Climate Change Data

Environmental Metrics

ESG Focus Areas

• Corporate Sustainability
• Employee Well-being
• Governance

Environmental Achievements

• New office in Breukelen uses LED lights and electric car charging stations.

Social Achievements

• Eight employees participated in Alpe d'HuZes charity cycling event.
• Low employee absence due to illness (1.1%).
• Offers flexible working hours and extensive special leave arrangement.
• Investigating employee share plan.

Governance Achievements

• Improved organization with a complete management team.
• Commenced Investor Relations Program.
• Appointed Mr. Bob Out as Advisor Investor Relations.

Climate Goals & Targets

Environmental Challenges

• Loss of Newco Food Retail and ADEC as customers.
• Samar BV legal case.
• Rapid changes in the E-Commerce market.

Mitigation Strategies

• Completed acquisitions of Light B.V. and ascention GmbH to expand geographically and gain expertise.
• Transitioning to a SaaS company to create a more consistent revenue stream.
• Professionalizing Investor Relations to improve shareholder communication.

Supply Chain Management

Climate-Related Risks & Opportunities

Sustainable Products & Innovation

• E-invoicing solutions to decrease paper usage.

Environmental Metrics

ESG Focus Areas

• Employee well-being
• Diversity and Inclusion
• Compliance
• Sustainability of solutions
• Environmental impact of data centers

Environmental Achievements

• Utilized green data centers (LeaseWeb) reducing paper usage through e-invoicing solutions.

Social Achievements

• Reduced absence due to illness to 0.86% (2013: 1.3%), lower than the commercial services sector average.
• Offered additional vacation day for employees with no illness.
• Provided English language training to French staff and Dutch lessons to foreign staff in the Netherlands.
• Implemented policies for dealing with harassment or discrimination and a whistleblower policy.
• Maintained a diverse and multicultural workforce.

Governance Achievements

• Appointed a Chief Financial Officer.
• Improved internal risk management and control system with My-TIE platform.
• Implemented a Compensation Policy with a claw-back clause.
• Actively engaged in one-to-one meetings with shareholders.

Climate Goals & Targets

Environmental Challenges

• Demand Generation business underperformed expectations due to immature market and customer reluctance to invest.
• Received a notice from the European Commission for a partial repayment of EU development grants due to non-compliance with administrative regulations.
• Legal proceedings with Samar B.V.

Mitigation Strategies

• Investing cautiously in Demand Generation, focusing on market development.
• Reconsidering participation in EU projects and mitigating further exposure.
• Recalculating the effects of the EU audit findings on other projects.
• Seeking a solution with the European Commission.
• Secured a guarantor for up to €2 million to cover potential repayment of EU grants.
• Submitting a statement of defense in the Samar damage proceedings.

Supply Chain Management

Climate-Related Risks & Opportunities

Sustainable Products & Innovation

• E-invoicing solutions
• Free Connect platform

Environmental Metrics

ESG Focus Areas

• Employees
• Compliance with Laws and Regulations
• Carbon Footprint

Environmental Achievements

• Solutions decrease paper usage (e-invoicing)

Social Achievements

• Investment in engaging, supporting and developing employees; low illness rate (2.3%); endorsement of flexible working hours; equal opportunities policy; whistleblower policy; code of conduct; insider knowledge regulations.

Governance Achievements

• New Supervisory Board appointed to focus on recovery of trust and confidence; compliance with Dutch corporate governance code; implementation of My-TIE internal risk management and control system.

Climate Goals & Targets

Environmental Challenges

• Conflict between major shareholders and supervisory board; lack of traction from certain third-party applications (Google products); insufficient FLOW subscription business to compensate loss of non-FLOW revenue; scaling up Google AdWords for Channel proved challenging.

Mitigation Strategies

• Replaced supervisory board members; reconsidering go-to-market strategy for Google AdWords for Channel; launching new initiatives in FY 2019 to bring FLOW deeper into existing customer base; reorganizing the sales process of FLOW with a dedicated team to upsell FLOW in the installed base; expanding ERP partner network.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: Dutch corporate governance code

Third-party Assurance: BDO Audit & Assurance B.V.

Sustainable Products & Innovation

• FLOW platform; FreeConnect platform for SMEs

Environmental Metrics

ESG Focus Areas

• Employee well-being
• Compliance with Laws and Regulations
• Gender diversity
• Data breach policy and privacy policy
• Sustainability of software solutions

Environmental Achievements

• Office fully lit by LED-lights with moving sensors; charging of electric cars; various electric or hybrid cars leased

Social Achievements

• Strive to be a good employer and invest in engaging, supporting and developing our people and treating their safety and wellbeing as a paramount concern; extra vacation day for employees in the Netherlands if they have not been ill during a certain period; flexible working hours and an extensive special leave arrangement; equal opportunities policy; Whistleblower’s policy; Code of Conduct; regulations on insider knowledge

Governance Achievements

• Compliance with the Dutch corporate governance code; Remuneration Policy with claw back clause; balanced gender representation in the Executive Board and Supervisory Board (although not achieved in 2020); internal risk management and risk control systems; My-TIE internal business process recording system

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impact on operations, travel restrictions, remote work challenges, customer financial difficulties
• Shortfall in large 'Hub' type customers due to COVID-19 restrictions
• Actual usage of e-invoicing platform behind expectations
• Slow development of Business to Government market in Germany

Mitigation Strategies

• Implemented daily management calls and tightened operational processes; emergency program to limit COVID-19 impact (not activated due to limited downside); extended payment terms for affected customers; focus on 100% digitization products; step up supplier onboarding program; invest in marketing, sales, and onboarding expenses

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: EU Transparency Directive, IFRS

Third-party Assurance: BDO Audit & Assurance B.V.

Sustainable Products & Innovation

• FLOW e-invoicing proposition (decreases paper usage)

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Reduced customers' carbon footprint through 100% digitalization, reducing paper, toner, and ink consumption.
• Reduced GHG emissions through cloud strategy and reduced office space.

Social Achievements

• Improved employee flexibility and development opportunities through digitalization of the workplace.
• Maintained workforce diversity and low employee turnover.

Governance Achievements

• Implemented ESG principles into strategy and decision-making.
• Published first ESG report.
• Paid first-ever dividend.

Climate Goals & Targets

Environmental Challenges

• Sensitivity to economic cycles
• Speed of technological developments
• Dependence on large clients
• Non-organic growth
• Inability to attract and retain talented staff
• Inadequate project control
• Incremental costs to attract and retain talented staff
• Operational and cost strain due to high organic growth
• Unauthorized access to systems
• Data breach
• Unfavorable movements in the US dollar
• Reporting risk
• Failure to comply with changing laws and regulations

Mitigation Strategies

• Maintaining a leading position in the marketplace through state-of-the-art products, growing SaaS revenues and long-term contracts, diversifying geographical markets, monitoring cost basis, and using price indexation clauses.
• Investing in R&D, engaging in customer dialogue, continuously training staff, and engaging in partnerships.
• Increasing customer base and signing new large contracts.
• Performing in-depth due diligence on targets and preparing integration plans.
• Acting in accordance with company values, using third-party recruiters, stimulating employee engagement, offering attractive remuneration, and facilitating remote work.
• Using qualified project managers, implementing tools and procedures, and monitoring project performance.
• Maintaining a state-of-the-art product, innovating for staff efficiency, and engaging in open dialogue with customers on pricing.
• Fast and effective training, managing new projects effectively, and ensuring timely execution of projects.
• Continuous development with high attention to security, ISO certifications, hosting on secure servers, appointing an Information Security Officer, mandating security awareness training, and performing penetration testing.
• Implementing information security controls, appointing a Privacy Officer, monitoring GDPR compliance, and mandating data security and privacy training.
• Maintaining minimal cash balances in currencies other than the euro and converting US dollar cash balances to euro.
• Internal procedures and guidelines, annual budgeting process, internal financial reporting, external reporting function, Supervisory Board oversight, and annual audit.
• In-house legal counsel, outside legal counsel, and tax advisors.

Supply Chain Management

Climate-Related Risks & Opportunities

Sustainable Products & Innovation

• FLOW Partner Automation platform