Integration of sustainability-related performance in incentive schemes

Since 2023, Heinzel Group has implemented a remuneration policy for managing directors that explicitly links compensation to sustainability targets. This approach emphasizes the responsibility of senior management to implement the sustainability strategy. Payment of bonuses at Heinzel Group is subject to clearly defined conditions regarding non-financial KPIs. These include the prevention of fatal occupational accidents among employees and full compliance with all applicable laws, regulations, and compliance rules.In addition to economic performance targets, 30% of variable compensation is tied to ESG and non-financial criteria. One key performance indicator is the change in site-specific CO₂ emissions per ton of production volume (t CO₂/t) compared to the previous year. Bonus points are awarded for achieved emission reductions versus budget, with an annual reduction of 4.2% or more resulting in a higher target achievement. This target aligns with the requirements of the Science Based Targets initiative (SBTi) and the implemented climate transition plan. Other key performance indicators for variable compensation include reducing Scope 3 emissions and developing the Lost Time Injury Frequency Rate (LTIFR). The Heinzel Holding Management Team developed the compensation system, which the Supervisory Board approved.