-14 – Health and safety metrics, p. 72 x x
ESRS S1-14 88 (e) Number of days lost to injuries, accidents, fatalities or illness
Luotea makes use of the transitional provision with regard to the required
disclosures x
ESRS S1-16 97 (a) Unadjusted gender pay gap S1-16 – Compensation metrics (pay gap and total compensation), p. 73 x x
ESRS S1-16 97 (b) Excessive CEO pay ratio S1-16 – Compensation metrics (pay gap and total compensation), p. 73 x
40
Sustainability report
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Reference to other EU legislation
Disclosure requirement Data point Sustainability disclosure Location and page SFDR Pillar 3
Benchmark
Regulation EU Climate Act
ESRS S1-17 103 (a) Incidents of discrimination S1-17 – Incidents, complaints and severe human rights impacts, p. 73 x
ESRS S1-17 104 (a)
Non-respect of UNGPs on Business and Human Rights and
OECD Guidelines Not applicable x x
ESRS 2 SBM-3 – S2 11 (b) Significant risk of child labour or forced labour in the value chain
S2 SBM-3 – Material impacts, risks and opportunities and their interaction
with strategy and business model, p. 74 x
ESRS S2-1 17 Human rights policy commitments S2-1 – Policies related to value chain workers, p. 74 x
ESRS S2-1 18 Policies related to value chain workers S2-1 – Policies related to value chain workers, p. 74 x
ESRS S2-1 19
Non-respect of UNGPs on Business and Human Rights and
OECD Guidelines Non-material x x
ESRS S2-1 19
Due diligence policies on issues addressed by the fundamental
International Labour Organization Conventions 1 to 8 GOV-4 – Statement on sustainability due diligence, p. 16 x
ESRS S2-4 36
Human rights issues and incidents connected to upstream and
downstream value chain Non-material x
ESRS S3-1 16 Human rights policy commitments Non-material x
ESRS S3-1 17
Non-respect of UNGPs on Business and Human Rights, ILO prin-
ciples or OECD guidelines Non-material x x
ESRS S3-4 36 Human rights issues and incidents Non-material x
ESRS S4-1 16 Policies related to consumers and end-users Non-material x
ESRS S4-1 17
Non-respect of UNGPs on Business and Human Rights and
OECD Guidelines Non-material x x
ESRS S4-4 35 Human rights issues and incidents Non-material x
ESRS G1-1 10 (b)
Anti-corruption and anti-bribery principles aligned with the Unit-
ed Nations Convention against Corruption Not applicable x
ESRS G1-1 10 (d) Protection of whistleblowers Not applicable x
ESRS G1-4 24 (a) Fines for violation of anti-corruption and anti-bribery laws G1-4 – Corruption and bribery, p. 77 x x
ESRS G1-4 24 (b) Standards of anti-corruption and anti-bribery G1-3 – Prevention and detection of corruption and bribery, p. 79 x
41
Sustainability report
Annual Report 2025
Report by the Board of Directors
In this section, Luotea publishes information on environmentally sustainable eco-
nomic activities in accordance with the EU taxonomy. The information is based on
Regulation (EU) 2020/852 of the European Parliament and of the Council (Tax-
onomy Regulation). The Regulation contains key performance indicators that com-
panies are required to report with regard to their environmentally sustainable eco-
nomic activities.
The taxonomy specifies six key environmental objectives against which a compa-
ny’s various business activities are assessed. The environmental objectives are cli-
mate change mitigation, climate change adaptation, water and marine resources,
the circular economy, pollution, and biodiversity and ecosystems. For the financial
year 2025, Luotea reports the taxonomy-aligned, taxonomy-eligible and non-taxon-
omy-eligible proportions of business activities for three key performance indicators
(turnover, operating expenditure and capital expenditure). The company's EU Tax-
onomy reporting covers all Luotea group companies presented in the consolidated
financial statements for the financial year 1 January–31 December 2025. Luotea’s
facility services business refers to continuing operations and circular economy busi-
ness refers to discontinued operations. The company’s Taxonomy reporting does
not take advantage of the relief provided by the European Commission’s Omnibus
package.
With regard to taxonomy alignment, the company reports the extent to which
the business in question supports the environmental objectives. An activity is con-
sidered to be taxonomy-aligned if it contributes substantially to one of the speci-
fied environmental objectives while doing no significant harm (DNSH) to the other
objectives. In addition, the activity must comply with the criteria concerning min-
imum safeguards.
Luotea’s assessment
Luotea has carried out assessments concerning taxonomy eligibility and taxonomy
alignment on the basis of the company's best interpretation of the EU Taxonomy
Regulation, the Climate Delegated Act, the Complementary Climate Act, the Envi-
ronmental Delegated Act and the currently available guidelines issued by the Euro-
pean Commission.
Taxonomy eligibility has been assessed on the basis of the descriptions of eco-
nomic activities and related NACE codes provided in the European Commission’s
Delegated Regulations. The assessment related to the taxonomy has been carried
out on turnover, capital expenditure and operating expenditure associated with
climate change mitigation, climate change adaptation, the sustainable use and
protection of water and marine resources, the transition to a circular economy, pol-
lution prevention and control, and the protection and restoration of biodiversity and
ecosystems. Luotea does not have business activities related to nuclear energy or
fossil natural gas.
The financial indicators concerning the taxonomy are based on figures extracted
from financial management systems and ERP systems. When calculating the pro-
portion of turnover of products related to taxonomy-aligned and taxonomy-eligible
economic activities, Luotea takes into account revenue from services and products
that have a clear connection to the identified economic activities. In taxonomy
reporting for the 2025 reporting period, turnover consists of turnover from the facility
services business (Note 1.2 to the financial statements) and turnover from the cir-
cular economy business (Note 6). For capital expenditure and operating expendi-
ture, data from 2025 was analysed and compared to the screening criteria.
Capital expenditure consists of additions to property, plant and equipment, intan-
gible assets and right-of-use assets, including additions arising from acquisitions.
In Luotea's taxonomy reporting, capital expenditure consists of the capital expen-
diture of the facility services business (Notes 3.1, 3.3 and 3.4 to the financial state-
ments) and capital expenditure of the circular economy business (Note 6). Oper-
ating expenditure consists of non-capitalised direct expenses of the facility services
and circular economy businesses that are necessary to ensure the continuous and
efficient operation of property, plant and equipment. The expenses include mainte-
nance, repair and servicing of the fleet and buildings, short-term rents and similar
expenses, and other direct expenses related to the maintenance of the assets in
question. The assessments concerning taxonomy eligibility and taxonomy align-
ment take into account only the operating expenditure and capital expenditure that
correspond to the technical screening criteria for the activity. Luotea does not have
separate capital or operating expenditure plans for the taxonomy.
Luotea reports on taxonomy at the Group level. Specialists from each division and
representatives of the businesses have assessed whether the economic activities
identified in the taxonomy meet the criteria for taxonomy alignment. The assess-
ment is based on the activity-specific technical screening criteria described in the
Taxonomy Regulation and the DNSH criteria. Luotea's climate risks are described in
paragraph E1 SBM-3, p. 50.
Luotea’s circular economy business operations are regulated and require sepa-
rate environmental permits that specify environmental requirements for water, soil
contamination and nature. We aim to comply with all environmental requirements
that are applicable to our operations. The procedures are described in more detail in
paragraph E4-2, p. 59.
Luotea has a management system in place that covers all of Luotea’s services
with regard to ISO 9001, ISO 14001 and ISO 45001 certification. The EHSQ manage-
ment model ensures that Luotea’s operations comply with the permit conditions,
and they are monitored and reported on regularly. Luotea also strives to manage
and reduce the environmental impacts of its activities through training and tech-
nical solutions. The technical screening criteria have been examined side by side in
order to achieve the greatest possible consistency in reporting and to avoid double
accounting.
Minimum safeguards
In addition to the technical screening criteria, the Taxonomy Regulation lays down
minimum safeguards that concern labour and human rights, the prevention of
corruption and bribery, fair competition and taxation. At Luotea, the minimum safe-
EU taxonomy
guards have been assessed at the Group level.
Luotea observes the Universal Declaration of Human Rights, workers’ rights as
defined by the International Labour Organization (ILO), international agreements
and the UN Guiding Principles on Business and Human Rights, and complies with
the six steps outlined in the OECD Guidelines for Multinational Enterprises. Luotea's
human rights impacts are described in more detail in paragraph ESRS 2 GOV-4, p.
16.
In the prevention of corruption and bribery, Luotea complies with national legisla-
tion and agreements. These principles have also been incorporated into a separate
anti-corruption and anti-bribery policy, which clearly prohibits bribery, the receiving
and giving of gifts, and other unethical conduct. Luotea’s guidelines on receiving
gifts and hospitality are public and can be found on the company’s website and
intranet. Actions to prevent corruption and bribery are described in more detail in
paragraph ESRS G1-3, p. 79.
The main principles concerning taxation are described in Luotea’s tax policy,
which has been approved by the company's Board of Directors. The policy covers all
of Luotea’s divisions in all operating countries and applies to all employees. Luotea
complies with local legislation in the payment, collection, accounting and reporting
of taxes. A key principle is the high-quality and timely submission of tax forms and
reporting of other legally required information to the authorities.
Luotea pays and collects taxes in the operating countries in which its business
creates value, and does not transfer the created value to low-tax jurisdictions. In
the pricing of intra-Group transactions, the company complies with the applicable
transfer pricing legislation, the OECD transfer pricing guidelines and the recom-
mendations of the tax administration. All of Luotea’s investment and location deci-
sions are made on the basis of business needs. Tax effects are assessed and taken
into account as part of the decision-making process, and businesses and group
structures are dealt with on the basis of their economic substance. Luotea does
not participate in arrangements made purely for tax reasons without business sub-
stance.
Luotea operates in Finland and Sweden, supports fair competition and complies
with good business conduct and the rules of competition law in all of its business
operations. All business activities undertaken by Luotea either in full or in part are
structurally transparent and financially justified. In its acquisition processes, Luotea
complies with competition law, carries out due diligence on the subjects of acquisi-
tion and submits the legally required notifications to the competition authorities.
Luotea’s Code of Conduct includes basic rules on compliance with competition
law and legislation. In addition, Luotea provides training on competition law for
employees whose role involves an identified need for more in-depth training. The
purpose of the training is to help the personnel identify situations that may be ques-
tionable or prohibited from the perspective of the rules of competition law, and to
provide more detailed instructions on the course of action to take in different situa-
tions.
42
Sustainability report
Annual Report 2025
Report by the Board of Directors
Luotea has due diligence processes in place with regard to taxation, anti-corrup-
tion, anti-bribery and fair competition. Requirements concerning human rights,
labour rights and corruption have been taken into account as separate principles,
included in the Code of Conduct and training, and taken into consideration in the
company’s procurement processes and guidelines. The Group-level policies apply to
all of Luotea’s business operations in Finland and Sweden.
Identified taxonomy-eligible activities
The taxonomy-eligible and taxonomy-aligned activities of Luotea's circular
economy business include, among other things, the collection and transport of
waste, recovery of materials from non-hazardous waste, hazardous waste treat-
ment, wastewater collection and treatment, sale of second-hand goods, and envi-
ronmental construction services related to the remediation of contaminated sites
and areas. These circular economy businesses include activities related to climate
change mitigation 5.5 (Collection and transport of non-hazardous waste in source
segregated fractions) and 5.9 (Material recovery from non-hazardous waste), activi-
ties related to the transition to a circular economy and the prevention and recycling
of waste 2.3 (Collection and transport of non-hazardous and hazardous waste), 2.7
(Non-hazardous waste sorting and material recovery and 5.4 (Sale of second-hand
goods). activities related to pollution prevention and control 2.1 (Collection and
transport of hazardous waste), 2.2 (Hazardous waste treatment) and 2.4 (Remedia-
tion of contaminated sites and areas), and an activity related to the sustainable use
of water and marine resources 2.2 (Urban waste water treatment).
Among taxonomy-eligible and taxonomy-aligned activities, Luotea's facility ser-
vices business operations in Finland and Sweden include, for example, the installa-
tion, maintenance and repair of energy efficiency equipment and renewable energy
technology, as well as the installation, maintenance and repair of instruments and
devices for measuring, regulating and controlling the energy performance of build-
ings. The business operations also include expert services related to improving the
energy efficiency of buildings. In taxonomy reporting, the company has taken into
account the climate change-related activities 7.3 (Installation, maintenance and
repair of energy efficiency equipment), 7.4 (Installation, maintenance and repair of
electric vehicle charging stations in buildings), 7.5 (Installation, maintenance and
repair of equipment for measuring, regulating and controlling the energy perfor-
mance of buildings), 7.6 (Installation, maintenance and repair of renewable energy
technologies) and 9.3 (Professional services related to the energy efficiency of build-
ings).
Transitional activities (nuclear power and natural
gas)
A transitional activity is an economic activity that supports the transition to a cli-
mate-neutral economy and for which there are no technologically and economically
feasible low-carbon alternatives. Luotea does not have any taxonomy-eligible or
non-taxonomy-eligible nuclear power or natural gas-related economic activities as
described in the Complementary Climate Delegated Act. Consequently, Template
1: Nuclear and fossil gas-related activities (Complementary Climate Delegated Act,
Annex III) is presented on the right, and templates 2–5 are omitted.
Nuclear energy-related activities
The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of innovative electricity generation facilities that
produce energy from nuclear processes with minimal waste from the fuel cycle.
No
The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear installations to produce electricity or process heat, in-
cluding for the purposes of district heating or industrial processes such as hydrogen production, as well as their safety upgrades, using best available technolo-
gies.
No
The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that produce electricity or process heat, including for the
purposes of district heating or industrial processes such as hydrogen production from nuclear energy, as well as their safety upgrades.
No
Fossil gas-related activities
The undertaking carries out, funds or has exposures to construction or operation of electricity generation facilities that produce electricity using fossil gaseous
fuels.
No
The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined heat/cool and power generation facilities using
fossil gaseous fuels.
No
The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat generation facilities that produce heat/cool using
fossil gaseous fuels.
No
43
Sustainability report
Annual Report 2025
Report by the Board of Directors
Net sales, continuing operations
Financial year N
2025 Substantial Contribution Criteria DNSH criteria ( Does Not Significantly Harm)
Economic Activities
Code Turnover
Propor-
tion of
Turnover,
year N
Climate
change miti-
gation
Climate
change adap-
tation Water Pollution
Circular Econ-
omy Biodiversity
Climate
change
mitigation
Climate
Change Adap-
tation Water Pollution
Circular
Economy Biodiversity
Minimum
Safeguards
Taxono-
my-aligned
(A.1) or taxon-
omy-eligible
(A.2.) propor-
tion of turnover,
year N-1
Category
enabling
activity
Category
transi-
tional
activity
(MEUR) (%) Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N Y; N Y; N Y; N Y; N; Y; N Y; N (%) E T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Installation, maintenance and repair of energy efficiency equipment CCM 7.3 15.0 4.3% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 2.6 % E
Installation, maintenance and repair of charging stations for electric vehicles
in buildings
CCM 7.4 0.2 0.05% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.03 % E
Installation, maintenance and repair of instruments and devices for measur-
ing, regulation and controlling energy performance of buildings
CCM 7.5 5.9 1.7% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 1.5 % E
Installation, maintenance and repair of renewable energy technologies CCM 7.6 1.4 0.4% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.3 % E
Professional services related to energy performance of buildings CCM 9.3 7.0 2.0% Y
N/A N/A
N/A N/A N/A Y Y Y Y Y Y Y 1.8 % E
Turnover of environmentally sustainable activities (Taxonomy-aligned) (A.1) 29.5 8.5% Y
N/A N/A
N/A N/A N/A Y Y Y Y Y Y Y 6.2 %
Of which Enabling 29.5 8.5% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 6.2 % E
Of which Transitional 0.0 0.0% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.0 %
T
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL
Installation, maintenance and repair of energy efficiency equipment CCM 7.3 7.1 2.1% EL N/EL N/EL N/EL N/EL N/EL 2.1 %
Installation, maintenance and repair of charging stations for electric vehicles
in buildings
CCM 7.4 3.5 1.0% EL N/EL N/EL N/EL N/EL N/EL 0.7 %
Installation, maintenance and repair of instruments and devices for measur-
ing, regulation and controlling energy performance of buildings
CCM 7.5 0.0 0.0% EL N/EL N/EL N/EL N/EL N/EL 0.0 %
Installation, maintenance and repair of renewable energy technologies CCM 7.6 0.0 0.0% EL N/EL N/EL N/EL N/EL N/EL 0.0 %
Professional services related to energy performance of buildings CCM 9.3 0.0 0.0% EL N/EL N/EL N/EL N/EL N/EL 0.0 %
Turnover of Taxonomy-eligible but not environmentally sustainable activi-
ties (not Taxonomy-aligned activities) (A.2)
10.7 3.1% 3.1% 2.9 %
A. Turnover of Taxonomy-eligible activities (A.1+A.2) 40.2 11.6% 11.6% 9.0 %
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Turnover of Taxonomy-non-eligible activities 305.7 88.4%
TOTAL (A+B) 346.0 100%
Code: CCM = Climate Change Mitigation, WTR = Water and Marine Resources, PPC = Pollution Prevention and Control, CE = Circular Economy.
A.1: Y – Yes, a taxonomy-eligible and taxonomy-aligned activity with regard to the environmental objective in question, N – No, a taxonomy-eligible but not taxonomy-aligned activity with regard to the environmental objective in question, N/A - Not applicable, a non-taxonomy-eligible activity with regard to the environmental objective in question
A.2: EL – A taxonomy-eligible activity with regard to the objective, N/EL – A non-taxonomy-eligible activity with regard to the objective
44
Sustainability report
Annual Report 2025
Report by the Board of Directors
Capital expenditure, continuing operations
Financial year N
2025 Substantial Contribution Criteria DNSH criteria ( Does Not Significantly Harm)
Economic Activities
Code
Capital Ex-
penditure
Share of
capital
expendi-
ture, year
N
Climate
change miti-
gation
Climate
change adap-
tation Water Pollution
Circular Econ-
omy Biodiversity
Climate
change miti-
gation
Climate change
adaptation Water Pollution
Circular
Economy Biodiversity
Minimum
Safeguards
Taxono-
my-aligned
(A.1) or taxon-
omy-eligible
(A.2.) proportion
of turnover, year
N-1
Category
enabling
activity
Category
transition-
al activity
(MEUR) (%) Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N Y; N Y; N Y; N Y; N; Y; N Y; N (%) E T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Installation, maintenance and repair of energy efficiency equip-
ment
CCM 7.3 0.6 5.3% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 4.6 % E
Installation, maintenance and repair of charging stations for elec-
tric vehicles in buildings
CCM 7.4 0.1 1.1% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 1.0 % E
Installation, maintenance and repair of instruments and devices
for measuring, regulation and controlling energy performance of
buildings
CCM 7.5 0.2 2.0% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 2.5 % E
Installation, maintenance and repair of renewable energy technolo-
gies
CCM 7.6 0.1 0.7% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.6 % E
Professional services related to energy performance of buildings
CCM 9.3 0.4 3.2% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 3.8 % E
Capital expenditure of environmentally sustainable activities (Tax-
onomy-aligned) (A.1)
1.4 12.3% 12.3% 0.0% 0.0% 0.0% 0.0% 0.0% Y Y Y Y Y Y Y 12.6 %
Of which Enabling
1.4 12.3% 12.3% 0.0% 0.0% 0.0% 0.0% 0.0% Y Y Y Y Y Y Y 12.6 % E
Of which Transitional
0.0 0.0% 0.0% Y Y Y Y Y Y Y 0.0 % T
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL
Installation, maintenance and repair of energy efficiency equip-
ment
CCM 7.3 0.6 5.6% EL N/EL N/EL N/EL N/EL N/EL 5.8 %
Installation, maintenance and repair of charging stations for elec-
tric vehicles in buildings
CCM 7.4 0.1 1.1% EL N/EL N/EL N/EL N/EL N/EL 1.0 %
Installation, maintenance and repair of instruments and devices
for measuring, regulation and controlling energy performance of
buildings
CCM 7.5 0.0 0.0% EL N/EL N/EL N/EL N/EL N/EL 0.0 %
Installation, maintenance and repair of renewable energy technolo-
gies
CCM 7.6 0.0 0.0% EL N/EL N/EL N/EL N/EL N/EL 0.0 %
Professional services related to energy performance of buildings
CCM 9.3 0.0 0.0%
EL N/EL N/EL N/EL N/EL N/EL
0.0 %
Turnover of Taxonomy-eligible but not environmentally sustain-
able activities (not Taxonomy-aligned activities) (A.2)
0.8 6.6%
6.6% 0.0% 0.00% 0.0% 0.0% 0.0%
6.8 %
A. Capital expenditure of taxonomy-eligible activities (A.1+A.2)
2.2 18.9% 18.9% 0.0% 0.00% 0.0% 0.0% 0.0% 19.4 %
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Capital expenditure for taxonomy-non-eligible activities
9.3 81.1%
TOTAL
11.5 100%
Code: CCM = Climate Change Mitigation, WTR = Water and Marine Resources, PPC = Pollution Prevention and Control, CE = Circular Economy.
A.1: Y – Yes, a taxonomy-eligible and taxonomy-aligned activity with regard to the environmental objective in question, N – No, a taxonomy-eligible but not taxonomy-aligned activity with regard to the environmental objective in question, N/A - Not applicable, a non-taxonomy-eligible activity with regard to the environmental objective in question
A.2: EL – A taxonomy-eligible activity with regard to the objective, N/EL – A non-taxonomy-eligible activity with regard to the objective
45
Sustainability report
Annual Report 2025
Report by the Board of Directors
Operating expenditure, continuing operations
Financial year N
2025 Substantial Contribution Criteria DNSH criteria ( Does Not Significantly Harm)
Economic Activities
Code
Operating
Expendi-
ture
Share of
operating
expendi-
ture, year
N
Climate
change miti-
gation
Climate
change adap-
tation Water Pollution
Circular Econ-
omy Biodiversity
Climate
change miti-
gation
Climate change
adaptation Water Pollution
Circular
Economy Biodiversity
Minimum
Safeguards
Taxono-
my-aligned
(A.1) or taxon-
omy-eligible
(A.2.) proportion
of operating
expenditure,
year N-1
Category
enabling
activity
Category
transi-
tional
activity
(MEUR) (%) Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N Y; N Y; N Y; N Y; N; Y; N Y; N (%) E T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Installation, maintenance and repair of energy efficiency equipment
CCM 7.3 0.4 5.5% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 3.7 % E
Installation, maintenance and repair of charging stations for electric vehicles
in buildings
CCM 7.4 0.1 0.9% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.7 % E
Installation, maintenance and repair of instruments and devices for measur-
ing, regulation and controlling energy performance of buildings
CCM 7.5 0.2 3.4% Y N/A N /A N /A N/A N/A Y Y Y Y Y Y Y 2.4 % E
Installation, maintenance and repair of renewable energy technologies
CCM 7.6 0.05 0.7% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.5 % E
Professional services related to energy performance of buildings
CCM 9.3 0.3 3.7% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 3.1 % E
Operating expenditure of environmentally sustainable activities
(taxonomy-aligned) (A.1)
1.0 14.2% 14.2% 0.0% 0.0% 0.0% 0.0% 0.0% Y Y Y Y Y Y Y 10.5 %
Of which Enabling
1.0 14.2% 14.2% 0.0% 0.0% 0.0% 0.0% 0.0% Y Y Y Y Y Y Y 10.5 % E
Of which Transitional
0.0 0.0% 0.0% Y Y Y Y Y Y Y 0.0 % T
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL
Installation, maintenance and repair of energy efficiency equipment
CCM 7.3 0.4 5.7% EL N/EL N/EL N/EL N/EL N/EL 4.7 %
Installation, maintenance and repair of charging stations for electric vehicles
in buildings
CCM 7.4 0.1 0.8%
EL N/EL N/EL N/EL N/EL N/EL
0.7 %
Operating expenditure of taxonomy-eligible but not environmentally sus-
tainable activities
(not Taxonomy-aligned) (A.2)
0.5 6.6%
6.6% 0.0% 0.00% 0.0% 0.0% 0.0%
5.3 %
A. Operating expenditure of taxonomy-eligible activities (A.1+A.2)
1.5 20.7% 20.7% 0.0% 0.00% 0.0% 0.0% 0.0% 15.9 %
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Operating expenditure of taxonomy-non-eligible activities
5.6 79.3%
TOTAL
7.1 100%
Code: CCM = Climate Change Mitigation, WTR = Water and Marine Resources, PPC = Pollution Prevention and Control, CE = Circular Economy.
A.1: Y – Yes, a taxonomy-eligible and taxonomy-aligned activity with regard to the environmental objective in question, N – No, a taxonomy-eligible but not taxonomy-aligned activity with regard to the environmental objective in question, N/A - Not applicable, a non-taxonomy-eligible activity with regard to the environmental objective in question
A.2: EL – A taxonomy-eligible activity with regard to the objective, N/EL – A non-taxonomy-eligible activity with regard to the objective
46
Sustainability report
Annual Report 2025
Report by the Board of Directors
Turnover, continuing and discontinued operations
Financial year N
2025 Substantial Contribution Criteria DNSH criteria ( Does Not Significantly Harm)
Economic Activities
Code Turnover
Propor-
tion of
Turnover,
year N
Climate
change miti-
gation
Climate
change adap-
tation Water Pollution
Circular
Economy Biodiversity
Climate
change
mitigation
Climate
change adap-
tation Water Pollution
Circular
Econo-
my
Biodiver-
sity
Minimum
safe-
guards
Taxono-
my-aligned
(A.1) or taxon-
omy-eligible
(A.2.) propor-
tion of turnover,
year N-1
Category
enabling
activity
Catego-
ry tran-
sitional
activity
(MEUR) (%) Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N Y; N Y; N Y; N Y; N; Y; N Y; N (%) E T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Installation, maintenance and repair of energy efficiency equipment CCM7.3 15.0 1.9% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 1.2 % E
Installation, maintenance and repair of charging stations for electric vehicles in buildings CCM7.4 0.2 0.0% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.0 % E
Installation, maintenance and repair of instruments and devices for measuring, regulation and
controlling energy performance of buildings
CCM7.5 5.9 0.8% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.7 % E
Installation, maintenance and repair of renewable energy technologies CCM7.6 1.4 0.2% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.1 % E
Professional services related to energy performance of buildings CCM9.3 7.0 0.9% Y
N/A N/A N/A N/A N/A
Y Y Y Y Y Y Y 0.8 % E
Collection and transport of non-hazardous waste in
source segregated fractions
CCM5.5 12.2 1.6% Y
N/A N/A N/A N/A N/A
Y Y Y Y Y Y Y 1.5 %
Material recovery from non-hazardous waste CCM5.9 1.8 0.2% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.3 %
Collection and transport of non-hazardous and hazardous waste CE 2.3 25.9 3.4% N/A N/A N/A
N/A
Y
N/A
Y Y Y Y Y Y Y 4.3 %
Sorting and material recovery of non-hazardous waste CE 2.7 10.7 1.4% N/A N/A N/A
N/A
Y
N/A
Y Y Y Y Y Y Y 1.5 %
Sale of second-hand goods CE 5.4 16.0 2.1% N/A N/A N/A N/A Y N/A Y Y Y Y Y Y Y 1.2 %
Collection and transport of hazardous waste PPC2.1 22.4 2.9% N/A N /A N/A Y
N/A N/A
Y Y Y Y Y Y Y 2.7 %
Treatment of hazardous waste PPC2.2 4.7 0.6%
N/A N/A N/A
Y
N/A N/A
Y Y Y Y Y Y Y 0.6 %
Remediation of contaminated sites and areas PPC2.4 3.4 0.4% N/A N/A N/A Y N/A N/A Y Y Y Y Y Y Y 0.4 %
Turnover from environmentally sustainable activities
(taxonomy-aligned) (A.1)
126.5 16.4%
5.6% 0.0% 0.0%
4.0% 6.8% 0.0% Y Y Y Y Y Y Y 15.3 %
Of which Enabling
29.5 3.8% 3.8% 0.0% 0.0% 0.0% 0.0% 0.0% Y Y Y Y Y Y Y 2.8 % E
Of which Transitional 0.0 0.0% 0.0% Y Y Y Y Y Y Y 0.0%
T
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL
Installation, maintenance and repair of energy efficiency equipment CCM7.3 7.1 0.9% EL N/EL N/EL N/EL N/EL N/EL 1.0 %
Installation, maintenance and repair of charging stations for electric vehicles in buildings CCM7.4 3.5 0.5% EL N/EL N/EL N/EL N/EL N/EL 0.3 %
Material recovery from non-hazardous waste CCM5.9 0.4 0.1% EL N/EL N/EL N/EL N/EL N/EL 0.1 %
Collection and transport of non-hazardous and hazardous waste CE 2.3 9.0 1.2% N/EL N/EL N/EL N/EL EL N/EL 1.3 %
Sorting and material recovery of non-hazardous waste CE 2.7 8.2 1.1% N/EL N/EL N/EL N/EL EL N/EL 1.0 %
Collection and transport of hazardous waste PPC2.1 1.7 0.2% N/EL N/EL N/EL EL N/EL N/EL 0.2 %
Turnover of Taxonomy-eligible but not environmentally
sustainable activities (not Taxonomy-aligned activities) (A.2)
29.9 3.9% 1.4% 0.0% 0.0% 0.2% 2.2% 0.0% 3.9 %
A. Turnover of Taxonomy-eligible activities (A.1+A.2) 156.4 20.3% 7.1% 0.0% 0.00% 4.2% 9.0% 0.0% 19.2 %
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Turnover of Taxonomy-non-eligible activities 613.9 79.7%
TOTAL (A+B) 770.3 100%
Code: CCM = Climate Change Mitigation, WTR = Water and Marine Resources, PPC = Pollution Prevention and Control, CE = Circular Economy.
A.1: Y – Yes, a taxonomy-eligible and taxonomy-aligned activity with regard to the environmental objective in question, N – No, a taxonomy-eligible but not taxonomy-aligned activity with regard to the environmental objective in question, N/A - Not applicable, a non-taxonomy-eligible activity with regard to the environmental objective in question
A.2: EL – A taxonomy-eligible activity with regard to the objective, N/EL – A non-taxonomy-eligible activity with regard to the objective
47
Sustainability report
Annual Report 2025
Report by the Board of Directors
Capital expenditure, continuing and discontinued operations
Financial year N
2025 Substantial Contribution Criteria DNSH criteria ( Does Not Significantly Harm)
Economic Activities
Code
Capital Ex-
penditure
Share of
capital
expendi-
ture, year
N
Climate
change miti-
gation
Climate
change ad-
aptation Water Pollution
Circular Econ-
omy Biodiversity
Climate
change miti-
gation
Climate change
adaptation Water Pollution
Circular
Economy Biodiversity
Minimum
Safeguards
Taxono-
my-aligned
(A.1) or taxon-
omy-eligible
(A.2.) proportion
of turnover, year
N-1
Category
enabling
activity
Category
transition-
al activity
(MEUR) (%) Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N Y; N Y; N Y; N Y; N; Y; N Y; N (%) E T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Installation, maintenance and repair of energy efficiency equipment
CCM7.3 0.6 0.9% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.7 % E
Installation, maintenance and repair of charging stations for electric vehicles in
buildings
CCM7.4 0.1 0.2% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.2 % E
Installation, maintenance and repair of instruments and devices for measuring,
regulation and controlling energy performance of buildings
CCM7.5 0.2 0.3% Y N /A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.4 % E
Installation, maintenance and repair of renewable energy technologies
CCM7.6 0.1 0.1% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.1 % E
Professional services related to energy performance of buildings
CCM9.3 0.4 0.5% Y
N/A N/A N/A N/A N /A
Y Y Y Y Y Y Y 0.6 % E
Collection and transport of non-hazardous waste in source segregated fractions
CCM5.5 0.2 0.3% Y
N/A N/A N/A N/A N /A
Y Y Y Y Y Y Y 3.0 %
Material recovery from non-hazardous waste
CCM5.9 0.7 1.0% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 1.4 %
Collection and transport of non-hazardous and hazardous waste
CE 2.3 2.2 3.2% N/A N/A N/A N/A Y N/A Y Y Y Y Y Y Y 6.3 %
Sorting and material recovery of non-hazardous waste
CE 2.7 0.9 1.3% N/A N/A N/A N/A Y N/A Y Y Y Y Y Y Y 2.2 %
Sale of second-hand goods
CE 5.4 1.3 2.0% N /A N/A N/A N/A Y N/A Y Y Y Y Y Y Y 1.7 %
Collection and transport of hazardous waste
PPC2.1 2.0 2.9% N/A N/A N/A Y N/A N/A Y Y Y Y Y Y Y 3.7 %
Treatment of hazardous waste
PPC2.2 0.2 0.3%
N/A N/A N/A
Y
N/A N/A
Y Y Y Y Y Y Y 0.7 %
Capital expenditure of environmentally sustainable activities
(taxonomy-aligned) (A.1)
9.0 13.2%
3.4% 0.0% 0.0%
3.3%
6.5% 0.0%
Y Y Y Y Y Y Y 20.9 %
Of which Enabling
1.4 2.1% 2.1% 0.0% 0.0% 3.3% 6.5% 0.0% Y Y Y Y Y Y Y 1.8 % E
Of which Transitional
0.0 0.0% 0.0% Y Y Y Y Y Y Y 0.0% T
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL
Installation, maintenance and repair of energy efficiency equipment
CCM7.3 0.6 0.9% EL N/EL N/EL N/EL N/EL N/EL 0.8 %
Installation, maintenance and repair of charging stations for electric vehicles in
buildings
CCM7.4 0.1 0.2% EL N/EL N/EL N/EL N/EL N/EL 0.1 %
Material recovery from non-hazardous waste
CCM5.9 0.2 0.2% EL N/EL N/EL N/EL N/EL N/EL 0.4 %
Collection and transport of non-hazardous and hazardous waste
CE 2.3 0.8 1.1% N/EL N/EL N/EL N/EL EL N/EL 1.9 %
Sorting and material recovery of non-hazardous waste
CE 2.7 0.7 1.0% N/EL N/EL N/EL N/EL EL N/EL 1.4 %
Collection and transport of hazardous waste
PPC2.1 0.1 0.2%
N/EL N/EL N/EL EL N/EL N/EL
0.3 %
Turnover of Taxonomy-eligible but not environmentally sustainable activities (not
Taxonomy-aligned activities) (A.2)
2.5 3.7%
1.4% 0.0% 0.0% 0.2% 2.1% 0.0%
5.0 %
A. Capital expenditure of taxonomy-eligible activities (A.1+A.2)
11.5 16.9% 4.7% 0.0% 0.00% 3.5% 8.7% 0.0% 25.8 %
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Capital expenditure for taxonomy-non-eligible activities
56.5 83.1%
TOTAL
68.0 100%
Code: CCM = Climate Change Mitigation, WTR = Water and Marine Resources, PPC = Pollution Prevention and Control, CE = Circular Economy.
A.1: Y – Yes, a taxonomy-eligible and taxonomy-aligned activity with regard to the environmental objective in question, N – No, a taxonomy-eligible but not taxonomy-aligned activity with regard to the environmental objective in question, N/A - Not applicable, a non-taxonomy-eligible activity with regard to the environmental objective in question
A.2: EL – A taxonomy-eligible activity with regard to the objective, N/EL – A non-taxonomy-eligible activity with regard to the objective
48
Sustainability report
Annual Report 2025
Report by the Board of Directors
Operating expenditure, continuing and discontinued operations
Financial year N
2025 Substantial Contribution Criteria DNSH criteria ( Does Not Significantly Harm)
Economic Activities
Code
Operating
Expendi-
ture
Share of
operating
expendi-
ture, year
N
Climate
change miti-
gation
Climate
change adap-
tation Water Pollution
Circular Econ-
omy Biodiversity
Climate
change miti-
gation
Climate change
adaptation Water Pollution
Circular Econ-
omy Biodiversity
Minimum
Safeguards
Taxono-
my-aligned
(A.1) or taxon-
omy-eligible
(A.2.) proportion
of operating
expenditure,
year N-1
Category
enabling
activity
Category
transition-
al activity
(MEUR) (%) Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N Y; N Y; N Y; N Y; N; Y; N Y; N (%) E T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Installation, maintenance and repair of energy efficiency equip-
ment
CCM7.3 0.4 1.1% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.9 % E
Installation, maintenance and repair of charging stations for elec-
tric vehicles in buildings
CCM7.4 0.1 0.2% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.2 % E
Installation, maintenance and repair of instruments and devices
for measuring, regulation and controlling energy performance of
buildings
CCM7.5 0.2 0.7% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.6 % E
Installation, maintenance and repair of renewable energy technol-
ogies
CCM7.6 0.1 0.1% Y N /A N /A N /A N/A N/A Y Y Y Y Y Y Y 0.1 % E
Professional services related to energy performance of buildings
CCM9.3 0.3 0.7% Y
N/A N/A N/A N/A N/A
Y Y Y Y Y Y Y 0.8 % E
Collection and transport of non-hazardous waste in source segre-
gated fractions
CCM5.5 0.8 2.3% Y
N/A N/A N/A N/A N/A
Y Y Y Y Y Y Y 2.1 %
Material recovery from non-hazardous waste
CCM5.9 0.0 0.1% Y
N/A N/A
N/A
N/A N/A
Y Y Y Y Y Y Y 0.1 %
Collection and transport of non-hazardous and hazardous waste
CE 2.3 1.9 5.3% N/A
N/A N/A
N/A
Y N/A
Y Y Y Y Y Y Y 6.7 %
Sorting and material recovery of non-hazardous waste
CE 2.7 0.8 2.2% N/A N/A N/A
N/A
Y N/A Y Y Y Y Y Y Y 2.3 %
Sale of second-hand goods
CE 5.4 1.2 3.3% N/A N/A N/A
N/A
Y N/A Y Y Y Y Y Y Y 1.8 %
Collection and transport of hazardous waste
PPC2.1 0.7 2.1% N/A N /A N /A
Y
N/A
N/A Y Y Y Y Y Y Y 1.9 %
Treatment of hazardous waste
PPC2.2 0.2 0.4%
N/A N/A N/A
Y
N/A
N/A
Y Y Y Y Y Y Y 0.4 %
Remediation of contaminated sites and areas
PPC2.4 0.0 0.1% N/A N /A N /A Y
N/A
N/A Y Y Y Y Y Y Y 0.1 %
Operating expenditure of environmentally sustainable activities
(taxonomy-aligned) (A.1)
6.6 18.6% 5.2% 0.0% 0.0% 2.6% 10.8% 0.0% Y Y Y Y Y Y Y 18.1 %
Of which Enabling
1.0 2.8% 2.8% 0.0% 0.0% 3.3% 6.5% 0.0% Y Y Y Y Y Y Y 2.6 % E
Of which Transitional
0.0 0.0% 0.0% Y Y Y Y Y Y Y 0.0 % T
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL
Installation, maintenance and repair of energy efficiency equip-
ment
CCM7.3 0.4 1.1% EL N/EL N/EL N/EL N/EL N/EL 1.1 %
Installation, maintenance and repair of charging stations for elec-
tric vehicles in buildings
CCM7.4 0.1 0.2% EL N/EL N/EL N/EL N/EL N/EL 0.2 %
Material recovery from non-hazardous waste
CCM5.9 0.0 0.01% EL N/EL N/EL N/EL N/EL N/EL 0.0 %
Collection and transport of non-hazardous and hazardous waste
CE 2.3 0.7 1.8% N/EL N/EL N/EL N/EL EL N/EL 2.0 %
Sorting and material recovery of non-hazardous waste
CE 2.7 0.6 1.7% N/EL N/EL N/EL N/EL EL N/EL 1.5 %
Collection and transport of hazardous waste
PPC2.1 0.1 0.2%
N/EL N/EL N/EL EL N/EL N/EL
0.1 %
Operating expenditure of Taxonomy-eligible but not environmen-
tally sustainable activities (not Taxonomy-aligned activities) (A.2)
1.8 5.0%
1.3% 0.0% 0.0% 0.2% 3.5% 0.0%
5.1 %
A. Operating expenditure of taxonomy-eligible activities (A.1+A.2)
8.4 23.6% 6.5% 0.0% 0.00% 2.8% 14.3% 0.0% 23.1 %
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Operating expenditure of taxonomy-non-eligible activities
27.1 76.4%
TOTAL
35.5 100%
Code: CCM = Climate Change Mitigation, WTR = Water and Marine Resources, PPC = Pollution Prevention and Control, CE = Circular Economy.
A.1: Y – Yes, a taxonomy-eligible and taxonomy-aligned activity with regard to the environmental objective in question, N – No, a taxonomy-eligible but not taxonomy-aligned activity with regard to the environmental objective in question, N/A - Not applicable, a non-taxonomy-eligible activity with regard to the environmental objective in question
A.2: EL – A taxonomy-eligible activity with regard to the objective, N/EL – A non-taxonomy-eligible activity with regard to the objective
49
Sustainability report
Annual Report 2025
Report by the Board of Directors
E1-1 – Transition plan for climate change mitigation
Climate targets are part of Luotea’s strategic objectives. The company’s target is to
achieve net zero for its own operations and the entire supply chain by 2045. Luotea
is also committed to phasing out fossil fuels in the long term. Luotea's climate tar-
gets are described in more detail in section E1-4, p. 51.
The targets are in line with the Paris Agreement. Luotea is not excluded from the
EU’s Paris Agreement benchmarks.
In 2025, Luotea's own operations (scope 1 and 2) accounted for 8% of total emis-
sions, of which approximately 98% were generated by transport (scope 1). Scope
2 emissions accounted for 2% of the emissions of Luotea’s own operations. Scope
2 emissions include all greenhouse gas (GHG) emissions arising from the use of
electricity, heating and cooling energy at Luotea’s properties. The majority, approxi-
mately 92%, of Luotea’s total emissions are generated in the value chain (scope 3).
To achieve the targets, Luotea has drawn up a separate climate transition plan
that includes an assessment of the key measures concerning Luotea's own opera-
tions and supply chain until 2030. The key aspects of the transition plan are related
to the company's measures to phase out fossil carbon in transport operations with
respect to both fuel use and the fleet, so that by 2030, in Luotea's continuing oper-
ations, 36% of the transport fuels used in the company’s own operations would be
renewable, and 20% of Luotea’s own fleet would consist of low-emission vehicles,
such as vehicles powered by biogas or electricity.
The partial demerger has a considerable effect on the company's emission
amounts and distribution of emissions with regard to scope 3 emissions, and the
company will update its transition plan in 2026.
In addition to focusing on its own operations, Luotea seeks to promote its value
chain emission reduction targets by intensifying its cooperation with value chain
partners. In 2025, Luotea focused on collecting emission data from its suppliers in
the area of transport subcontracting and machine contracting. In 2026, Luotea's
continuing operations will assess ways to reduce emissions generated in the supply
chain.
The lock-in of potential GHG emissions is not estimated to cause a significant
transition risk or prevent the achievement of emission reduction targets in respect
of the company’s own operations, as the power source of the fleet in use can be
adjusted during use, for example by replacing fossil energy with renewable energy.
The availability of renewable energy is expected to remain good in the future.
Luotea’s climate targets are part of the company’s strategic business objectives. A
more detailed transition plan that supports the targets and examines the effective-
ness of the key measures targeted at the company’s own operations in relation to
the emission targets, and their potential financial effects, has been approved by the
Board of Directors.
The plan takes into account the anticipated capital and operating expenditure
to achieve the climate targets set for the company’s own operations by the end
of 2030. The long-term measures extending to 2045 are not yet at a sufficiently
detailed level due to insufficient transparency. The adequacy of the measures and
Luotea has planned to reduce the emissions generated by its own operations by approximately 31%by 2030, using 2022 as the base year. Of the planned emission reductions in Luotea's own oper-
ations, 70% is made up of the increased use of renewable energy and 30% is made up of changes in the fleet’s propulsion sources. Luotea estimates that, in 2030, 22% of the fleet will consist of
low-emission vehicles, and the rate of renewable energy use for vehicles will be 25%.
The drivers of the planned emission reductions in the value chain include increasing the recycling rate and emission reduction measures in subcontracted logistics. In addition, scope 3 emissions are
expected to decrease organically as a result of other decarbonisation measures in the value chain.
The company’s long-term net-zero target is to reduce emissions by 90% from the 2022 level and offset the share of emissions that cannot be reduced in the company’s own operations or value chain.
E1 Climate change
-20%
Luotea’s key means of decarbonisation and their impact on Luotea’s short-term targets
Growth of operations 22–30
Scope 1&2
Scope 3
Carbon offset
2022
Reductions in
own operations
Scope 3 reductions
Target year 2030 Net-zero target 2045
tCO
2
e
50
Sustainability report
Annual Report 2025
Report by the Board of Directors
the related financing plan will be reviewed annually as part of Luotea’s investment
decisions.
The significant capital expenditure required to implement Luotea’s planned mea-
sures is related to increasing the relative share of low-emission equipment in the
fleet by 2030. The planned measures will increase Luotea's annual capital expendi-
ture, which in turn will increase depreciation and amortisation in Luotea's income
statement. As a counterbalance to increasing depreciation and amortisation,
Luotea anticipates that low-emission equipment will reduce the annual operating
expenditure of the fleet in the income statement. With respect to non-low-emission
equipment, Luotea will significantly increase the use of renewable fuels in accor-
dance with the transition plan. This measure is expected to increase annual fuel
expenditure in Luotea's income statement by 2030. Luotea's total net sales and a
disaggregation of investments, depreciation and amortisation are presented in the
notes to the financial statements on note 1.1.
The alignment of the company's economic activities with the criteria established
in Commission Delegated Regulation (EU) 2021/2139 is mainly focused on the
renewal of the fleet, which is expected to reduce the company's general environ-
mental impact. Although the renewal of the fleet is not directly related to the activi-
ties specified in the taxonomy to a significant degree, it supports the company's aim
of operating more sustainably.
SBM-3 – Material impacts, risks and opportunities
and their interaction with strategy and business
models
Based on the double materiality assessment, Luotea’s material impacts, risks and
opportunities related to climate change were related to climate change mitigation
and improving energy efficiency. Luotea’s entity-specific disclosure obligations apply
to the carbon handprint and carbon intensity (gCO
2
/km), which is also one of the
sustainability targets associated with Luotea's bond issued in 2022. In the partial
demerger, the bond was transferred to the Circular Economy Business.
Climate change and biodiversity loss are global phenomena whose mitigation
creates both opportunities and risks for Luotea's business activities. The company’s
positive impacts arise from energy efficiency services provided by its businesses
that reduce customers' energy consumption. Luotea's discontinued operations sup-
port the transition to a low-carbon circular economy by promoting the recycling of
materials and raw materials, and by reducing the volumes of waste directed to dis-
posal and incineration. The negative impacts of Luotea's own operations arise from
transport-related emissions and purchased products and services, for example.
Most of Luotea’s emissions are generated in the value chain.
The transition to a low-emission fleet and significantly increasing the use of renew-
able energy are key measures for achieving Luotea’s emission reduction targets.
Luotea's material transition risks are also related to these measures. The material
transition risks include delays in the technological development of low-emission and
electrically powered heavy-duty vehicles and the availability and price of renewable
fuels in the long term.
The positive climate impact of the services is measured using the carbon hand-
print. It describes the emissions avoided through companies’ conscious choices
and solutions relative to previous operating practices. Luotea’s carbon handprint is
created through services produced for customers, such as energy efficiency solu-
tions and material recycling.
The monitoring of the outcomes of climate change related to our business oper-
ations is integrated in Luotea’s strategy process. The company has assessed the
impacts of climate change both during the short strategy period of five years and
in the long term, extending to 2035. The resilience analysis is based on a qualita-
tive assessment of the uncertainties in the business environment, which takes into
account changes in the market and the operating environment and their significant
financial effects. The most recent scenario review was carried out in 2023.
The resilience analysis was focused on Luotea’s own operations. With regard to
transition risks, it considered changes in markets and regulation and, with regard to
physical risks, it considered potential weather fluctuations in Finland and Sweden.
The analysis takes into account Luotea’s own climate targets and related measures,
such as Luotea’s emissions reduction measures in logistics, as well as fleet invest-
ments and measures promoting the recycling of materials.
The company's resilience analysis applies the IPCC scenarios of climate
warming of 1.5°C, less than 2°C and 4°C by the end of the century (RCP 2.6 and
RCP 6.0), which have been assessed in relation to the latest climate research data
on changes in weather in Finland. The International Energy Agency's (IEA) back-
ground data and assumptions (APS, NZE2050 and STEPS) have also been utilised
in the analysis.
The evaluated scenarios included a business environment in which legislation
and measures support and guide companies towards targets aligned with the net
zero objective. The other extreme was a business environment in which change
slows down and the necessary measures are implemented slowly. The business
effects of climate change were assessed in the different scenarios through aspects
of change in the industry related to regulation, the business model and technolog-
ical development.
The uncertainties in the resilience analysis are related to regulatory changes and
market changes. These factors have been taken into account in the background of
Luotea's climate transition plan when assessing the impacts of low-emission fleet
investments. The flexibility of the business model in the operating environments out-
lined in the different climate scenarios is on a stable foundation. The reference sce-
nario was a business environment where the status quo supports the 1.5°C climate
path in the short term and the long term.
In connection with the company's strategy work in 2023, Luotea tightened its
climate targets by setting a net-zero target to be achieved by 2045. The assessment
indicated that Luotea’s updated climate targets, the actions aimed at achieving the
targets and the separate climate targets set for the supply chain are in line with the
observations made in the scenario analysis.
E1-2 – Policies related to climate change mitigation
Luotea’s climate targets are guided by the company’s environmental policy, which
describes not only Luotea's own operations but also the principles pertaining to the
value chain. The environmental policy, which is published on Luotea’s website, has
been approved by the President and CEO and the Group Executive Board.
Luotea’s environmental policy describes the company’s material targets and prin-
ciples with regard to climate change mitigation, the use of renewable energy and
the promotion of energy efficiency. Luotea is committed to net zero targets by 2045
and also encourages its partners to set their own climate targets and reduce their
dependence on fossil raw materials. In addition, emissions generated in Luotea's
own operations and the value chain are reduced by promoting the use of renew-
able raw materials and improving energy efficiency. The environmental policy takes
into account customer solutions by which Luotea promotes its customers’ climate
targets. The positive climate impact of the value chain arises when the company’s
services are used to replace virgin raw materials with recycled and renewable raw
materials or when Luotea implements energy efficiency measures for customers. At
the same time, Luotea’s own carbon handprint increases.
The principles laid down in the policy are reviewed regularly, at two-year intervals.
The responsibility for updating the policy and its content lies with the company’s
SVP, Strategy, Sustainability and Development, who prepares the key principles
of the policy together with Luotea’s specialists. Other stakeholders have not been
engaged for the time being. Luotea's divisions and units are responsible for the
implementation of the policy and the allocation of the necessary resources in their
respective operations. Climate targets concerning the supply chain have been taken
into account in Luotea’s new procurement agreements.
E1-3 – Actions and resources in relation to climate
change policies
Luotea’s climate targets and environmental policy principles are put into action in
the units through division-specific sub-targets, guidelines and circular economy and
energy efficiency solutions implemented for customers. In addition, climate targets
and their monitoring are one of the key themes of Luotea’s communications, and
the topic as a whole is also discussed regularly at the divisions' internal personnel
briefings.
Measures to reduce emissions caused by Luotea's own
operations
The key measures related to climate change mitigation and renewable energy
deployment in Luotea's own operations are focused on the deployment of low-emis-
sion equipment and the use of renewable fuel in the fleet. The company also invests
in training drivers on an economical driving style and the use of the equipment. The
measures support Luotea’s efforts to phase out fossil carbon both in the short term
(by 2030) and the long term (by 2045).
Luotea made good progress towards its emission reduction targets in 2025. Emis-
sions caused by Luotea's own operations have decreased by 53% (continuing oper-
ations: 65%) since 2018. The renewal of the fleet and a significant increase in the use
of renewable fuels had a substantial impact on the scope 1 emissions caused by
Luotea's own operations.
The following measures, among others, were taken in 2025 to promote the targets
related to Luotea's own operations:
• In the Circular Economy Business, driving style monitoring equipment had been
installed in 1,345 vehicles by the end of 2025.
• In Facility Services, driving style monitoring equipment has been installed in all
vehicles and, in 2025, a management tool was introduced for the monitoring of
deviations, such as braking, accelerating and speeding.
• Luotea's Circular Economy Business has 91 low-emission heavy-duty vehicles,
and Facility Services has 72 light-duty vehicles, that run on either biogas or elec-
tricity.
• 27% of the diesel oil used by Luotea in transport operations was replaced with
HVO (Hydrotreated Vegetable Oil) made from renewable raw materials.
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• Luotea engages in route planning on an ongoing basis. It has enabled the com-
pany to improve the efficiency of its operations and reduce emissions, kilome-
tres driven and working hours.
• Luotea has been a pioneer in the Nordic countries with regard to the deploy-
ment of electric heavy-duty vehicles, including an electric vacuum truck, which
is part of discontinued operations.
Luotea’s properties will switch to renewable electricity by 2030. Currently, the elec-
tricity used in Finland is produced with nuclear energy and certified with guarantees
of origin. The energy efficiency of properties has been improved, for example, by opti-
mising the controls of building systems and replacing LED lighting systems, building
automation systems, ventilation machines and heating systems. All oil heating
systems at properties owned by Luotea have been replaced with air-to-water heat
pumps. In 2025, energy efficiency measures were taken at 13 properties. The mea-
sures have led to emission reductions of 121 tCO
2
e, corresponding to approximately
22.4% of scope 2 emissions. The projected scope 2 emission reductions for 2030
amount to approximately 1,000 tCO
2
e,
using 2018 as the base year.
Good progress has also been made towards Luotea's validated SBTi emission
reduction targets. Emission intensity (scope 1 & 2, tCO
2
e per kilometre driven)
decreased by 51% from the 2018 level, and the company is in line with the selected
emission reduction path. The target is also one of the conditions of Luotea’s sustain-
ability-linked bond. The supply chain target was updated in 2023 to an absolute 20%
emission reduction target, with 2022 as the base year.
Luotea's carbon handprint
Luotea’s carbon handprint is created by, for example, long-term efforts related to
energy efficiency and sustainability, as well as services that promote the circular
economy of the value chain. Our wide-ranging energy efficiency services have
enabled our customers to achieve significant reductions in energy consumption
and emissions by implementing energy efficiency measures identified and recom-
mended by our specialists.
The Smartti automation service developed by Luotea's Facility Services is used
to control building automation systems, which improves the energy efficiency of
properties. Luotea also offers a blast cleaning method for the cleaning of boilers in
industrial power plants, which reduces emissions and improves efficiency.
In 2025, the carbon handprint of Luotea’s operations was 378.8 MCO
2
e, which
was approximately 14% lower than in 2024. The decrease in the carbon handprint
was particularly attributable to the slowdown in general economic activity and the
resulting decrease in waste streams and declining demand for solid recovered fuels.
Climate efforts in the supply chain
Most of Luotea’s total emissions consist of supply chain emissions, such as emis-
sions arising from purchased goods and services, waste processing and transport
subcontracting. Luotea has analysed the most significant sources of scope 3 emis-
sions in the supply chain and prepared a short-term action plan, extending to 2030,
based on the analysis. The measures contribute to climate change mitigation, pro-
mote of renewable energy deployment and reduce the value chain's dependence on
fossil carbon.
Approximately 17% of Luotea’s scope 3 emissions arise from the incineration of
waste, such as plastics contained in mixed waste and waste-to-energy material, and
the disposal of hazardous waste. The company’s goal is to enhance sorting at source
in cooperation with customers by facilitating the recycling of raw materials in mixed
waste and waste-to-energy material, which also reduces the climate impact of the
waste. Luotea also develops solutions to improve the recycling of hazardous waste. It
is also key to improve the quality of supply chain data so that emissions calculations
are increasingly based on primary data received from suppliers.
A significant proportion of Luotea’s scope 3 emissions are generated during trans-
port subcontracting. In 2025, supplier-specific transport emissions reporting sur-
veys were carried out in the Circular Economy Business. In 2025, emissions from
transport subcontracting decreased by 0.1% when compared to the previous year’s
emissions, but they were still 2% higher than the emissions in the base year 2020.
The partial demerger has a significant effect on the distribution of scope 3 emis-
sions, and Luotea will carry out a new analysis of its most significant scope 3 emis-
sion sources in 2026.
Anticipated financial effects
The emission reduction measures related to Luotea’s own operations require finan-
cial capital and operating expenditure which Luotea's taxonomy reporting does not
fully take into account, as some of the measures are not taxonomy-eligible due to
the sector classification included in the Taxonomy Regulation. The most significant
capital expenditures are allocated particularly to low-emission fleet investments in
accordance with the transition plan, while the key operating expenditures include
the costs incurred from the use of renewable fuel, for example. The significant cap-
ital and operating expenditures associated with Luotea’s measures are described as
part of the financial report on the transition plan in section E1-1, pp. 49–50. Disclo-
sures required by the Taxonomy Regulation are reported as part of the taxonomy, pp.
41–48.
Luotea’s measures are also partially dependent on external factors, such as
market development, technological innovations and changes in legislation, which
may either promote or hinder the achievement of climate targets. The company
closely monitors the development of the business environment and adapts its
strategy accordingly.
Future development areas
In addition to the existing measures, Luotea will focus particularly on developing the
monitoring of the supply chain’s climate targets and the practical implementation of
emission reduction measures.
E1-4 – Targets related to climate change mitigation
and adaptation
Luotea updated its climate targets in late 2023. The focus of the targets is on
phasing out fossil raw materials. Luotea’s target is to achieve net zero across the
entire value chain (scope 1, 2 and 3) by reducing the absolute GHG emissions of the
chain as a whole by at least 90% by 2045. The target also requires that the emissions
that remain after the emission reductions are offset by carbon sinks, climate-positive
projects or carbon sequestration. The benchmark years for the target are 2018 for
Luotea's own operations and 2022 for the value chain. No separate stakeholder con-
sultations have been conducted in connection with the setting of targets.
With regard to Luotea's own operations, 2018 is the first year for which the scope
and integrity of fuel and energy consumption data are at a sufficient level to ensure
the reliability of the benchmark. Luotea has assessed that the year in question rep-
resents the normal level of operations. With regard to value chain emissions, 2022
is the first year for which the scope and integrity of the background data are at a
sufficient level to ensure the reliability of the benchmark. Luotea has estimated that
the COVID-19 pandemic's impacts on the level of economic activity were only very
minor in that year, and they have no impact on the reliability of the benchmark.
In addition to the long-term targets, Luotea has set separate short-term targets
to be achieved by 2030. The absolute emission reduction targets for the entire value
chain by 2030 are as follows:
• Halving the emissions of Luotea's own operations by 2030, using 2018 as the
baseline (2018: 47,400 tCO
2
e). The target has been validated by the SBTi.
• 20% reduction in value chain emissions by 2030, using 2022 as the baseline
(2022: 271,200 tCO
2
e). The company has also set separate targets for transport
subcontracting: 30% reduction in emissions from transport subcontracting by
2030, using 2020 as the baseline (2020: 20,501 tCO
2
e). The target applies to dis-
continued operations.
The targets for the following year are always updated annually, and the 2045 net-
zero target is broken down into an average annual target of -4.2%.
Luotea’s Board of Directors has approved the company’s climate targets, and the
company plans to have its net-zero target validated by the SBTi (Science Based
Targets initiative). Luotea’s climate target for 2045 is aligned with the goal of limiting
global warming to 1.5°C in accordance with the Paris Agreement and the European
Union’s climate targets. Our current SBTi-validated short-term climate targets are
based on Luotea’s previous climate targets, which corresponded to the goals of the
Paris Agreement to limit global warming to well below 2°C. In 2026, Luotea's con-
tinuing operations will set new SBTi-validated short-term and long-term climate
targets.
In addition to having established emission targets, Luotea is committed to the
general action plan for the service sector under the Confederation of Finnish Indus-
tries’ Energy Efficiency Agreement. The company's aim is to improve the energy
efficiency of its properties by 7.5% by 2025, using 2020 as the baseline. This corre-
sponds to total savings of 2,758 MWh. The target for the Energy Efficiency Agree-
ment period 2017–2025 was -7.5%. This target was achieved and exceeded by the
end of the agreement period. The total reported energy savings achieved through
energy efficiency measures for the entire agreement period amounted to 3,038
MWh, which exceeded the target by +10%.
The key decarbonisation levers of the emission targets are described in more
detail in section E1-1, p. 49.
Luotea’s net-zero climate targets for 2045 take GHG removal or GHG emission
mitigation projects into account as potential measures. In 2025, Luotea did not
carry out such projects to offset its own emissions. The company does not apply
internal carbon pricing schemes in measures related to its targets. The results of
the previously presented scenario analysis and the expectations of external stake-
holders, which have been surveyed in connection with Luotea’s double materiality
assessment process, for example, have been taken into account as background
data for the targets.
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Acquisitions, divestments or changes in calculation principles and methods may
affect the recalculation of the emission values for the benchmark years selected for
the climate targets. As a result of the corporate restructuring, the emissions figures
for the years 2025 and 2024 have been calculated for continuing operations. No sig-
nificant changes have been identified in Luotea’s business environment that would
have required recalculations of the benchmark data in 2025.
In 2026, Luotea's continuing operations will recalculate the benchmark figures for
the base year so that new climate targets can be set accordingly. The principles for
calculating emissions are presented in section E1-6, p. 52.
E1-5 – Energy consumption and mix
The share of renewable energy of Luotea's total energy consumption increased
in 2025. Renewable energy accounted for 30% of total energy consumption. In
Luotea's operations, fuels account for 83% of total energy consumption, and the
amount of renewable energy produced by the company itself came to 120 MWh.
Systematic progress has been made towards Luotea's energy efficiency target.
The consumption of purchased energy decreased by 7.3% from the comparison
year 2024. The energy efficiency of Luotea’s properties was improved by optimising
building technology controls and upgrading lighting, for example. In 2025, we
continued the renewal of heating systems and replaced some of the natural gas
and oil-powered heating systems of properties with air-to-water heat pumps. The
renewal of heating systems will continue in 2025.
In 2025, the energy consumption of Luotea’s properties in Finland came to 32
575 MWh, of which 77% was emission-free. The energy consumption of properties
in Finland decreased by 5.5% when compared to 2024. The origin of the purchased
electricity used by Luotea in Finland is certified with guarantees of origin. Luotea’s
own energy consumption is disaggregated in the table to the right.
Basis of calculation
The energy consumption calculation includes all energy purchased and produced
by Luotea, measured in MWh. The end-use of energy includes the fuel purchased
by Luotea during the reporting year, renewable electricity produced by Luotea itself
and the amount of purchased electricity and heat. The information is obtained
from Luotea’s own systems and the energy suppliers’ reporting systems. In the cal-
culations, energy consumption of leased premises where electricity or heating is
included in the rent, and where Luotea does not have a contract with the energy sup-
plier, has been included in the Scope 3 emissions calculation.
Local factors are used to calculate the energy content of different fuels. The origin
of Luotea's purchased electricity in Finland is certified with guarantees of origin. In
Sweden, Luotea uses multiple electricity suppliers, and the origin of the purchased
electricity depends on the agreement. Purchased electricity is classified as fossil
when the electricity production method is a mixture of nuclear energy and renew-
able energy, or contains fossil production. 77% of the energy purchased by Luotea
has been certified to be emission-free by means of an agreement or guarantees of
origin acquired from the market afterwards.
The energy intensity is calculated on operations in industries that have significant
climate impacts. Commission Delegated Regulation (EU) 2022/1288 defines high
impact climate sectors as the NACE sectors listed in Sections A to H and Section L
of Annex I to Regulation (EC) No 1893/2006 of the European Parliament and of the
Council.
The calculation of Luotea's energy intensity is based on the Group's total energy
consumption and total net sales, as the reporting of energy consumption does not
currently enable categorisation according to NACE classification. Luotea’s con-
tinuing operations total net sales amounted to EUR 346.0 million (note 1.2 to the
financial statements). The following table lists the two-digit NACE sectors in which
Luotea has significant operations:
NACE Rev. 2
classification Description
C16 Manufacture of wood and of products of wood and cork,
except furniture; manufacture of articles of straw and
plaiting materials
C22 Manufacture of rubber and plastic products
E37 Sewerage
E38 Waste collection, treatment and disposal activities, mate-
rials
recovery
E39 Remediation activities and other waste management ser-
vices
F43 Specialised construction activities
N71 Architectural and engineering activities; technical testing
and analysis
O81 Services to buildings and landscape activities
E1-6 – Gross Scope 1, 2, 3 and Total GHG emissions
In 2025, Luotea’s GHG emissions decreased from the comparison year 2024. In
2025, the emissions of Luotea’s own operations amounted to 22,140 tCO
2
e, of which
98% was generated by the fuel consumption of the fleet. Luotea reports scope 2
emissions using the market-based approach, as it better reflects the company’s
choices regarding purchased energy and the emissions arising from energy produc-
tion.
The majority of Luotea’s total emissions arise in the supply chain (scope 3),
including the procurement of purchased products and services, fuel consumption
by subcontractors and emissions generated by the final processing of materials.
Scope 3 emissions accounted for 92% of Luotea’s total emissions in 2025. Luotea
did not carry out any GHG removal during the reporting period, and Luotea did not
have any contractual emissions related to purchased energy.
Biogenic emissions arise from the use of bio-based fuel, such as renewable diesel.
Luotea only reports the biogenic emissions of its own operations.
In 2025, the calculation for scope 3, category 2 was expanded to also include
operations in Sweden. No significant changes have been made to Luotea’s other
scope 1, 2 or 3 calculation principles.
Following the partial demerger that took place in Luotea on 31 December 2025,
Luotea reports the 2025 emissions allocated to Luotea's continuing operations on a
disaggregated basis.
Own energy consumption,
MWh
Continuing
operations
2025
Continuing
and dis-
continued
operations
2025
Continuing
and dis-
continued
operations
2024
Continuing
operations
2024
Fuel consumption from coal
and coal products
0 0 0 0
Fuel consumption from crude
oil and petroleum products
10,050 103,900 121,600 12,500
Fuel consumption from natu-
ral gas
90 90 30 30
Fuel consumption from
other fossil sources
0 0 0 0
Consumption of purchased
or acquired electricity, heat,
steam, or cooling from fossil
sources 800 7,500 8,400 600
Total fossil energy consump-
tion 11,000 111,500 130,000 13,000
Share of fossil sources in total
energy consumption, %
77 57 62 81
Consumption from nuclear
sources
1,100 25,100 26,600 800
Share of consumption from
nuclear
sources in total energy con-
sumption, % 8 13 13 5
Fuel consumption for renew-
able sources including bio-
mass 2,100 57,100 52,500 2,100
Consumption of purchased
or acquired electricity, heat,
steam, and cooling from re-
newable sources 200 400 500 300
Consumption of self-generat-
ed non-fuel renewable energy
0 120 85 0
Total renewable energy con-
sumption 2,200 57,500 53,100 2,400
Share of renewable sources in
total energy consumption, %
16 30 25 15
Total energy consumption
14,300 194,100 209,700 16,200
Aggregate consumption data reporting is based on raw data.
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GHG calculation principles
GHG emissions are calculated in accordance with the GHG Protocol, and they are
based on the reporting requirements of the GHG Protocol Corporate Standard and
scope 3. Biogenic carbon dioxide emissions arise from the combustion of biofuels
and organic materials. Scope 2 biogenic carbon dioxide emissions are based on
location-based emission factors for district heating.
Financial control has been used as the consolidation method in Luotea's GHG
calculations. The report covers the scope 1 emissions of all of Luotea’s production
plants and vehicles. Scope 2 emissions are reported using both the market-based
and location-based approaches. Scope 3 emissions are reported for Luotea as a
whole, and 17% of the calculation of scope 3 emissions is based on information
obtained from suppliers.
GHG calculation includes all greenhouse gases covered by the GHG Protocol
(CO
2
, CH
4
, N
2
O, HFCs, PFCs, SF6 and NF3). Emissions have been converted into
carbon dioxide equivalents based on the Global Warming Potential (GWP) factors
of different greenhouse gases, as specified in the IPCC Fifth Assessment Report.
GHG intensity based on kilometres driven: an entity-specific
metric established on the basis of the double materiality
assessment
Luotea issued a EUR 75 million bond linked to the company’s sustainability tar-
gets in May 2022. The financial characteristics of the bond are partly linked to the
development of the company’s GHG intensity per kilometre driven (gCO
2
e/km)
through the development of the interest rate. The terms of the bond were amended
in 2025 in connection with the partial demerger. The new terms are effective from
31 December 2025. Due to the demerger, the baseline values for the sustainability
targets associated with the bonds were adjusted to correspond to the emission vol-
umes of the discontinued operations to which the obligations and liabilities related
to the bonds were transferred on 31 December 2025.
GHG intensity based on kilometres driven is a metric that indicates the amount
of GHG emissions generated by the company in relation to the kilometres driven
during its operations. The calculation is based on the principles of the GHG Protocol
and takes into account the emissions of the company’s own operations and the
data on kilometres driven collected by the fleet’s on-board computers. The metric
does not take biogenic emissions into account.
In 2025, Luotea’s GHG intensity per kilometre driven was 468 gCO
2
e/km (2024:
556 gCO
2
e/km). For Luotea's discontinued operations, the GHG intensity per kilo-
metre driven was 637 gCO
2
e/km (2024: 757 gCO
2
e/km). Emission intensity has
decreased due to the electrification of light vehicles and the increased use of renew-
able fuels in heavy vehicles. More detailed emissions data is presented in the tables
on page 53.
GHG emissions Retrospective Milestones and target years
Base
year
Continuing
operations
2025
Continuing and
discontinued op-
erations 2025
Continuing and
discontinued op-
erations 2024
Continuing
operations
2024 % N/N-1 2030 2045
Annual
target, %
Scope 1 GHG emissions
Gross scope 1 GHG emissions, tCO
2
e 45,500 2,110 21,600 26,450 2,700 80% -50% -90% 4.2%
GHG emissions from regulated emission trading schemes, % 0 0 0 0 0
Scope 2 GHG emissions
Gross location-based scope 2 GHG emissions, tCO
2
e
6,900 170 2,470 3,030 140 80%
Gross market-based scope 2 GHG emissions, tCO
2
e
1,900 90 540 760 60 75% -50% -100% 4.2%
Significant scope 3 GHG emissions
Total Gross indirect (scope 3)
GHG emissions, tCO
2
e
271,200 53,520 250,100 262,200 60,100 95% -20% -90% 3.1%
1 Purchased goods and services
113,320 42,470 96,400 103,200 48,600 95%
2 Capital goods
560 90 1,170 1,010 360 115%
3 Fuel and energy-related activities (not included in scope 1 or
scope 2)
9,490 790 9,440 10,840 940 85%
4 Upstream transportation and distribution
20,501
1
6,020 20,950 20,970 5,250 100% -30%
6 Business travel
1,190 880 1,530 1,480 800 105%
7 Employee commuting
6,900 3,280 5,150 6,310 4,120 80%
12 End-of-life treatment of sold products
126,900 0 115,500 118,400 0 100%
Total GHG emissions
Total GHG emissions (location-based), tCO
2
e
55,810 274,200 291,700 62,900 95%
Total GHG emissions (market-based), tCO
2
e
55,720 272,300 289,400 62,800 95%
The base year for Luotea’s scope 1 and scope 2 emission reduction targets is 2018. The base year for scope 3 emission reduction targets is 2022. The annual reduction target (%) has been calcu-
lated for the 2030 targets.
Aggregate emissions data reporting is based on raw data.
1
GHG intensity
Continuing
operations
2025
Continuing and
discontinued op-
erations 2025
Continuing and
discontinued op-
erations 2024
Continuing
operations
2024
GHG intensity based on net revenue, scope 1 and 2 (market-based), tCO
2
e/MEUR 6 29 35 12
GHG intensity based on net revenue, scope 1, 2 and 3 (market-based), tCO
2
e/MEUR 161 353 376 281
GHG intensity based on kilometres driven, scope 1 and 2 (market-based), tCO
2
e/km 137 468 556 165
Biogenic CO
2
emissions, tCO
2
Continuing
operations
2025
Continuing and
discontinued op-
erations 2025
Continuing and
discontinued op-
erations 2024
Continuing
operations
2024
Biogenic scope 1 CO
2
emissions 1,000 19,200 17,800 1,100
Biogenic scope 2 CO
2
emissions 700 6,400 6,900 400
Energy intensity (continuing and discontinued operations) 2025 2024
Total energy consumption from activities in high climate im-
pact sectors, MWh
194,100 209,700
Total energy consumption from activities in high climate im-
pact sectors per net revenue from activities in high climate
impact sectors, MWh/MEUR
252 272
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Sustainability report
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Carbon handprint: an entity-specific metric established on the
basis of the double materiality assessment
The carbon handprint measures the positive climate impacts of Luotea’s services.
Emission reductions are created when fossil and virgin raw materials are replaced
by renewable and recycled raw materials or when the energy efficiency of cus-
tomers’ operations is improved. The calculations take into account the entire value
chain from waste collection to the use of secondary raw material. Increasing the
carbon handprint is a key long-term target for Luotea and a material metric.
In 2025, emissions avoided as a result of Luotea’s operations decreased by 14%
when compared to 2024, and totalled EUR -378.8 MCO
2
e. Intensity describes the
carbon handprint generated by services relative to the Group’s total net sales. In
2025, Luotea’s carbon handprint intensity was -492 tCO
2
e/MEUR. In 2025, the slow-
down of general economic activity and decreased demand for solid recovered fuels
had a negative impact on the carbon handprint in the Circular Economy Business.
Basis of calculation
The carbon handprint describes the computational avoided emissions attribut-
able to Luotea’s services. Luotea’s carbon handprint calculation takes into account
emissions avoided through waste recycling, energy production, blast cleaning and
energy services. There is a high degree of uncertainty associated with the reported
data on avoided emissions.
For recycled materials, the carbon handprint has been calculated on a mate-
rial-specific basis and it is based on the degree to which the recycled material
reduces emissions compared to the corresponding production using virgin raw
materials. Data on the weight of materials is obtained from Luotea’s own systems.
The emissions data for recycled materials is based on scientific research on the
emission factors of separately collected waste materials directed to recycling. The
emission factors are of a general nature and the assumed carbon footprint of recy-
cled materials involves significant uncertainty. The carbon handprint of products
refined by Luotea from oil-based waste has been calculated by Luotea’s specialists
and is based on Luotea’s own emission calculations and the emissions from alter-
native disposal.
In energy production, GHG emissions are reduced when fossil fuels are replaced
with biofuels and solid recovered fuels. For fuels, the carbon handprint takes into
account Luotea's solid recovered fuel deliveries and the resulting greenhouse gas
emissions compared to producing the corresponding amount of energy using fossil
fuels. The reference values used in the calculations are primarily based on coal. The
emission factors are based on Statistics Finland’s fuel classification 2023.
Blast cleaning carried out by Luotea's Industrial Services improves the energy
efficiency of power boilers. GHG emissions are reduced when less fuel is used for
producing energy. The calculation is based on a model created by VTT Technical
Research Centre of Finland regarding the effects of cleaning on the energy effi-
ciency and CO
2
emissions of power boilers.
In addition, the calculation of energy efficiency measures covers the computa-
tional savings generated by energy efficiency measures for Luotea's Energy
Services’ customers, as well as the energy savings generated for properties and pro-
duction plants connected to the Smartti automation system. The emission factors
for electricity and heating are based on the average emission factors published by
Statistics Finland for the rolling period 2021–2023.
Carbon handprint, MCO
2
e
(continuing and discontinued operations) 2025 2024
Material recycling -289.4 -331.6
Biofuel and recovered fuel deliveries -85.5 -102.0
Energy efficiency measures -3.8 -4.6
Total -378.8 -438.2
Carbon handprint intensity, tCO
2
e/MEUR -492 -569
Calculated reductions in emissions have been calculated using the model created
by VTT for the entire value chain, from the collection of waste to the use of the sec-
ondary raw material or fuel.
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Sustainability report
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Summary of Scope 3 calculations
List of scope 3 categories included in the report Category 1: Purchased products and services
Category 2: Capital goods (fleet)
Category 3: Indirect emissions from purchased energy (other than Scope 1 and Scope 2)
Category 4: Emissions from subcontracted transport
Category 6: Business travel Category
Category 7: Employee commuting Category
Category 12: Final treatment of materials
List of Scope 3 activities excluded from the report and the reasons
for their exclusion
Category 5: Waste generated in operations – excluded
• Luotea processes its own waste alongside the waste it processes on behalf of its customers. Their emissions are reported in Scope 3 Category 12. Based on a qualitative assessment, these
emissions are less than 2% of the company’s Scope 3 Category 12 emissions and are therefore not reported on a disaggregated basis.
Category 8: Upstream leased assets – excluded
• Based on a qualitative assessment, this category is not relevant. Luotea does not have leased assets that are not yet included in Scope 1 or 2 calculations or other
Scope 3 activities.
Category 9: Downstream transportation and distribution – excluded
• Based on a qualitative assessment, this category is not relevant. Due to the current system limitations, it is not possible to make a precise distinction between upstream and downstream
transportation based on the participation of the transport subcontractor, and therefore emissions related to downstream transport subcontracting are reported in their entirety in Scope 3 cat-
egory 4.
Category 10: Processing of sold products – excluded
• Based on a qualitative assessment, this category is not relevant. Luotea primarily produces services. Emissions related to the processing of sold products are estimated
to be minimal (less than 2%) compared to the other Scope 3 categories. Emissions from waste materials sold for recycling are included in the calculations for category 12.
Category 11: Use of sold products – excluded
• According to a quantitative assessment, the emissions during use of products and equipment sold by Luotea are less than 1% of the company’s total Scope 3 emissions, so they have been
excluded from the calculation. This estimate is based on the energy consumption of the equipment and the emission factors of electricity production in Finland.
Category 13: Downstream leased assets – excluded
• Based on a qualitative assessment, the category is not relevant, as Luotea does not have leased assets that are not yet included in Scope 1 or 2 calculations or other Scope 3 activities.
Category 14: Franchises – excluded
• Based on a quantitative assessment, the emissions of the Huomenta franchising chain owned by the company represent less than 1% of Luotea's total Scope 3 emissions, so they have been
excluded from the calculation. The estimate is based on the computational euro-based CO
2
intensity of cleaning and the net sales figures produced by the chain.
Category 15: Investments – excluded
• Based on a qualitative assessment, this category is not relevant. Luotea has no emissions related to investments that are not yet included in Scope 1 or 2 calculations or other Scope 3 activi-
ties. Luotea does not provide financial services.
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Scope Description of the data types and sources used in calculating emissions Description of the calculation principles, allocation methods and assumptions used in calculating emissions
Scope 1, Direct emissions Activity data (primary data):
• Finland: Fuel data measured in kilograms or litres and registered in the Alekstra (SaaS)
reporting system or the supplier’s system
• Sweden: Fuel data measured in kilograms or litres and registered in the Ziklo Fleet Ser-
vices (SaaS) reporting system
Emission factors (secondary data):
• Finland: Statistics Finland Fuel Classification 2025
1
• Sweden: Swedish Energy Agency – fuels 2024
2
Scope 2, Emissions from the
production of purchased energy
Activity data (primary data):
• Finland: Energy consumption data measured in kWh and
entered in the Enerkey reporting system (SaaS)
• Sweden: Energy consumption data collected from the energy suppliers' invoices (kWh)
Emission factors (secondary data):
Market-based, Finland:
• Electricity: Luotea’s purchases Guarantees of origin for electricity (Veni)
• District heating: Supplier-specific emission data from the Enerkey reporting system (SaaS)
Market-based, Sweden:
• Electricity: Supplier-specific emission data based on energy supply agreements
• District heating: Supplier-specific emission data collected from the energy supplier
Location-based, Finland:
• Electricity: Motiva
3
• District heating: Motiva
3
Location-based, Sweden:
• Electricity: Swedish Energy Agency
4
• District heating: Swedenergy - Energiföretagen Sverige (industry organisation)
5
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Scope Description of the data types and sources used in calculating emissions Description of the calculation principles, allocation methods and assumptions used in calculating emissions
Upstream scope 3 emissions
1: Purchased products and services Activity data (primary data): Quantities (weight or volume) and amounts (EUR) of
purchases obtained from Luotea's procurement data.
Emission factors (secondary data): ENVIMAT 2019 publication (euro-based emission factors
adjusted for annual inflation)
6
The calculation of purchased products and services includes all materials and services that are not included in Scope 1, 2 or other
Scope 3 calculations. Emission calculations for products and services are based on purchase data and euro-based emission fac-
tors. The emission factors have been obtained from external publicly available sources (literature) and adjusted for annual inflation.
Coverage: All activities in Finland and Sweden
2: Capital goods Activity data (primary data): Quantities obtained from Luotea's procurement data
(weight or volume) and the amount of purchases (EUR)
Emission factors (secondary data): ENVIMAT 2019 publication (euro-based
emission factors adjusted for annual inflation)
6
The calculation of capital goods includes the procurement of production equipment and is based on purchase data and euro-based
emission factors. The calculation includes all fleet-related purchases that are considered to be capital goods. The emission factors
have been obtained from external publicly available sources (literature) and adjusted for annual inflation.
Coverage: All activities in Finland and Sweden
3: Activities related to
fuel and energy (not included
in Scope 1 or 2)
Activity data (primary data): Fuel and energy consumption data as measured and entered in
suppliers' reporting systems
Emission factors (secondary data): DEFRA 2025: WTT and T&D emission factors
for fuels, electricity and heat
7
Indirect energy emissions (other than Scope 1 and Scope 2) include upstream emissions from energy production and distribution
and WTT emissions for purchased fuels. The emission factors are based on DEFRA's location-based public data, and the basic data
is the amount of fuel/energy purchased during the reporting year.
Coverage: All activities in Finland and Sweden
4: Upstream transportation and distri-
bution
Activity data (primary data): Fuel consumption data provided by the supplier or, if the data is not
available, the monetary purchase amounts (in euros) from Luotea’s procurement system.
Emission factors (secondary data): Statistics Finland Fuel Classification
2025
1,
DEFRA 2025: WTT emission factors for fuels
7
, Cost Index of Road Transport of Goods 2025
8
The emission calculations of transport and machinery contractors are based on procurement data and estimated fuel consumption,
as well as actual fuel consumption data provided by contractors. The data is combined with fuel classification data published by Sta-
tistics Finland and the WTT emission data for fuels published by DEFRA.
Coverage: All divisions in Finland. There are no significant purchases related to transport contracting in Sweden
6: Business travel Activity data (primary data): CWT travel agency, monetary purchase amounts obtained from Lu-
otea’s procurement systems (in euros), kilometre allowances entered in Luotea’s HR system
Emission factors (secondary data): DEFRA 2025: Passenger car emissions/km
7
The information concerning business travel is based on total emission data for flights and train journeys received from the travel ser-
vice provider (travel-based). Emissions generated by taxi journeys are estimated on the basis of taxi travel costs. All purchases of taxi
journeys are compared to the average price per taxi kilometre, supplemented by the WTW emission factors for passenger car trans-
port per kilometre driven published by DEFRA. Business travel by private car is based on kilometre allowances paid, combined with
the WTW emission factors per kilometre driven provided by DEFRA.
Coverage: All divisions in Finland and Facility Services Sweden
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Scope Description of the data types and sources used in calculating emissions Description of the calculation principles, allocation methods and assumptions used in calculating emissions
7: Employee commuting Activity data (primary data): Employee’s home address, Traficom’s national commuting survey
9
Emission factors (secondary data): DEFRA 2025: Passenger travel emission data and WTT
emission factors for fuels
7
, Aalto University study: Public transport emissions/km
10
Emissions from commuting are calculated on the basis of the postal code provided by the employee to the employer. The average
commute and form of commuting were assessed on the basis of a national transport survey, which examined the share of different
modes of transport and daily journeys in cities and communities of different sizes. The annual working days of part-time employees
were estimated on the basis of average weekly working hours. The calculation method and the sources used involve a significant
amount of uncertainties, so they can only be used as a very high-level estimate of the climate impacts of commuting by Luotea
employees.
Coverage: All activities in Finland and Sweden. For personnel in Sweden, emissions from commuting have been estimated on the
basis of the number of personnel. For personnel in Finland, emissions from commuting have been estimated on the basis of compu-
tational emissions from commuting. The estimated share is 19% of the reported total emissions from commuting.
Downstream Scope 3 emissions
12: End-of-life treatment of sold prod-
ucts
Activity data (primary data): Waste data from Luotea’s ERP system
Emission factors (secondary data): Emission factors reported by suppliers,
Ecoinvent 3.11, Statistics Finland Fuel Classification 2025
1
, SYKE
11
The end-use of products covers the material flows that Luotea forwards to energy incineration, earthworks, landfilling or disposal. The
calculation is based on the tonnage of materials delivered. The emission factors have been obtained either from partners or from
external sources when supplier-specific information is unavailable. Emissions from the collection and transport of waste are included
in Luotea's own direct emissions, and the processing-related emissions of external recipients are not taken into account. The sub-
sequent processing of materials is excluded from the calculation. Solid recovered fuels delivered to co-incineration plants and bio-
waste are excluded from the calculation because they serve as raw materials for industry. Of materials forwarded to recycling, only
hazardous waste is included, as their material recovery involves significant uncertainty. The calculation also involves uncertainties
related to the boundaries of material masses.
Coverage: All Circular Economy Business operations in Finland. Facility Services and the operations in Sweden do not have signifi-
cant emissions related to waste treatment, and these have been taken into account in the calculation of Scope 3 Category 1.
Sources:
1) Statistics Finland: Fuel Classification 2025, https://stat.fi/tup/khkinv/khkaasut_polttoaineluokitus.html
2) Swedish Energy Agency, https://www.energimyndigheten.se/statistik/ovrig-energistatistik/statistik-om-biobranslen-och-drivmedel/
3) Motiva, https://www.motiva.fi/ratkaisut/energiankaytto_suomessa/co2-paastokertoimet
4) Swedish Energy Agency, https://www.energimyndigheten.se/klimat/hallbarhetskriterier/fragor-och-svar-om-hallbarhetskriterier/
5) Swedenergy, https://www.energiforetagen.se/statistik/fjarrvarmestatistik/miljovardering-av-fjarrvarme/
6) Finnish Environment Institute: The carbon footprint and natural resource usage of public procurement and household consumption, http://hdl.handle.net/10138/300737
7) DEFRA (2025) , https://www.gov.uk/government/publications/greenhouse-gas-reporting-conversion-factors-2025
8) Kuorma-autoliikenteen kustannusindeksi (2025), https://stat.fi/tup/kustannusindeksit/kuorma-autoliikenteen-kustannusindeksi.html
9) Traficom: Henkilöliikennetutkimus, https://www.traficom.fi/fi/ajankohtaista/julkaisut/hlt/henkiloliikennetutkimusten-julkaisut
10) Sree Manikanta Kumar Kanujula, Carbon Emission Estimator for Public Transportation in Finland. Aalto University, https://urn.fi/URN:NBN:fi:aalto-202301291841
11) Finnish Environment Institute (SYKE) Y-Hiilari, https://www.syke.fi/fi/ymparistotieto/laskurit-ja-tyokalut#y-hiilari-%E2%80%93-hiilijalanj%C3%A4ljen-laskentaan-yrityksille
E4-1 – Transition plan and consideration
of biodiversity and ecosystems in strategy
and business model
Luotea aims to mitigate climate change and biodiversity loss and promote the
sustainable use of raw materials by means of the circular economy. Fostering
biodiversity is also one of the focal points of Luotea’s sustainability programme in
2025. In this respect, the company’s positive impact arises through nature-related
services aimed at the built environment in particular.
Biodiversity is promoted in Luotea’s operations particularly from three perspec-
tives. They are climate change mitigation, the use of recycled raw materials
and fostering biodiversity in the built environment. Measures for climate change
mitigation and promotion of the circular economy indirectly support Luotea’s envi-
ronmental work. The remediation of contaminated soil sites and various solutions
in the maintenance of green areas business, such as meadow restoration and the
removal of invasive species, increase biodiversity in the built environment and are
business opportunities with growth potential for Luotea. The perspectives are in line
with the EU’s climate targets, circular economy package and biodiversity strategy.
Luotea has not separately assessed the resilience of its strategy and business
models in relation to biodiversity and ecosystems. The material transition risks and
physical risks related to biodiversity and ecosystems have been assessed indirectly
as part of climate risks and as part of the related resilience review, which are
described in more detail in the section ESRS E1 SMB-3, p. 50. No material risks
have been identified in the company’s current business model and strategy.
SBM-3 – Material impacts, risks and opportunities
and their interaction with strategy and business
model
Luotea has not identified sites that, due to their location and operations, would
have a negative impact on areas that are sensitive in terms of biodiversity. Luotea’s
offices whose operations involve potential environmental impacts are guided by
environmental permit obligations and monitoring them. The environmental permits
take into account the natural habitat types, habitats of species and protected areas
in the locations in question.
Luotea’s service offering includes the remediation of contaminated soil, meadow
creation, and the removal of invasive species, as well as various stormwater solutions
that positively impact the condition of ecosystems and their ability to provide
ecosystem services. Cleaning contaminated soils can improve the conditions for the
formation of clean freshwater. Similarly, stormwater treatment solutions tailored to
construction sites and other similar location reduce the load on water bodies. Meadow
creation can strengthen biodiversity, increase protection from extreme weather and
combat erosion. Recycling promotes the sustainable use of natural resources and
thus reduces the pressure on ecosystem services by combating climate change,
for example. Luotea’s consulting services support its service offering that promotes
biodiversity and ecosystem services.
Luotea has identified several opportunities to grow the business within its current
services and create added value for its customers with new services that support
biodiversity and ecosystem services. Luotea believes that in the near future,
the key business opportunities with regard to the development of regulation related
to environmental protection will focus on in the environmental construction sector
and on customers’ restoration projects.
A description of material impacts and opportunities concerning biodiversity
and ecosystems,can also be found in section ESRS 2 SBM-3, p. 20.
E4-2 – Policies related to biodiversity and ecosystems
Luotea’s material impacts and opportunities are guided by the company’s strategy
and its own operating principles, such as environmental policy, as well as measures
to promote biodiversity in customers’ operations. Luotea’s environmental manage-
ment system is ISO 14001-certified.
Environmental policy and environmental management system
Luotea’s environmental policy, which is publicly available on the company’s website,
includes a commitment to mitigate climate change, promote the sustainable
use of raw materials and foster biodiversity by promoting the circular economy,
preventing the pollution of soil and water, and supporting the sustainable use of
forests. In addition, Luotea provides its customers with solutions for the remediation
of contaminated soil sites and the promotion of biodiversity in the built environment.
The principles laid down in the policy apply to both Luotea’s own operations and
projects carried out in the customer interface.
The policy has been approved by the President and CEO together with the Group
Executive Board, and it applies to all of Luotea’s operations. The principles laid down
in the policy are reviewed regularly, at two-year intervals. The Senior Vice President
in charge of sustainability is responsible for the content of the policy and updating it.
Luotea’s divisions and units are responsible for the implementation of the Policy
and the allocation of the necessary resources in their respective operations.
External stakeholders have not been separately consulted in the preparation
of the environmental policy.
The environmental management system prevents pollution caused by the
company’s own operations, which is one of the of the factors that causes biodiversity
loss. Luotea’s circular economy business operations are strictly regulated and subject
to environmental permits that specify requirements pertaining to water, soil contam-
ination and nature. They also include related monitoring processes. The monitoring
processes include follow-up of sites’ impacts on biodiversity-sensitive areas in
their vicinity, if possible impacts have been identified in the environmental permit.
All of Luotea’s treatment and storage areas and waste treatment plants are subject to
environmental permits. The aim of Luotea’s policies is to minimise the environmental
impacts of the Group’s own operations and to ensure that all plants requiring
an environmental permit operate in accordance with the terms of the permit.
All environmental permit decisions are publicly available.
E4 Biodiversity and ecosystem services
The company’s impacts on climate change are managed with a transition plan,
which is detailed further in paragraph E1-1, p. 49. The Company does not have
any operations that directly promote changes to land-use, freshwater and sea
use, adverse impacts on the status of species or extent and status of ecosystems
or ecosystem services. These impacts have not been taken into account in the
Company’s current environmental policy or environmental management system.
Operating principles
Luotea forecasts that regulation that maintains ecosystem services will increase,
which will further drive demand for restoration projects carried out for customers.
This is a material opportunity and positive impact for the company. Landscaping
services and the remediation of contaminated soil sites are based on maintaining
the health of soil, water and local ecosystems. In addition, these services can
improve the comfort of local communities’ living environments. At the same
time, land and green areas in cities are used effectively, which can increase their
economic, natural and social value. The company’s contaminated soil restoration
services have a positive impact on the state of local soil and water ecosystems
and the ecosystem services of clean water production. The operating principle
is to prevent the possible spread of invasive species as a result of mass changes
carried out in connection with rehabilitation measures. The monitoring metrics
used by Luotea are described in more detail in section ESRS E4-5, p. 60.
We follow the principles of sustainable environmental construction in both
construction and maintenance of our green construction services. The green
and nature services also have a quality certificate and qualification issued by the
Construction Quality Association RALA ry.
As part of its circular economy business, Luotea produces pallet repair and reuse
guidance services. The pallet business also distributes some new wooden packaging
products and uses new wooden parts for repairing pallets. In 2025, Luotea has
prepared for the application of Regulation (EU) 2023/1115 of the European
Parliament and of the Council on deforestation in its operations. Luotea has
prepared for the entry into force of the regulation and included the deforestation
risk in the procurement risk assessment process.
Luotea’s main industry is not directly focused on agriculture. Taking into account
the nature of the operations and the geographical location of the sites, the impacts on
seas are low. For this reason, Luotea does not have separate policies on these topics.
E4-3 – Actions and resources related to biodiversity
and ecosystems
Customer projects to promote biodiversity in the built environment continued
in 2025. They included meadow restoration and the removal of invasive species
at a number of customer sites. The measures have increased the abundance
of native plant species and insect and bird populations at the sites in question.
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The total land area covered by meadow restoration projects in 2025 was
6.8 hectares. This represented a decrease of 59% from the previous year. Invasive
species, such as lupine and rosa rugosa, were removed from areas totalling
26.2 hectares. Green construction services carried out a biodiversity survey
complete with action proposals at 250 sites and implemented measures to
increase biodiversity at more than 300 customer sites while reducing risks related
to adaptation to climate change, for example, with stormwater solutions at more
than 50 customer sites.
In 2025, the research project on the use of gritting sand in the eradication of
invasive species and meadow restoration continued. The meadow established in
the test area is doing well, and no lupin has yet to be observed in the area. The test
area has been implemented in cooperation with the customer and the Finnish
Environment Institute. The aim is to develop a permanent operating method for
simultaneously recycling sand, suppressing invasive species and establishing
a diverse new meadow.
Contaminated soil restoration projects in the environmental construction
business model also progressed well in 2025. The company developed its industrial
environmental construction services to promote the restoration of nature and
the prevention of biodiversity loss. In 2025, Luotea’s circular economy business
processed a total of 179,906 tonnes of contaminated soil. In addition, Luotea’s
circular economy business is involved in a project aimed at developing a model for
calculating the value of restoring contaminated soil. The project is part of an EBITDA
consortium project led by the University of Tampere that studies the sustainability
choices of companies and the value creation of environmental sustainability.
The project will continue to be implemented in Luotea’s operations discontinued
in 2026, and the calculation model is expected to be completed by the end of 2026.
Thus far, Luotea has not used biodiversity offsets in its own operations or value
chain, or directly incorporated local or indigenous knowledge into biodiversity and
ecosystems-related actions. Although these are not yet part of Luotea’s established
operating practices, the company recognises the value of such knowledge,
particularly in the development and implementation of nature-based solutions.
Luotea strives to develop its operations to promote diversity and ecosystems.
In the coming years, Luotea will develop impact and risk assessments related
to biodiversity. Luotea’s material impacts are related to discontinued operations,
and with the partial demerger, Luotea’s continuing operations will assess the need
for a more detailed action plan to support biodiversity and ecosystem services.
E4-4 – Targets related to biodiversity and ecosystems
The focus of Luotea’s sustainability efforts has been the implementation of climate
and circular economy targets, which also have an indirect impact on biodiversity.
Luotea does not have a more detailed action plan or other goals for promoting
biodiversity. The company monitors its positive impacts on ecosystem services using
the metrics presented in section E4-5. The objectives related to the promotion of the
circular economy presented in section E5-3 also have an indirect positive impact
on ecosystem services.
E4-5 – Impact metrics related to biodiversity
and ecosystems change
The progress of Luotea’s measures taken at the customer interface is monitored
through Luotea’s monitoring metrics:
• Total area of customer sites subject to meadow restoration, in hectares
• Removal of invasive species from customer sites, in hectares
• The total amount of soil mass treated in contaminated soil site remediation
projects during the reporting year in tonnes.
More detailed information on the progress of the actions related to the metrics
is provided in section ESRS E4-3, p. 59.
Basis of calculation
The areas in hectares of customer sites subject to meadow restoration and the
removal of invasive species are based on site sizes specified in the work instructions
for work carried out at the customer sites in question during the reporting period.
The information is obtained by using the area calculator of the National Land Survey
of Finland’s map service, and the necessary measures and areas are agreed on with
the customer before starting the work. Information on the work carried out during
the year is maintained, monitored and reported in an aggregated manner using
Luotea’s internal system.
The total amount of soil mass treated in contaminated soil site remediation
projects during the reporting year in tonnes is based on scale weights measured
at the treatment plants. Weight data is maintained, monitored and reported
in an aggregated manner using Luotea’s internal system.
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E5-1 – Policies related to resource use
Luotea’s activities, material impacts and opportunities related to resource use
and circular economy are managed by means of the public environmental policy
approved by Luotea’s President and CEO and the Group Executive Board.
The environmental policy applies to all of Luotea’s business operations in all
of its operating countries. In addition, discontinued operations maintain operating
guidelines related to the use of resources and the circular economy, such as sorting
guides. Luotea’s material impacts and opportunities are targeted at the discon-
tinued operations and have been managed and guided by the business strategy.
In addition to the operating principles and strategy, the impacts of Luotea’s
discontinued operations are managed through the obligations set out in
environmental permits and related internal control and certification. All of Luotea’s
operations are certified and meet the requirements of the ISO 14001 standard,
the management of which is the responsibility of the Group’s Vice President
in charge of risk management.
Environmental policy
Luotea’s targets and key objectives related to resource use and circular economy
are guided by the Group’s environmental policy, which describes the principles
observed in Luotea’s own operations and the value chain.
Luotea’s environmental policy does not include policies concerning the process
of monitoring targets. The company will update its environmental policy and the
monitoring process for the related objectives during 2026.
Luotea’s environmental policy does not address the transition away from the
use of primary resources, but it takes into account the increased use of secondary
resources in the value chain. In its environmental policy, the company commits to
promoting the sustainable use of natural resources by preventing waste, managing
the recovery of materials to be recycled and reused and by replacing fossil fuels with
bio-based and recycled raw materials.
Luotea’s circular economy-related targets and environmental policy principles are
put into action at the unit level through division-specific sub-targets, guidelines and
circular economy services and solutions offered to customers. The implementation
is the responsibility of the business units with the support of the EHSQ and
sustainability functions.
Recycling and waste management services, circular economy-related consulting
and environmental construction are part of the company’s circular economy
business, which include separate commercial business unit and division-specific
targets in addition to Group-level targets. The monitoring of the implementation
of Luotea’s policies concerning the circular economy in service production is
based on Luotea’s ISO 9001 and ISO 14001-certified management systems.
Luotea’s Senior Vice President in charge of sustainability is responsible of the
implementation of the environmental policy in the Group’s operations. Luotea’s
divisions and units are responsible for the implementation of the policy and
the allocation of the necessary resources in their respective operations.
Stakeholders have not been separately consulted in connection with the
preparation of the environmental policy. The next review of the principles
of environmental policy will be carried out in 2026.
E5-2 – Actions and resources related to resource
use and circular economy
Value creation and growth through circular economy solutions remained at the
heart of Luotea’s strategy in 2025. Circular Economy Business promotes the
sustainable use of natural resources by preventing waste, managing the recovery of
materials to be recycled and reused and by replacing fossil fuels with bio-based and
recycled raw materials. The company has also aimed to promote the preconditions
of the circular economy in its operating environment. The company monitors the
implementation of the circular economy principles in its services and its strategic
goal is to increase the recycling rate. The target is presented in more detail in section
E5-3, p. 62.
Circular Economy Business has the opportunity to influence the operating
conditions of the circular economy indirectly among its customers and the end-
users of secondary raw materials. Circular Economy Business takes care of the
collection of waste from customer sites and directs the material flows it collects
for treatment in accordance with the order of priority in waste management.
Circular Economy Businessprovides the pre-treatment of materials received from
customers as a service, and the company has several recycling plants of its own
where recycled raw materials are produced for industrial use from the materials
collected from customers. Waste fractions for which there are no dedicated
processing, are forwarded to partners that have an environmental permit and the
expertise required for processing the waste fraction in question. Luotea’s actions
to promote the operating conditions of the circular economy are aligned with
the EU’s climate goals, circular economy package and biodiversity strategy.
Material inflows and outflows directly related to Luotea’s own operations are
relatively minimal. Examples of such inflows include products and equipment
purchased by Luotea, while the outflows directly related to Luotea’s own operations
include the company’s own waste flows.
Luotea’s measures to achieve the targets and objectives within its circular
economy customer accounts are related to the prevention and reuse of waste,
preparation for reuse, recycling, other recovery and disposal in accordance with
the EU’s waste hierarchy.
The company’s processing and recycling plants are located in Finland, where
the environmental legislation is comprehensive and the operations are subject
to site-specific environmental permits. The environmental permit process includes
consultation of stakeholders. Any environmental incidents caused by the operations
are addressed together with the Finnish environmental authorities, and the
authorities approve the remedies for potential environmental incidents. The Circular
Economy Business monitors its disposal sites after the closure of each site,
and the company has recognised the necessary provisions in its financial accounts
for potential future remedies regarding the terminated operations.
In 2025, Luotea implemented the following measures to achieve the targets
and objectives of the aforementioned policies related to resource use and circular
economy:
Preventing the generation of waste
Luotea supported and consulted its corporate customers on preventing the
generation of waste. The company’s comprehensive customer reporting tools
provided customers with visibility into the waste flows generated in their operations,
enabling the customer to take measures to reduce the generation of waste. During
the review period, support in preventing the generation of waste and improving
the efficiency of separate collection was provided to a total of 340 customer sites.
Preparation for reuse
Luotea’s terminated operations included repair business activities that involved
repairing damaged pallets and returning them to use. In 2025, the pallet repair
business expanded when the competition authority approved the acquisition
of Stena Recycling’s pallet repair business.
Recycling
With its expert services, Luotea supported and developed its customers’ sorting at
source and other circular economy-related upstream activities in the value chain
in order to direct customers’ waste and side streams to recycling. Luotea forwards
separately collected waste fractions from customers to be utilised with the highest
possible degree of processing.
Luotea’s terminated operations included its own waste pre-treatment plants that
process different waste fractions, such as fibres, wood waste, glass and metals, and
treatment plants that produce secondary raw materials, such as plastic granules.
Contaminated soil masses at customer sites are cleaned in the environmental
construction business. The soil masses are processed at the customer site or
transported to treatment centres for processing. After cleaning, the soil masses are
returned to the site, used in earthworks at another site or disposed of.
Luotea’s own sites have comprehensive sorting opportunities for waste fractions
generated in the company’s own operations, and the fractions are recycled in
accordance with the order of priority in waste management. The amount of material
flows related to Luotea’s own operations is very small compared to the customer
material flows handled by the company.
In 2025, Luotea organised several training activities, customer events and
webinars related to the correct sorting of different waste fractions and circular
economy development. The company engaged in active dialogue with corporate
customers and partners on the technological choices and opportunities related
to the recycling of waste.
E5 Resource use and circular economy
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In 2025, the company had several ongoing research and development projects
aimed at increasing the degree of refinement of materials and increasing reuse
and recycling. In addition to investments in the pallet business, Luotea had ongoing
projects developing wood recovery solutions and the company has studied the
use of recycled wood in biochar production. Separate collection of packaging
plastics has developed positively during 2025, and the company has developed its
mechanical recycling process and studied the possibilities of chemical recycling.
The company’s circular economy business has also expanded its service offering
in water treatment solutions for the removal of harmful substances from various
types of contaminated water. There is also a research project underway for
identifying solutions for the treatment and recycling of waste containing PFASs.
Other recovery
Luotea produces recycled fuel from customers’ non-recyclable waste materials
to replace fossil fuels in district heat production, for example.
Disposal
The company has its own disposal sites for soil masses and fractions that cannot
be safely reused or recycled. Luotea’s discontinued operations are planning two new
final disposal sites, one of which was completed in 2025 and the other is expected
to be completed in 2026-2027.
E5-3 – Targets related to resource use and circular
economy
In its environmental policy, Luotea has set a target of increasing the recycling rate
of the materials processed by the company to 70% by 2030. The recycling target
is the sum of the recycling rates of materials collected and processed by Luotea,
calculated based on weight. The recycling rate only applies to the discontinued
operations. The target is absolute. The target covers municipal waste collected from
Luotea’s corporate customers, hazardous waste, industrial waste and construction
waste in Finland. It also includes materials that cannot be recycled, such as
hazardous waste containing PFAS compounds. The target applies to Luotea’s
own operations.
The recycling target is related to resource outflows. The development of the
recycling rate ultimately depends on the recycling and material choices made by
customers of the Circular Economy Business and the industries they operate in.
The goal of the Circular Economy Business is to provide customers with the
opportunity to process different waste fractions in accordance with the highest
possible level of the waste hierarchy. The final decision on the processing of each
waste fraction is always made by the customer. The industries of Luotea’s customers
also differ in the waste fractions generated by the business activities. For example,
the commerce sector achieves a higher recycling rate than the construction
industry due to the different nature of the business and the associated material
flows. There are still several waste fractions that cannot be recycled safely, and
some hazardous waste is processed at an incineration plant that is authorised
to process hazardous waste or put into final disposal.
The recycling target supports Luotea’s policy of promoting the circular economy
and recycling by increasing the proportion of secondary raw materials used in the
value chain. The recycling target is related to the “recycling” section of the order
of priority laid down in the waste hierarchy.
The target is aligned with the goals of the EU’s circular economy package.
The target is not science-based. A large proportion of the customers of the
Circular Economy Business have also set a recycling rate target for their waste.
The target has been approved by the company’s President and CEO and the
Group Executive Board, and it covers the entire Group. The target (54.2%) was set
in 2018 and is voluntary in nature, i.e. not required by law. No stakeholders have been
consulted in setting the target.
In 2025, Luotea’s recycling rate was 49.8% (55.2%). The recycling rate was
decreased particularly by contaminated soil representing a higher relative share of
all material flows managed by Luotea. The recycling rate was boosted by the growth
of separately collected packaging plastic and wood waste directed to material
recovery. The weak economic outlook reduced the amount of waste processed
by Luotea.
The calculation of the recycling rate in accordance with the sustainability
standard is a poor descriptor of the work in material recycling carried out by
a recycling and waste industry operator such as Luotea’s discontinued operations.
There is a significant annually variation in the number of tonnes of contaminated
soil processed by the environmental construction project business based on the
number and profile of work sites. The tonnage of contaminated soil is significantly
higher than other material recycling streams, such as plastic, wood or fibre material,
making their impact on the overall recycling rate significant.
During 2025 Luotea has reviewed the metrics used to monitor the progress of the
circular economy and developed suitable metrics for the use of circular economy
business operations.
E5-4 – Resource inflows
The material inflows related directly to Luotea’s own operations are relatively
minimal. Examples of such inflows include products purchased by Luotea
and used for service production.
Packaging and packaging waste are not material to Luotea’s own operations.
Luotea’s terminated operations included the processing and refining of various
types of waste and raw materials. The Circular Economy Business processes and
refines waste and raw materials received from corporate customers at its premises.
Examples of such waste and raw materials include plastic, wood, glass, cardboard
and paper, as well as hazardous waste, such as oil and treated wastewater.
The total weight of the products, technical materials and biological materials
used during the reporting period is presented in section E5-5, p. 62.
Luotea is a service company that does not, as a rule, manufacture products itself.
The procurement of biological materials required for service production is low, and
the procurement of renewable fuels is described in section E1-3, p. 50.
As Luotea is a recycling and waste management operator, some of the customers’
waste streams could also be defined as resource inflows. To avoid double counting,
Luotea addresses all flows in section E5-5, p. 62.
E5-5 – Resource outflows
The Circular Economy Business collects and processes significant amounts of
various waste materials and soil masses from its customers. Waste materials and
soil masses are processed, recycled or forwarded as they are for further use by the
same customer or a different customer.
The significant material flows forwarded to reuse and recycling consisted mainly
of municipal waste collected from corporate customers, such as plastic, paper,
cardboard and biowaste, hazardous waste sorted at source, industrial waste and
construction waste in Finland. The company also processes sludge, soil masses
and ash. In addition, the company produces solid recovered fuel and forwards waste
to incineration and disposal. The waste streams processed by Luotea are affected
by the industries in which the company’s customers operate and the development
of their business.
The Circular Economy Business is a significant producer of recycled raw
materials. Part of the operations, the plastics refinery in Merikarvia produces plastic
granules from customers’ plastic waste, which can be used to manufacture new
plastic products. The company recycles hazardous waste, such as glycol and waste
oil, for reuse. The company does not manufacture products at a significant scale.
The total amounts of waste generated by Luotea’s own operations are included
in the figures in the table on page 63.
Calculation principles
The reporting of data on waste and materials includes waste and materials
collected from Luotea’s customers and the waste generated at Luotea’s own sites.
The data is obtained from Luotea’s own ERP systems. The amounts indicated in
tonnes in the reporting are based on either the actual weighed weight or assumed
weights based on container-specific average weight measurements. Waste
quantities are stated inclusive of moisture.
In determining the waste treatment method, information received from the
recipients of the materials on the waste treatment method or waste fraction-specific
assumptions on the waste treatment method are used to the extent that supplier-
specific information is not available. It is estimated that there are no significant
differences between the assumed and actual treatment methods at the level
of Group reporting.
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Waste and material flows managed by Luotea 2025
1,000 kg Non-hazardous waste Hazardous waste Total
1
Waste and material flows 902,000 164,000 1,066,000
Materials redirected from disposal 742,700 52,200 795,000
Preparation for reuse 44,600 0 44,600
Recycling 447,000 40,000 487,000
Other recovery 251,100 12,300 263,400
Materials directed to disposal 159,200 111,900 271,000
Incineration 1,690 16,700 18,400
Landfill disposal 155,500 91,400 247,000
Other disposal 2,000 3,700 5,700
Non-recycled waste 410,300 124, 100 534,500
Non-recycled waste, % 45 76 50
As Luotea is a recycling and waste management operator, some of the customers’ waste streams could also be defined as resource inflows. To avoid double counting, Luotea addresses all flows
under E5-5 Resource outflows. For 2025,material flows have been calculated to include waste collected from customers in connection with the provision of services within the Swedish operations
that are part of the circular economy business. The amounts are small and do not affect the total waste volumes.
1
The data in this column is based on non-rounded data.
Waste and material flows managed by Luotea 2024
1,000 kg Non-hazardous waste Hazardous waste Total
1
Waste and material flows 900,000 163,000 1,063,000
Materials redirected from disposal 809,000 49,900 859,000
Preparation for reuse 25,300 0 25,300
Recycling 519,000 42,200 561,000
Other recovery 265,000 7,700 272,000
Materials directed to disposal 90,300 113,000 204,000
Incineration 190 16,400 16,600
Landfill disposal 88,800 94,700 184,000
Other disposal 1,300 2,400 3,700
Non-recycled waste 355,000 121,000 476,000
Non-recycled waste, % 39 74 45
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SBM-3 – Impacts, risks and opportunities from
the perspective of the strategy and business model
In their double materiality assessment, Luotea has identified and assessed the
impacts, risks and opportunities related to its own workforce with reference to the
sub-topics and sub-sub-topics of the European Sustainability Reporting Standards.
The identified material impacts, risks and opportunities included employment
security, working time, adequate wages, social dialogue, freedom of association,
the existence of works councils and the information, consultation and participation
rights of workers, collective bargaining, work-life balance, health and safety, gender
equality and equal pay for work of equal value, training and skills development,
measures against violence and harassment in the workplace, and diversity. Luotea’s
material impacts and opportunities in relation to its own workforce are presented
in the table in ESRS section 2 in section ESRS 2 SBM-3, p. 27.
Luotea operates in the service sector and is a significant employer. With this in
mind, the well-being of the personnel is a key success factor for the company’s
business. One of Luotea’s strategic priorities is to attract the industry’s best
professionals to the Group companies, as people are a vital asset for a company
in the service sector. Deterioration of the personnel’s well-being has a negative
impact, as Luotea’s services and the customer experience delivered by the company
to its customers are created through interaction with motivated and competent
personnel. For a company that operates in the service sector, the availability of
personnel is a key factor that can either enable or limit the growth of the business.
In the competition for suitable workers, a sustainable personnel policy and
sustainable operating practices are very important. Luotea engages in continuous
and diverse and varied dialogue with its personnel at several organisational levels.
The company’s goal is to ensure that Luotea’s personnel have the right
competence, that the amount, quality and retention of personnel are at a level
required for profitable operations, that the work community is diverse and equal,
that the personnel’s work ability and ability to function are maintained throughout
their working life and that the members of the personnel are encouraged and
motivated to perform at a high level so that the company’s goals can be achieved.
In this sustainability report, Luotea’s own workforce covers both employees and
non-employee workers. An employee refers to a person who is in an employment
relationship with a Luotea company in Finland or Sweden. Non-employee workers
refer to persons who work in Luotea companies as leased employees or self-
employed people. The definition of “own workforce” does not include subcontractors.
Luotea strives to provide its personnel with an excellent employee experience,
a safe and healthy work community, high-quality management and opportunities
to increase their competence and develop in their work. Taking the company’s
policies, activities and geographical location into account, the potential negative
impacts on the personnel are not widespread or systemic. The identified potential
negative impacts relate to health and safety, as well as to measures aimed at
preventing workplace violence and harassment. Luotea’s personnel responsibility
perspectives are in line with national laws, agreements and other obligations. At
Luotea, we respect human rights as defined by the Universal Declaration of Human
Rights, workers’ rights as defined by the International Labour Organization (ILO),
international agreements and the UN Guiding Principles on Business and Human
Rights. We are also committed
to supporting the UN Global Compact initiative and its principles pertaining
to human rights and labour.
Luotea aims to offer permanent employment relationships where possible.
The company has a total of 5,007 employees in Finland and Sweden. The largest
groups of employees are cleaners and property maintenance and technical services
employees. The company also has 504 salaried employees in various roles in
sales, customer service, financial management, communications and personnel
management, as well as other expert roles. Luotea uses leased labour in some
of its business models, and this is described in more detail in section S1–7, p. 70.
Luotea has assessed potential negative impacts on its various personnel
groups. Luotea has recognised that young summer workers could be at greater
risk in terms of occupational safety than other personnel groups if the induction
training of young seasonal workers is not carried out as required by the company’s
occupational safety guidelines. Luotea’s cleaning services also include workers
whose Finnish or English language proficiency is not at the same level as that of
other personnel groups, and who could be exposed to occupational safety risks
if their induction and training are not carried out with sufficient care.
Luotea operates in Finland and Sweden, where the legal requirements related
to working conditions, such as reasonable working hours, occupational safety,
annual holiday, parental leave and part-time work, are at a high level. All employees
in both operating countries have the right to belong to, or not belong to, a trade
union. The company does not operate in countries where the risk of forced labour
or child labour would traditionally be high. However, Luotea actively monitors
incidents in different industries and updates its risk assessments.
In Finland and Sweden, legislation, collective agreements and the supervisory
activities of the authorities establish minimum requirements for occupational
safety and health. Possible negative impacts related to working conditions could,
if realised, impair employees’ physical and mental work ability and make their
financial position more difficult. Luotea could also suffer legal and/or financial
consequences. Should they materialise, these effects could have harm the
employer’s reputation, which in turn, would reduce labour availability and increase
personnel turnover. The effects are managed by means of standardised processes
and contract templates, as well as regular supervisor training. Employment
contracts are always concluded in writing.
Luotea is also a member of employer organisations in the industries it operates
in. Through its membership in industry organisations, Luotea also demonstrates its
commitment the applicable collective agreements and ensures that the company
has access to the latest interpretations on the application of collective agreements.
Luotea monitors compliance with collective agreements, environmental
S1 Own workforce
legislation, labour law, occupational safety legislation and regulations pertaining
to financial management. Luotea also complies with the applicable legislation
governing contractors’ obligations and liability, and requires the same of its
suppliers. Luotea’s Code of Conduct emphasises fair and equal treatment and
respect for the human dignity, privacy and rights of each individual. Supervisor
training, support for supervisors and measures such as the monitoring of working
hours ensure that supervisors act in accordance with the applicable rules and
guidelines and know how to support the personnel in urgent situations.
As a company operating in the service sector, Luotea is dependent on human
resources with regard to its own workforce. A description of the material impacts
and opportunities related to Luotea’s own workforce is presented in the table
in paragraph ESRS2 SBM-3 on page 26 and has been identified in accordance
with the double materiality assessment process presented on page 20.
S1-1 – Policies related to own workforce
Luotea’s actions, impacts and risk management related to the company’s own
workforce are guided by Luotea’s Code of Conduct, the company’s public Code
of Conduct, HR Policy, Human Rights Policy, Occupational Safety Policy and
various guidelines. The principles and policies apply to all business operations
in all operating countries.
Code of Conduct
Luotea’s Code of Conduct sets expectations for sustainable and ethical conduct by
Luotea’s personnel. The Code of Conduct calls for compliance with laws, rules and
regulations, integrity and transparency, respect for human rights and colleagues,
and safety at work, among other things. The Code of Conduct is approved by the
company’s Board of Directors and updated at two-year intervals. The Code applies
to all of Luotea. The company has a separate Supplier Code of Conduct for the
supply chain. The Senior Vice President, HR and Legal, is in charge of the Code
of Conduct, and the Group Executive Board monitors compliance with the Code
of Conduct. The Code of Conduct is available for personnel on Luotea’s website,
intranet and the notice boards of the company’s operating locations. The Code
of Conduct has been the subject of dialogue with employee representatives.
HR policy
Objectives related to Luotea’s own workforce are guided by the Group’s HR Policy.
The HR Policy has been approved by the President and CEO and the Group
Executive Board. In the HR Policy, the company commits to compliance with
national legislation, collective labour agreements, internationally recognised human
rights and the core principles of the International Labour Organization (ILO).
The Policy lays down Luotea’s commitment to equality and to combating the use
of child labour and all forms of discrimination. The HR Policy is updated regularly
at two-year intervals. The Senior Vice President, HR and Legal, is in charge of the
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implementation of the HR Policy together with the HR organisation. The Policy
is put into action as part of the Group’s personnel management processes.
The HR Policy has been discussed with the company’s shop stewards before its
entry into force.
Human Rights Policy
Luotea’s Human Rights Policy aims to influence the company’s potential direct
or indirect human rights impacts concerning its personnel, supply chain and
customers. In the Human Rights Policy, Luotea commits to respecting human
rights as defined by the Universal Declaration of Human Rights, workers’ rights as
defined by the International Labour Organization (ILO), the OECD Guidelines and
the UN Guiding Principles on Business and Human Rights. The Policy describes the
company’s commitment to supporting the UN Global Compact initiative and its
principles concerning human rights and labour rights, and complying with national
laws, agreements and other obligations.
Luotea does not, under any circumstances, tolerate trafficking in human beings,
forced labour, the use of child labour in violation of children’s rights, or modern
slavery in its own operations or in the activities of its supply chain.The Human
Rights Policy also establishes zero tolerance for all forms of inappropriate behaviour,
harassment and discrimination in our own operations and in our supply chain.
At Luotea, no one is discriminated against on the basis of gender, gender identity,
gender expression, pregnancy, childbirth, age, ethnicity, nationality, language,
religion, ideology, opinion, political activities, labour union activity, family relations,
health, disability, sexual orientation or any other reason pertaining to an individual.
Race, ethnic origin, skin colour and national or social origin are also prohibited
grounds for discrimination.
Luotea’s Human Rights Policy has been approved by the company’s Board of
Directors and President and CEO. The company’s management team is committed
to respecting and promoting human rights. The Human Rights Policy has been
discussed with the company’s shop stewards. The Group’s Senior Vice President, HR
and Legal is responsible for the Human Rights Policy. The Human Rights Policy is
implemented as part of the company’s HR processes. The policy covers all Luotea
Group companies and divisions in all operating countries, and it applies to the
entire personnel. The Human Rights Policy is updated at two-year intervals. The
next update will take place in 2026. Luotea does not have a separate compensation
mechanism for human rights violations. Instead, the company complies with
Finnish and Swedish legislation in terms of any possible compensations.
Occupational Safety Policy
Luotea’s Occupational Safety Policy covers both the company’s own operations
and the company’s supplier network. It describes the key occupational safety goals,
responsibilities and organisation, as well as our commitment to complying with
legislation and regulatory requirements concerning our operations. The Senior
Vice President, HR and Legal, is responsible for the Occupational Safety Policy
and implements the policy together with the occupational safety organisation. The
goal of Luotea’s occupational safety operations is to guarantee a safe workplace
for all employees. The company is committed to the idea of zero accidents and
believes that all accidents and damage can be prevented. In the event of any action
or conduct in violation of the applicable legislation, orders issued by the authorities
or instructions, the company takes immediate action in accordance with
mutually agreed rules. Luotea’s Occupational Safety Policy has been
approved by the President and CEO and the Group Executive Board, and it
is updated at two-year intervals. The next update will take place in 2026. The
Occupational Safety Policy has been discussed together with the Group’s
shop stewards.
Guidelines and plans
Luotea’s policies are supplemented by division-specific and country-
specific guidelines and plans, which apply only to employees as a rule. In
Finland, Luotea has drawn up guidelines on the prevention of inappropriate
behaviour, harassment and discrimination that apply to the entire personnel
in Finland, as well as an occupational health and safety action plan and
an occupational health care action plan. Luotea also prepares division-
specific equality and non-discrimination plans in Finland, as well as wage
surveys in accordance with the Equality Act. The company has a process for
conducting target-setting and development discussions. Luotea also has an
EHSQ manual, which contains the company’s operating instructions related
to occupational health and safety, among other things. The purpose of the
manual is to make find information easier and to ensure that all information
is up to date. The content of the manual is reviewed at least once per year or
whenever the operating models of a specific area are updated.
In Sweden, the Industrial Services business has its own anti-discrimination
guidelines, substance abuse policy, operating guidelines and occupational
safety guidelines. In Sweden, Facility Services has its own substance abuse
policy, non-discrimination and equality policy, working environment and
safety manual and a process for the prevention of discrimination and
harassment.
S1-2 Engaging with own workers and their
representatives
Luotea’s own workforce constitutes one of the company’s most important
stakeholders. Luotea engages in diverse and close engagement with the
company’s own workers and their representatives. The primary methods
of engaging with the company’s own workers include, for example, the
company’s intranet and internal newsletters, personnel briefings, strategy
days and other events, supervisor communications, target-setting and
development discussions, the activities of the European Works Council and,
in Finland, the activities of Luotea Finland’s Group Cooperation Forum and
industry-specific dialogue in accordance with the Act on Co-operation within
Undertakings.
Planning the process of engaging with the company’s own workers and
their representatives is the responsibility of the Senior Vice President, HR and
Legal. In addition to the Senior Vice President, HR and Legal, engagement
with workers’ representatives in Finland is the responsibility of the Senior
Vice Presidents in charge of each division, the employee relations team,
which works under the Senior Vice President, HR and Legal, and consists of
employment lawyers, along with selected roles with HR responsibilities. The
occupational safety manager, together with their team is also responsible for
matters related to occupational safety. In Sweden, engagement with workers and
their representatives is the responsibility of the Business Director of the Swedish
Facility Services and the HR Manager together with their team.
In Finland, engagement with workers’ representatives on actual and potential
material impacts on the company’s own workforce takes place in quarterly dialogue
pursuant to the Act on Co-operation within Undertakings, in change negotiations
pursuant to the Act on Co-operation within Undertakings, in meetings of the Finnish
Group Co-operation Forum, organised at least once per year, or in the quarterly
meetings of occupational safety and health committees.
Depending on the topic and the forum, the meetings are held either for the entire
Group or for one legal company or unit. For personnel groups that do not have a
representative, direct engagement with the employees belonging to the personnel
group in question is used instead.
In addition, each of Luotea’s legal companies has its own occupational safety and
health committee. The occupational safety and health committees discuss themes
related to occupational safety and health in particular. In 2025, each committee
convened in accordance with the legally required meeting schedule.
The European Works Council meeting is held twice per year and includes
employee representatives from both operating countries to discuss varying topics.
Luotea engages in dialogue with internal and external stakeholders on the
promotion of human rights. Employee representatives in Finland and Sweden
have been consulted in drawing up Luotea’s Human Rights Policy.
Fiilinki and Pulsen personnel surveys
Luotea conducts an annual Fiilinki/Pulsen personnel satisfaction survey that
allows all employees to provide feedback on themes related to their work and
management. The personnel satisfaction survey can be completed in Finnish,
Swedish, English, Estonian and Russian. The survey is anonymous.
S1-3 – Processes to remediate negative impacts
and channels for own workforce to raise concerns
Luotea aims for an organisational culture in which everyone can speak up if they
suspect or observe any violations of the law or Luotea’s policies and instructions.
The personnel are encouraged to report any grievances they observe and
potential violations related to Luotea’s activities. Grievances and incidents can be
reported to one’s direct supervisor or by using a whistleblowing channel that runs
on the technical platform of an external service provider. In addition, all reported
incidents of harassment are recorded in a separate electronic harassment reporting
system in Finland and Sweden.
Suspected misconduct can be reported anonymously via the whistleblowing
channel. Instructions concerning the whistleblowing channel and guidelines for
the prevention of harassment, discrimination and inappropriate behaviour are
available to all of Luotea’s personnel on the company’s intranet. The instructions
regarding the whistleblowing channel are also available on the company’s public
website. Updates to the instructions concerning the whistleblowing channel are
discussed in dialogue with employee representatives, and the representatives have
the opportunity to ask questions and comment on any planned changes.
Employee representatives and employees also have the opportunity to raise
concerns to the management in regular dialogue meetings and other formal and
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informal discussions with management. Luotea’s annual personnel satisfaction
survey also provides the opportunity to anonymously raise concerns and respond
to open-ended questions.
All violations and suspicions of inappropriate conduct that Luotea becomes
aware of are appropriately investigated.
Reports of suspected misconduct received via Luotea’s whistleblowing channel
are handled confidentially by the Legal Affairs department, by a separately
designated individual holding a master’s degree in law. Reports of suspected
misconduct are reviewed by the Compliance Team and with the President and CEO,
and reported to the Audit Committee of the Board of Directors. Luotea decides
on possible further measures, takes corrective measures and provides instruction,
if necessary, and monitors their effectiveness by the persons responsible for
the matter.
Persons belonging to Luotea’s own workforce and their representatives who may
be subject to potential negative impacts can use the channels at the level of the
company in which they are employed or have been hired to work. The whistleblowing
channel can also be used to report suspected misconduct concerning operations
carried out by another Luotea Group company.
Luotea prohibits retaliation against all persons who submit whistleblower reports
in good faith and takes disciplinary action against anyone found to have been
guilty of retaliation. This is separately mentioned in the instructions concerning
the whistleblowing channel and in the company’s Human Rights Policy and Anti-
corruption and Anti-bribery Policy.
One of the questions in Luotea’s employee survey carried out in 2025 concerned
reporting suspected misconduct, helping the company to determine the extent
to which employees are aware of the channels and mechanisms through which
concerns can be raised. A total of 72 per cent of the entire Luotea Group’s personnel
were aware of the company’s channels and mechanisms for reporting suspected
misconduct.
Third-party mechanisms, such as those maintained by the state, NGOs, industry
associations and other co-operation initiatives to raise concerns, are available to all
members of the company’s own workforce and their representatives. Luotea does
not prevent the use of such mechanisms unless the matter concerns a trade secret,
for example, in which case the requirement for non-disclosure could restrict the use
of such mechanisms. Luotea regularly monitors any complaints made regarding
the company through the OECD National Contact Point and reports of suspected
misconduct received in the OECD database.
Luotea Group has a grievance mechanism for processing employee-related
matters in Finland and Sweden as required by Regulation (EU) 2022/1288.
S1-4 – Taking action on material impacts on own
workforce, and approaches to managing material
risks and pursuing material opportunities related to
own workforce, and effectiveness of those actions
Key focus areas related to Luotea’s own workforce include increasing employee
satisfaction, strengthening the work ability of the personnel, developing diversity
and improving occupational safety. The most significant negative impacts related
to own workforce in Luotea’s business environment concern occupational safety.
The company also strives to maintain a non-discriminatory, harassment-free
and equal workplace.
Luotea’s strategic objective is to increase the Employee Net Promoter Score (eNPS)
to 50 by 2026 and to 70 by 2030. The short-term target was revised in 2024, as the
eNPS for that year was 21, and the target for 2025 was defined as 25. The eNPS
varies by business unit, and new targets will be set for continuing operations in 2026.
The company’s impacts and opportunities related to its own workforce are
described in section ESRS S1 SBM-3, p. 64.
Luotea is a diverse work community that accepts and respects differences.
At Luotea, we believe that our extensive diversity work strengthens the employee
experience of everyone at Luotea. The company develops its culture and operating
practices so that everyone finds it easy to join Luotea and enjoy being part of the
work community.
Luotea prevents discrimination and inappropriate behaviour and builds an
equal work community by various means, including processes, wages that are
in line with the applicable collective agreements, job classification based on how
demanding each role is, and by providing guidance and training to the personnel,
and supervisors in particular.
Atypical employment relationships, such as part-time and fixed-term employment
relationships, may pose particular human rights risks from the perspective of
adequate wages and working hours, for example. The use of such employment
relationships at Luotea is always based on legislation, the nature of the business
and customer needs, particularly in Facility Services Finland and Facility Services
Sweden.
In 2025, Luotea carried out a system development project to further specify
the data collection process concerning the personnel of its operations in Sweden.
As a result of the project, some of the data assessed during the last reporting
period is now available directly from the system. Luotea will continue to develop
the comprehensiveness of its personnel data in Sweden.
Development of job satisfaction and strengthening the work
ability of the personnel
Employees with a high level of work ability and well-being are Luotea’s most
important asset and one of its key success factors. Well-being encompasses
physical, mental and social well-being. The work performed by Luotea’s employees
is primarily physically strenuous, but mental resources are also significant. The
company helps its personnel find their own way of looking after their well-being.
As an employer, Luotea also constantly looks for ways to develop work and the
working environment to better support work ability.
Luotea’s target for work ability management is to reduce sickness-related
absences to 4.5% by 2026. To achieve the target set for sickness-related absences,
Luotea will continue the purposeful implementation of the action plan for promoting
health.
Among Luotea’s operating countries, occupational health care is a statutory
right in Finland. The company provides its personnel with preventive and statutory
occupational health care and medical care through its occupational health
provider. In Finland, the company also complements its occupational health
care services with its own sickness fund. In 2025, occupational health services
covered all of the personnel in Finland. Leased employees are covered by statutory
occupational health care through their respective employers. In Sweden,
the personnel are covered by the national health care system.
In 2025, the company co-operated with the occupational health provider
to promote musculoskeletal health and prevent prolonged symptoms,
expedite the start of rehabilitation and influence working methods and working
conditions. Measures related to ergonomics and work arrangements have been
implemented according to local and job-specific needs.
During the review period, mental well-being was supported through low-threshold
services that employees can take advantage of during times of stress or change,
relationship crises or challenges related to supervisory work. For more complicated
challenges related to mental well-being and mental health, employees have
been provided with support and short-form therapy by an occupational health
psychologist.
Luotea aims to reduce sickness-related absences by using the company’s early
care model and various measures to support employees’ return to work. During
the review period, sickness-related absences decreased in Finland, but increased
slightly in Sweden. Our sickness-related absence rate was 5.0% (4.9%) in Finland
and 5.0% (5.4%) in Sweden.
In accordance with our early care model, potential challenges related to work
ability are addressed through co-operation between the employee, the supervisor
and occupational health services at the earliest possible stage. The implementation
of early care discussions was monitored in 2025 by using the early care implemen-
tation percentage as an indicator. In 2025, the number of supervisors who had
a backlog of early care discussions decreased from the previous year.
Luotea continued to organise regular work ability briefings during the period
under review. They involve supervisors having unit-specific meetings to discuss
practical measures related to early care, interaction and supporting health and
well-being with other supervisors and the personnel. Luotea also regularly organised
training related to the early care model, with the aim of improving supervisors’ ability
to enhance interaction, address problems and seek solutions to difficult situations
and potential challenges related to work ability.
The company provided support for returning to work after extended sickness-
related absences using various support measures. These typically include
supporting the employee’s return to their previous job or a similar position by
temporarily adapting the work duties, as well as using partial sickness allowance
or workplace rehabilitation. If the current job is no longer suitable for the employee,
they can receive assistance in finding a more suitable position that corresponds
to their work ability and skills through vocational rehabilitation or the Suitable Work
operating model.
At Luotea, target-setting and development discussions are a key tool for
developing job satisfaction. The aim of the discussions is to ensure that everyone
at Luotea has targets that promote the achievement of our shared objectives.
The discussions are also intended to ensure that job descriptions are clear and
that employees have the required competencies and conditions for successful
performance. These measures support job satisfaction.
As a rule, a development discussion is held with all employees at least once a year.
The discussion is voluntary for employees on fixed-term employment relationships
of less than one year, and for part-time employees whose weekly working hours
do not exceed 20 hours. The purpose of the discussions is to evaluate the past
period, set targets for the upcoming period and discuss the employee’s well-being,
67
Annual Report 2025
Report by the Board of Directors
Sustainability report
workload, competence and career wishes. In 2025, 95% (98%) of salaried employees
in Luotea’s companies in Finland had a target-setting and development discussion
with their supervisor.
The quality of supervisory work has a significant impact on the development
of job satisfaction. Good leadership requires effective dialogue between supervisors
and employees, as well as between coworkers.
In 2025, we provided support for success in supervisory work through various
training activities, for example. The company organised regular training for new
supervisors to familiarise them with Luotea’s supervisory practices and help them
manage employee performance. Supervisors were also offered brief training
activities on topics such as employment relationships, managing teams and
holding successful target-setting and development discussions. In Luotea’s
divisions, the development of leadership and supervisory work was closely
linked to enabling the achievement of strategic goals.
Diversity
Luotea has made a long-term commitment to promoting the employment of people
with reduced work ability. The company is constantly looking for new ways to reach
a broader audience of applicants in population groups that have previously not
been recognised in society as skilled workers. To achieve good results, it is important
to seek progress by focusing on carefully selected groups of people with reduced
work ability. This makes it possible for Luotea to plan the best possible support for
people with reduced work ability employed by the company and ensure in advance
that supervisors have sufficient capability to support such employees at work.
To promote the employment of people with reduced work ability, Luotea has
co-operation projects under way with partners including municipalities in the
Helsinki metropolitan area and other organisations. To ensure the successful
implementation of the projects, Luotea’s Facility Services organisation includes
a dedicated project manager focused on the availability of labour and promoting
the employment of people with reduced work ability.
Occupational safety
Occupational safety at Luotea work is carried out systematically in all units and
teams. Proactive risk assessment is key to mitigating occupational safety risks.
The majority of the personnel work at customer sites, which is why site-specific
risk assessments are carried out in cooperation with the customers. The results
of the risk assessments are reviewed with the employees working at each site as
part of induction training or occupational safety briefings.
The key measures during the review period included regular safety briefings for
employees in production roles, safety walks to observe potential risk areas in the
working environment, as well as safety observations and various risk surveys for all
personnel. Every Luotea employee has access to a system for making occupational
safety observations on a mobile phone. The observations are forwarded to the
supervisor for further processing. The reporting of proactive safety measures
is based on information obtained from Luotea Group’s systems.
In 2025, we increased our employees’ awareness of occupational safety and
risks, starting from induction training and also through online occupational
safety training and clear guidelines, as well as by providing regular briefings
on instructions, procedures and operating models. Care is also taken to ensure
that subcontractors operating at our installations are instructed in occupational
Proactive safety measures
Continuing
operations 2025
Continuing and dis-
continued operations
2025
Continuing and dis-
continued operations
2024
Continuing
operations 2024
Safety observations 49,595 63,933 73,449 59,482
Safety Walks 9,153 15,958 20,770 14,158
Occupational safety sessions 11,184 16,512 19,488 14,398
Risk assessments 911 1,326 1,172 855
Total 70,843 97,729 114,879 88,893
Target
Target
2030
Continuing and discontinued
operations 2025
Continuing and discontinued
operations 2024
eNPS >70 outcome 24
target 25
outcome 21
target 25
Sickness-related absences (%) 4 outcome 5.0
target 4.6
outcome 5.0
target 4.7
TRIF 15 outcome 18
target 19
outcome 19
target 21
Personnel in figures Continuing and discontinued operations 2025
2
Continuing and discontinued operations 2024
Men 2,723 4,724
Women 2,280 2,712
Other
1
2 3
Not specified 2 2
Total number of employees 5,007 7,441
Finland 3,805 6,313
Sweden 1,172 1,128
Average number of employees
expressed as a full-time equivalent
5,858 5,980
1
Gender, self-reported by the employees.
2
Situation on the last day of the year when the division took place
Employee turnover
Continuing
operations 2025
Continuing and discon-
tinued operations 2025
Continuing and discon-
tinued operations 2024
Continuing
operations 2024
Number of employees who have left the undertaking during the reporting period 1,265 1,474 1,806 1,506
Employee
turnover, %
17 15 22 26
68
Annual Report 2025
Report by the Board of Directors
Sustainability report
safety. In addition, Luotea’s employees participate in occupational safety training
organised by our customers to ensure that we always adhere to the occupational
safety instructions of each operating location.
If an accident occurs in spite of our preventive measures, it is investigated.
Accident investigations are conducted using a method that helps us better identify
the root causes of accidents and target corrective actions appropriately. In addition
to accident investigations, accident panels carry out a further review of accidents
to ensure that the corrective actions are sufficient.
Resource allocation for the management of material risks
and opportunities arising from the personnel
Luotea has allocated a wide range of resources for the management of material
risks arising from the personnel. Luotea has an adequate and comprehensive HR
management organisation and occupational health and safety organisation in all
of its operating countries. The organisation includes the work ability team, employee
relations team, payroll administration, business-specific HR Business Partners, HR
service team, competence development team and HR system team. Each division
also has its own occupational safety manager.
The necessary amount of financial and human resources is allocated annually to
dialogue with the personnel and personnel representatives, but the exact amounts
have not been defined in advance. Approximately EUR 40,000 in financial resources
is budgeted for European Works Council (EWC) activities each year, along with
an adequate amount of human resources for the matters addressed.
In Finland, Luotea has also provided medical care as part of occupational health
care services and a comprehensive sickness fund.
S1-5 – Targets related to managing material negative
impacts, advancing positive impacts, and managing
material risks and opportunities
The targets related to Luotea’s own workforce have been approved by the company’s
President and CEO and the Group Executive Board. Time-linked and performance-
oriented targets concerning Luotea’s employees, such as eNPS, TRIF and the
sickness-related absence rate, are the subject of regular dialogue with personnel
representatives through dialogue meetings held in Luotea’s Finnish companies.
The personnel representatives have the opportunity to share their thoughts
regarding development measures that promote achievement of the targets.
The targets related to Luotea’s own workforce are absolute and apply to the entire
Group. The base year for the targets is 2020. In the base year, the eNPS was 82,
the sickness-related absence rate was 4.7%, and TRIF was 24.
Luotea engaged in dialogue with personnel representatives in 2025 regarding
the results of the personnel satisfaction survey and the development of eNPS.
Progress towards the targets related to Luotea’s own workforce is monitored on
a quarterly basis, and the results are presented to the entire personnel in personnel
briefings.
The results of the personnel satisfaction survey are discussed in team-specific
workshops. The workshop participants together agree on concrete measures for the
Employees by gender, reported by head count per 31.12.
2025 (continuing and discontinued operations) Women Men Other
1
Not specified Tota l
Number of employees
2,280 2,723 2 2 5,007
Number of permanent employees 2,003 2,341 1 1 4,346
Number of temporary employees 277 382 1 1 661
Number of non-guaranteed hours employees 241 457 1 1 700
Number of full-time employees 1,294 1,728 0 1 3,023
Number of part-time employees 676 538 1 0 1,215
1
Gender, self-reported by the employees
Employees by gender, reported by head count
2024 (continuing and discontinued operations) Women Men Other
1
Not specified Tota l
Number of employees
2,712 4,724 3 2 7,441
Number of permanent employees 2,499 4,237 0 2 6,828
Number of temporary employees 213 397 3 0 613
Number of non-guaranteed hours employees 273 497 3 0 773
Number of full-time employees 1,692 3,646 0 2 5,340
Number of part-time employees 747 581 0 0 1,328
1
Gender, self-reported by the employees
Employees by country, reported by head count per 31.12.
2025 (continuing and discontinued operations) Finland Sweden Tota l
Number of employees 3,835 1,172 5,007
Number of permanent employees 3,449 897 4,346
Number of temporary employees 386 275 661
Number of non-guaranteed hours employees 529 240 769
Number of full-time employees 2,301 722 3,023
Number of part-time employees 1,005 210 1,215
Employees by country, reported by head count
2024 (continuing and discontinued operations) Finland Sweden Tota l
Number of employees 6,313 1,128 7,441
Number of permanent employees 5,822 1,006 6,828
Number of temporary employees 491 122 613
Number of non-guaranteed hours employees 678 95 773
Number of full-time employees 4,521 819 5,340
Number of part-time employees 1,114 214 1,328
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Annual Report 2025
Report by the Board of Directors
Sustainability report
team to increase employee satisfaction and develop supervisory work in day-to-day
operations.
S1-6 – Characteristics of the undertaking’s
employees
In Luotea’s reporting, an employee refers to a person who is in an employment
relationship with a Luotea company in Finland or Sweden. The term “personnel”
is used to refer to employees. The term “own workforce” covers employees and non-
employees. Non-employee workers refer to persons who work in Luotea companies
as leased employees or self-employed people. The definition of “own workforce”
does not include subcontractors.
Luotea uses temporary workforce only as necessary. Fixed-term employment
contracts are typically used for seasonal roles, such as summer jobs, and to
balance out seasonal fluctuations in Industrial Services. Long-term temporary
employees are mainly used in project-type roles or as substitutes in connection
with family leave. Temporary employees are provided social benefits and other
employment benefits that correspond to those of permanent employees and
are offered on the same terms.
Luotea aims to offer full-time employment where possible. The number of
employees on part-time and “zero hours” contracts varies by division. Part-time
work is common among the youngest and oldest wage-earners. As a rule, part-time
duties include cleaning work in Facility Services, process cleaning work in Industrial
Services, and customer service and lorry driver roles in Environmental Services.
The number of employees on “zero hours” contracts is very low. In the
Environmental Services division, part-time employees work under a “zero hours”
contract and, as a rule, at their own request. Luotea has surveyed the reasons
for part-time positions in a selective manner. Typically, part-time positions in
Environmental Services and Facility Services are sought by students and people
looking for additional work. In the Industrial Services division, part-time positions
are sought by project workers.
Calculation principles
The reporting is based on information obtained from the HR systems of the Luotea
Group and its subsidiaries.
The number of employees is reported as the head count, unless otherwise stated.
The reporting does not include employees on long-term absences. Luotea employs
approximately 612 (750) seasonal summer workers, thesis workers and trainees per
year, not all of whom are in an employment relationship at the end of the reporting
period, when the number of employees is calculated.
The calculation of the average number of personnel (FTE) is based on actual
working days. Working days are based on all days worked regardless of the duration
of the working day. In other words, if an employee works one hour in a day, this
counts as one actual working day in the calculations. The calculation does not
take overtime into account, which means that a person cannot count for more
than 1 FTE in the report.
Non-guaranteed hours employees
Non-guaranteed hours employees refers to persons who are called in when
Average number of non-employees,
expressed as a full-time equivalent
(continuing and discontinued operations) 2025 2024
Average number of non-employees,
reported as full-time equivalents
20.1 63.2
Salaried employees 3.9 7.2
Employees 16.2 56.0
necessary. Personnel called in when necessary are often called in to work at short
notice. It is typical of this type of work that the parties have not made an advance
commitment to offering work repeatedly, or coming to work. The employment
contracts of personnel called in when necessary may be temporary or valid until
further notice.
In Finland, employees called in when necessary refers to employees who are
on a “zero hours” contract and have no fixed weekly working time obligation.
The reporting on non-guaranteed hours employees does not include employment
contracts that specify a variable amount of weekly working hours (e.g. 10–20 hours/
week), as the HR system used by Luotea’s companies in Finland does not recognise
these types of range-based contracts/variable working hours. However, persons
on these types of contracts are reported as part-time employees.
In Sweden, employees called in when necessary refer to employees who are on
a temporary employment contract with a zero-percent employment relationship.
This means that they do not have guaranteed working hours and are called in
according to their employer’s needs. The employer submits work requests at
the agreed hourly wage.
Exit turnover of the personnel
Reporting on the exit turnover of the personnel includes employment relationships
terminated on the employee’s initiative. This refers to the termination of a trial period
on the employee’s initiative, resignation, retirement, death, or the cancellation of an
employment relationship. Fixed-term employment relationships are not included
in the reporting of exit turnover. This means that summer workers, for example,
are not included. The reported exit turnover also includes employment relationships
t
erminated on the employer’s initiative, such as dismissals on personal and collective
grounds, terminations of trial periods on the employer’s initiative, cancellations
of employment contracts and severance agreements. Exit turnover of Luotea’s
personnel has been calculated as follows: The total number of employment
relationships terminated on the employee’s initiative and on the employer’s initiative
during the reporting period divided by the total number of employment relationships
in force on the last day of the reporting period.
Collective bargaining coverage and social dialogue 2025
Coverage rate
Collective bargaining coverage Social dialogue
Employees – EEA Employees – Non-EEA Workplace representation – EEA only
0–19%
20–39%
40–59% Sweden
60–79%
80–100% Finland, Sweden Finland
Collective bargaining coverage and social dialogue 2024
Coverage rate
Collective bargaining coverage Social dialogue
Employees – EEA Employees – Non-EEA Workplace representation – EEA only
0–19%
20–39%
40–59% Sweden
60–79%
80–100% Finland, Sweden Finland
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Annual Report 2025
Report by the Board of Directors
Sustainability report
S1-7 – Characteristics of non-employee workers
in the undertaking’s own workforce
Luotea uses non-employee workers in its operations. Non-employee workers are
people provided by undertakings primarily engaged in employment activities, and
in Luotea’s reporting they are referred to as leased employees. Leased employees
can be used in all divisions, but they are primarily used in cleaning services and
in annual maintenance work in the process cleaning business of the Industrial
Services division. The use of leased employees is most common in production roles
to substitute for sickness-related absences or address personnel shortages, and to
respond to the changing human resource needs in the process cleaning business.
Leased employees receive training for their tasks in the same manner as employees,
and they are covered by Luotea’s occupational safety systems. In Sweden, leased
employees are used primarily in expert roles to a small extent.
Calculation principles
Luotea reports the head count of non-employees included in its own workforce
(leased employees and self-employed people) as full-time equivalents (FTE)
at the end of the reporting period as the average for the reporting period.
In Finland, the FTE calculation of leased employees is based on purchases of
leased employee services and the average hourly earnings determined for each
Luotea Group company and personnel group. The calculation of average hourly
earnings is based on estimates of each personnel group’s average hourly earnings
provided by the HR functions of Luotea’s group companies. The estimates are
based on the hourly wages specified in the applicable collective agreements.
The average hourly earnings figures are multiplied by the leased employee multiplier,
which is based on the multipliers of the largest leased employee service providers for
each Luotea Group company and personnel group. The FTE for leased employees
has been calculated by dividing the calculated working hours by 7.5 and by the
number of working days in the year.
In Sweden, the FTE calculation of leased employees is based on purchases
of leased employee services and the working hours used as the basis of invoicing.
The FTE for leased employees has been calculated by dividing the invoiced working
hours by eight and by the number of working days in the year.
S1-8 – Collective bargaining coverage
and social dialogue
All employees and salaried employees (100%) at Luotea’s companies in Finland
are covered by collective agreements. At Luotea’s companies in Finland, collective
agreements do not apply to senior salaried employees or persons in executive
positions. The terms of employment of the above-mentioned personnel groups
are determined in accordance with the applicable legislation. However, in the
employment relationships of senior salaried employees in 2025, Luotea applied the
practices applicable to salaried employees in the Luotea company in question with
regard to holiday pay, sick pay, annual holiday, family leave and salary increases.
In Facility and Industrial Services in Sweden, all employees (100%) except senior
management are covered by a collective agreement. The terms of employment
for senior management are specified in their employment contracts.
Luotea has established a European Works Council (EWC) for informing and
consulting personnel representatives with regard to transnational matters. Luotea
has in place a separate agreement regarding EWC according to which EWS
activities at Luotea are organised. The agreement has been in force since 2018.
Finland and Sweden are represented in the EWC.
Calculation principles
The reporting is based on information obtained from the HR systems of the Luotea
Group and its subsidiaries.
Collective bargaining coverage
The calculation of collective agreement coverage does not include senior salaried
employees and executives, as Luotea does not have an applicable collective
agreement for those personnel groups.
Social dialogue
The personnel are entitled to elect a representative at the workplace. The task of a
personnel representative is to ensure that employees’ voices are heard in workplace
decision-making and that their rights are protected.
Examples of such representatives include shop stewards, employee representa-
tives, occupational safety delegates, EWC representatives and national group
cooperation representatives. The number of persons covered by personnel repre-
sentation is reported by country according to the proportion of Luotea employees
who have actually elected a personnel representative for their personnel group.
S1-9 – Diversity
At Luotea, we believe that purposefully building a diverse workplace community
is one way of ensuring sustainable business growth. Luotea’s overall objective
is to increase diversity in all of its personnel groups.
Among Luotea’s employees, men account for 54% and women for 46%. The
Company offers employment opportunities to people of different ages and at
various stages of their careers.
Calculation principles
The reporting is based on information obtained from the HR systems of the Luotea
Group and its subsidiaries. In the reporting, senior management comprises the
members of Luotea’s Group Executive Board.
S1-10 – Adequate wages
Luotea pays all employees employed under an employment contract in accordance
with the applicable collective bargaining agreements in Finland and Sweden.
Wage surveys were conducted in accordance with the Equality Act in Luotea’s
Finnish divisions (Facility Services Finland, Environmental Services, Industrial
Services and Group Services) in 2024. The wage surveys did not reveal any
unjustified differences in pay between the genders. We assess the realisation
of pay equality between the genders as part of our two-year diversity plans.
At Luotea wages are influenced by factors such as the content and demands
of the job, the employee’s competence, performance and experience, and the
Training and skills development
(continuing and discontinued operations) 2025 2024
Employees that participated in regular target
setting and performance review discussions, %
83 78
Men 82 75
Women 84 81
Other 0 0
Not specified 100 100
Employees 79 72
Salaried employees 95 98
Average number of training hours of employees 3.1 5.5
Men 3.6 6.5
Women 2.2 3.7
Other 0.0 0.0
Not specified 0.0 6.0
Employees 2.5 5.1
Salaried employees 5.7 6.8
Distribution of employees by age group,
number of persons (continuing and discontin-
ued operations) 2025 2024
Under 30 years old 841 1,366
30–50 years old 2,464 3,726
Over 50 years old 1,702 2,349
Gender
distribution senior
management
2025 2024
Number Share, % Number Share, %
Men 7 87.5 7 87.5
Women 1 12.5 1 12.5
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Annual Report 2025
Report by the Board of Directors
Sustainability report
provisions of any applicable collective agreement. At Luotea, non-discrimination in
remuneration is promoted by ensuring that remuneration is based on the demands
of the role, which are assessed by means of objective criteria. The categories used
for the demands of each role and wages are based on factors such as the collective
agreements applied at Luotea.
Luotea operates in a number of different industries, which is why average pay
is not an appropriate indicator for the level of structure of wages. During the
review period, Luotea continued preparing for the amendments to the EU’s Pay
Transparency Directive, which will be implemented in Finnish legislation no lateer
than 7 June 2026.
S1-11 – Social protection
All of Luotea’s employees in Finland and Sweden are covered by social protection,
as referred to in the sustainability reporting standard, against loss of income due
to major life events.
S1-13 – Training and skills development
Employees play a key role in the successful execution of the company’s strategy.
There are many jobs at Luotea that do not require training or previous experience.
Through high-quality induction training, we help the employees perform their new
duties and ensure a successful employee experience right from the start of the
employment relationship. The digitalised Polku induction training model used
in cleaning services, for example, is used in the induction training of hundreds
of cleaning employees each year.
The main focus of competence development is on day-to-day learning on the job,
but training and coaching also play a role. The Luotea Academy provides a range
of training opportunities on various broad themes, particularly for supervisors and
specialists. Examples of the themes of training carried out during 2025 include
project management, employment relationships, supervisory work, financial
management, data protection, occupational well-being and time management,
Luotea’s business, sustainability and IT.
The concise Luotea Academy training courses have lowered the threshold for our
personnel to increase their competence. Luotea also offers division-specific training
to help employees develop their professional skills and maintain their professional
qualifications as well as to support the achievement of strategic goals.
Luotea engages in co-operation with various educational institutions. In 2025, our
personnel were offered apprenticeship training for completing basic, vocational and
specialist vocational qualifications in cleaning and facility services as well as basic
qualifications in logistics.
In 2025, Luotea’s employees spent an average of 3.1 hours participating in
various training activities. The figure is based on training entries and the number
of personnel. This figure does not cover all of our training activities and all of the
hours of training completed by Luotea employees. During their working hours, our
specialists and supervisors, in particular, also participate in various seminars and
training programmes provided by various organisations, partners and companies.
The company also offers internships and thesis writing opportunities in areas
including cleaning, property maintenance, sales and customer service.
With regard to terminated functions, Luotea has ensured that all drivers complete
the necessary professional qualifications for drivers and that their qualifications
Occupational Health and Safety
Continuing
operations 2025
Continuing and dis-
continued operations
2025
Continuing and dis-
continued operations
2024
Continuing
operations 2024
Total recordable incident frequency (TRIF) 16 18 19 18
Employees 16 18 19 18
Finland 17 18 20 18
Sweden 14 20 17 15
Other workers 0 0 0 0
Finland 0 0 0 0
Sweden 0 0 0 0
Number of accidents 126 220 243 141
Employees 126 220 243 141
Finland 103 184 213 117
Sweden 23 36 30 24
Other workers 0 0 0 0
Finland 0 0 0 0
Sweden 0 0 0 0
Fatal accidents 0 0 0 0
Cases of occupational illnesses 2 2 0 0
Fatal
cases of occupational illness
0 0 0 0
Working hours, million hours 7.9 12.2 12.6 8.3
Employees 7.8 12.1 12.5 8.2
Finland 6.2 10.3 10.8 6.6
Sweden 1.6 1.8 1.8 1.6
Other workers 0.0 0.1 0.1 0.1
Finland 0.0 0.1 0.1 0.0
Sweden 0.0 0.0 0.0 0.0
Occupational Health and Safety
management system coverage
all employees % 100 100 100 100
Finland 100 100 100 100
Sweden 100 100 100 100
Entity-specific metric:
Sickness-related absence rate
Continuing
operations 2025
Continuing and dis-
continued operations
2025
Continuing and dis-
continued operations
2024
Continuing
operations 2024
Sickness-related absence % 4.8 5.0 5.0 4.8
Finland 4.9 5.0 4.9 4.7
Sweden 4.8 5.0 5.4 5.5
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Report by the Board of Directors
Sustainability report
are continuously updated. In addition, mandatory training related to professional
qualifications, which in Finland include a hygiene passport, wet room cleaning,
first aid (EA1 and EA2) and hot work card qualifications, for example, is offered
to all employees who need it. In Finland, the completion of training activities
is monitored via the HR system.
Calculation principles
The reporting is based on information obtained from the HR systems of the Luotea
Group and its subsidiaries.
Employees who participated in regular performance and career development reviews
The proportion of the personnel covered by target-setting and development discus-
sions is based on the number of target-setting and development discussions
held during the reporting period for personnel who were active employees at the
end of the reporting period and who are within the scope of target-setting and
development discussions, and is expressed as a percentage of all personnel.
Persons who are considered to be within the scope of target-setting and develop-
ment discussions at the end of the period must meet the following criteria:
• A person who, at the end of the reporting period, is not on an extended
uninterrupted absence (over 30 days)
• A person for whom the working hours specified in the employment contract
amount to at least 20 hours per week
• A person whose employment relationship has lasted at least 90 days (salaried
employees) or 60 days (employees)
• A person whose temporary employment relationship has lasted at least 360 days
Average number of training hours per employee
The calculation of the average training hours takes into account all training hour
entries registered in the HR systems during the reporting period. The number
of training hours is reported by gender based on the head count.
S1-14 – Health and safety metrics
Luotea’s occupational safety target is zero accidents. The company’s strategic
metric for occupational safety is the total recordable incident frequency (TRIF).
Luotea’s TRIF target for 2030 is 15. For the year 2026, the company has set a TRIF
target of 19. In 2025, the number of occupational accidents recorded for Luotea
Group employees was 220. Safety is on the agenda of meetings from the Executive
Board down, and it is also linked to personal bonuses of most service production
supervisors. The development of occupational safety is reported on a monthly
basis to the Group Executive Board, the Board of Directors and the divisions,
down to the unit level.
Luotea’s occupational safety activities are certified and audited by a third party.
Luotea’s occupational safety activities are guided by an ISO 45001 certified man-
agement system and occupational safety policy. The certification covers 100%
of Luotea’s business operations and personnel.
The company engages in effective co-operation with the personnel, and each
Luotea company has its own occupational safety committee. In 2025, each
committee convened in accordance with the legally required meeting schedule.
Incidents and human rights violations reported via the whistleblowing channel
Continuing
operations 2025
Continuing and dis-
continued operations
2025
Continuing and dis-
continued operations
2024
Continuing
operations 2024
Reports of discrimination or harassment during the reporting period 14 18 7 5
Confirmed incidents of discrimination and harassment 0 0 0 0
Other discrimination related reports 0 0 0 0
Total amount of fines, penalties and damages paid based on identified incidents, € 0 0 0 0
Ratio between the remuneration of the highest paid individual and the median
remuneration for employees
Continuing
operations 2025
Continuing and dis-
continued operations
2025
Continuing and dis-
continued operations
2024
Continuing
operations 2024
Ratio between the annual remuneration of the highest paid individual and the median
annual remuneration for employees (excluding the highest paid individual)
15 25 29 22
Ratio between the remuneration of female and male employees, %
(continuing and discontinued operations)
2025 2024
Finland Sweden Finland Sweden
Total 15 14 15 13
Employees 22 17 21 16
Salaried employees 20 9 19 16
The difference of average pay levels between female and male employees, expressed as percentage of the average pay level of male employees. The figures include both
discontinued and continuing operations.
The right to family leave
and use of family leave
Continuing
operations 2025
Continuing and dis-
continued operations
2025
Continuing and dis-
continued operations
2024
Continuing
operations 2024
Share of employees entitled
to family leave, %
100 100 100 100
Share of employees that used
family leave, %
13 14 15 14
Women 45 36 39 50
Men 55 64 61 50
Other
1
0 0 0 0
1
Gender, self-reported by the employees
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There were two cases of diagnosed occupational disease in 2025. In 2025, the
company had no fatalities due to work-related injuries or work-related ill health.
Luotea will develop the calculation of days lost due to work-related injuries and
work-related accidents in 2026.
Calculation principles
The reporting is based on information obtained from the EHSQ systems of Luotea
Group and its subsidiaries. The number of occupational accidents, the number
of fatal accidents and the total recordable incident frequency (TRIF) cover both
employees and non-employees. The accident frequency has been calculated per
million working hours. The reporting of cases of occupational diseases only covers
Luotea’s employees, as the relevant information is not available for non-employees.
The company applies the transitional provision in this respect.
Entity-specific metric: Sickness-related absence rate
The sickness-related absence rate measures the working hours lost due to illness
or accidents in relation to the planned working hours for the reporting period.
Luotea’s target was to have a sickness-related absence rate of no more than
4.6% in 2025. The longer-term target is a sickness-related absence rate of no
more than 4% by 2030. In 2025, the sickness-related absence rate was 5%.
Calculation principles
The reporting is based on information obtained from the HR systems of the Luotea
Group and its subsidiaries. The calculation takes into account absences of persons
working at Luotea due to an illness or accident. Absences related to a child’s illness
or care are excluded from the calculation. The calculation takes into account
absences with a medical certificate issued by a health care professional and
sickness-related absences reported by employees themselves.
Entity-specific metric: Employee Net Promoter Score
(eNPS)
The Employee Net Promoter Score (eNPS) is an indicator of the employees’
satisfaction with their employer. The Employee Net Promoter Score is measured
by means of an annual digital survey that is sent to all Luotea employees. The
survey is available in Finnish, Swedish and English. The personnel survey measures
personnel motivation, the day-to-day work of the teams, teamwork, supervisory
work and leadership, as well as the personnel’s willingness to recommend Luotea.
Calculation principles
The reporting is based on information obtained from the internal systems of Luotea
Group and its subsidiaries.
S1-15 – Work-life balance metrics
In Luotea’s operating countries, Finland and Sweden, all of the personnel (100%)
have a statutory right to parental leave. In 2025, 14% of employees were on family
leave. Of the people on family leave, 36% were women and 64% were men.
Calculation principles
The reporting is based on information obtained from the HR systems of the Luotea
Group and its subsidiaries. The calculation of the number of employees entitled
to take family leave is based on employees in an active employment relationship.
Family leave includes maternity leave, paternity leave, parental leave and informal
care leave available under national legislation or collective agreements.
The calculation for Luotea Finland includes all types of family leave pursuant
to Chapter 4 of the Employment Contracts Act, except absences for compelling
family reasons, absences for taking care of a family member or someone close
to the employee, and informal care leave, as stipulated by sections 7, 7a and 7b
of the Employment Contracts Act. This is because Luotea Finland’s companies
do not have separate codes for itemising such absences. Instead, they are entered
under the same code as other unpaid absences in the companies’ reporting.
Consequently, the calculation includes pregnancy leave, parental leave, childcare
leave, and temporary absence due to a child’s illness.
For Facility Services Sweden and SVB, the term “family leave” includes full-time
or part-time parental leave (föräldrarledigt), paternity leave (pappaledigt), paternity
leave for an adoptive father (pappaledigt 10 dgr vid barns adoption), temporary
childcare leave (tillfällig föräldrapenning dvs VAB, vård av sjukt barn), informal
care leave (vård av närstående) and pregnancy allowance (graviditetspenning).
Persons who have indicated a gender other than male or female in the HR
system, or who have not specified any gender information, are not included
in the calculation of the percentage.
S1-16 – Compensation metrics (pay gap and total
compensation)
Luotea reports the percentage-based gender pay gap of its employees by personnel
group. The personnel groups used are “employees” and “salaried employees”,
with the latter category including all of Luotea’s salaried employees, senior salaried
employees and executives. The percentage-based pay gap is also reported on
a country-specific basis for Finland and Sweden. The next wage survey of Luotea
Finland’s divisions will be conducted in 2026, as part of our diversity plans. In the
salary survey carried out in 2024, the pay of female employees on hourly wages was
95%, and the pay of female employees on monthly salaries 98%, of the pay of male
employees in corresponding positions.
Calculation principles
The reporting on the pay gap and total earningsis based on information obtained
from the HR systems of the Luotea Group and its subsidiaries. The reporting on
the salary comparison between male and female employees on hourly wages is
based on payroll data for positions for which pay comparisons in accordance with
the Equality Act can be reliably conducted without compromising the protection
of privacy.
Ratio between the remuneration of female and male employees
Luotea reports the percentage-based gender pay gap of its employees by personnel
group. The pay is based on hourly wages, average hourly income and, for employees
on monthly salaries, the total salary.
The personnel groups used are “employees” and “salaried employees” (including
all of Luotea’s salaried employees, senior salaried employees and executives).
Persons who have indicated a gender other than male or female in the HR system,
or who have not specified any gender information, are not included in the figures.
In other words, the comparison is based on the pay of men and women. The
percentage-based pay gap is also reported on a country-specific basis for Finland
and Sweden.
Luotea’s Swedish operations report information on pay in the local currency.
The necessary currency conversions are carried out after the end of the reporting
period using the average exchange rate for the reporting period.
Annual total remuneration ratio
The highest paid individual in the calculations for the reporting period was the
President and CEO of Luotea Group. The calculation takes into account the taxable
pay of all employees.
Luotea’s Swedish operations report information on pay in the local currency.
Currency conversions are carried out after the end of the reporting period using
the average exchange rate for the reporting period.
S1-17 – Incidents, complaints and severe human
rights impacts
Luotea does not tolerate any kind of discrimination, harassment, bullying, racism or
inappropriate treatment or the use of child labour, any form of forced labour or any
other practices in violation with basic human rights in its own operations or in its
supply chain.
No confirmed incidents of discrimination or harassment, and no serious human
rights incidents, were reported to Luotea in 2025. Consequently, in 2025, Luotea did
not pay any fines, penalties or compensation for damages in relation to complaints
and incidents of misconduct. In the reported information, a “reported incident
of discrimination or harassment” refers to a suspected incident of harassment
or discrimination on the basis of gender, pregnancy, childbirth, gender identity,
gender expression, age, ethnicity, nationality, language, religion, ideology, opinion,
political activities, union activities, family relations, health, disability, sexual
orientation or any other reason pertaining to an individual, or any other form of
inappropriate behaviour or harassment brought to the attention of the company. No
other discrimination-related reports were received during the reporting period.
Calculation principles
Luotea’s Finnish companies have their own electronic harassment reporting system,
and Luotea Facility Services Sweden has its own system. The Swedish Industrial
Services company SVB does not have an electronic harassment reporting system.
The number of reported incidents is monitored and maintained at the Group level
using the company’s internal system.
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SBM-3 – Material impacts, risks and opportunities and
their interaction with strategy and business model
The material impacts, risks and opportunities concerning value chain workers have
been identified in accordance with the double materiality assessment presented
in the general disclosures, section ESRS 2 IRO-1, p. 22. Luotea’s material impacts
are related to the occupational safety and well-being of employees in the supply
chain and the potential occurrence of harassment, bullying and discrimination
in industries with employees from several countries and different cultures.
The assessment was focused on Luotea’s direct suppliers on whom information
was already available. The downstream value chain impacts were considered to
be minor. The review was influenced by Luotea’s human rights risk assessment,
which covered the impacts of the supply chain.
Description of the supply chain
The structure of the supply chain and the origin of suppliers may affect the impacts
on employees in the supply chain. Luotea mainly purchases from locally operating
companies in Finland and Sweden. These countries comply with the rule of law
and are also known for their high level of social trust and comprehensive labour
market regulations. Despite this, labour exploitation, trafficking in human beings,
and the shadow economy are issues that occur widely across various industries.
In 2025, approximately 97% of the purchases of Luotea Finland’s subsidiaries
were made from companies operating in Finland, and about 2.8% were made
from companies operating in other EU countries. Purchases from outside the EU
represented approximately 0.2%. Of the purchases of Luotea’s Swedish subsidiaries,
99% were made from companies operating in Sweden and 0.5% from other EU
countries. Hardly any purchases were made from non-EU suppliers.
One fifth of the procurements in Luotea’s supply are related to direct service
procurements, and 15% are generated by material procurements, such as various
substances and supplies.
Actual or potential impacts on supply chain workers
Luotea’s actions may have indirect impacts on the employees of direct suppliers
in the supply chain.
Luotea’s operations depend on, among other things, subcontracting, such as
transportation subcontracting, which is used to supplement Luotea’s in-house
logistics. Typically, subcontracted employees work at Luotea’s or customers’
premises, particularly in logistics, environmental construction projects and process
cleaning and property maintenance in production-related tasks which may
involve an actual elevated occupational safety risk, for example. There may occur
discrimination and exploitation of employees in service sectors that employ a large
number of foreign employees. In Luotea, these include, subcontracting of cleaning
and property maintenance and leased work. In addition, potential impacts may be
related to the inadequate work conditions, such as unclear records of working time.
Luotea has assessed that the most vulnerable groups in terms of material impacts
are young people and foreign employees.
Efforts are made to minimise the potential impacts through procurement
agreements that take into account Luotea’s Supplier Code of Conduct. In addition,
Luotea regularly reviews occupational safety observations made at its own premises
or customers’ premises together with suppliers and their employees, and takes
corrective measures as necessary.
Luotea recognises that potential impacts can also occur deeper in the value
chain, especially in countries with inadequate practices or legislation concerning
working life. Violations related to working conditions and human rights are more
likely in these countries than in non-risk countries. Examples of such supply chains
include the production of Luotea’s workwear and the procurement of raw materials
for the company’s fleet and ICT equipment.
Description of Luotea’s supply chain workers
The workers in Luotea’s supply chain in Finland and Sweden can be categorised
as follows:
• Production subcontracting employees, particularly in transport tasks (Circular
Economy Business), seasonal snow and green work in property maintenance
(Facility Maintenance), cleaning (Cleaning Services) and industrial process
cleaning (Circular Economy Business).
• Specialists in ICT services and primary health care.
• Specialists and production workers at the plants of material recycling partners
(Circular Economy Business).
Particularly vulnerable groups of workers may work in different parts of the supply
chain. In subcontracting, one example of such groups is workers with a foreign
background, whose inadequate language proficiency may make it more difficult
to understand and implement the appropriate occupational safety practices and
exposes to human rights violations. They may also have inadequate knowledge
of national work practices. Young employees who lack previous work experience
can also be more vulnerable to various types of violations. The employees of
subcontractors working at Luotea’s sites receive induction training for their duties
according to the same principles as Luotea’s own personnel.
Potential negative impacts may also emerge in Luotea’s value chain. However,
considering the geographical location of operations in Finland and Sweden, the
impacts on employees are not estimated to be extensive or systemic, but rather
incidental. These impacts may occur as isolated incidents, such as inadequate
use of personal protective equipment or work-related injuries caused by repeated
physical strain.
Luotea’s operations can also have positive impacts on value chain workers.
Extending Luotea’s occupational safety practices to subcontracting and monitoring
them develops occupational safety capabilities throughout the chain and promotes
the use of best practices in the supply chain. In addition, Luotea’s Supplier Code
of Conduct lays down basic requirements for good conduct and practices. The
supplier self-assessment model created to support these requirements, for its part,
increases the supply chain’s awareness of Luotea’s expectations and practices
with regard workers’ rights and human rights, occupational safety and working
conditions, for example.
All forms of child labour and forced labour are strictly prohibited and constitute
violation of the Supplier Code of Conduct. Luotea has not identified any significant
risks related to the use of child labour or forced labour in its own operations or
supply chain in Finland and Sweden. Finland and Sweden have strong legislation,
supervision by the public authorities and compliance with the rule of law that reduce
the risks in the business environment.
S2-1 – Policies related to value chain workers
Luotea is committed to respecting workers’ rights and human rights throughout
the value chain. The company’s human rights principles and requirements are
described in the company’s human rights policy and they cover the entire value
chain. The human rights policy is described in more detail in section ESRS S1-1,
p. 64. In addition, Luotea’s Supplier Code of Conduct, which is incorporated into
Luotea’s procurement agreements, takes into account the sustainability-related
expectations for Luotea’s suppliers. Luotea’s human rights policy and the Supplier
Code of Conduct both include a commitment to respecting human rights and
complying with the UN Guiding Principles, the ILO Declaration on Fundamental
Principles and Rights at Work, and the OECD Guidelines for Multinational
Enterprises. Luotea is also committed to the principles of the Global Compact.
Luotea requires that the suppliers’ personnel, suppliers and subcontractors also
comply with these principles and guidelines.
The Supplier Code of Conduct lays down obligations for Luotea’s suppliers
with regard to compliance with law, business conduct, respecting human rights,
including the prohibition of child labour, forced labour and trafficking in human
beings, safeguarding health and safety, and reducing environmental and climate
impacts. The Supplier Code of Conduct also describes Luotea’s whistleblowing
channel, through which actors in the value chain can anonymously report
misconduct. The Supplier Code of Conduct is incorporated into the appendices
to Luotea’s procurement agreements and it is publicly available on the company’s
website. The Supplier Code of Conduct has been approved by the President and
CEO together with the Group Executive Team.
The Group’s Chief Procurement Officer is responsible for developing the Supplier
Code of Conduct, and its content is reviewed and updated as necessary so that
Luotea can actively react to changes in the business environment. The participants
in the regular review of the Supplier Code of Conduct also include Luotea’s key
internal stakeholders, such as Legal Affairs and the sustainability organisation. Thus
far, other stakeholders have been consulted in the process of drawing up the policy.
Luotea’s divisions and units are responsible for the implementation of the policy
and the allocation of the necessary resources in their respective operations.
S2 Workers in the value chain
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Luotea’s human rights principles are described in more detail in section
ESRS 2 GOV-4, p. 16. The principles include risk identification and assessment,
procedures for raising concerns, and policies for the implementation of appropriate
remedies. The policies are in alignment with the OECD Guidelines for Multinational
Enterprises.
S2-2 – Processes for engaging with value chain
workers about impacts
Luotea does not have other processes in place for engaging with value chain workers.
In 2026, efforts will be made to identify in more detail which value chain workers will
be most affected. Promoting communication with value chain workers is another
focus area.
S2-3 – Processes to remediate negative impacts and
channels for value chain workers to raise concerns
Processes used by Luotea
Luotea’s Supplier Code of Conduct lays down clear requirements for respecting
the rights of value chain workers, including working conditions, safety and respect
for human rights. Suppliers commit to the Supplier Code of Conduct in connection
with procurement agreements. Suppliers renew their commitment to the Code
of Conduct at least every three years.
Compliance with the Supplier Code of Conduct is monitored in accordance
with an annual plan through supplier self-assessments and audits. In Luotea’s self-
assessment model, the supplier assesses its performance in terms of corporate
ethics, occupational safety, the environment, quality and supply chain sustainability
practices, taking into account policies, principles and measures to promote these
areas.
The survey also covers zero-tolerance issues pertaining to the use of child labour
and forced labour, and the supplier’s commitment to Luotea’s Supplier Code Of
Conduct. Any deviations concerning the zero tolerance questions always require
further action in cooperation with the supplier in question.
If significant deviations are revealed in the self-assessment, Luotea initiates
a dialogue with the supplier to jointly agree on an action plan and timetables for
remediation. The action plan also takes into account potential impacts on delivery
times so that critical deviations are corrected as a matter of priority. The progress
of the measures and their effectiveness can be assessed by means of new self-
assessments or audits, for example. In 2025, there were no significant deviations
that would have led to a dialogue with suppliers.
Cooperation with the supplier is typically not terminated in such instances, as
doing so would not promote the position of workers in the supply chain. However,
if the partner fails to demonstrate their desire and commitment to address the
identified shortcomings, the cooperation may be terminated.
The whistleblowing channel and processing reports
Luotea has a whistleblowing channel through which Luotea’s employees,
customers, suppliers and other stakeholders can report suspected
misconduct concerning Luotea’s operations in relation to violations of
legislation or the Supplier Code of Conduct. The whistleblowing channel
enables people to report suspected misconduct related to Luotea’s
operations confidentially. The whistleblowing channel is public and
anonymous.
Value chain workers can report any misconduct or shortcomings they
observe by using Luotea’s whistleblowing channel. The processing of
whistleblower reports is supported by an impartial third party, which
ensures independence and confidentiality. Instructions on how to submit
a whistleblower report and a description of the operating model are
presented in a transparent manner on the website of the company and
the whistleblowing channel. Suppliers and their workers are informed about
the use and purpose of the whistleblowing channel as part of Luotea’s
Supplier Code of Conduct and on the company’s procurement website.
Luotea prohibits retaliation against all persons who submit whistleblower
reports in good faith and takes disciplinary action against operators
found to have been guilty of retaliation. Whistleblowers are also protected
by Finnish and Swedish legislation. The company’s commitment to
whistleblower protection is communicated in the Supplier Code of Conduct,
the external website and the home page of the whistleblowing channel.
Each report is processed by an investigation team appointed on a case-
by-case basis. The team’s composition takes into account the expertise
required by the subject, while avoiding potential conflicts of interest. The
whistleblower receives confirmation of the receipt of the whisteblower report
within seven days of the report being received. In addition, the whistleblower
will be informed, no later than three months after the report has been
received, of the actions that have been taken in response to the report.
The channel has been designed to be as easy-to-use as possible to make
reporting convenient and effortless.
Luotea investigates all reports and determines the necessary remedies.
In 2025, a total of 24 reports were received through Luotea’s whistleblowing
channels. Of these, one was related to the supply chain.
Luotea monitors the issues raised through the whistleblowing channel
and evaluates the effectiveness of the channel accordingly. Reports received
via the whistleblowing channel are documented and categorised by topic,
which allows the company to identify the most common problems and
recurring themes in the value chain. It is also possible to send feedback
to Luotea regarding the usability of the channel and the support provided.
The company also monitors how actively the channel is used in order to
assess whether the channel reaches its target group. Otherwise, Luotea has
not assessed whether the value chain workers are aware of the processes
in use (whistleblowing channel). Persons who use the whistleblowing channel
are protected from retaliation. This is explained in more detail at the end of
section G1-1, p. 77 , and it applies to everyone including value chain workers.
S2-4 – Taking action on material impacts on value
chain workers, and approaches to managing
material risks and pursuing material opportunities
related to value chain workers, and effectiveness
of those actions
Actions to promote the working practices of suppliers’ employees
Luotea’s material impacts are related to the occupational safety and realisation
of working conditions of employees in the supply chain and discrimination against
them. Luotea’s expectations for suppliers are presented in the Supplier Code
of Conduct, which includes requirements for respecting the rights of workers,
working practices and safe working conditions.
Compliance with the Supplier Code of Conduct is assessed by means of supplier
self-assessment surveys, in which suppliers are asked to describe their targets,
policies and actions in relation to their own operations. In addition, Luotea conducts
risk-based audits to ensure that workers’ rights are respected and the working
conditions are safe.
Luotea’s self-assessment survey was widely deployed in 2024. At the beginning
of 2025, a supplier risk assessment process was introduced. The used risk scoring
takes into account factors such as the supplier’s compliance. Starting in 2025,
significant deviations have been addressed by the procurement management team.
There were no significant deviations in 2025. During the year, Luotea developed the
supplier risk assessment process to ensure that it would also cover downstream
value chain suppliers, which are waste processing partners. The self-assessment
process is described in more detail in section ESRS S2-3, p. 75.
In 2025, the audit model for Luotea’s suppliers was developed by adding a risk
assessment basis to the audit process. Luotea plans the necessary measures
to prevent discrimination and improve working conditions for suppliers based
on supplier-specific audits.
In 2024, Luotea introduced a supplier management system through which it
can systematically monitor compliance in the value chain, including compliance
with the Supplier Code of Conduct and self-assessments. In 2025, the company
also further specified its internal monitoring processes and supplier obligations.
At the end of the year, 75% of suppliers had made a commitment to Luotea’s
Supplier Code of Conduct or corresponding principles, and 71% of suppliers had
completed Luotea’s self-assessment survey. No deviations related to the zero
tolerance issues were detected in the survey results.
Luotea will continue to integrate sustainability criteria into its procurement
processes in the coming years. The Supplier Code of Conduct were updated
in 2025. During 2026, Luotea will assess measures aimed at increasing supplier
awareness and promoting the engagement of workers in the supply chain.
No serious human rights violations or significant problems, such as child labour
or forced labour, have been observed in Luotea’s current value chain. If such reports
were to be received, the company would take immediate action by initiating
an investigation and implementing remedies in cooperation with the supplier
in question.
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Actions to promote the occupational safety of subcontractors’
employees
Luotea minimises occupational safety risks related to workers in the subcontracting
chain by maintaining and developing occupational safety practices, such as
proactive safety efforts and risk management processes.
Luotea requires its subcontractors to ensure a safe and healthy workplace for
their personnel by complying with the legislation governing their operations and
Luotea’s Supplier Code of Conduct. Subcontractors can participate in safety efforts
by making safety observations and start-of-work checklists. Depending on their
role, subcontractors may also have the opportunity to participate in Luotea’s
safety briefings aimed at the prevention of accidents.
Accidents occurring in the work of subcontractors in Luotea’s operations,
including leased employees, are recorded in the Clean Sheet reporting channel
(subcontractors in Luotea’s operations in Finland and in Industrial Services
Sweden). Such accidents are processed in accordance with the same operating
model as accidents involving Luotea’s own personnel. Luotea plans the necessary
accident prevention measures based on safety observations and accident reports.
Proactive measures taken by subcontractors are included in Luotea’s reporting.
Luotea aims to increase the occupational safety competence of supply chain
workers and improve their occupational safety going forward. Whenever safety
observations are reported via the Clean Sheet reporting channel, the person who
submits the report receives a response. In addition, all accidents are investigated
and efforts are made to identify their root causes. Luotea’s goal is to develop
long-term cooperation with suppliers and provide their personnel with a stable
and safe working environment.
S2-5 – Targets related to managing material
negative impacts, advancing positive impacts,
and managing material risks and opportunities
Luotea has set Group-wide targets related to managing impacts on workers
in the supply chain and improving the transparency of the supply chain:
• 80% coverage of the Supplier Code of Conduct for selected procurement in
2025. The selected operators exclude, for example, authorities, financial and
insurance companies and suppliers with low purchases (less than €20,000/
year). The objective of the target is to ensure that all suppliers are committed
in material respects, to Luotea’s Supplier Code of Conduct, including respect
for workers’ rights and safe working conditions.
• In 2025, 70% of suppliers selected based on procurement spend are included
in the self-assessment process. The selected operators have been excluded,
for example, from authorities, financial and insurance companies and
suppliers with low purchases (less than EUR 20,000/year).
The targets are used to monitor potential negative impacts in the supply chain
and to promote sustainable practices throughout the chain.
Monitoring the scope of the Code of Conduct and the implementation of self-
assessments began in 2024, which was also the first time the goals were set .
The targets are absolute and are set annually. At the end of 2024, 59% of suppliers
had committed to the Luotea Code of Conduct, with the target being 85%,
and 55% of suppliers had completed the Luotea self-assessment survey,
with the target being 60%.
In 2025, the monitoring was further specified by defining in more detail which
procurements it applies to.
Luotea’s 2025 goals have been developed by the company’s procurement in
cooperation with the sustainability organisation. They have been approved by the
President and CEO, the Group Executive Board and the Board of Directors. Due to
the nature of the targets, the company has not engaged in direct dialogue with value
chain workers or their representatives. However, the targets are based on an analysis
of the company’s supplier network and generally accepted sustainability practices.
Luotea aims to improve the transparency of the supply chain through self-assess-
ment processes and monitoring so that potential negative and positive impacts
can be identified and taken into account in the development of procurement-related
targets in the future. The results of the monitoring are used to identify the strengths
and development areas associated with the existing supply chain practices
and to assess the effectiveness of the targets.
Calculation principles
Luotea monitors the fulfilment of the targets concerning suppliers on the basis
of selected total purchases. The reporting is based on information obtained from
the supplier management service of an external service provider used by the Group.
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G1-1 – Business conduct policies
and corporate culture
The compliance of Luotea’s business conduct and the company’s corporate culture
are guided by the applicable legislation and the company’s policies and principles.
The policies and principles concerning governance and corporate culture comprise
the corporate governance principles that the company adheres to in all of its
activities and in all countries of operation.
Luotea is also committed to supporting the UN Global Compact initiative and its
principles pertaining to human rights, labour, the environment and anti-corruption.
Luotea’s Board of Directors approves the company’s Code of Conduct, human
rights policy, disclosure policy, tax policy and the code concerning the governance
of a listed company. The President and CEO and the Group Executive Board
approve other Group-wide policies, such as the policy for the prevention of corruption
and bribery, and the data protection policy.
The Senior Vice President, HR and Legal, who is a member of the Group Executive
Board, is in charge of the implementation of the policies that create and develop
Luotea’s corporate culture. The Legal Affairs unit puts the policies into action with
the support of the line organisation.
At Luotea, corporate culture is created, developed and promoted through various
measures. Online and in-person training are used to ensure that the employees are
aware of the policies and principles they are required to follow. The training activities
cover examples of situations which the personnel may encounter in their work.
Records are kept of course completions so that the HR and Legal Affairs functions
can ensure that employees have completed the training modules that are relevant
to their role. The company has separate training for its personnel on topics such as
the Code of Conduct, data protection — including data security — and the prevention
of corruption and bribery, including guidelines on accepting gifts and hospitality
in the context of procurement activities.
Internal communications and personnel briefings are used to develop and
promote Luotea’s corporate culture. Themes related to ethical business conduct are
regularly discussed on Luotea’s intranet and in internal newsletters and personnel
briefings, and the company’s senior management communicates its commitment
to the principles and leads by example to demonstrate the importance of the
principles in the company.
Corporate culture and commitment to the Code of Conduct are assessed
annually as part of the employee satisfaction survey, which provides all employees
with an opportunity to give anonymous feedback on supervisory work, the company’s
commitment to sustainability, day-to-day operations and various changing themes.
The response rate to the personnel survey has remained at a good level, the result
for 2025 was 78% (77%).
The results of the personnel survey are discussed by the company’s Board of
Directors and the Group Executive Board and at the team level. The results of the
survey are analysed, and team-level and Group-level actions are taken on the basis
of the results.
Policies, principles and guidelines that are of particular relevance
to corporate culture
Code of Conduct for employees
Luotea’s Code of Conduct for Personnel sets expectations for sustainable and
ethical conduct by Luotea’s personnel. The Code of Conduct calls for compliance
with laws, rules and regulations, integrity and transparency, respect for human rights
and colleagues, and safety at work, among other things. The Code of Conduct
is approved by the company’s Board of Directors and updated every two years.
The company’s General Counsel is in charge of the implementation of the Code
of Conduct, and the Group Executive Board monitors compliance with the Code of
Conduct. The Code of Conduct for Personnel is a public document that is available
on Luotea’s website, intranet and the notice boards of the company’s operating
locations. The Code of Conduct has been the subject of dialogue with employee
representatives.
Luotea’s target is for 100% of its employees and salaried employees in Finland
and Sweden to have completed online training on the Code of Conduct for
employees, which familiarises them with the content of the Code of Conduct and
provides practical examples. The achievement of the target is monitored on the
annual level at the end of each year. The target is absolute and approved by the
Board of Directors. The personnel have not been consulted in setting the target.
Online training on the Code of Conduct is a mandatory part of every new
employee’s induction. There are separate online courses available for employees
and salaried employees. In 2025, Luotea updated the training for employees, and
it will also be completed by all current employees. In Finland, the course can also
be completed on a mobile device, which makes it easier to participate, especially for
those whose work is mobile. A more extensive online training for salaried employees
has been in use since 2023.
Supplier Code of Conduct
Luotea has a separate Supplier Code of Conduct that describes the expectations
on supply chain representatives. The company requires its suppliers to familiarise
themselves with the Supplier Code of Conduct, adhere to it and continuously
develop their operations according to it. The topics covered by the Supplier Code
of Conduct include corruption, bribery, data security, legal compliance, human
and labour rights, health and safety, supplier self-assessments and whistleblowing.
Suppliers are responsible for ensuring that their personnel, suppliers and
subcontractors adhere to the Supplier Code of Conduct. The Supplier must inform
Luotea about the use of subcontractors. Luotea may request suppliers to conduct
a self-assessment at the beginning or during the co-operation. The Supplier
Code of Conduct is approved by the President and CEO and the Group Executive
Board. The Supplier Code of Conduct was updated in 2025. The Chief Purchasing
Officer is in charge of the implementation of the Supplier Code of Conduct, and
the procurement team monitors compliance with it. The Supplier Code of Conduct
is publicly available on Luotea’s website. They are also part of procurement
agreements.
Luotea aim is that 80% of the suppliers selected for procurement, calculated
based on purchases, are committed to the Supplier Code of Conduct, and that
70% of these suppliers, calculated based on purchases, have carried out a self-
assessment in 2025. Authorities, financial and insurance companies and suppliers
with a low amount of purchases (less than EUR 20,000/year) are excluded from the
selected operators. The targets are absolute and are set annually. Starting in 2025,
the Supplier Code of Conduct has been be incorporated into all new agreements,
and acceptance of the Supplier Code of Conduct will be sought separately for
suppliers who already have an existing agreement in place.Reliable data on the
baseline for this target is not available, as the reporting practices of the business
lines have varied. Luotea has not carried out an assessment on prepared a report
on agreement coverage. The target has been approved by the Board of Directors.
Luotea has not engaged in direct dialogue with suppliers about the target.
Anti-corruption and anti-bribery policy
Luotea’s anti-corruption and anti-bribery policy lays down the Group’s ground rules
for preventing corruption and bribery. The company complies with the applicable
legislation in all of its operations. Luotea is committed to anti-corruption and anti-
bribery operating principles in accordance with the UN Convention. Luotea prohibits
all forms of bribery and corruption. In the policy, Luotea takes a position on issues
such as lawful and ethical business conduct, fair competition, acceptable hospitality,
the avoidance of conflicts of interest and the identification and prevention of
corruption and bribery.
Luotea’s anti-corruption and anti-bribery policy is approved by the President
and CEO and the Group Executive Board. Luotea’s anti-corruption and anti-bribery
policy, as well as its implementation, is the responsibility of the General Counsel,
and it is monitored by the Group Executive Board. Luotea updates the policy at two-
year intervals. The policy covers all of the Group’s companies and divisions. It applies
to Luotea’s own workforce in all operating countries and other parties participating
in the business activities, such as consultants. The policy has been the subject of
dialogue with employees and employee representatives and it has been discussed
in a European Works Council meeting.
The company has assessed that, among its internal functions, procurement,
sales and business management are the most vulnerable to corruption and bribery.
The completion of online training on the prevention of corruption and bribery is
monitored particularly closely for employees In the aforementioned roles. If an
employee fails to complete the course within the due date, a separate discussion
on the prevention of corruption and bribery will be held with the person. The anti-
corruption and anti-bribery policy is public and available on Luotea’s website and
intranet. Actions to prevent and detect corruption and briberyxx are described
in more detail in section G1-3, p. 79.
G1 Business conduct
78
Sustainability report
Annual Report 2025
Report by the Board of Directors
Policy concerning gifts and hospitality in procurement
Luotea has a separate policy on receiving gifts and hospitality from suppliers,
or giving gifts and hospitality. The policy supplements Luotea’s Code of Conduct
for Personnel and the anti-corruption and anti-bribery policy. The policy defines
a reasonable gift or hospitality that a Luotea employee may accept and in which
situations no hospitality of any kind may be accepted. The policy applies to Luotea’s
management and all employees engaged in procurement activities. The policy
has been approved by the President and CEO and the Group Executive Board.
The Director of Procurement is responsible implementing the policy. Luotea has
not defined any targets for the policy.
Guidelines on authorisation on the basis of position
The guidelines on authorisation on the basis of position define the decision-making
bodies and decision-making procedure at Luotea. The guidelines define who can,
or must, decide on matters and up to what euro amount. They also specify when
decision-making must be escalated and when consultation with Legal Affairs or
other expert organisations is required prior to decision-making. Decisions must
be made in accordance with the defined policies and guidelines. The Senior Vice
President, HR and Legal is responsible for the guidelines on authorisation on the
basis of position with the support of Legal Affairs. The guidelines on authorisation on
the basis of position apply to all of the personnel and are approved by the President
and CEO and the Group Executive Board. The guidelines were updated in 2025.
Calculation principles
The completion rate of online courses is expressed as a percentage of the target
group. The coverage of training describes the percentage of active employees
at the end of the reporting period, or members of the Board of Directors, to whom
the training in question has been assigned who have successfully completed
it. Information on the completion and assignment of training is obtained directly
from Luotea’s own systems.
Reporting prohibited conduct
If an employee observes or suspects prohibited conduct at Luotea, such as
corruption, bribery or conflicts of interest, they must report them to their supervisor,
the HR function or Legal Affairs. Reports can also be submitted via Luotea’s
whistleblowing channel. Reports via the whistleblowing channel can be submitted
anonymously. Links and instructions for the whistleblowing channel are available
on the company’s intranet and website, the Code of Conduct for employees,
the Supplier Code of Conduct and on notice boards. Luotea encourages its own
workforce and supply chain representatives to speak up if they suspect a violation
of the Code of Conduct for employees, the Supplier Code of Conduct or the anti-
corruption and anti-bribery policy, if they become aware of misconduct, particularly
in cases where they are offered a bribe or asked to give a bribe, or if they suspect
that a particular incident involves bribery.
The whistleblowing channel also occasionally receives reports that do not belong
there, which are directed to the correct channel. “All reports related to unethical
conduct” includes all reports received via the whistleblowing channels regarding
unethical conduct, regardless of the content of the report. Reports and contacts
directed to other channels have been subtracted from the number of reports
that led to investigations.
Luotea’s target is for all employees to act in accordance with the policy.
The company will also ensure that 100% of the salaried employees and executives
identified as particularly relevant to anti-corruption and anti-bribery activities
complete the online training on the content of the policy by 2026. The target is
absolute and applies to all of Luotea’s own operations in Finland and Sweden.
Luotea has had an anti-corruption and anti-bribery policy in force since 2024.
The Policy is updated every two years. The company also prepared online training on
the content of the policy. The aim of the training is to prevent corruption and bribery.
In 2025, 93% of the individuals assessed by the company to be most vulnerable
to corruption and bribery had completed the online training. The online training
must be renewed every 2–3 years, and new persons who have been identified as
key to operations will complete the training at the beginning of the employment
relationship.
In 2025, Luotea will ensure that potential corruption and bribery is detected by
reminding all of the personnel and value chain workers about the anonymous
whistleblowing channel.
Data protection and data security policies
The data protection policy defines Luotea’s internally approved data protection
principles to be followed when processing the personal data of customers, partners
and other stakeholders, as well as employees and job applicants. With the data
protection policy and the function-specific data protection instructions derived
from the policy, Luotea aims to ensure the lawful processing of personal data and
an appropriate level of data protection. The data protection policy is supplemented
by a separate data security policy, which is guided by external and internal
requirements, such as requirements established by legislation and the public
authorities, contractual requirements and the general situation and development
of data security and related threats. The implementation of the data security policy
is supported by supplementary data security guidelines, specifications, plans and
training activities. The data protection policy and data security policy apply to the
entire company.
The data protection policy has been approved by the Board of Directors, and
the data security policy has been approved by the President and CEO and the
Group Executive Board. The policies are reviewed and updated at two-year
intervals if necessary. The Senior Vice President, HR and Legal is in charge of the
implementation of the data protection policy and monitoring compliance with
data protection legislation and data protection instructions at Luotea. The Chief
Information Officer is in charge of the implementation and monitoring of the data
security policy.
Luotea has engaged in direct dialogue with its personnel about the data protectio
n
policy in connection with the update of the policy in 2025. The data protection policy
is public and available on Luotea’s website and intranet. The data security policy is
intended only for internal use within the company, and it is available to employees
on the intranet.
Luotea provides its employees with instructions and training on data protection
and data security. All employees are required to be familiar with the data protection
and data security obligations related to their duties and to comply with said
obligations. In 2025, 92% of salaried employees had completed online training on
the content of the data security policy, which also includes the key subject areas
of the data protection policy.
Training coverage, % 2025 2024
Code of Conduct for employees 68 64
Salaried employees 96 84
Employees 61 59
Data security 70 68
Salaried employees 92 85
Employees 65 64
Prevention of corruption and bribery 93 83
Persons in key positions 94 81
Administrative, management and supervisory bodies 89 91
Violations of good corporate governance
or ethical corporate culture 2025 2024
All reports related to unethical conduct 24 23
Reports leading to an investigation 8 15
Critical incident reports reported to the Board of Directors 0 0
Anti-competitive behaviour 1 0
Legal actions for anti-competitive behaviour, anti-trust
and monopoly practices
0 0
Coverage of the anti-corruption
and anti-bribery training
Persons in key
positions
Administration,
management and
supervisorybodies
Training coverage, persons
Number of employees 141 44
Persons trained 133 39
Training method and training
duration, hours
Computer-aided training 0.5 0.5
Recurrence
Refresher training every 2–3 years every 2–3 years
Topics covered
Gifts and bribery X X
Conflicts of interests X X
Hospitality and entertainment X X
Corruption X X
Sponsorship X X
Cooperation with the public authorities
Procedures in case of suspicion/detection X X
79
Sustainability report
Annual Report 2025
Report by the Board of Directors
was received during 2025. The report relates to alleged bribery and is still being
investigated.
Luotea investigates all suspected incidents of misconduct. Any person reporting,
in good faith, their suspicions within the scope of whistleblower legislation and
participating in the investigation of any suspected misconduct will not suffer any
negative consequences as a result, such as being subsequently discriminated
against or being at risk of being put in a disadvantageous position. Luotea takes
disciplinary action against anyone who is found to have taken any prohibited
retaliatory measures.
Reports submitted via the whistleblowing channel are investigated by Luotea’s
Compliance Officer, Legal Affairs or other individuals who report to the General
Counsel and who have a master’s degree in law or other applicable education.
Luotea’s compliance team processes all reports leading to an investigation, and
the team reports all violations and critical incident reports to the Audit Committee
of the Board of Directors.
G1-3 – Prevention and detection of corruption
and bribery
Luotea has a separate anti-bribery and anti-corruption policy that is approved by
the President and CEO and the Group Executive Board. The General Counsel is in
charge of the implementation of the policy together with Legal Affairs. The business
level supports Legal Affairs in the implementation.
The company has identified roles that involve a higher exposure to corruption than
other roles. These roles include procurement, sales and business management roles,
including the Group Executive Board. All individuals in these roles (100%) receive
training on the content of Luotea’s anti-bribery and anti-corruption policy, as well as
case studies. Their completion of the training activities is monitored. In 2025, 93% of
the individuals working in the above-mentioned roles had completed anti-corruption
and anti-bribery training. A more detailed description of the policies is provided in
section G1-1, p. 77.
The company has separate online training on the prevention of corruption and
bribery. The training specifies practices that are prohibited in the company, provides
example cases of such practices and explains what action to take when corruption
or bribery is observed or suspected in the organisation. The training takes about
30 minutes to complete.
Suspected incidents of corruption and bribery can be reported to one’s supervisor,
HR or Legal Affairs, or via the whistleblowing channel. Reports submitted via the
whistleblowing channel can be submitted anonymously.
The reports are processed by Luotea’s Compliance Officer, Legal Affairs or other
individuals who report to the General Counsel and who have a master’s degree
in law or other applicable education. The persons processing the reports do not
process reports concerning their own organisation and are thus separate from
the chain of command involved.
The reports are processed by Luotea’s Compliance team and reported to the Audit
Committee of the Board of Directors once per year.
G1-4 – Incidents of corruption or bribery
Luotea was not informed of any violations related to corruption or bribery during
the review period, and the company was not subject to any fines or sanctions related
to corruption or bribery. Representatives of Luotea’s management have not been
convicted of bribery or corruption. One report regarding anti-competitive activities
Annual Report 2025
Key figures
80
Key figures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Calculation of key figures . . . . . . . . . . . . . . . . . . 83
Key figures
Annual Report 2025
Key figures
81
Key figures
Key figures on shares
2025 2024 2 0 2 3
Earnings per share (EPS), EUR, continuing operations 0.03 -0.82 0.77
Earnings per share (EPS), diluted, EUR, continuing operations 0.03 -0.82 0.76
Earnings per share (EPS), EUR 4.23 -0.05 0.77
Earnings per share (EPS), diluted, EUR 4.23 -0.05 0.76
Equity per share, EUR 1.08 5.48 6.06
Dividend per share, EUR 0.07 0.50 0.49
Payout ratio, %, continuing operations 216.2 n/a 64.0
Payout ratio, % 1.7 n/a 64.0
Effective dividend yield, %, continuing operations 2.7 6.4 5.0
Effective dividend yield, % 0.7 6.4 5.0
P/E ratio, % 86 -173.3 12.8
Net cash flow from operating activities after investments per share,
EUR 1.16 1.07 1.33
Share price adjusted for issues:
lowest, EUR 7.7 7.71 9.00
highest, EUR 10.7 10.36 11.84
average, EUR 10.58 8.81 10.11
closing, EUR 10.62 7.87 9.80
Market capitalisation 31 December, MEUR 405.8 300.5 373.9
Number of shares adjusted for issue, 1,000 pcs
average during the year 38,180 38,164 38,127
at year end 38.212 38,189 38,154
average during the year, diluted 38.246 38,268 38,232
Adjusted number of shares traded during the year, 1,000 pcs 6,600 8,605 5,649
As a percentage of the average 17.4 22.5 14.8
Volume of shares traded, MEUR 62.9 75.8 57.1
2025 proposal by the Board of Directors
Unless otherwise stated, the figures include both continuing and discontinued operations.
The balance sheet figures as at 31 December 2025 do not include discontinued operations.
2025 figure is based on 2 January 2026 share price
The figures for 2023 include both continuing and discontinued operations, even if the line item refers to continuing operations
Key figures on financial performance
2025 2024 2 0 2 3
Net sales, MEUR, continuing operations 346.0 349.5 802.1
Operating profit, MEUR, continuing operations 3.0 -31.8 37.3
% of net sales 0.9 -9.0 4.6
Adjusted operating profit, MEUR, continuing operations 5.5 -0.3 37.9
% of net sales 1.6 0.1 4.7
EBITDA, MEUR, continuing operations 14.8 3.6 95.8
% of net sales 4.3 1 11.9
Result before taxes, MEUR, continuing operations 2.3 -32.6 34.6
% of net sales 0.7 -9.3 4.3
Result for the period, MEUR, continuing operations 1.2 -31.5 29.2
% of net sales 0.3 -9.0 3.6
Cash flow from operating activities, MEUR 75.6 81.4 93.6
Balance sheet total, MEUR 142.0 607.9 648.8
Return on equity, % (ROE) 1.0 -0.8 12.9
Capital employed, MEUR 60.9 396.1 425.0
Return on capital employed, % (ROCE) 77.8 3.3 10.1
Equity ratio, % 29.1 35.4 36.7
Gearing, % 10.1 73.2 69.5
Net interest-bearing liabilities, MEUR 4.1 153.0 160.9
Gross capital expenditure, MEUR, continuing operations 1.3 1.4 60.3
% of net sales 0.4 0.4 7.5
Average number of employees in full-time equivalents 5,864 5,980 6,743
Total number of full-time and part-time employees at year end 5,007 7,441 8,159
The calculation for 2025 is based on the profit for the financial year from continuing operations.
Unless otherwise stated, the figures include both continuing and discontinued operations.
The balance sheet figures as at 31 December 2025 do not include discontinued operations.
The figures for 2023 include both continuing and discontinued operations, even if the line item refers to continuing operations
Annual Report 2025
Key figures
82
Reconciliation of alternative
performance measures
In addition to IFRS key figures, the company publishes certain other commonly
used performance indicators, most of which are derived from the income statement
and the balance sheet. The calculation formulas for these indicators are presented
in the section Calculation principles of key figures. In the company’s view, these
indicators complement the picture provided by the income statement and the
balance sheet regarding the performance, financial position and comparability of
operations.
Reconciliation of the adjusted operating profit to the operating profit
1 January - 31 December MEUR 2025 2024
Operating profit, continuing operations 3.0 -31.8
Items affecting comparability:
- costs arising from business restructurings 0.2 4.0
- costs arising from acquisitions
- impairment of goodwill 0 23.3
- other items 2.3 4.1
Adjusted operating profit, continuing operations 5.5 -0.3
Other items in 2025 mainly consist of expenses related to the ongoing efficiency
programme as well as changes in provisions related to loss-making contracts and
legal disputes in Sweden.
Reconciliation of gross capital expenditure
1 January - 31 December MEUR 2025 2024
Increases to intangible assets 0.3 0.4
Increases to tangible assets 1.0 0.9
Gross capital expenditure, continuing operations 1.3 1.4
Return on capital employed (ROCE), %, by segment
1 January - 31 December 2025 2024
Facility Services Finland
Capital employed (MEUR), average of the beginning and
the end of the period 14.6 19.4
Operating profit 11.1 9.4
+ financial income 0.6 0.6
Return on capital employed, MEUR 11.7 10.0
Return on capital employed (ROCE), % 80.2 51.4
Facility Services Sweden
Capital employed (MEUR), average of the beginning and
the end of the period 30.5 44.9
Operating profit -5.3 -35.1
+ financial income 0.1 0.1
Return on capital employed, MEUR -5.2 -34.9
Return on capital employed (ROCE), % -17.2 -77.9
Includes the EUR 23.3 million impairment of goodwill recognised in December 2024.
Annual Report 2025
Key figures
83
Calculation of key figures
Earnings per share (EPS) =
Result attributable to equity holders of the parent company
Adjusted average basic number of shares
Earnings per share (EPS), diluted =
Result attributable to equity holders of the parent company
Adjusted average diluted number of shares
Equity per share =
Equity attributable to equity holders of the parent company
Adjusted basic number of shares at the balance sheet date
Dividend per share
1
=
Dividend for the financial period
Adjusted basic number of shares at the balance sheet date
Payout ratio, %
1
=
Dividend per share
Earnings per share
Effective dividend yield, %
1
=
Dividend per share
Closing price of the financial period
P/E ratio, % =
Closing price of the financial period
Earnings per share
Net cash flow from operating activities
after investments per share
=
Net cash from operating and investing activities as in the cash
flow statement
Adjusted average basic number of shares
Market capitalization =
Basic number of shares at the balance sheet date excluding
treasury shares x closing price of the financial period
1
The calculations are also applied with capital repayment.
Key figures on financial performance
Key figures on shares
Adjusted operating profit = Operating profit +/- items affecting comparability
Items affecting comparability
2
=
Substantial costs arising from business restructurings or acquisitions,
gains and losses from divestments and costs arising from the discon-
tinuation of businesses as well as other material items outside ordinary
course of business
EBITDA = Operating profit + depreciation, amortisation and impairment
Return on equity, % (ROE) =
Result for the period
Equity (average of the end and of the beginning of the period)
Capital employed = Equity + Interest-bearing financial liabilities
Return on capital employed, %
(ROCE)
=
Operating profit + financial income + share of results in associated
companies and joint ventures
Equity + Interest-bearing financial liabilities (average of the end and of
the beginning of the period)
Equity ratio, % =
Equity
Total equity and liabilities - advances received
Gearing, % =
Net interest-bearing liabilities
Equity
Net interest-bearing liabilities = Net interest-bearing liabilities - cash and cash equivalents
Gross capital expenditure =
Investments in intangible and tangible assets excluding right-of-use
assets and other adjustments including leased heavy vehicles and as-
sets acquired through acquisitions
x 100
x 100
x 100
x 100
x 100
x 100
Annual Report 2025
Financial statements
Consolidated income statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .85
Consolidated statement of comprehensive income . . . . . . . . . . . . .85
Consolidated statement of financial position . . . . . . . . . . . . . . . . . . .86
Consolidated statement of cash flows . . . . . . . . . . . . . . . . . . . . . . . . . .87
Consolidated statement of changes in equity . . . . . . . . . . . . . . . . . . .88
Notes to the consolidated financial statements . . . . . . . . . . . . . . . . .89
Financial statements of the parent company . . . . . . . . . . . . . . . . . . 126
Proposal by the Board of Directors for the distribution
of the profit and the Auditor’s Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135
1
Financial result
1.1 Segment reporting . . . . . . . . . . . . . . . . . . . . . . . . . . 92
1.2 Revenue from contracts with customers . . . . 94
1.3 Other operative income . . . . . . . . . . . . . . . . . . . . . 95
1.4 Materials and services . . . . . . . . . . . . . . . . . . . . . . 96
1.5 Employee benefit expenses . . . . . . . . . . . . . . . . . 96
1.6 Other operating expenses . . . . . . . . . . . . . . . . . . . 96
1.7 Share-based payments . . . . . . . . . . . . . . . . . . . . 97
1.8 Expenses related to leases . . . . . . . . . . . . . . . . . . 99
1.9 Depreciation, amortisation
and impairments . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
1.10 Financial income and expenses . . . . . . . . . . . . 100
1.11. Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
2
Operational assets and liabilities
2.1 Trade and other receivables . . . . . . . . . . . . . . . . .103
2.2 Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .103
2.3 Trade and other current payables . . . . . . . . . . 104
2.4 Other non-current liabilities . . . . . . . . . . . . . . . 104
2.5 Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
2.6 Retirement benefit obligations . . . . . . . . . . . . . 105
3
Intangible and tangible assets and other
non-current assets
3.1 Goodwill and other intangible assets . . . . . . 108
3.2 Goodwill impairment testing . . . . . . . . . . . . . . . 109
3.3 Tangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
3.4 Right-of-use assets and lease liabilities . . . . .111
3.5 Other non-current assets . . . . . . . . . . . . . . . . . . . 112
4
Financial risks and capital structure
4.1 Financial assets and liabilities . . . . . . . . . . . . . . 114
4.2 Financial risk management . . . . . . . . . . . . . . . . . 116
4.3 Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118
4.4 Earnings per share and dividend per share . 119
4.5 Commitments and contingent liabilities . . . 119
5
Consolidation and other notes
5.1 Consolidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121
5.2 Group companies . . . . . . . . . . . . . . . . . . . . . . . . . . . 121
5.3 Business acquisitions . . . . . . . . . . . . . . . . . . . . . . .122
5.4 Related-party transactions . . . . . . . . . . . . . . . . .123
5.5 Auditing costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .123
5.6 Events after the balance sheet date . . . . . . . . .123
6
Discontinued operations...............................................124
Financial statements
Annual Report 2025
Financial statements
Primary financial statements of the Group
85
Consolidated income statement
1 January - 31 December MEUR | 2025 | 2024 | Note |
| Continuing operations | |||
Net sales | 1.2 | ||
Other operating income | 1.3 | ||
Materials and services | - | - | 1.4 |
Employee benefit expenses | - | - | 1.5 |
Other operating expenses | - | - | 1.6 |
Depreciation, amortisation and impairment | - | - | 1.9 |
Impairment of goodwill | - | 1.9, 3.2 | |
Operating profit | - | ||
Financial income | 1.10 | ||
Financial expenses | - | - | 1.10 |
Exchange rate differences (net) | - | - | |
Financial income and expenses | - | - | 1.10 |
Result before taxes | - | ||
Income taxes | - | 1.11 | |
Result for the period, continuing operations | - | ||
Result for the period, discontinued operations | 6 | ||
Result for the period | - | ||
| Attributable to: | |||
Equity holders of the parent company | - | ||
Continuing operations | - | ||
Discontinued operations | |||
| Earnings per share attributable to the equity holders of the parent company: | |||
Earnings per share, EUR | - | 4.4 | |
Diluted earnings per share, EUR | - | 4.4 | |
Earnings per share, EUR, continuing operations | - | 4.4 | |
Diluted earnings per share, EUR, continuing operations | - | 4.4 | |
Earnings per share, EUR, discontinued operations | 4.4 | ||
Diluted earnings per share, EUR, discontinued operations | 4.4 |
Consolidated statement of
comprehensive income
1 January - 31 December MEUR | 2025 | 2024 | Note |
Result for the period | - | ||
| Other comprehensive income, net of tax | |||
| Items not to be recognised through profit or loss | |||
Items arising from re-measurement of defined benefit plans, continuing op- erations | - | 2.6 | |
Items not to be recognised through profit or loss, total | - | ||
| Items potentially to be recognised through profit or loss | |||
Currency translation differences, continuing operations | - | ||
Currency translation differences, discontinued operations | - | ||
Items potentially to be recognised through profit or loss, total | - | ||
Other comprehensive income, total | - | ||
Total comprehensive income, after tax | - | ||
| Attributable to: | |||
Equity holders of the parent company | - | ||
Continued opererations | - | ||
Discontinued operations |
More information on taxes in consolidated statement of comprehensive income is presented in note 1.11 Income taxes.
Annual Report 2025
Financial statements
Primary financial statements of the Group
86
Consolidated statement of financial position
31 December MEUR | 2025 | 2024 | Note |
| ASSETS | |||
| Non-current assets | |||
Intangible assets | 3.1 | ||
Goodwill | |||
Other intangible assets | |||
Tangible assets | 3.3 | ||
Right-of-use assets | 3.4 | ||
| Other non-current assets | |||
Shares in associated companies and joint ventures | 3.5 | ||
Other shares and holdings | 3.5 | ||
Deferred tax assets | 1.9 | ||
Other receivables | 3.5 | ||
Total non-current assets | |||
| Current assets | |||
Inventories | 2.2 | ||
Trade receivables | 2.1, 4.1 | ||
Contract assets | 1.2, 2.1, 4.1 | ||
Income tax receivables | 2.1 | ||
Other receivables | 2.1, 4.1 | ||
Cash and cash equivalents | 4.1 | ||
Total current assets | |||
TOTAL ASSETS |
31 December MEUR | 2025 | 2024 | Note |
| EQUITY AND LIABILITIES | |||
| Equity | |||
Equity attributable to equity holders of the parent company | 4.3 | ||
Share capital | |||
Other reserves | - | - | |
Invested unrestricted equity reserve | |||
Retained earnings | |||
Total equity | |||
| Liabilities | |||
| Non-current liabilities | |||
Deferred tax liabilities | 1.9 | ||
Retirement benefit obligations | 2.6 | ||
Provisions | 2.5 | ||
Borrowings | 4.1 | ||
Lease liabilities | 3.4, 4.1 | ||
Other liabilities | 2.4 | ||
| Current liabilities | |||
Borrowings | 4,1 | ||
Lease liabilities | 3.4, 4.1 | ||
Trade and other payables | 2.3, 4.1 | ||
Income tax liabilities | 2.3 | ||
Provisions | 2.5 | ||
Total liabilities | |||
TOTAL EQUITY AND LIABILITIES |
Annual Report 2025
Financial statements
Primary financial statements of the Group
87
Consolidated statement of cash flows
1 January - 31 December MEUR | 2025 | 2024 | Note |
| Cash flows from operating activities | |||
Result for the period | - | ||
| Adjustments | |||
Income taxes | 1.11 | ||
Depreciation, amortisation and impairment | 1.9 | ||
Financial income and expenses | 1.10 | ||
Gains and losses on sale of tangible and intangible assets | - | - | |
Share of result of associated companies and joint ventures | - | - | 3.5 |
Provision | - | 2.5 | |
Non-cash adjustments related to the partial demerger | - | ||
Other adjustments | |||
| Net cash generated from operating activities before change | |||
in working capital | |||
| Change in working capital | |||
Change in trade and other receivables | - | ||
Change in inventories | - | - | |
Change in trade and other payables | - | ||
Change in working capital | - | ||
Interest and other financial expenses paid | - | - | |
Interest and other financial income received | |||
Income taxes paid | - | - | |
Net cash from operating activities |
1 January - 31 December MEUR | 2025 | 2024 | Note |
| Cash flows from investing activities | |||
Acquisitions of subsidiaries and businesses, net of cash acquired | - | - | 5.3 |
Purchases of property, plant and equipment and intangible assets | - | - | |
Proceeds from sale of property, plant and equipment and intangible as- sets | |||
Dividends received from joint venture | |||
Dividends received from other non-current investments | |||
Net cash from investing activities | - | - | |
Net cash from operating and investing activities | |||
| Cash flows from financing activities | |||
Proceeds from short-term borrowings | 4.1 | ||
Repayments of short-term borrowings | - | - | 4.1 |
Proceeds from long-term borrowings | 4.1 | ||
Repayments of long-term borrowings | - | - | 4.1 |
Repayments of lease liabilities | - | - | |
Dividends paid | - | - | |
Net cash from financing activities | - | - | |
Net change in cash and cash equivalents | |||
Cash and cash equivalents at the beginning of the period | |||
Impact of the partial demerger on net assets | - | ||
Effect of changes in foreign exchange rates | - | ||
Cash and cash equivalents at the end of the period | 4.1 |
Includes cash flows from both continuing and discontinued operations.
The impact of the partial demerger on cash and cash equivalents includes the cash transferred to Lassila & Tikanoja
in the subsidiaries.
Annual Report 2025
Financial statements
Primary financial statements of the Group
88
| Consolidated statement of changes in equity | ||||||
| Currency translation | Invested unrestricted | Retained | ||||
MEUR | Share capital | differences | equity reserve | earnings | Total equity | Note |
Equity on 1 January 2024 | - | |||||
| Total comprehensive income | ||||||
Result for the period continuing operations | - | - | ||||
Result for the period discontinued operations | ||||||
Other comprehensive income items continuing operations | - | - | - | |||
Other comprehensive income items discontinued operations | - | - | ||||
Total comprehensive income | - | - | - | |||
| Transactions with shareholders | ||||||
Share-based benefits | 1.5 | |||||
Dividends paid | - | - | ||||
Returned dividends | ||||||
Transactions with shareholders, total | - | - | ||||
Equity on 31 December 2024 | - | |||||
Equity on 1 January 2025 | - | |||||
| Total comprehensive income | ||||||
Result for the period continuing operations | ||||||
Result for the period discontinued operations | ||||||
Other comprehensive income items continuing operations | ||||||
Other comprehensive income items discontinued operations | ||||||
Total comprehensive income | ||||||
| Transactions with shareholders | ||||||
Reduction of share capital | - | |||||
Share-based benefits | 1.5 | |||||
Dividends paid | - | - | ||||
Returned dividends | ||||||
Assets transferred in the partial demerger at fair value | - | - | ||||
Other effects of the partial demerger. | - | |||||
Transactions with shareholders, total | - | - | - | - | ||
Equity on 31 December 2025 | - |
Based on the resolution of the Extraordinary General Meeting, Luotea Plc reduced its share capital to EUR 1,000,000 and subsequently recognised a distribution liability at fair value for the business to be transferred to
Lassila & Tikanoja. At the demerger date, the liability was recognised in profit or loss, offsetting the income statement impact of the net assets leaving the Group. In connection with the demerger, the reserve for invest-
ed unrestricted equity was partly dissolved, and entries relating to former option programmes were reclassified to retained earnings. In accordance with the demerger plan, the company’s share capital was further
reduced by EUR 18,399 thousand and transferred to the reserve for invested unrestricted equity. The partial demerger was accounted for as a transaction with owners under IFRIC 17. The demerger gain, calculated as
the difference between the fair value of the circular economy business and the carrying amount of the net assets distributed, is presented in the profit or loss of discontinued operations.
Annual report 2025
Financial statements Notes to the consolidated financial statements
89
Notes to the consolidated financial statements
Annual report 2025
Financial statements Notes to the consolidated financial statements
90
Critical judgements by Management
Annual report 2025
Financial statements Notes to the consolidated financial statements
91
1 Financial result
1.1 Segment reporting . . . . . . . . . . . . . . . . . . . . . . . . . . 92
1.2 Revenue from contracts with customers . . . 94
1.3 Other operating income . . . . . . . . . . . . . . . . . . . . 95
1.4 Materials and services . . . . . . . . . . . . . . . . . . . . . . 96
1.5 Employee benefit expenses . . . . . . . . . . . . . . . . . 96
1.6 Other operating expenses . . . . . . . . . . . . . . . . . . 96
1.7 Share-based payments. . . . . . . . . . . . . . . . . . . . . 97
1.8 Expenses related to leases . . . . . . . . . . . . . . . . . 99
1.9 Depreciation, amortisation, impairments . . 99
1.10 Financial income and expenses . . . . . . . . . . . 100
1.11 Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
Annual report 2025
Financial statements Notes to the consolidated financial statements
92
1.1 Segment Reporting
Accounting policy
The Group’s operating segments
The Group has two reportable segments within continuing operations, which corre-
spond to the Group’s business units:
• Facility Services Finland and
• Facility Services Sweden
In addition to these business segments, Group Administration and other general
administrative items are reported separately.
The Facility Services Finland segment provides cleaning and other support
services for properties, as well as property maintenance and technical services,
including energy management services.
The Facility Services Sweden business area provides cleaning and support ser-
vices for properties, as well as technical property services.
The circular economy business, which was transferred to the new Lassila
& Tikanoja on 31 December 2025 through a partial demerger, is classified as dis-
continued operations and is therefore not presented as part of segment reporting in
2025.
The information on discontinued operations is presented in Note 6 Discontinued
Operations.
2025 MEUR
Facility Services
Finland
Facility Services
Sweden
Group
administration
and other Group
External net sales 224 121.9 - 346.0
Inter-division net sales 0.4 0.0 -0.4 -
Total net sales 224.4 121.9 -0.4 346
Other operating income - - - 0.8
Materials and services 42.6 56.7 - 99.3
Employee benefit expenses 138.9 58.3 4.3 201.6
Other operating expenses 27.3 7.3 -3.5 31.1
EBITDA 16.2 -0.3 -1.2
Adjusted EBITDA ed EBITDA 1 17.6 1.1 -1.4
Adjusted EBITA A 1 12.6 -2.7 -2.9
Depreciation, amortisation and impairments 5.2 5.1 1.6 11.8
Operating profit 11.1 -5.3 -2.7 3.0
Adjusted operating profit ofit¹ 12.4 -3.9 -2.9
Operating profit-% 4.9 -4.4 - 0.9
Adjusted operating profit-% ofit-%1 5.5 -3.2 -
Financial income and expenses - - - -0.7
Profit before tax - - - 2.3
Income taxes - - - -1.1
Profit for the period - - - 1.2
Capital employed 12.1 31.0 17.8 60.9
Return on capital employed (ROCE) 80.2 -17.2 77.8
Gross capital expenditure xpenditure¹ 0.9 0.1 0.3 1.3
Annual report 2025
Financial statements Notes to the consolidated financial statements
93
2024 MEUR
Facility Services
Finland
Facility Services
Sweden
Group
administration
and other Group
External net sales 237.6 111.9 - 349.5
Inter-division net sales 0.4 0.0 -0.4 -
Total net sales 238 111.9 -0.4 349.5
Other operating income - - - 2.0
Materials and services 52.5 53.3 - 105.8
Employee benefit expenses 142.5 54.3 4.8 201.6
Other operating expenses 27.5 12.5 0.4 40.5
EBITDA 16.2 -7.0 -5.6
Adjusted EBITDA ed EBITDA1 16.4 -2.8 -1.8
Adjusted EBITA A 1 9.9 -6.3 -2.4
Depreciation, amortisation and impairmentst
2
6.8 28.1 0.5 35.4
Operating profit 9.4 -35.1 -6.1 -31.8
Adjusted operating profit ofit¹ 9.6 -7.5 -2.4
Operating profit-% 3.9 -31.3 - -9.0
Adjusted operating profit-% ofit-%1 4.0 -6.7 -
Financial income and expenses - - - -0.8
Profit before tax - - - -32.6
Income taxes - - - 1.1
Profit for the period - - - -31.5
Capital employed 17.0 29.9 349.2 349.23 396.1 396.13
Return on capital employed (ROCE) 51.4 -77.9 3.3
Gross capital expenditure xpenditure¹ 1.1 0.1 0.1 1.4
Geographical segments
Accounting policy
MEUR 2025 2024
Net sales
Finland 223.9 237.6
Sweden 122.0 111.9
Other countries 0.1 0.1
Total 346.0 349.5
Finland 88.4 561.3
Sweden 53.6 46.6
Total 142.0 607.9
Capital expenditure
Finland 1.2 1.3
Sweden 0.1 0.1
Total 1.3 1.4
Annual report 2025
Financial statements Notes to the consolidated financial statements
94
Annual report 2025
Financial statements Notes to the consolidated financial statements
95
Annual report 2025
Financial statements Notes to the consolidated financial statements
96
Annual report 2025
Financial statements Notes to the consolidated financial statements
97
Annual report 2025
Financial statements Notes to the consolidated financial statements
98
Annual report 2025
Financial statements Notes to the consolidated financial statements
Annual report 2025
Financial statements Notes to the consolidated financial statements
Annual report 2025
Financial statements Notes to the consolidated financial statements
101
Tax effects of components of other comprehensive income
2025 2024
MEUR Before tax
Tax expense/
benefit After tax Before tax
Tax expense/
benefit After tax
Items arising from re-measurement of defined
benefit plans 0.0 -0.0 0.0 -0.0 0.0 -0.0
Currency translation differences, continuing
operations 1.2 - 1.2 -1.8 - -1.8
Currency translation differences, discontinued
operations 0.7 - 0.7 -0.3 - -0.3
Components of other comprehensive income 1.9 -0.0 1.9 -2.1 0.0 -2.1
Deferred tax assets and liabilities
MEUR 1 Jan 2025
Recognised
in income
statement
Recognised
in equity
Exchange
rate
differences
Business
acquisitions
Partial de-
merger 31 Dec 2025
MEUR 1 Jan 2024
Recognised
in income
statement
Recognised
in equity
Exchange
rate
differences
Business
acquisitions 31 Dec 2024
Annual report 2025
Financial statements Notes to the consolidated financial statements
102
2 Operational assets and liabilities
2.1 Trade and other receivables . . . . . . . . . . . . . . . . . . . . .103
2.2 Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .103
2.3 Trade and other current payables . . . . . . . . . . . . . . .104
2.4 Other non-current liabilities . . . . . . . . . . . . . . . . . . . . .104
2.5 Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .104
2.6 Retirement benefit obligations. . . . . . . . . . . . . . . . . . .105
Annual report 2025
Financial statements Notes to the consolidated financial statements
103
2.1 Trade and other receivables
Accounting policy
2.2 Inventories
MEUR 2025 2024
Raw materials and consumables - 4.2
Finished goods - 1.2
Other inventories - 3.8
Total - 9.2
An expense of EUR 0.1 million (0.0) was recognised to reduce the carrying amount of
inventories to their net realisable value. The expense is presented in the statement of
profit or loss for discontinued operations under Materials and services.
Maturity of trade receivables, contract assests and allowance for impairment
2025 2024
MEUR
Trade receivables
and contract
assets
of which the
allowance for
impairment
Trade receivables
and contract
assets
of which the
allowance for
impairment
Specification of accrued income
MEUR 2025 2024
Interest - -
Employees’ health care compensation 1.0 1.6
Licences 0.7 0.6
Other 4.0 4.5
Total 5.6 6.7
Annual report 2025
Financial statements Notes to the consolidated financial statements
104
2.4 Other non-current liabilities
MEUR 2025 2024
Advances received - 6.7
Deferred consideration - 5.9
Other liabilities - 0.8
Total - 13.4
The contingent consideration relates to the discontinued operations in Sweden and
to the acquisition of 70 percent of the shares in Sand & Vattenbläst i Tyringe AB
(“SVB”), a company providing industrial cleaning services, completed on 1 February
2022.
MEUR 2025 2024
Non-current provisions 0.0 9.0
Current provisions 1.8 2.5
Total 1.8 11.5
Provisions for onerous contracts
The provisions recognised for onerous contracts relate to fixed-price public sector
customer contracts in Facility Services Sweden, for which the future costs are,
according to management’s assessment, expected to exceed the anticipated rev-
enues. The provisions recognised for onerous contracts were reversed during the
2025 financial year..
Other provisions
Other provisions consist mainly of provisions for restructuring and accident
insurance contribution as well as restoration provisions for leased premises.
Obligations covered by the environmental provisions
Environmental provisions amounting to EUR 6.3 million were transferred to the new
Lassila & Tikanoja in connection with the partial demerger.
Annual report 2025
Financial statements Notes to the consolidated financial statements
105
MEUR 2025 2024
Amounts recognised in the statement of financial
position
Present value of funded obligations 0.3 0.3
Fair value of plan assets -0.3 -0.3
0.0 0.0
Present value of unfunded obligations 0.5 0.5
Liability related to pension deposits 0.4 0.6
Closing net liability 0.9 1.1
Changes in present value of obligation
Opening defined benefit obligation 1.4 1.4
Interest cost 0.0 0.0
Actuarial gain (-) and loss (+) on obligation -0.0 0.0
Benefits paid -0.1 -0.1
Change in liability related to pension deposits -0.1 -0.1
Effect of demerger -0.1 -
Closing value of obligation 1.1 1.4
Changes in fair value of plan assets
Opening fair value of plan assets 0.3 0.3
Interest income 0.0 0.0
Actuarial gain (+) and loss (-) 0.0 0.0
Benefits paid -0.0 -0.0
Closing fair value of plan assets 0.3 0.3
MEUR
Environ-
mental
provisions
Onerous
contracts
Other
provisions Tota l
Provisions at 1 Jan 2025 6.3 3.3 1.9 11.5
Additions 0.5 - 1.8 2.4
Used during the year -0.4 -0.3 -1.3 -1.9
Reversals of unused provi-
sions - -2.9 -0.5 -3.4
Effect of discounting -0.1 -0.2 0.0 -0.3
Effect of exchange rate chan-
ges - 0.1 0.0 0.1
Effect of demerger -6.3 - -0.3 -6.6
Provisions at 31 Dec 2025 - - 1.8 1.8
MEUR
Environ-
mental
provisions
Onerous
contracts
Other
provisions Tota l
Provisions at 1 Jan 2024 7.2 - 0.9 8.1
Additions 0.6 3.3 1.2 5.1
Used during the year -0.4 - -0.2 -0.6
Reversals of unused provi-
sions - - - -
Effect of discounting -1.0 - - -1.0
Provisions at 31 Dec 2024 6.3 3.3 1.9 11.5
Annual report 2025
Financial statements Notes to the consolidated financial statements
106
MEUR 2025 2024
Movements in the liability recognised in the statement 1.1 1.2
Opening liability 0.0 0.0
Expense recognised in the income statement 0.0 0.0
Actuarial gain (-) and loss (+) -0.0 0.0
Contributions paid -0.0 -0.0
Change in liability related to pension deposits -0.1 -0.1
Effect of demerger -0.1 -
Closing liability 0.9 1.1
Amounts recognised in the statement comprehensive
income
Service cost for the financial year 0.0 0.0
Interest cost 0.0 0.0
Interest income -0.0 -0.0
Actuarial gain (-) and loss (+) -0.0 0.0
Total 0.0 0.0
The Group estimates that it will contribute EUR 36 thousand to defined benefit
plans in 2026.
MEUR 2025 2024
Present value of obligation 1.1 1.4
Fair value of plan assets -0.3 -0.3
Deficit 0.9 1.1
Principal actuarial assumptions used, %
Discount rate 3.5 3.1
Expected rate of return on plan assets 3.2 3.1
Expected rate of salary increase 2.2 2.1
Expected rate of inflation 2.0 1.9
Defined contribution maturity of the obligation
MEUR 2025 2024
Maturity of less than one year 0.1 0.1
1-5 years 0.3 0.3
5-10 years 0.3 0.3
10-15 years 0.2 0.2
15-20 years 0.1 0.1
20-25 years 0.1 0.1
25-30 years 0.1 0.1
over 30 years 0.1 0.1
Total 1.1 1.1
Annual report 2025
Financial statements Notes to the consolidated financial statements
107
3 Intangible and tangible assets
and other non-current assets
3.1 Goodwill and other intangible assets . . . . . . . . . . . . . . . . . . . . . . . 108
3.2 Goodwill impairment testing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
3.3 Tangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
3.4 Right-of-use assets and lease liabilities . . . . . . . . . . . . . . . . . . . . . 111
3.5 Other non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112
Annual report 2025
Financial statements Notes to the consolidated financial statements
108
3.1 Goodwill and other intangible
assets
MEUR Goodwill
Customer
relationships
arising from
acquisitions
Agreements
on prohibition
of competition
arising from
acquisitions
Other
intangible
assets arising
from
acquisitions
Intangible
rights
Other
intangible
assets
Prepayments
and
construction
in progress Tota l
Acquisition cost. 1 Jan 2025 170.7 59.1 1.4 10.0 9.8 20.8 20.9 292.6
Additions - - - - 0.0 0.1 2.6 2.7
Business acquisitions 6.4 4.9 0.2 - - - - 11.5
Disposals - - - - -0.1 -2.1 - -2.2
Effect of demerger ger 1 -125.7 -33.2 -0.3 -10.1 -1.1 -33.5 -1.7 -205.6
Transfers between items - - - - - 21.5 -21.5 -
Exchange differences 1.5 1.3 0.1 0.0 0.3 0.0 - 3.2
Accumulated depreciation. 1 Jan 2025 d depreciation. 1 Jan 2025 1 -13.6 -45.9 -1.4 -9.9 -7.8 -14.8 - -93.4
Accumulated amortisation on disposals
and transfers - - - - 0.0 2.1 - 2.1
Amortisation charge - -3.1 -0.0 -0.0 -0.6 -3.1 - -6.9
Effect of demerger - 20.7 0.1 10.0 0.4 10.1 - 41.3
Exchange differences -0.5 -1.0 -0.1 -0.0 -0.2 -0.0 - -1.8
Accumulated depreciation. 31 Dec 2025 -14.1 -29.2 -1.4 -0.0 -8.1 -5.7 - -58.6
Carrying amount at 31 Dec 2025 38.8 2.9 - - 0.8 1.0 0.2 43.6
Other intangible assets arising from business combinations consist mainly of environmental permits. which were transferred to the new Lassila & Tikanoja in the partial demerger.
Other intangible assets consist mainly of software and software licences.
MEUR Goodwill
Customer
relationships
arising from
acquisitions
Agreements
on prohibition
of competition
arising from
acquisitions
Other
intangible
assets arising
from
acquisitions
Intangible
rights
Other
intangible
assets
Prepayments
and
construction
in progress Tot al
Acquisition cost. 1 Jan 2024 194.7 59.1 1.5 10.1 9.8 18.4 14.6 308.2
Additions - - - - 0.1 0.0 9.5 9.7
Business acquisitions 0.8 0.7 0.0 - - - - 1.5
Disposals - - - - -0.0 -0.9 - -1.0
Impairments -23.3 - - - - - - -23.3
Transfers between items - - - - - 3.3 -3.3 -
Exchange differences -1.6 -0.7 -0.0 -0.0 -0.1 -0.0 - -2.5
Acquisition cost. 31 Dec 2024 170.7 59.1 1.4 10.0 9.8 20.8 20.9 292.6
Accumulated depreciation. 1 Jan 2024 -13.9 -43.1 -1.4 -9.8 -7.2 -13.8 - -89.2
Accumulated amortisation on disposals
and transfers - - - - 0.0 0.9 - 1.0
Amortisation charge - -3.3 -0.0 -0.1 -0.6 -2.0 - -6.0
Exchange differences 0.3 0.5 0.0 0.0 0.1 0.0 - 0.9
Accumulated depreciation. 31 Dec 2024 -13.6 -45.9 -1.4 -9.9 -7.8 -14.8 - -93.4
Carrying amount at 31 Dec 2024 157.0 13.2 0.0 0.2 2.0 5.9 20.9 199.2
Annual report 2025
Financial statements Notes to the consolidated financial statements
109
3.2 Goodwill impairment testing
Goodwill allocation
The carrying amounts of goodwill are allocated to cash-generating units in
accordance with the table below:
MEUR 2025 2024
Facility Services, Finland 28.6 28.6
Facility Services, Sweden 10.2 9.6
Yhteensä 38.8 38.2
Goodwill Impairment testing in 2025
The impairment testing has been performed using value-in-use calculations in
which future cash flows are discounted to their present value. A terminal growth rate
of 2.0 percent has been applied in the cash-generating units, corresponding to the
European Central Bank’s medium-term inflation target. The same terminal growth
assumption is used for all cash-generating units due to the uniform nature of the
business area. The discount rate used in the calculations is based on the Group’s
weighted average cost of capital (WACC). The components of the WACC include
the risk-free interest rate, market risk premium, company-specific beta, cost of debt,
and the proportion of equity and debt. A specific discount rate has been determined
for each cash-generating unit.
Key assumptions used in the calculations
% 2025 2024
Discount rate pre tax, Facility Services, Finland 8.2 8.8
Discount rate pre tax, Facility Services, Sweden 8.0 8.8
Revenue growth assumption for the review period, Finland 5.4 3.6
Revenue growth assumption for the review period, Sweden 1.0 3.9
Terminal revenue growth assumption, Finland 2.0 2.0
Terminal revenue growth assumption, Sweden 2.0 2.0
EBITDA % during the review period, Facility Services Finland 9.6 8.4
EBITDA % during the review period,
Facility Services Sweden 6.5 5.2
The loss for Facility Services Sweden in 2025 decreased as expected. The 2024
result was weaker than anticipated, and the value in use calculated in the impair-
ment testing for Facility Services Sweden amounted to EUR 22 million, which was
below the carrying amount of the assets tested. As a result, an impairment loss of
EUR 23 million was recognised on the goodwill allocated to Facility Services Sweden
for 2024. The impairment loss is presented in the consolidated statement of profit or
loss under Goodwill impairment.
Sensitivity analyses of impairment testing
A sensitivity analysis was performed for each cash-generating unit, in which the key
assumptions used in the calculations were tested. The assumptions tested included
the discount rate and the EBITDA margin applied in the terminal value calculation,
determined based on historical performance.
In the sensitivity analysis, the threshold levels at which the value in use equals the
carrying amount were calculated by varying one key assumption at a time.
Significant changes in future growth, revenue development or EBITDA margin could
lead to a reduction in goodwill. Management does not consider this scenario likely.
Annual report 2025
Financial statements Notes to the consolidated financial statements
110
MEUR Land Buildings
Machinery and
equipmen Other
Prepayments
and
construction
in progress Tota l
Acquisition cost. 1 Jan 2025 7.7 152.6 423.4 0.4 8.0 592.2
Additions 0.0 1.1 9.1 0.0 12.0 22.2
Business acquisitions - - 1.0 0.0 - 1.0
Disposals - -1.3 -17.4 0.8 - -18.0
Effect of demerger -7.6 -135.6 -320.0 -1.1 -12.5 -476.8
Transfers between items - 3.7 3.7 - -7.4 0.0
Exchange differences - 0.0 0.6 0.0 0.0 0.7
Acquisition cost. 31 Dec 2025 0.1 20.5 100.3 0.1 0.1 121.2
Accumulated depreciation. 1 Jan 2025 - -116.5 -311.2 -0.2 - -427.9
Depreciation for the period - -5.4 -21.7 -0.0 - -27.2
Accumulated depreciation on disposals and transfers - 1.1 16.4 -0.8 - 16.7
Effect of demerger 0.0 101.0 221.7 0.9 0.0 323.7
Exchange differences - -0.0 -0.2 -0.0 - -0.3
Accumulated depreciation. 31 Dec 2025 - -19.9 -95.0 -0.1 - -114.9
Carrying amount at 31 Dec 2025 0.1 0.7 5.3 0.0 0.1 6.3
Contractual commitments for the acquisition of property. plant and equipment amounted to EUR 1.6 million (0.0).
MEUR Land Buildings
Machinery and
equipmen Other
Prepayments
and
construction
in progress Tota l
Acquisition cost. 1 Jan 2024 7.7 146.1 416.4 0.3 16.0 586.5
Additions 0.0 0.7 10.4 0.0 18.6 29.7
Business acquisitions - - 0.3 0.0 - 0.4
Disposals - -3.7 -20.4 - -0.1 -24.1
Transfers between items - 9.5 16.9 - -26.4 0.0
Exchange differences - -0.0 -0.3 -0.0 -0.0 -0.3
Acquisition cost. 31 Dec 2024 7.7 152.6 423.4 0.4 8.0 592.2
Accumulated depreciation. 1 Jan 2024 - -113.8 -307.7 -0.1 - -421.7
Accumulated depreciation on disposals and transfers - 2.6 19.9 - - 22.5
Depreciation for the period - -5.4 -23.4 -0.0 - -28.8
Exchange differences - 0.0 0.1 0.0 - 0.1
Accumulated depreciation. 31 Dec 2024 - -116.5 -311.2 -0.2 - -427.9
Carrying amount at 31 Dec 2024 7.7 36.1 112.3 0.2 8.0 164.3
Annual report 2025
Financial statements Notes to the consolidated financial statements
111
MEUR Land Buildings
Machi-
nery and
equipment Total
Acquisition cost, 1 Jan 2025 13.6 68.7 70.1 152.5
Additions 1.0 17.0 11.7 29.6
Business acquisitions 0.0 0.9 0.0 1.0
Disposals -0.3 -17.6 -11.2 -29.2
Effect of demerger -11.7 -42.6 -49.0 -103.2
Exchange differences - 0.6 0.8 1.4
Acquisition cost, 31 Dec 2025 2.6 27.0 22.5 52.1
Accumulated depreciation, 1 Jan
2025 -5.1 -38.8 -39.4 -83.3
Accumulated depreciation on
disposals and transfers 0.1 14.1 9.4 23.7
Effect of demerger 3.3 16.4 22.7 42.5
Depreciation for the period -0.9 -10.0 -8.4 -19.3
Exchange differences - -0.4 -0.6 -1.0
Accumulated depreciation, 1 Jan
2025 -2.6 -18.7 -16.2 -37.5
Carrying amount at 31 Dec 2025 0.0 8.4 6.2 14.6
MEUR Land Buildings
Machi-
nery and
equipment Total
Acquisition cost, 1 Jan 2024 15.1 59.2 81.7 155.9
Additions 0.4 16.0 3.5 19.9
Business acquisitions - 0.1 0.0 0.1
Disposals -1.8 -6.3 -14.7 -22.8
Exchange differences - -0.3 -0.4 -0.7
Acquisition cost, 31 Dec 2024 13.6 68.7 70.1 152.5
Accumulated depreciation, 1 Jan
2024 -4.5 -33.6 -41.8 -79.9
Accumulated depreciation on
disposals and transfers 0.4 4.9 11.9 17.2
Depreciation for the period -1.0 -10.3 -9.8 -21.1
Exchange differences - 0.1 0.3 0.4
Accumulated depreciation, 1 Jan
2024 -5.1 -38.8 -39.4 -83.3
Carrying amount at 31 Dec 2024 8.5 29.9 30.8 69.1
At the reporting date, no new lease contracts are known to enter into force in future
financial periods that would have a material impact on the amount of right-of-use
assets or lease liabilities.
Lease liabilities and their maturities are presented in Notes 4.1 Financial assets and
liabilities and 4.2 Financial risk management.
Further information on lease-related expenses is provided in Note 1.8 Lease-related
expenses.
Annual report 2025
Financial statements Notes to the consolidated financial statements
112
Annual report 2025
Financial statements Notes to the consolidated financial statements
113
4 Financial risks and capital structure
4.1 Financial assets and liabilities . . . . . . . . . . . . . . . . . . . . . . 114
4.2 Financial risk management . . . . . . . . . . . . . . . . . . . . . . . . . 116
4.3 Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118
4.4 Earnings per share and dividend per share . . . . . . . . . . 119
4.5 Commitments and contingent liabilities . . . . . . . . . . . . . 119
Annual report 2025
Financial statements Notes to the consolidated financial statements
114
4.1 Financial assets and liabilities
Annual report 2025
Financial statements Notes to the consolidated financial statements
115
The increase during 2025 relates to the acquisition of RecondConcept i Ånge AB
in December 2025. In connection with the transaction, Luotea recognised a contin-
gent consideration (earn-out) of EUR 1.1 million in non-current liabilities. The contin-
gent consideration is measured at fair value, which is based on the development of
RecondConcept i Ånge AB’s EBITDA in 2026 and 2027.
RecondConcept i Ånge AB and the related assets and liabilities were transferred to
Lassila & Tikanoja in the partial demerger.
Annual report 2025
Financial statements Notes to the consolidated financial statements
116
Annual report 2025
Financial statements Notes to the consolidated financial statements
117
Annual report 2025
Financial statements Notes to the consolidated financial statements
118
Sensitivity to interest rate risks arising
from financial instruments
Capital management
The objective of the Group’s capital management is to ensure the continuity of oper-
ations and to maintain an optimal capital structure in order to support investments,
taking capital costs into account. Capital is defined as equity and interest-bearing
liabilities, less advances received. The Company’s objective is to distribute at least
50% of the profit for the financial year as dividends. The development of the capital
structure is monitored quarterly using the equity ratio and the net gearing ratio.
MEUR 2025 2024
Equity in the consolidated statement of financial position 41.1 209.2
Equity and liabilities tota 142.0 607.9
Current advances received -1.0 -10.5
Non-current advances received - -6.7
Total 141.0 590.7
Equity ratio, % 29.1 35.4
MEUR 2025 2024
Equity in the consolidated statement of financial position 41.1 209.2
Non-current financial liabilities 13.8 168.3
Current financial liabilities 6.0 18.6
Cash and cash equivalents -15.7 -33.9
Net interest-bearing liabilities 4.1 153.0
Gearing, % 10.1 73.2
Annual report 2025
Financial statements Notes to the consolidated financial statements
119
4.4 Earnings per share and dividend
per share
2025 2024
Result attributable to equity holders of the company, MEUR y, MEUR¹ 1.2 -31.5
Adjusted weighted average number of ordinary shares
outstanding during the year, million shares 38.2 38.2
Earnings per share, EUR, continuing operations erations ¹ 0.03 -0.82
Earnings per share, diluted, EUR, continuing operations ations 1 0.03 -0.82
Earnings per share, EUR, discontinued operations ued operations ¹ 4.20 0.78
Earnings per share, diluted, EUR, discontinued operations tinued operations 1 4.20 0.78
Earnings per share, EUR, total al ¹ 4.23 -0.05
Earnings per share, diluted, EUR, total al 1 4.23 -0.05
Dilution effect of the share-based incentive plan, million
shares 0.1 0.1
Weighted average number of diluted shares outstanding
during the period, million shares 38.2 38.3
Earnings per share, EUR, UR, ¹ 0.03 -0.82
4.5 Commitments and contingent
liabilities
The Group company Luotea FM AB (formerly Lassila & Tikanoja FM AB) is both
plaintiff and defendant in legal proceedings in Sweden concerning unpaid receiva-
bles invoiced from a former customer of the Group.
In June 2022, Luotea FM AB filed a lawsuit in the Solna District Court against the
former customer company, demanding payment of the outstanding receivables.
A full impairment has been recognised for the receivables as at the end of the
2025 financial year. The former customer has disputed Luotea FM AB’s claims and
its payment obligation, and has simultaneously filed a counterclaim demanding
approximately SEK 144 million from Luotea FM AB. The dispute is still ongoing.
Luotea considers the counterclaim to be unfounded and has not recognised any
provision in respect of it.
In addition to the dispute mentioned above, Luotea Plc is a party to a few other
disputes related to the Group’s ordinary business operations, the outcomes of which
are not expected to have a material impact on the Group’s financial position.
Annual report 2025
Financial statements Notes to the consolidated financial statements
120
5 Consolidation and other notes
5.1 Consolidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121
5.2 Group companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121
5.3 Business acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122
5.4 Related-party transactions . . . . . . . . . . . . . . . . . . . . . . . 123
5.5 Auditing costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123
5.6 Events after the balance sheet date . . . . . . . . . . . . . . 123
Annual report 2025
Financial statements Notes to the consolidated financial statements
121
Annual report 2025
Financial statements Notes to the consolidated financial statements
122
Business acquisitions 2025
All business acquisitions made in 2025 related to the circular economy business.
In the partial demerger, the balance sheet items related to these acquisitions were
transferred to Lassila & Tikanoja. Luotea Plc’s subsidiary L&T Ympäristöpalvelut Oy
acquired Stena Recycling Oy’s pallet business on 2 June 2025. The annual revenue
of the acquired business has been approximately EUR 10 million. The acquisition
strengthens the Group’s service offering in the circular economy business and sup-
ports its growth. Following the transaction, the Group’s pallet business employs
more than 30 people across four locations. In the fair value allocation, intangible
assets based on customer relationships amounting to EUR 3.7 million and good-
will amounting to EUR 3.4 million were identified. The goodwill is mainly attributable
to an expanded service network, a strengthened service offering and future growth
prospects. The goodwill is deductible for tax purposes.
Luotea Plc’s subsidiary L&T Teollisuuspalvelut Oy acquired the entire share cap-
ital of Viemärihuolto Reinikka Oy on 1 December 2025. In the fair value allocation,
intangible assets based on customer relationships amounting to EUR 0.9 million
and goodwill amounting to EUR 1.4 million were identified. The goodwill is primarily
attributable to an expanded service network, a strengthened service offering and
future growth prospects.
Luotea’s Swedish subsidiary Sand & Vattenbläst i Tyringe AB (SVB) acquired the
entire share capital of RecondConcept i Ånge AB, a provider of industrial cleaning
services in Sweden, on 1 December 2025. In the fair value allocation, intangible
assets based on customer relationships amounting to EUR 0.4 million and goodwill
amounting to EUR 1.6 million were identified. The goodwill is mainly attributable to
a strengthened service offering and future growth prospects. In connection with the
transaction, Luotea recognised a contingent consideration (earn-out) of EUR 1.1 mil-
lion in non-current liabilities. The contingent consideration is measured at fair value,
which is based on the development of RecondConcept i Ånge AB’s EBITDA in 2026
and 2027.
The business acquisitions completed during the financial year increased the
revenue of the Group’s discontinued operations by EUR 7.1 million and operating
profit by EUR 0.3 million. Had the acquisitions been completed on 1 January 2025,
the revenue of Luotea’s discontinued operations would have been approximately
EUR 434.7 million and operating profit approximately EUR 45.0 million. Transaction
costs of EUR 0.3 million (0.3) related to the acquired businesses were recorded in
other operating expenses of the discontinued operations for the financial year.
Fair value, MEUR 2025
Intangible assets 5.1
Property, plant and equipment 1.0
Right-of-use assets 1.0
Inventories 0.5
Receivables 0.6
Cash and cash equivalents 0.8
Total assets 9.0
Lease liabilities 0.9
Other liabilities 1.1
Deferred tax liabilities 0.3
Total liabilities 2.3
Net assets acquired 6.7
Total consideration 13.0
Goodwill 6.4
Impact on cash flow:
Total consideration -13.0
Contingent consideration (earn-out) 1.1
Consideration paid in cash -11.9
Cash and cash equivalents of the acquired company 0.8
Total impact on cash flow -11.1
The purchase price allocations for 2025 are still preliminary. The fair values of the
net assets of the acquisitions completed in December will be finalised during the
first half of 2026. Information on acquired companies and businesses that are not
material individually is presented in aggregate.
Net sales
Operating
profit
Continuing operations 2024 349.5 -31.8
Discontinued operations 2024 424.0 41.6
Group 770.7 9.8
Incl. acquired operations 770.8 9.8
Impact of acquired operations 0.1 0.0
Including the impact of discontinued operations
2024 424.1 41.6
Annual report 2025
Financial statements Notes to the consolidated financial statements
123
5.5 Auditing costs
MEUR 2025 2024
Auditing 0.2 0.3
Other assignments in accordance with the auditing act 0.3 0.0
Tax consulting services 0.1 0.0
Other services 0.7 0.1
Total 1.2 0.5
Other services provided by the statutory auditor, PricewaterhouseCoopers Oy,
amounted to EUR 755 thousand in the 2025 financial year (EUR 178 thousand in
the 2024 financial year).
5.6 Events after the balance sheet
date
On 13 January 2026, the Company announced that the Shareholders’ Nomination
Board will propose to the Annual General Meeting to be held on 29 April 2026 that
the Board of Directors consist of six (6) members. The Nomination Board proposes
that all current members of the Board—Johan Mild, Pasi Tolppanen, Anna-Maria
Ronkainen, Juuso Maijala, Timo Karppinen and Soile Kankaanpää—be re-elected.
The Nomination Board also proposes that Johan Mild continue as Chair of the
Board and Pasi Tolppanen as Vice Chair. All candidates have given their consent to
the election and are independent of the Company and its significant shareholders.
The Shareholders’ Nomination Board consists of representatives appointed by the
Company’s three largest shareholders as well as the Chair of the Board of Directors
of Luotea Plc. The members of the Shareholders’ Nomination Board were Miikka
Maijala, Chair (shareholder group), Juhani Lassila (Evald ja Hilda Nissin Säätiö),
Dag Marius Nereng (Protector Forsikring ASA) and Johan Mild (Chair of the Board
of Directors of Luotea Plc).
On 9 February 2026, the Company announced that Luotea has appointed Hanna
Inget (M.Sc. Econ.) as the Company’s Chief Commercial Officer and a member of
the Executive Management Team. She will assume her position on 1 March 2026.
Inget will be responsible for Luotea’s growth, commercial operations and the devel-
opment of customer experience.
Annual report 2025
Financial statements Notes to the consolidated financial statements
124
6 Discontinued operations
Annual report 2025
Financial statements Notes to the consolidated financial statements
125
Annual Report 2025
Financial statements
Financial statements of the parent company
126
Financial statements of the
parent company
Income statement . . . . . . . . . . . . . . . . . . . . . . . 127
Balance sheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
Cash flow statement . . . . . . . . . . . . . . . . . . . . . 128
Accounting policies . . . . . . . . . . . . . . . . . . . . . . 128
Notes to the financial statements . . . . . . . . 130
Annual Report 2025
Financial statements
Financial statements of the parent company
127
Income statement of
the parent company
EUR thousand 2025 2024 Note
Net sales 23,163 23,633 1
Other operating income 4,268 2,864 4
Employee benefit expenses -11,077 -10,494 2
Other operating expenses -23,450 -18,121 3,4
Depreciation, amortisation and impairment -929 -767
Operating result -8,025 -2,884
Financial income and expenses -1,075 -19,462 5
Result before appropriations and taxes -9,100 -22,346
Appropriations 6
Increase/decrease in accumulated
depreciation difference -26 -58
Group contribution 9,950 35,281
9,924 35,223
Income taxes -140 -5,265 7
Result for the period -684 7,612
Balance sheet of the parent company
EUR thousand 2025 2024 Note
ASSETS
Non-current assets
Intangible assets 8
Intangible rights - 2
Other intangible assets 623 2,382
Advance payments and construction
in progress 215 244
838 2,628
Tangible assets 9
Buildings and constructions - 124
Machinery and equipment 87 44
Other tangible assets - 42
Prepayments and assets under construction 26 -
113 210
Investments 10
Shares in group companies 38,430 125,696
Shares in joint venture - 9,947
Other shares and holdings 6 106
38,436 135,749
Total non-current assets 39,388 138,587
Current assets
Non-current receivables
Loan receivables from group companies - 2,225
Prepaid expenses and accrued income - 237
Other non-current receivables - 60
Deferred tax assets 70 86 12
70 2,607
Current receivables
Receivables from group companies 21,970 53,588 11
Trade receivables 2 -
Other receivables 7,108 267
Prepaid expenses and accrued income 1,281 819 11
30,361 54,674
Cash and cash equivalents 15,679 32,014
Total current assets 46,110 89,295
Total assets 85,498 227,881
EUR thousand 2025 2024 Note
SHAREHOLDERS’ EQUITY AND LIABILITIES
Shareholders’ equity 13
Share capital 1,000 19,399
Invested non-restricted equity reserve 80 727
Retained earnings 13,583 32,038
Profit for the period 684 7,612
15,346 59,776
Accumulated appropriations
Depreciation difference 126 238
Obligatory provisions 14
Non-current 231 249
Current 0 21
232 270
Liabilities 15
Non-current
Loans from credit intitutions 5,000 40,000
Bonds - 75,000
5,000 115,000
Current
Trade payables 8,360 3,215
Liabilities to group companies 55,125 43,871
Other liabilities 514 714
Accrued expenses and deferred income 795 4,799
64,794 52,597
Total liabilities 69,794 167,597
Total shareholders’ equity and liabilities 85,498 227,881
Annual Report 2025
Financial statements
Financial statements of the parent company
128
Cash flow statement of
the parent company
EUR thousand 2025 2024
Operating activities
Profit (+) / loss (-) before appropriations and taxes -9,100 -22,346
Adjustments:
Depreciation, amortisation and impairments 929 767
Gains and losses on sales of non-current assets 32 -2
Financial income and expenses 1,075 -13,763
Impairment of investments held as non-current
assets - 33,226
Provisions -11 -29
Merger gain - -2,661
Other adjustments - 117
Cash flow before change in working capital and
change in cash pool account balance -7,075 -4,692
Change in working capital
Increase/decrease in current non-interest-bearing
receivables -7,774 241
Increase/decrease in current non-interest-bearing
liabilities 6,820 1,611
Change in net working capital -954 1,851
Change in cash pool account balance 2,839 -12,223
Interest expenses and other financial expenses paid -8,114 -6,097
Interest received from operations 3,127 2,788
Direct taxes paid -999 -4,588
Cash flow from operating activities -11,176 -22,961
Investing activities
Increase in loan receivables from subsidiaries 1,762 -1,498
Proceeds from sale of other shares - 65
Investments in subsidiaries and associated compa-
nies and Acquired businesses -1,809 -
Investments in tangible and intangible assets -1,014 -532
Proceeds from sale of tangible and intangible assets - 2
Received dividends 1,586 17,019
Cash flow from investing activities 2,999 15,056
EUR thousand 2025 2024
Financing activities
Paid group contributions - -3,358
Received group contributions 35,281 31,526
Proceeds from short-term borrowings 30,000 60,000
Repayments of short-term borrowings -30,000 -60,000
Proceeds from long-term borrowings 55,000 -
Repayments of long-term borrowings -40,000 -
Dividends paid -19,078 -18,686
Cash flow from financing activities 31,203 9,482
Cash and cash equivalents transferred in the partial de-
merger -33,363
Change in cash and cash equivalents -16,335 1,576
Cash and cash equivalents at 1 January 32,013 30,437
Cash and cash equivalents at 31 December 15,679 32,014
The impairments relate to shares of a Swedish subsidiary.
Accounting
policies of the
parent company
Basis of preparation
Luotea Plc is the parent company of the Luotea Group and is domiciled in Helsinki.
The Company provides centralised administrative services to Group companies.
The financial statements of Luotea Plc have been prepared in accordance with
the Finnish Accounting Act (FAS). The financial statements are presented in euros,
and the items have been measured at historical cost unless otherwise stated in
the exceptions to the accounting principles guiding the timing of recognition as at
31 December 2025. In its separate financial statements, Luotea Plc applies, where
applicable, the accounting policies based on the IFRS standards applied in the
Luotea Group. The accounting policies of the consolidated financial statements
are presented in the notes to the consolidated financial statements. The following
sections present the accounting principles applied by Luotea Plc that differ from the
Group’s accounting principles.
Subsidiary shares
Subsidiary shares are recognised in the balance sheet at their original acquisition
cost less impairment losses. The carrying amounts of subsidiary shares are reviewed
as part of the Group’s impairment testing, in which cash flow forecasts based on
value-in-use calculations are prepared for the Group’s cash-generating units.
In the impairment testing of subsidiary shares, the cash flows are further allocated
to the recoverable amounts of the subsidiaries. An impairment loss is recognised
if the combined amount of the carrying value of the subsidiary shares and the
net loan receivables from the subsidiary exceeds the recoverable amount of the
corresponding asset.
Interests in joint ventures and other shares and
holdings
Interests in joint ventures and other shares and holdings are recognised in the
balance sheet at their original acquisition cost less impairment losses.
Loans from financial institutions and bonds
Loans are recognised in the balance sheet at their original acquisition cost.
Transaction costs and other expenses directly attributable to obtaining the financing
are capitalised as prepayments and amortised as expenses on a straight line basis
over the loan period. Interest on loans is recognised as an expense in the financial
period to which it relates.
Share-based payments
Share based rewards settled in shares are recognised in equity as a deduction from
the acquisition cost of the Company’s own shares. Share based rewards related to
employee stock options that are settled in cash are recognised as an expense in
the income statement under employee benefit expenses and as a liability until the
payment is made.
Leases
Lease payments under lease agreements are recognised as an expense over the
lease term and are presented under other operating expenses. Leased assets and the
related liabilities are not recognised in the parent company’s balance sheet.
Research and development expenses
Research and development expenses are recognised as an expense in the financial
year in which they are incurred.
Provisions
Provisions presented in the balance sheet comprise items that are based on law or
represent obligations towards third parties arising from contracts or other binding
commitments, but which have not yet been realised. They relate to the current
or a previous financial year, their realisation is considered certain or probable at
the time the financial statements are prepared, but the exact amount and timing
are uncertain, and no corresponding income is certain or probable. Changes in
provisions are recognised in the income statement.
Annual Report 2025
Financial statements
Financial statements of the parent company
129
Pensions
Most of the Company’s pension arrangements are defined contribution plans,
under which the Company pays fixed contributions to insurance companies.
These contributions are recognised as an expense in the income statement in the
financial period to which the charge relates. The Company’s defined benefit pension
arrangements are limited in scope and relate to a small number of individuals.
Partial demerger
The circular economy business of Lassila & Tikanoja Plc was separated on 31
December 2025 through a partial demerger into an independent company, which
was named Lassila & Tikanoja Plc. At the same time, the former Lassila & Tikanoja
changed its name to Luotea Plc. In the partial demerger, the assets and liabilities
transferred to the new Lassila & Tikanoja were derecognised from the parent
company’s balance sheet at their carrying amounts as at 31 December 2025.
The difference between the assets and liabilities transferred was recognised as a
deduction in the Company’s equity. The impact of the partial demerger on the parent
company’s equity was EUR 26.0 million.
Annual Report 2025
Financial statements
Financial statements of the parent company
130
Notes to the financial statements of the parent company
1. Net sales
EUR thousand 2025 % 2024 %
Net sales
Administrative services, group com-
panies 23,163 100.0 23,633 100.0
Total 23,163 100.0 23,633 100.0
Net sales by market area
Finland 23,163 100.0 23,633 100.0
Total 23,163 100.0 23,633 100.0
2. Personnel and administrative bodies
2025 2024
Average number of personnel
Salaried employees 95 95
Total 95 95
EUR thousand 2025 2024
Personnel expenses
Salaries and bonuses 9,271 8,885
Pension expenditure 1,564 1,427
Other salary-related expenses 242 182
Total 11,077 10,494
Salaries, bonuses and pension benefits of the management are described in the note
5.4 Related-party transactions of the consolidated financial statements.
No loans were granted to the related parties of the Group Companies.
3. Auditor’s fees
EUR thousand 2025 2024
Auditing 60 59
Other assignments in accordance with
the auditing act 252 14
Tax consulting services 52 7
Other services 691 104
Total 1,055 184
4. Other operating income and
expenses
Includes EUR 4.2 million of income related to the partial demerger, received from
Lassila & Tikanoja Plc.
EUR thousand 2025 2024
Other operating income
Government grants 13 -
Merger gains - 2,661
Compensations received 187
Other operating income 4,255 16
Total 4,268 2,864
Other operating expenses
ICT costs 13,458 10,446
Travel costs 381 212
Vehicles and machinery 130 61
Rents and real estate costs 1,967 1,623
Expert fees 5,920 4,996
Voluntary social security costs 466 401
Other 1,127 383
Total 23,450 18,121
5. Financial income and expenses
EUR thousand 2025 2024
Interest and other financial income 4,879 19,806
Interest and other financial expenses -5,954 -6,043
Impairment of investments held as non-current assets - -33,226
Total financial income and expenses -1,075 -19,462
Financial income and expenses include:
Interest income
from group companies 2,626 2,149
from others 502 638
Dividend income
from group companies - 15,200
from joint ventures 1,586 1,818
from others - 0.1
Other financial income
from others - 0.2
Exchange gains
from others 166 -
Interest expenses
to group companies -784 -757
to others -4,430 -5,063
Exchange gains
to others -20
Other financial expenses
to others -720 -222
Impairments of shares in group companies - -33,226
Total -1,075 -19,462
1
The impairments relate to the shares of the Swedish subsidiary.
The figure consists mainly of the dividend from Laania Oy, which is no longer a joint venture
of Luotea as of 31 Dec 2025
Annual Report 2025
Financial statements
Financial statements of the parent company
131
6. Appropriations
EUR thousand 2025 2024
Increase/decrease in accumulated depreciation
difference
Intangible assets -36 -58
Tangible assets 10 -
-26 -58
Group contribution
Group contribution received 9,950 35,281
Total group contributions 9,950 35,281
Total appropriations 9,924 35,223
7. Income taxes
EUR thousand 2025 2024
Income taxes on operations for the financial year 157 5,275
Income taxes from previous financial years -25 -20
Change in deferred taxes 9 11
Total 140 5,265
8. Intangible assets
2025
EUR thousand
Intangible
rights
Other intangible
assets
Prepayments and
construction
in progress Total
Acquisition cost, 1 Jan 307 8,398 244 8,948
Additions - - 1,308 1,308
Disposals -33 -2,595 - -2,628
Transfers in the partial demerger -38 -2,421 -1,049 -3,508
Transfers between items - 288 -288 -
Acquisition cost, 31 Dec 236 3,670 215 4,121
Accumulated amortisation, 1 Jan -305 -6,016 - 6,321
Accumulated amortisation on disposals and transfers 32 2,566 -
Transfers in the partial demerger 38 1,160 - 1,198
Amortisation during the period -2 -756 - -758
Accumulated amortisation, 31 Dec -236 -3,047 - 3,282
Total carrying amount, 31 Dec - 623 215 838
Other intangible assets include several ICT projects.
2024
EUR thousand
Intangible
rights
Other intangible
assets
Prepayments and
construction
in progress Total
Acquisition cost, 1 Jan 307 7,614 1,365 9,286
Additions - - 402 402
Disposals - -74 0 - - 74 0
Transfers between items - 1,523 -1,523 -
Acquisition cost, 31 Dec 307 8,398 244 8,948
Accumulated amortisation, 1 Jan -291 -6,038 -6,329
Accumulated amortisation on disposals and transfers - 74 0 74 0
Amortisation during the period -13 -718 -731
Accumulated amortisation, 31 Dec -305 -6,016 -6,321
Total carrying amount, 31 Dec 2.4 2,382 244 2,628
Annual Report 2025
Financial statements
Financial statements of the parent company
132
9. Tangible assets
2025
EUR thousand
Buildings and
constructions
Machinery
and
equipment
Other tangible
assets
Prepayments
and assets under
construction
Tota l
Acquisition cost, 1 Jan 359 274 42 - 675
Additions - 181 - 199 381
Disposals -206 -213 -3 - -421
Transfers in the partial demerger - -127 -40 -173
Acquisition cost, 31 Dec 153 116 0 26 295
Accumulated depreciation 1 Jan -235 -230 - - -465
Accumulated depreciation on disposals and transfers 206 213 - - 419
Transfers in the partial demerger - 36 - - 36
Depreciation during the period -124 -47 - - -171
Accumulated depreciation, 31 Dec -153 -28 - - -181
Total carrying amount, 31 Dec - 87 0 26 113
2024
EUR thousand
Buildings and
constructions
Machinery
and
equipment
Other tangible
assets
Prepayments
and assets under
construction
Tota l
Acquisition cost, 1 Jan 359 289 42 - 690
Disposals - -15 - - -15
Acquisition cost, 31 Dec 359 274 42 - 675
Accumulated depreciation 1 Jan -214 -230 - - -444
Accumulated depreciation on disposals and transfers - 15 - - 15
Depreciation during the period -21 -15 - - -36
Accumulated depreciation, 31 Dec -235 -230 - - -465
Total carrying amount, 31 Dec 124 44 42 - 210
Annual Report 2025
Financial statements
Financial statements of the parent company
133
10. Investments
EUR thousand
Shares in
Group companies
Shares in
joint ventures
Other shares
and holdings Tota l
2025
Acquisition cost, 1 Jan 125,696 9,947 106 135,749
Additions 1,809 - - 1,809
Transfers in partial demerger -89,075 -9,947 -100 -99,122
Acquisition cost, 31 Dec 38,430 - 6 38,436
Total carrying amount, 31 Dec 38,430 0 6 38,436
2024
Acquisition cost, 1 Jan 159,085 9,947 171 169,200
Impairments -33,226 - - -33,226
Disposals -160 - -65 -225
Acquisition cost, 31 Dec 125,696 9,947 106 135,749
Total carrying amount, 31 Dec 125,696 9,947 106 135,749
The additions and impairments relate to the shares of the Swedish subsidiary
11. Short-term receivables
EUR thousand 2025 2024
From Group Companies
Cash pool receivables 10,319 18,307
Trade receivables 1,701 -
Group contribution receivable 9,950 35,281
Total 21,970 53,588
Other receivables 7,108
Prepaid expenses and accrued income
Employees’ health care compensation 9 29
Licences 690 605
Taxes 359 -
Other 223 184
Total 1,281 819
Includes EUR 6,933 thousand of receivables related to the partial demerger from
Lassila & Tikanoja Plc.
The financing of the Group companies is centralised to the parent company. The
intra-group financing between the parent company and the subsidiaries is conducted
on an arm’s length basis.
12. Deferred tax assets
EUR thousand 2025 2024
Unused depreciation 2 5
Obligatory provisions 46 54
Impairment of non-current assets 22 27
Total 70 86
Holding of shares
and votes, %
Holdings in group companies
Luotea Kiinteistöhuolto Oy, Helsinki
100.0
Luotea Kiinteistötekniikka Oy, Helsinki
100.0
Luotea Siivous Oy, Helsinki
100.0
Luotea Service Ab, Stockholm, Sweden
100.0
Luotea FM AB, Stockholm, Sweden
100.0
Annual Report 2025
Financial statements
Financial statements of the parent company
134
13. Shareholders’ equity
EUR thousand
2025 2024
Restricted equity
Share capital at 1 Jan 19,399 19,399
Reduction of share capital at 31 December -18,399
Restricted equity, total 1,000 19,399
Non-restricted equity
Reserve for invested unrestricted equity at 1 January 727 727
Effect of the demerger at 31 December -19,046
Transfer of share capital to the reserve for invested un-
restricted equity 18,399
Invested non-restricted equity reserve 31 Dec 80 727
Retained earnings at 1 Jan 39,650 50,608
Dividend distribution -19,099 -18,706
Expired dividends 15 19
Transfer of treasury shares - 117
Effect of the demerger at 31 December -6,983
Retained earnings at 31 Dec 13,583 32,038
Profit for the period 683 7,612
Non-restricted equity total 14,346 40,377
Shareholders’ equity at 31 Dec 15,346 59,776
Distributable funds
Retained earnings 13,583 32,038
Profit for the period 684 7,612
Invested non-restricted equity reserve 80 727
Total distributable funds 14,346 40,377
In connection with the demerger, share capital was reduced by EUR 18,399 thousand in
accordance with the demerger plan, and the reduction in share capital was transferred
to the reserve for invested unrestricted equity. The reserve for invested unrestricted equity
decreased by EUR 19,046 thousand as a result of the demerger, resulting in a net change of
EUR –647 thousand. In addition, retained earnings amounting to EUR 6,983 thousand were
transferred in the demerger
The Extraordinary General Meeting of 4 December 2025 resolved to reduce the share capital
and transfer the reduction to the reserve for invested unrestricted equity.
14. Obligatory provisions
EUR thousand 2025 2024
Pension liabilities 231 249
Restructuring provisions 0 21
Total 232 270
15. Liabilities
Repayments of non-current borrowings in coming years
EUR thousand 2026 2028
Loans from credit institutions - 5,000
EUR thousand 2025 2024
Short term liabilities to Group Companies
Trade payables - 20
Group company liabilities 54,956 43,468
Other liabilities - 219
Accrued expenses and deferred income 168 164
Total 55,125 43,871
Accrued expenses and deferred income
Personnel expenses 601 1,943
Interest expenses 8 2,189
Taxes 157 664
Other expenses 30 3
Total 795 4,799
16. Contingent liabilities
EUR thousand 2025 2024
For own commitments
Mortgages on rights of tenancy - 122
Lease liabilities
Maturity within 1 year 466 1,694
Maturity in subsequent years 953 506
Total 1,419 2,200
Guarantees For Group Companies 2,704 44,000
Guarantees on behalf of others 32,377
Guarantees For Joint Ventures - 16,500
Other bank guarantees 348 265
Mortgages under own control
Company mortgages - 210
Annual Report 2025
Financial statements
Proposal by the Board of Directors
135
The Auditor’s Note
We have today submitted our report on the audit conducted by us.
Helsinki on 8 April 2026
PricewaterhouseCoopers Oy
Samuli Perälä
APA
Proposal by the Board of Directors for distribution of profit
According to the financial statements, Luotea plc’s unrestricted
equity amounts to EUR 14,346,297.25 with the result for the period representing
EUR 683,830.79 of this total. There were no substantial changes in the financial position
of the company after the end of the period, and the solvency test referred to in Chapter
13, Section 2 of the Companies Act does not affect the amount
of distributable profits.
The Board of Directors proposes to the Annual General Meeting that a dividend of
EUR 0.07 per share be paid for the financial year 2025. The dividend is to be paid to
shareholders included in the company shareholder register maintained by Euroclear
Finland Oy on the record date, 4 May 2026. The Board proposes to the Annual General
Meeting that the dividend be paid on 11 May 2026. No dividend will be paid on the
Company’s own shares held by the Company on the dividend reconciliation date of 4
May 2026.
On the day the proposal for the distribution of profit was made, the number of shares
entitling to dividend was 38,211,724, which means
the total amount of the dividend would be EUR 2,674,820.68
To be retained and carried forward EUR 11,671,476.57
Total EUR 14,346,297.25
Statements of the Board of Directors and signatures to the Report of the Board of Directors and
the Financial Statements for the year 2025
The financial statements have been prepared in accordance with applicable accounting regulations and provide a true and fair view of the assets, liabilities, financial
position, and results of operations of both the company and the entities included in the consolidated financial statements. The report by the board of directors includes a fair
review of the development and performance of the business of the company and the entities included in the consolidated financial statements, along with a description of the
principal risks and uncertainties and other relevant information. The sustainability report included in the report by the board of directors has been prepared in
accordance with the requirements set forth in Chapter 7 of the accounting act as well as the article 8 of the taxonomy regulation.
Helsinki on 7 April 2026
Johan Mild Pasi Tolppanen Timo Karppinen
Soile Kankaanpää Juuso Maijala Anna-Maria Ronkainen
Antti Niitynpää
President and CEO
Annual Report 2025
Auditor*s Report
136
To the Annual General Meeting of Luotea plc
Report on the Audit of the Financial Statements
Opinion
In our opinion
• the consolidated financial statements give a true and fair view of the group’s
financial position, financial performance and cash flows in accordance with
IFRS Accounting Standards as adopted by the EU
• the financial statements give a true and fair view of the parent company’s
financial performance and financial position in accordance with the laws and
regulations governing the preparation of financial statements in Finland and
comply with statutory requirements.
Our opinion is consistent with the additional report to the Audit Committee.
What we have audited
We have audited the financial statements of Luotea plc (business identity code
1680140-0) for the year ended 31 December 2025. The financial statements
comprise:
• the consolidated statement of financial position, consolidated income
statement, consolidated statement of comprehensive income, consolidated
statement of changes in equity, consolidated statement of cash flows and notes
to the consolidated financial statements, which include material accounting
policy information and other explanatory information
• the parent company’s balance sheet, income statement, cash flow statement
and notes.
Basis for Opinion
We conducted our audit in accordance with good auditing practice in Finland. Our
responsibilities under good auditing practice are further described in the Auditor’s
Responsibilities for the Audit of the Financial Statements section of our report. We
believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Independence
We are independent of the parent company and of the group companies in
accordance with the ethical requirements that are applicable in Finland and
are relevant to our audit, and we have fulfilled our other ethical responsibilities in
accordance with these requirements.
To the best of our knowledge and belief, the non-audit services that we have
provided to the parent company and group companies are in accordance with
the applicable law and regulations in Finland and we have not provided non-audit
services that are prohibited under Article 5(1) of Regulation (EU) No 537/2014. The
non-audit services that we have provided are disclosed in note 5.5 to the Financial
Statements.
Our Audit Approach
Overview
Materiality
Audit
Scope
Key Audit
Maers
• Overall group materiality: € 4,500,000
• The group audit scope included the most signifi-
cant group companies and covered a sufficient
share of group’s revenues, assets, and liabilities.
• Revenue recognition
• Employee benefit expenses
• Valuation of goodwill
• Valuation of shares in group companies and
receivables from group companies in the parent
company financial statements
As part of designing our audit, we determined materiality and assessed the risks
of material misstatement in the financial statements. In particular, we considered
where management made subjective judgements; for example, in respect
of significant accounting estimates that involved making assumptions and
considering future events that are inherently uncertain.
Materiality
The scope of our audit was influenced by our application of materiality. An audit
is designed to obtain reasonable assurance whether the financial statements are
free from material misstatement. Misstatements may arise due to fraud or error.
They are considered material if individually or in aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of the
financial statements.
Based on our professional judgement, we determined certain quantitative
thresholds for materiality, including the overall group materiality for the consolidated
financial statements as set out in the table below. These, together with qualitative
considerations, helped us to determine the scope of our audit and the nature, timing
and extent of our audit procedures and to evaluate the effect of misstatements on
the financial statements as a whole.
Overall group materiality € 4,500,000 (previous year €4 600 000)
How we determined it
We used net sales as benchmark to determine overall
group materiality
Rationale for the
materiality benchmark
applied
We chose net sales as the benchmark because, in
our view, it is the appropriate benchmark that users of
the financial statements regularly use to evaluate the
group’s performance.
How we tailored our group audit scope
We tailored the scope of our audit, taking into account the structure of the Luotea
Group, the accounting processes and controls, and the industry in which the group
operates.
The Group has two reportable segments: Facility Services Finland and Facility
Services Sweden, its main markets being Finland and Sweden. We have scoped our
audit to obtain sufficient audit coverage of Luotea Group’s consolidated financial
statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the financial statements of the current period. These
matters were addressed in the context of our audit of the financial statements as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion
on these matters.
As in all of our audits, we also addressed the risk of management override of
internal controls, including among other matters consideration of whether there was
evidence of bias that represented a risk of material misstatement due to fraud.
Auditor’s Report
Annual Report 2025
Auditor*s Report
137
Responsibilities of the Board of Directors and the
Managing Director for the Financial Statements
The Board of Directors and the Managing Director are responsible for the
preparation of consolidated financial statements that give a true and fair view
in accordance with IFRS Accounting Standards as adopted by the EU, and of
financial statements that give a true and fair view in accordance with the laws
and regulations governing the preparation of financial statements in Finland and
comply with statutory requirements. The Board of Directors and the Managing
Director are also responsible for such internal control as they determine is
necessary to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directors and the Managing
Director are responsible for assessing the parent company’s and the group’s ability
to continue as a going concern, disclosing, as applicable, matters relating to going
concern and using the going concern basis of accounting. The financial statements
are prepared using the going concern basis of accounting unless there is an
intention to liquidate the parent company or the group or to cease operations, or
there is no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the
Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to fraud
or error, and to issue an auditor’s report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with good auditing practice will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these
financial statements.
As part of an audit in accordance with good auditing practice, we exercise
professional judgment and maintain professional skepticism throughout the audit.
We also:
• Identify and assess the risks of material misstatement of the financial
statements, whether due to fraud or error, design and perform audit procedures
responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a
material misstatement resulting from fraud is higher than for one resulting
from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to
design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the parent
company’s or the group’s internal control.
• Evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures made by
management.
• Conclude on the appropriateness of the Board of Directors’ and the Managing
Key audit matter in the audit of the consolidated financial statements How our audit addressed the key audit matter
Revenue recognition
Refer to note 1.1 and 1.2 in the consolidated financial statements)
The Group’s total net sales for continuing operations amounted to EUR 346 million.
Revenue from contracts with customers is generated from multiple revenue streams as
described in note 1.2. Revenue recognition principles vary depending on the nature of the
revenue stream.
Revenue recognition is considered a key audit matter due to the significance of revenue
to the financial statements and due to management judgment involved in selecting the
appropriate revenue recognition method for the different revenue streams.
Our audit procedures included, for example, the following:
• We obtained an understanding of the company’s revenue recognition policies and
compared these to the respective IFRS standards
• We obtained an understanding of the internal controls that the company uses to as-
sess the completeness, accuracy, and timing of revenues
• We ested revenue transactions on a sample basis
• We tested, on a sample basis, revenue related balance sheet items such as contract
assets and liabilities.
Employee benefit expenses
(Refer to note 1.5 and 5.4 in the consolidated financial statements)
The Group operates in a highly labor-intensive business. Wages, salaries, and other em-
ployee benefit expenses form a significant part of the Group’s operating expenses. In
2025 employee benefit expenses for continuing operations were EUR 202 million.
Employee benefit expenses is considered a key audit matter due to its significance to the
consolidated financial statements.
Our audit procedures included, for example, the following:
• We obtained an understanding of the company’s payroll process
• We evaluated and tested the internal controls that the company uses to assess the
accuracy of employee benefit expenses
• We performed analytical audit procedures in relation to employee benefit expenses
• We tested on a sample basis employee benefit expenses related accruals.
Valuation of goodwill
Refer to note 3.1 and 3.2 in the consolidated financial statements
As of 31.12.2025, Goodwill in the consolidated balance sheet amounted to EUR 39 mil-
lion. Goodwill is not amortised but is tested at least annually for impairment. Goodwill
impairment testing has been prepared based on value-in-use calculations in which fu-
ture cash flows are discounted to current value. Value-in-use calculations include signifi-
cant management judgment in respect of profitability levels, long-term growth rates and
discount rates.
The valuation of goodwill is considered a key audit matter due to its significance as well
as due to the management judgment involved in the impairment testing.
Our audit procedures included, for example, the following:
• Weobtained an understanding of the methodology and assumptions used in the
goodwill impairment testing
• We tested the mathematical accuracy of the calculations
• We assessed the reasonableness of the estimated future profitability levels and their
consistency with the budgets and forecasts made by the management in connection
with the strategy process
• We assessed the reasonableness of the discount rates, long-term growth rates and
certain other assumptions by e.g., comparing the inputs to observable market data
• We assessed management’s sensitivity analysis to ascertain the extent of change in
key assumptions that either individually or collectively could result in an impairment
of goodwill
• We assessed the adequacy of the disclosures.
Annual Report 2025
Auditor*s Report
138
Key audit matter in the audit of the parent company financial statements How our audit addressed the key audit matter
Valuation of shares in group companies and receivables from group companies in the
parent company financial statements
(Refer to the accounting policies of the parent company and note 10 and 11)
The investments in shares in group companies amounted to EUR 38 million and current
receivables from group companies to EUR 22 million.
The valuation of shares in group companies and receivables from group companies is
assessed annually and tested for impairment when necessary. Impairment testing is
performed using the discounted cash flow model.
Valuation of shares in group companies and receivables from group companies is con-
sidered a key audit matter in the audit of the parent company due to the significance of
these investments to the financial statements and due to management judgment invol-
ved in the impairment testing of these investments.
Our audit procedures included, for example, the following:
• We assessed the reasonableness of the management estimates by e.g. checking their
consistency with the approved budgets and forecasts
• We assessed the methodology used in determining the discount rates and long-term
growth rates by e.g., comparing the inputs to observable market data.
There are no significant risks of material misstatement referred to in Article 10(2c) of Regulation (EU) No 537/2014 with respect to the consolidated financial statements or the pa-
rent company financial statements.
Director’s use of the going concern basis of accounting and based on the audit
evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the parent company’s or the
group’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report
to the related disclosures in the financial statements or, if such disclosures
are inadequate, to modify our opinion. Our conclusions are based on the
audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the parent company or the group to cease to
continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial
statements, including the disclosures, and whether the financial statements
represent the underlying transactions and events so that the financial
statements give a true and fair view.
• Plan and perform the group audit to obtain sufficient appropriate audit
evidence regarding the financial information of the entities or business units
within the group as a basis for forming an opinion on the group financial
statements. We are responsible for the direction, supervision and review of
the audit work performed for purposes of the group audit. We remain solely
responsible for our audit opinion.
We communicate with those charged with governance regarding, among other
matters, the planned scope and timing of the audit and significant audit findings,
including any significant deficiencies in internal control that we identify during our
audit.
We also provide those charged with governance with a statement that we
have complied with relevant ethical requirements regarding independence, and
communicate with them all relationships and other matters that may reasonably be
thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we
determine those matters that were of most significance in the audit of the financial
statements of the current period and are therefore the key audit matters. We
describe these matters in our auditor’s report unless law or regulation precludes
public disclosure about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in our report because the
adverse consequences of doing so would reasonably be expected to outweigh the
public interest benefits of such communication.
Other Reporting Requirements
Appointment
We were first appointed as auditors by the annual general meeting on 17 March
2022.
Other Information
The Board of Directors and the Managing Director are responsible for the other
information. The other information comprises the report of the Board of Directors
and the information included in the Annual Report but does not include the
financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information.
In connection with our audit of the financial statements, our responsibility is to read
the other information and, in doing so, consider whether the other information is
materially inconsistent with the financial statements or our knowledge obtained
in the audit, or otherwise appears to be materially misstated. With respect to the
report of the Board of Directors, our responsibility also includes considering whether
the report of the Board of Directors has been prepared in compliance with the
applicable provisions, excluding the sustainability report information on which there
are provisions in Chapter 7 of the Accounting Act and in the sustainability reporting
standards.
In our opinion, the information in the report of the Board of Directors is consistent
with the information in the financial statements and the report of the Board of
Directors has been prepared in compliance with the applicable provisions. Our
opinion does not cover the sustainability report information on which there are
provisions in Chapter 7 of the Accounting Act and in the sustainability reporting
standards.
If, based on the work we have performed, we conclude that there is a material
misstatement of the other information, we are required to report that fact. We have
nothing to report in this regard.
Other Statements based on Law
Registration of the Income Tax Report
Our responsibility is to, based on our audit, express an opinion on the registration
and publication of the income tax report required in Chapter 7 b of the Accounting
Act.
The Board of Directors and the Managing Director are responsible for the
registration and the publication of the income tax report.
In our opinion, the company has not been obliged to register and publish an
income tax report referred to in Chapter 7 b of the Accounting Act for the financial
year immediately preceding the financial year.
Helsinki 8 April 2026 Helsinki
PricewaterhouseCoopers Oy
Authorised Public Accountants
Samuli Perälä
Authorised Public Accountant (KHT)
Annual Report 2025
Independt Assurance Report
139
Independent Assurance Report
To the Annual General Meeting of Luotea plc
We have performed a limited assurance engagement on the group sustainability
report of Luotea plc (business identity code 1680140-0) that is referred to in Chapter
7 of the Accounting Act and that is included in the report of the Board of Directors
for the reporting period 1.1.–31.12.2025.
Opinion
Based on the procedures we have performed and the evidence we have obtained,
nothing has come to our attention that causes us to believe that the group
sustainability report does not comply, in all material respects, with
1) the requirements laid down in Chapter 7 of the Accounting Act and the
sustainability reporting standards (ESRS), and
2) the requirements laid down in Article 8 of the Regulation (EU) 2020/852 of the
European Parliament and of the Council on the establishment of a framework to
facilitate sustainable investment, and amending Regulation (EU) 2019/2088 (EU
Taxonomy).
Point 1 above also contains the process in which Luotea plc has identified the
information for reporting in accordance with the sustainability reporting standards
(double materiality assessment).
Our opinion does not cover the tagging of the group sustainability report with digital
XBRL sustainability tags in accordance with Chapter 7, Section 22, Subsection 1(2),
of the Accounting Act, because sustainability reporting companies have not had
the possibility to comply with that requirement in the absence of requirements for
the tagging of sustainability information in the ESEF regulation or other European
Union legislation.
Basis for Opinion
We performed the assurance of the group sustainability report as a limited
assurance engagement in compliance with good assurance practice in Finland and
with the International Standard on Assurance Engagements (ISAE) 3000 (Revised)
Assurance Engagements Other than Audits or Reviews of Historical Financial
Information.
Our responsibilities under this standard are further described in the
Responsibilities of the Authorised Group Sustainability Auditor section of our report.
We believe that the evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Authorised Group Sustainability Auditor’s
Independence and Quality Management
We are independent of the parent company and of the group companies in
accordance with the ethical requirements that are applicable in Finland and are
relevant to our engagement, and we have fulfilled our other ethical responsibilities in
accordance with these requirements.
The authorised group sustainability auditor applies International Standard on
Quality Management ISQM 1, which requires the authorised sustainability audit
firm to design, implement and operate a system of quality management including
policies or procedures regarding compliance with ethical requirements, professional
standards and applicable legal and regulatory requirements.
Responsibilities of the Board of Directors and the
Managing Director
The Board of Directors and the Managing Director of Luotea plc are responsible for:
• the group sustainability report and for its preparation and presentation in
accordance with the provisions of Chapter 7 of the Accounting Act, including
the process that has been defined in the sustainability reporting standards
and in which the information for reporting in accordance with the sustainability
reporting standards has been identified,
• the compliance of the group sustainability report with the requirements
laid down in Article 8 of the Regulation (EU) 2020/852 of the European
Parliament and of the Council on the establishment of a framework to facilitate
sustainable investment, and amending Regulation (EU) 2019/2088, and for
• such internal control as the Board of Directors and the Managing Director
determine is necessary to enable the preparation of a group sustainability
report that is free from material misstatement, whether due to fraud or error.
Inherent Limitations in the Preparation of a
Sustainability Report
In reporting forward-looking information in accordance with ESRS, management
of the Company is required to prepare the forward-looking information on the
basis of assumptions that have been disclosed in the sustainability report about
events that may occur in the future and possible future actions by the Group. Actual
outcomes are likely to be different since anticipated events frequently do not occur
as expected.
Responsibilities of the Authorised Group
Sustainability Auditor
Our responsibility is to perform an assurance engagement to obtain limited
assurance about whether the group sustainability report is free from material
misstatement, whether due to fraud or error, and to issue a limited assurance
report that includes our opinion. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the decisions of users taken on the basis of the group
sustainability report.
Compliance with the International Standard on Assurance Engagements (ISAE)
3000 (Revised) requires that we exercise professional judgment and maintain
professional skepticism throughout the engagement. We also:
• Identify and assess the risks of material misstatement of the group
sustainability report, whether due to fraud or error, and obtain an
understanding of internal control relevant to the engagement in order to design
assurance procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the parent
company’s or the group’s internal control.
• Design and perform assurance procedures responsive to those risks to obtain
evidence that is sufficient and appropriate to provide a basis for our opinion.
The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal control.
Description of the Procedures That Have Been
Performed
The procedures performed in a limited assurance engagement vary in nature and
timing from, and are less in extent than for, a reasonable assurance engagement.
The nature, timing and extent of assurance procedures selected depend on
professional judgment, including the assessment of risks of material misstatement,
whether due to fraud or error. Consequently, the level of assurance obtained in a
limited assurance engagement is substantially lower than the assurance that would
have been obtained had a reasonable assurance engagement been performed.
Our procedures included for example the following:
• We interviewed the company’s management and the individuals responsible for
collecting and reporting the information contained in the group sustainability
report at different levels of the organization to gain an understanding of
the sustainability reporting process and the related internal controls and
information systems.
Annual Report 2025
Independt Assurance Report
140
• We familiarised ourselves with the background documentation and records
prepared by the company where applicable, and assessed whether they support
the information contained in the group sustainability report.
• We assessed the company’s double materiality assessment process in relation
to the requirements of the ESRS standards, as well as whether the information
provided about the assessment process complies with the ESRS standards.
• We assessed whether the sustainability information contained in the group
sustainability report complies with the ESRS standards.
• Regarding the EU taxonomy information, we gained an understanding of the
process by which the company has identified the group’s taxonomy-eligible and
taxonomy-aligned economic activities, and we assessed the compliance of the
information provided with the regulations.
Helsinki on 8 April 2026
PricewaterhouseCoopers Oy
Authorised Sustainability Auditors
Samuli Perälä
Authorised Sustainability Auditor
ANNUAL REPORT 2025
ESEF Assurance Report
153
To the Board of Directors of Luotea plc
We have performed a reasonable assurance engagement on the financial
statements 743700Z9Z54VGHZA0028-2025-12-31-0-fi.zip of Luotea plc (business
identity code 1680140-0) that have been prepared in accordance with the
Commission’s regulatory technical standard for the financial year 1.1.-31.12.2025.
Responsibilities of the Board of Directors and the
Managing Director
The Board of Directors and the Managing Director are responsible for the
preparation of the company’s report of the Board of Directors and financial
statements (the ESEF financial statements) in such a way that they comply with the
requirements of the Commission’s regulatory technical standard. This responsibility
includes:
• preparing the ESEF financial statements in XHTML format in accordance with
Article 3 of the Commission’s regulatory technical standard
• tagging the primary financial statements, notes and company’s identification data
in the consolidated financial statements that are included in the ESEF financial
statements with iXBRL tags in accordance with Article 4 of the Commission’s
regulatory technical standard and
• ensuring the consistency between the ESEF financial statements and the audited
financial statements.
The Board of Directors and the Managing Director are also responsible for such
internal control as they determine is necessary to enable the preparation of ESEF
financial statements in accordance with the requirements of the Commission’s
regulatory technical standard.
Auditor’s independence and quality management
We are independent of the company in accordance with the ethical requirements
that are applicable in Finland and are relevant to the engagement we have
performed, and we have fulfilled our other ethical responsibilities in accordance with
these requirements.
The auditor applies International Standard on Quality Management (ISQM) 1,
which requires the firm to design, implement and operate a system of quality
management including policies or procedures regarding compliance with
ethical requirements, professional standards and applicable legal and regulatory
requirements.
.
Auditor’s responsibilities
Our responsibility is to, in accordance with Chapter 7, Section 8 of the Securities
Markets Act, provide assurance on the financial statements that have been
prepared in accordance with the Commission’s regulatory technical standard.
We express an opinion on whether the consolidated financial statements that
are included in the ESEF financial statements have been tagged, in all material
respects, in accordance with the requirements of Article 4 of the Commission’s
regulatory technical standard.
Our responsibility is to indicate in our opinion to what extent the assurance has
been provided. We conducted a reasonable assurance engagement in accordance
with International Standard on Assurance Engagements (ISAE) 3000 (Revised).
The engagement includes procedures to obtain evidence on:
• whether the primary financial statements in the consolidated financial statements
that are included in the ESEF financial statements have been tagged, in all material
respects, with iXBRL tags in accordance with the requirements of Article 4 of the
Commission’s regulatory technical standard and
• whether the notes and company’s identification data in the consolidated financial
statements that are included in the ESEF financial statements have been tagged, in
all material respects, with iXBRL tags in accordance with the requirements of Article
4 of the Commission’s regulatory technical standard and
• whether there is consistency between the ESEF financial statements and the
audited financial statements.
The nature, timing and extent of the selected procedures depend on the auditor’s
judgment. This includes an assessment of the risk of a material deviation due to
Independent auditor’s report on the ESEF financial statements of Luotea
plc
fraud or error from the requirements of the Commission’s regulatory technical
standard.
We believe that the evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
.
Opinion
Our opinion pursuant to Chapter 7, Section 8 of the Securities Markets Act is
that the primary financial statements, notes and company’s identification data
in the consolidated financial statements that are included in the ESEF financial
statements of Luotea plc 743700Z9Z54VGHZA0028-2025-12-31-0-fi.zip for
the financial year 1.1.-31.12.2025 have been tagged, in all material respects, in
accordance with the requirements of the Commission’s regulatory technical
standard.
Our opinion on the audit of the consolidated financial statements of Luotea plc for
the financial year 1.1.-31.12.2025 has been expressed in our auditor’s report dated
8 April 2026. With this report we do not express an opinion on the audit of the
consolidated financial statements nor express another assurance conclusion.
Helsinki 8 April 2026
PricewaterhouseCoopers Oy
Authorised Public Accountants
Samuli Perälä
Authorised Public Accountant (APA)
Luotea
Kutomotie 2, 00380 Helsinki
puh. 010 590 2000
www.luotea.com
Value Beyond
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