Material Impacts, Risks, and Opportunities and Their Interaction with Strategy and Business Model

The material sustainability-related impacts, risks, and opportunities (IROs) that we have identified in our materiality assessment are described in the relevant topic chapters. All identified IROs are covered by the ESRS requirements and no further entity-specific topics were identified.

The identified impacts on the environment and people are all to be put into the context of our business model as a global consumer goods manufacturer. The impacts in our own operations are primarily associated with the process of manufacturing our products. With regard to our own workforce, the impacts are primarily related to the working conditions and the work environment that we create for our employees. Impacts in the upstream and downstream value chain arise through our business relationships with suppliers that supply us with raw materials and intermediate products or deliver our products. Impacts also arise through the use and disposal of our products by consumers or at the end of the product life cycle.

Our business model and strategy are heavily influenced by the necessity for sustainable conduct. The direct effects of our identified IROs are already noticeable. They include the increasing regulatory pressure, potential reputational risks, transitioning our production sites, and the need for good working conditions both for our own workforce and throughout the value chain. We expect additional challenges going forward, such as rising costs, stronger shifts in consumer preferences, and operational adjustments to meet regulatory requirements.

Beiersdorf performed a qualitative analysis of the resilience of its corporate strategy and business model with a view to the material IROs in 2024. The focus was on the extent to which these topics are integrated in the business processes, strategy, and reporting. The results of the analysis underpin the assessment that the company is capable of addressing the material impacts and risks and taking advantage of its material opportunities. Sustainability is firmly enshrined in our business strategy and integrated in our strategic planning with the objective of ensuring the long-term success and resilience of our company.

As regards the identified opportunities and risks, we do not expect any material financial effects on Beiersdorf’s net assets, financial position, and results of operations this reporting year or next.

Further information on the actions we are carrying out in the various areas is provided in the topic chapters under “Environmental Information”, “Social Information”, and “Governance Information.”