Glossary definitions and (estimation) methodologies

A sustainability matter is material from a financial perspective if it generates risks or opportunities that affect (or could reasonably be expected to affect) the undertaking’s financial position, financial performance, cash flows, access to finance or cost of capital over the short, medium or long term.

All the factors that cause changes in nature, anthropogenic assets, nature’s contributions to people and a good quality of life. Direct drivers of change can be both natural and anthropogenic. They have direct physical (mechanical, chemical, noise, light etc.) and behavior-affecting impacts on nature. They include, inter alia, climate change, pollution, different types of land use change, invasive alien species and zoonoses, and exploitation. Indirect impact drivers operate diffusely by altering and influencing direct drivers (by affecting their level, direction or rate) as well as other indirect drivers. Interactions between indirect and direct drivers create different chains of relationship, attribution, and impacts, which may vary according to type, intensity, duration, and distance. These relationships can also lead to different types of spill-over effects. Global indirect drivers include economic, demographic, governance, technological and cultural ones. Special attention is given, among indirect drivers, to the role of institutions (both formal and informal) and impacts of the patterns of production, supply and consumption on nature, nature’s contributions to people and good quality of life.

Sustainability related opportunities with positive financial effects that materially affect, (or could reasonably be expected to affect) the undertaking’s cash flows, access to finance, or cost of capital over the short, medium or long term.

Sustainability related risks with negative financial effects that materially affect (or could reasonably be expected to affect) the undertaking’s cash flows, access to finance, or cost of capital over the short, medium or long term.

Refers to Arcadis’ own workforce, and aspects of Arcadis operations that Arcadis has direct operational control over, such as leased offices and office spaces, associated leased facilities, company-owned and operated vehicles, leased vehicle fleet and employee-owned vehicles used for company purposes (including commuting), remote working infrastructure, and IT systems.

The value chain of Arcadis encompasses activities, resources and relationships Arcadis uses and relies on to create its products or services from conception to delivery, consumption and end-of- life, extending beyond immediate contractual relationships to include upstream and downstream activities.

The value chain comprises the following components:
Upstream: The actors in our upstream that provide products or services that are used in the development of Arcadis products or services, including procurement activities linked to our project execution and ongoing business operations.
Downstream: The actors that receive products or services from Arcadis, including clients and the assessment of (outcomes from) our projects.

Arcadis applies this broad definition specifically for its double materiality assessment and assessment of impacts, risks, and opportunities associated with the value chain. These assessments consider the value chain as encompassing the areas it impacts and depends on through projects for clients and its relationships with value chain partners, both upstream and downstream. The specific focus within the value chain may vary depending on the context, with particular actors and elements identified, addressed, and disclosed as appropriate.

Refers to individuals performing work in the Arcadis value chain through third parties that Arcadis directly contracts with, including but not limited to clients, suppliers, and ecosystem partners. It also considers workers in the extended network of these third parties, provided their work relates to the operations, products or services of Arcadis.
The scope of workers in the value chain includes workers in the Arcadis’ upstream and downstream value chain who are or can be materially impacted by Arcadis. This includes impacts that are connected to Arcadis own operations, and value chain, including through its products or services, as well as through the business relationships. It is acknowledged that the scope may evolve over time, with further clarifications provided in related disclosures, taking into account the phased approach to implementation.

Exclusion of non-employee/Contingent Worker: Contingent workers are classified within Arcadis’ workforce (S1) and are therefore not included as value chain workers.

Arcadis’ carbon footprint consists of the total metric tons of CO2 equivalents from material scope 1, 2 and 3 emissions, based on the methodology used to calculate greenhouse gas (GHG) emission inventories.
Our scope 1 includes emissions from our company owned vehicles (purchased or leased for > 6 months) fuel consumptions and our stationary energy consumption at the offices (e.g., natural gas for heating) as well as emissions from refrigerants due to releases from air conditioners.
Our scope 2 includes our office's electricity and district heating, as well as our company owned vehicles' electricity.
Our scope 3 includes categories 1 to 7, as described under “Scope 3 definition and boundary setting” in this glossary. The general carbon accounting policies and emission factors are described below.

Our emissions calculations are based on the GHG Protocol “A Corporate Accounting and Reporting Standard“ (World Resources Institute and World Business Council for Sustainable Development, March 2004), as well as the “GHG Protocol Scope 2 Guidance” and the “Corporate Value Chain (Scope 3) Accounting and Reporting Standard”.
The organizational boundaries of Arcadis are based on the 'Operational control approach'. This means that Arcadis takes responsibility for the emissions of the business units over which it has operational control.
As emission factors, the factors from Defra v12 (09/2024) have been used and for electricity-related emissions, the factors from IEA v7 (12/2024) have been applied for scope 2 (location-based). For the market-based scope 2 footprint, our renewable electricity purchases via direct contracts or contractual instruments (energy attribute certificates such as (i)RECs, GOs, etc.) have been taken into account with a factor of 0. For scope 3 categories 1, 2 and 4, spend-based US EPA EEIO v1.3 emission factors have been used, as well as supplier emissions from 70 of our biggest suppliers, collected through a third-party supply chain management program called CDP. The latter covers about 10% of our spend-based emissions for scope 3 category 1.

In our scope 3 we currently include Category 1: Purchased Goods and Services, Category 2: Capital goods, Category 3: Fuel-and-energy-related activities (not included in Scope 1 or 2), Category 4: Upstream Transportation and Distribution, Category 5: Waste generated in operations, Category 6: business travel (including airplanes, private vehicles, short-term hired vehicles, taxi, and public transportation) and Category 7: Employee commuting. Emissions from working from home (WFH) are reported separately, and not part of our total footprint, to align it with the scope of our approved science-based net zero target. Any other scope 3 categories are not reported because previous screenings showed that these are not relevant for our footprint. This means we do include also indirect emissions in our carbon footprint over which Arcadis has limited influence. To illustrate: employees have the choice to meet their business mobility needs in different ways, for example with their private car. Arcadis is responsible for the emissions but has no direct influence on the choice of which type of car that the employee drives.

Scope 1 & Scope 2: As we published this report early in the year, we don’t have all final emissions data points by the date of publication, e.g., electricity and heating consumptions for December in all cases, November most locations and for October at a few locations. Therefore, we work with estimates based on historical data for these missing data points and publish an update on our webpage in Q2 each year. For consumptions not depending on the climate (like office electricity for workstations and lighting), we use the consumption of the same month of the previous year for the missing month. In case the office size (floor area) changed since then, we use the % change to scale the consumption for the estimate. If historical data from the previous year is not available, we calculate the average monthly electricity consumption considering the previous months where data is available. In rare cases where also previous year’s data is not available, a global average of 25 kWh/m2year in electricity and 0.8 m3/m2year in natural gas is applied (if applicable for that office). These global standardized numbers may be replaced by a better local average (e.g., from the same climate zone) when appropriate documentation can be provided (source, conversion factor, etc.). Estimations for the use of climate-dependent energy (e.g., natural gas, heat (district heating), electricity for heating or cooling if measured separately) are calculated in proportion to the number of heating or cooling degree days if no other historical data is available for that office.

MSA-based (Mean Species Abundance) footprint assessment

Mean Species Abundance (MSA) describes biodiversity changes with reference to the undisturbed state of ecosystems. It is defined as the average abundances of originally occurring species relative to their abundance in the undisturbed ecosystem. Undisturbed ecosystem is understood here as equivalent to a pristine state, intact and undisturbed by human activity. MSA varies between 0% and 100% (or score 0 to 1). ​The MSA has a low value in areas where the pressure on biodiversity is high. A score of 1 implies that the area is undisturbed. A score of 0 represents a complete loss of the original biodiversity.​ The MSA-based footprint assessment is based on:​ 1) Surface area component - Arcadis’ proportionate use of each site (building and surrounding space on-site)​; and 2) Quality component - Attributing an MSA score for each site​.

The footprint caused by changes, consumptions, or restorations during a specific period (e.g., accounting year)​. The general formula used to calculate a biodiversity footprint at any point in time is = ∑(areai * [1 - MSAi]) in which i= land use or GHG; and area is in hectare. The dynamic footprint is then calculated as the difference between the 2023 and 2024 biodiversity footprints for the exact same list of Arcadis offices, thus incorporating land use change at these locations.

A footprint including all the ‘persistent’ or ‘long-lasting’ effects which remain over time. This static footprint can result from spatial pressures (land use, fragmentation, encroachment) that are linked to existing facilities and the persistent (and constant) effects impacting biodiversity today.​ The general formula used to calculate a biodiversity footprint at any point in time is = ∑(areai * [1 - MSAi]) in which i= land use or GHG; and area is in hectare. The static footprint is the biodiversity footprint from 2024, accounting for all Arcadis offices currently in its portfolio that are part of the biodiversity footprint.

Actual waste amounts were available from 71 of our 335 offices and estimated data for the remaining offices. For the offices which didn’t yet start to collect waste data in 2024, the average waste intensity per FTE by waste type from 40 offices (for which the data was available before the data entry deadline), representing 21% of our offices, has been prorated using the FTE of the missing offices and the average Arcadis-specific office attendance in its country. The average office attendance has been calculated based on our annual global survey on commuting and WFH behavior which has been sent to all Arcadis employees globally and answered by 23% of our employees. This survey has been completed by the end of October and includes estimations for November and December.

The methodology adopted to disclose the metrics related to our employees and non-employees is to report the information based on headcount as on the last reporting day of the financial year (December 31), with exception to turnover which uses 12 months average headcount from January to December 2024.

The global estimate of 70% (Female 71%, Male 70%, Not Disclosed 50%) is built on data from our main system of record. For the countries that are not on this system, an estimation was applied based on the data out of the system of record. Excluding these estimations, the global figure is 61% (Female 63%, Male 60%, Not Disclosed 56%).

Workforce is defined as individuals with an employment agreement with Arcadis, in accordance with national law or its application (employees), as well as individual contractors providing labor to Arcadis ("self-employed") and individuals supplied by other undertakings (companies or organizations primarily engaged in employment activities) to Arcadis ("agency"). Self-employed and agency workers are classified as non-employees. The workforce is measured as an absolute number on the balance sheet date.

Individuals that are in an employment agreement with Arcadis, according to national law or its application (i.e. employees). Employees exclude contingent workers, such as consultants and agency workers.

Active employees are individuals that are in an employment agreement with Arcadis, according to national law or its application (i.e. employees). Active employees exclude i) contingent workers, such as consultants and agency workers, ii) employees still on long term leave of absence on 31 December, and iii) employees who have left the organization before 31 December in the relevant year.

Workforce expressed in FTE (Full Time Equivalent).

Voluntary termination of permanent employees (see definition above) divided by the average number of permanent employees during the period. A termination is voluntary when the decision for termination is made by the employee. The rate is calculated as a percentage covering the calendar year.

The eNPS (Employee Net Promoter Score) measures our employee engagement. On a scale of -100 to +100, the eNPS score determines to what extent employees promote Arcadis as a place to work and therefore helps us ascertain how we are progressing on our journey to be a best place to work. The eNPS is only measured for permanent employees and temporary employees (that have a tenure of more than 6 months). eNPS is calculated by subtracting the percentage of detractors (scores between 0 and 6) from the percentage of promotors (scores of 9 and 10). Our final score is based on four quarterly engagement surveys throughout the year, which includes integrating companies (AIBI, CRTKL, Arcadis Gen, DPS) from June. The last survey was in December 2024.

Training Hours are from Oracle Timesheets or equivalent tools (for countries not yet integrated on Oracle).This is based on employees self-declared training hours on their timesheet or/and local equivalent tools.

Lost Time Case Frequency (LTCF)

The number of lost time injuries or ill health per 200,000 or 1,000,000 working hours. This is calculated using both working hours set by regulatory and client requirements.

OSHA: (Number of LTIs) x (200,000 hours) / (total Number of Work Hours)
ESRS: (Number of LTIs) x (1,000,000 hours) / (total Number of Work Hours)

Total Recordable Case Frequency (TRCF)


(ESRS Term: Rate of recordable work-related accidents)

The number of Total Recordable Cases per 200,000 or 1,000,000 working hours. This is calculated using both working hour constants based on regulatory and client requirements.

OSHA: (Number of Recordable Cases) x (200,000 hours) / (total Number of Work Hours)
ESRS: (Number of Recordable Cases) x (1,000,000 hours) / (total Number of Work Hours)

GHSMSS

(ESRS Term: H&S Management System)

Injury

(ESRS Term: Work-related injuries)

Occupational Illness

(ESRS Term: Work-related ill-health)

Recordable Case

(ESRS Term: Recordable work-related accidents)

Lost Workdays (LWD)

(ESRS Term: Number of days lost to work-related injuries and fatalities from work-related accidents, work-related ill health and fatalities from ill health)

Work that deprives children of their childhood, their potential and their dignity, and that is harmful to physical and mental development. It refers to work that:
i. is mentally, physically, socially or morally dangerous and harmful to children; and/or
ii. interferes with their schooling by depriving them of the opportunity to attend school; obliging them to leave school prematurely; or requiring them to attempt to combine school attendance with excessively long and heavy work.

A child is defined as a person under the age of 18. Whether or not particular forms of ‘work’ can be called ‘child labour’ depends on the child’s age, the type and hours of work performed and the conditions under which it is performed. The answer varies from country to country, as well as among sectors within countries. The minimum age of work should not be less than the minimum age of completion of compulsory schooling, and, in any case, should not be less than 15 years according to International Labour Organisation (ILO) Convention No. 138 on Minimum Age. Exceptions can occur in certain countries where economies and educational facilities are insufficiently developed, and a minimum age of 14 years applies. These countries of exception are specified by the International Labour Organisation (ILO) in response to a special application by the country concerned and in consultation with.

The right of workers to health and safety measures that ensure physical and mental well-being. This includes the provision of the correct personal protective equipment (PPE) aimed at preventing injuries, illnesses and health issues caused by work-related hazards.

Calculation methodology for the average number of days to pay an invoice = (A+B) / total number of invoices

in which:
A = Invoices with a term paid in time vs our internal SLA * maximum days of that term + 10 days per invoice for process steps outside of Arcadis influence such as extended approval times by illness, payment processing time at the banks, delays by the fact that some countries do not process payments on daily base.
B = Invoices with a late payment * maximum days of that term * 2 (being overdue) + 10 days per invoice for process steps outside of Arcadis

The method to assess timeliness of payments for the internal SLA is as follows:
• The invoice date plus invoice or Purchase Order terms equal the due date of each invoice.
• If the invoice payment date is equal or less than the due date, the invoice is accepted as paid on time.
• Invoices that have been received after the due date as calculated above are not accepted as paid on time.
• Invoices that have due dates less than 10 days from accounting date are also removed from the population as there is not sufficient time to receive, process, approve and schedule an invoice for payment in accordance with the due date.
• Invoices with an immediate due date are set on a term of 1 day. All invoices except intercompany are taken into account.

Prudency is applied by counting only with the maximum amount of the set terms, as well as if determined overdue, then set terms are multiplied by two. Also, out of prudency 10 extra days are added for process steps outside of Arcadis.

Percentage of active employees that have successfully passed annual mandatory training on Arcadis' General Business Principles (AGBP, our code of conduct). This training specifically addresses issues like corruption, bribery, conflicts of interest and other risks to which our people may be exposed. The number is expressed as percentage, calculated by dividing the number of active employees that successfully passed the training by the total number of active employees.