EU taxonomy

As one of the central elements of the European Green Deal, the Taxonomy Regulation (EU) 2020/852 (Taxonomy Regulation) was adopted in July 2020. The taxonomy is a standardized classification system for sustainable economic activities based on the six EU environmental targets. According to article 9 of the Taxonomy Regulation the six environmental objectives of the EU are:

• Climate Change Mitigation (CCM)
• Climate Change Adaptation (CCA)
• Water and Marine Resources (WMR)
• Circular Economy (CE)
• Pollution Prevention and Control (PPC)
• Biodiversity and Ecosystems (BIO)

According to the EU Taxonomy Regulation:

• The first step is to determine the taxonomy-eligible economic activities of a company. These are activities that are covered by the EU taxonomy and therefore potentially make a significant contribution to achieving EU environmental targets. The assessment of economic activities of DB Group includes both those activities that can be assigned to the first two environmental targets (“Climate Change Mitigation” and “Climate Change Adaptation”) in accordance with Delegated Regulation (EU) 2021/2139 and the supplementary Delegated Regulation (EU) 2023/2485, as well as those activities that are in line with the remaining environmental objectives in accordance with Delegated Regulation (EU) 2023/2486.
• In the second step, the identified economic activities are to be checked for taxonomy alignment. An activity is considered taxonomy-aligned if it meets the technical assessment criteria for a significant contribution to at least one EU environmental target. At the same time, it may not significantly harm any of the other EU environmental targets and must meet the minimum social standards (so-called minimum safeguard) laid down in the Taxonomy Regulation (EU) 2020/852. These demand, in particular, compliance with human and labor rights. The analysis of taxonomy-eligible and taxonomy-aligned economic activities of DB Group was performed on the basis of Delegated Regulation (EU) 2021/2139 and by applying the supplementary Delegated Regulations (EU) 2023/2485 and (EU) 2023/2486.

Reporting on the financial taxonomy indicators is conducted both at Group level and at the level of individual economic activities of companies subject to reporting requirements.

The review of the Do No Significant Harm criteria (DNSH criteria) was conducted across the Group and supplemented by business unit-specific aspects. A climate risk and vulnerability analysis was used to review the requirements for avoiding significant adverse effects on the EU environmental objective “Climate Change Adaptation.” Compliance with the DNSH criteria at “Transition to a circular economy” is essentially ensured via environmental management systems and waste management processes. Compliance with the minimum safeguards was validated by way of a Group-wide information survey. This query consisted of an in-depth review of all relevant internal guidelines, process requirements and remedial measures in the core areas of human rights due diligence (including employee rights), the Group-wide compliance management system (combating corruption, fraud and embezzlement), fair competition and tax compliance.

The following economic activities of DB Group were classified as applicable:

• 6.1 Passenger interurban rail transport
• 6.2 Freight rail transport
• 6.3 Urban and suburban transport, road passenger transport
• 6.5 Transport by motorbikes, passenger cars and light commercial vehicles
• 6.6 Freight transport services by road
• 6.14 Infrastructure for rail transport
• 6.15 Infrastructure enabling low-carbon road transport and public transport
• 7.7 Acquisition and ownership of buildings

These economic activities can be fully allocated to the EU environmental target “Climate Change Mitigation”(CCM).

DB Group’s business model comprises a large number of economic activities, each thereof is assigned its own set of criteria with specific alignment requirements under the Taxonomy Regulation. If several economic activities apply to activities within an EU environmental objective, the allocation is based on the target activity from the core business and thus the revenue-relevant activity. Only in cases where such an allocation was not possible were the activities allocated according to the criteria for other economic activities (in particular CCM 7.7). To maintain appropriate proportionality in the taxonomy review, a financial materiality threshold was defined both in deriving key figures and considering individual economic activities:

• A threshold value of ≥95% was defined for the degree of coverage of the respective assessment basis at Group level (revenues, capital expenditures, operating expenses) for the individual taxonomy key figures. The taxonomy audit therefore covers at least 95% of DB Group to be analyzed for all key figures.
• The materiality threshold for individual economic activities was set at < 0.1% of the respective assessment basis at Group level (revenues, capital expenditures, operating expenses). If this threshold is not reached for individual activities, these activities are not analyzed separately.