Aareal Bank

Reference: page 65 (GOV-1 21); page 66 (GOV-1 21a, d); page 67 (GOV-1 22-23).

Aareal Bank AG has a two-tier/dual board system separating senior management (Management Board) from monitoring (Supervisory Board). The Management Board manages the company, develops and implements the enterprise strategy in coordination with the Supervisory Board, and ensures sustainable risk management. All Management Board members hold specific ESG skills and are informed on ESG risks and opportunities at least annually by the Sustainability department or the Bank's Sustainability Officer.

Management Board members (2024):

• Dr Christian Ricken, Chief Executive Officer (CEO)
• Nina Babic, Chief Risk Officer (CRO)
• Andrew Halford, Chief Financial Officer (CFO)
• Christof Winkelmann, Chief Market Officer (CMO)

Supervisory Board: 12 members, four of whom are employee representatives. 91.7% of members are independent (one member, i.e. 8.3%, is not independent). The Supervisory Board advises and monitors the Management Board.

Composition and diversity (31 December 2024): Executive members: 4 (3 male / 75%, 1 female / 25%). Non-executive members: 12 (8 male / 67.67%, 4 female / 33.33%).

ESG topics are a fixed component of regular Management Board and Supervisory Board meetings. The Group Sustainability Officer coordinates sustainability management and reports directly to the Chairman of the Management Board, who holds overall responsibility for the Group's sustainability strategy.

Reference: page 67 (GOV-2 26); page 68 (GOV-2 26 c); page 69.

Aareal Bank AG's Management Board and Supervisory Board are involved in the CSRD implementation process and were informed in several Management Board and Audit Committee meetings during 2023 and 2024 about implementation of the due diligence requirements as part of ESRS preparation, led by the Sustainability team. Both boards are kept constantly informed of material impacts, risks and opportunities related to the business model, and the results of the ESG risk inventory are presented to them once a year.

The boards are obliged to establish a risk culture in line with the EBA guidelines on internal governance; an annual risk culture report addresses audit findings on ESG risk requirements. ESG risks are treated as a sub-aspect of the established risk types and compiled via a structured questionnaire; the RiskExCo, the Management Board and the Supervisory Board (Risk Committee) are involved in the risk inventory.

Material IROs addressed during the reporting period included: climate change impacts from own operations and financed emissions, transition and physical risks to building values, and green finance opportunities (environmental); positive impacts of remote working, employee communication, training/CPD and avoidance of violence and harassment (own workforce); positive impacts of a good corporate culture (governance); and ICT/cyberattack risks (information security).

Reference: page 69 (GOV-3 29).

The Management Board's variable remuneration includes sustainability targets; however, Aareal Bank operates a sustainability-related remuneration policy rather than dedicated sustainability-related incentive systems. One of the Group targets in the remuneration systems is ESG-related, and the target-setting arrangements for Management Board members provide for at least one ESG-related strategic target. As a result, approximately 10% of Management Board members' variable remuneration depends directly on achieving ESG-related targets. The amount of variable remuneration does not depend on achieving any GHG emissions reduction targets.

2024 targets related to:

• Achievement of green loan targets
• Ethical behaviour and respect
• Gender diversity for new hires
• Promotion of gender diversity
• Implementation of the CSRD requirements

Per the GOV-3 table, the percentage of remuneration recognised as linked to climate-related considerations is 4.50% for the management body. No remuneration is linked to GHG emission reduction targets for either the management or supervisory body. Supervisory Board members do not receive variable remuneration (per the revised remuneration resolved at the 2023 Annual General Meeting). The Supervisory Board's Remuneration Control Committee, established under section 25d (7) KWG, reviews the appropriateness of the remuneration systems at least annually.

Reference: page 70 (GOV-4 30 and 32).

Aareal Bank Group maps the core elements of due diligence to the relevant paragraphs of its sustainability statement:

• a) Embedding due diligence in governance, strategy and business model - GOV-2, GOV-3, SBM-3
• b) Engaging with affected stakeholders in all key steps of the due diligence - GOV-2, SBM-2, IRO-1
• c) Identifying and assessing adverse impacts - IRO-1, SBM-3
• d) Taking actions to address those adverse impacts - E1-3
• e) Tracking the effectiveness of these efforts and communicating - E1-4, E1-5, E1-6, E1-7, E1-8, S1-5, S1-6, S1-9, S1-14, S1-16, S1-17

This cross-reference table situates the due diligence process within the broader governance, strategy and impact-management disclosures of the combined sustainability statement, with the topical Disclosure Requirements covering the climate change (E1) and own workforce (S1) standards.

Reference: page 70 (GOV-5 36); page 71.

Preparation of the sustainability statement is supported by comprehensive internal documentation, Group-wide rules and control processes. Key elements and internal responsibilities are set out in a Written Set of Procedural Rules (Framework Directive), with the ESRS preparation process described in internal procedural guidelines. An internal control system (ICS) ensures risks are avoided during sustainability reporting.

The ICS for sustainability reporting is part of the overall ICS and is aligned with the COSO framework. It is guided by the principle of proportionality and aims to ensure the effectiveness of business activities, the reliability of internal and external financial reporting, and compliance with statutory, regulatory, contractual and internal provisions.

A risk management system (RMS) and a regular end-to-end risk inventory ensure all risks, including ICS-relevant process-inherent risks, are identified and assessed. Identified process-inherent risks include errors in communication and in reports drawing on the financial statements, breaches of statutory and supervisory requirements, and risks in data capture and report generation. Risk mitigation is ensured through appropriate and effective key controls. The Management Board is informed at least annually, via the ICS annual report, of the results of the risk assessment and internal controls and their appropriateness and effectiveness.

Reference: page 71 (SBM-1 40); page 72 (SBM-1 42); page 73.

Aareal Bank AG is a specialist property-finance bank headquartered in Wiesbaden, Germany, operating across Europe, North America and Asia/Pacific. Its two business segments are Structured Property Financing (SPF) - commercial property finance for hotels, alternative living, retail, logistics, office and residential real estate, plus funding - and Banking & Digital Solutions (BDS) - sector-specific payments processing, corporate banking and tenancy bond solutions for the German housing, property and energy/utilities industries. Main SPF clients are institutional investors, private equity firms, family offices and listed property companies. The Aareon subsidiary was sold during the reporting period.

Headcount by geography (31 December 2024): Germany 1,088; Europe excl. Germany 85; North America 43; Asia/Pacific 9; total 1,225.

Revenue by ESRS sector (2024): Banking (FBM) EUR 1,047 mn; Hotels & Lodging (HHL) EUR 38 mn. The Group is not active in coal, oil, gas, chemicals, arms or tobacco.

Value chain: As a pure-play service provider, upstream inputs (IT, lending expenses, audit/advisory, facility management) are immaterial. The downstream value chain differs between SPF (financing completed buildings, no new builds) and BDS (payments processing with partners including First Financial Software GmbH). The 2024 target of EUR 1.75 billion in new green loans was met (EUR 6-7 billion targeted by 2026).

Reference: page 73 (SBM-2 45); page 74; page 231 (per-topic, S1).

Aareal Bank Group's business strategy aims to add value for its stakeholders, using a structured strategy process and stakeholder dialogue to ascertain the opinions, needs and wishes of key stakeholder groups and incorporate them into the strategy and individual products. Key stakeholder groups are included in the business strategy review at least annually and ad hoc.

Key stakeholder groups comprise internal stakeholders (employees, Management Board, Supervisory Board) and external stakeholders, with clients, investors, employees and owners identified as key for the business model. The Management Board develops and owns the strategy, discussed with the Supervisory Board; owners are involved via the Advisory Council; employees are engaged through town hall meetings, Bank-wide employee talks and the internal magazine. Client dialogue follows a "follow the customer" principle. Investors provide feedback via investor discussions and road shows.

Other stakeholders considered in strategic decisions and the DMA include policymakers and supervisory bodies, the public and media, suppliers and rating agencies (e.g. MSCI ESG, ISS ESG, CDP, Sustainalytics). All affected stakeholder groups and users of the statement are included in the DMA via internal representatives. Following Atlantic BidCo GmbH's takeover, the strategy was reviewed via a "strategy challenge" resulting in the Value Creation Plan (VCP).

Reference: page 74 (SBM-3 49); page 218 (E1); page 231 (S1); page 252 (G1); page 260 (information security).

In its double materiality assessment, Aareal Bank Group identified IROs as material for the standards E1 Climate Change, S1 Own Workforce and G1 Business Conduct, and for the entity-specific topic of information security. Information security was therefore assessed as material (per the SBM-3 text on page 74), with (potential) risks identified for it.

By topic:

• E1 Climate Change: IROs relate mainly to the Group's own operations and to its financing of properties (financed emissions), including transition and physical climate risks to building values and green finance opportunities.
• S1 Own Workforce: Most identified impacts caused by Aareal Bank AG as an employer were positive.
• G1 Business Conduct: The corporate culture and risk culture were considered positive.
• Information security (entity-specific): (Potential) risks were identified, principally ICT risks (e.g. cyberattacks) triggered by unauthorised internal or external access to ICT systems.

The topics E2 Pollution, E3 Water and Marine Resources, E4 Biodiversity and Ecosystems, E5 Resource Use and Circular Economy, S2 Workers in the Value Chain, S3 Affected Communities and S4 Consumers and End-users were not assessed as material. This is the first year of CSRD/ESRS application for the Group.

Reference: page 75 (IRO-1 53); page 76; page 77; page 83 (E1); page 85 (E2, E3); page 86 (E4, E5, G1); page 87 (information security).

Material IROs are determined through the double materiality assessment (DMA), performed from the perspective of affected parties and users of the sustainability statement. A total of 12 relevant stakeholder groups were defined, of which eight were classified as affected parties; they are represented by internal Group experts.

Process: A longlist of topics, based on ESRS 1 AR 16 and expanded to include the entity-specific topic of "information security", is drawn up beforehand. Experts independently formulate and assess IROs using assessment templates, applying a gross approach (voluntary mitigating actions excluded). The assessment covers own operations and the upstream and downstream value chain, including financed emissions.

Scoring: Positive impacts are scored as ((scale + scope) / 2) x likelihood; negative impacts as ((scale + scope + irredeemable character) / 3) x likelihood; risks and opportunities as expected financial impact x likelihood. For potential human rights impacts, likelihood is notionally set to 100%. A topic exceeding the defined threshold on impact or financial materiality is classified as material.

The DMA is linked methodologically to the ESG risk inventory. Per-topic IRO-1 disclosures confirm E2, E3, E4 and E5 were each not material. The methodology and results will be reviewed in 2025.

Reference: page 77 (IRO-2 56); page 78.

Aareal Bank Group lists the Disclosure Requirements complied with in preparing the sustainability statement. Beyond the ESRS 2 general disclosures (BP-1, BP-2, GOV-1 to GOV-5, SBM-1 to SBM-3, IRO-1, IRO-2), the topical Disclosure Requirements reported reflect the material topics identified in the DMA: E1 Climate Change, S1 Own Workforce and G1 Business Conduct (plus the entity-specific topic of information security).

E1 Climate Change: E1-1 (transition plan, p218), E1-2 (policies, p220), E1-3 (actions, p221), E1-4 (targets, p225), E1-5 (energy consumption and mix, p226), E1-6 (gross Scope 1, 2, 3 and total GHG emissions, p227), E1-7 (GHG removals and carbon credits, p230), E1-8 (internal carbon pricing, p231).

S1 Own Workforce: S1-1 (policies, p233), S1-2 (engagement processes, p237), S1-3 (remediation and channels, p240), S1-4 (actions, p241), S1-5 (targets, p246), S1-6 (employee characteristics, p247), S1-9 (diversity metrics, p249), S1-14 (health and safety metrics, p249), S1-16 (remuneration metrics, p250), S1-17 (incidents, complaints and severe human rights impacts, p251).

G1 Business Conduct: G1-1 (business conduct policies and corporate culture, p252).

The standards E2, E3, E4, E5, S2, S3 and S4 were not assessed as material and their topical Disclosure Requirements are therefore not reported. This is the first year of CSRD/ESRS application.

Reference: page 218 (ESRS E1: Climate change, E1-1 Transition plan for climate change mitigation); page 222 (E1-3); page 226 (E1-4).

No comprehensive transition plan exists as at 31 December 2024. Aareal Bank Group had not yet published a transition plan at the reporting date. As a commercial property finance provider, it acknowledges the building sector's relevance to climate goals and is laying foundations for a plan. The Bank plans to publish the ESRS-required transition plan information for financial year 2026.

Foundational progress in 2024 (described under E1-3):

• First disclosure of financed carbon emissions in the Commercial Real Estate Financing (CREF) portfolio via a separate PCAF report (Partnership for Carbon Accounting Financials standard), creating portfolio carbon transparency for the first time. This data pool is described as the foundation for developing a science-based transition plan.
• An initiative to be launched in 2025 will identify and assess the key levers and mechanisms for a long-term transition plan, including development of Aareal's climate pathway.
• The goal is to derive robust targets for 2030, 2035 and 2050 (page 226).

Own operations: environmental management focuses on energy efficiency, especially the Wiesbaden HQ (see E1-3). Climate neutrality for own operations is pursued via an "avoid, reduce, offset" approach (not currently science-based; see E1-4).

NOT present (first-year gaps): no GHG decarbonisation targets aligned to 1.5C/SBTi; no SBTi validation; no quantified financed-emissions reduction trajectory; no defined base year or milestones (to be set once the transition plan is developed, page 228); no locked-in emissions analysis; no Scope-by-scope reduction pathway; no quantified climate capex/investment plan. Aareal Bank Group states it is not excluded from the EU Paris-aligned Benchmarks.

Reference: page 220 (E1-2 Strategies related to climate change mitigation and adaptation); page 221.

Limiting climate change and adapting to it are incorporated into the business strategy covering all of the Bank's global activities. The business strategy is resolved by Aareal Bank AG's full Management Board following discussion by the Supervisory Board. It defines the Bank's sustainability mission statement, ambition level on ESG performance, qualitative and quantitative ESG targets at corporate level, and performance-related ESG KPIs.

Risk side: the main focus is transition risks and physical climate risks, with particular attention to the commercial real estate sector's exposure. The risk strategy (resolved by the full Management Board) is binding across Sales, Credit Management, Risk Management, Finance & Controlling and Corporate Affairs, and covers the two segments Structured Property Financing (SPF) and Banking & Digital Solutions (BDS). ESG criteria play an increasingly important role in lending decisions and in assessing the sustainable value of financed properties.

Opportunity side: the Bank follows its Green Finance Framework (separate Frameworks for Lending and Liabilities), based on the Loan Market Association Green Loan Principles and the ICMA Green Bond Principles. These enable origination of green loans against defined green qualification criteria and issuance of green funding instruments. The ESG Expert Group and the Green Finance Committee oversee framework design and compliance; material changes require full Management Board consent.

The "strategic sustainability" approach uses five ESG target dimensions: Ambition, Investment, Client, Risk and Regulation.

Reference: pages 221-225 (E1-3 Actions and resources in relation to climate change policies).

Financed/portfolio actions (the Bank's main lever):

• New green loans of approximately EUR 3.9 billion entered into in 2024, lifting total green loans to approximately EUR 7.6 billion.
• First green senior non-preferred bond issued: EUR 500 million, two-year maturity; plus EUR 467 million green European Commercial Paper (ECP) outstanding at 31 Dec 2024.
• Active participation in the PCAF network (D/A/CH/Li CRE and Mortgages subgroup); published its first PCAF report on financed carbon emissions in the CREF portfolio, the foundation for a science-based transition plan. An initiative to be launched in 2025 will identify the key decarbonisation levers.
• First Green Bond Allocation & Impact Report, including carbon-avoidance methodology.

Own-operations actions (Wiesbaden HQ focus), under "avoid, reduce, offset":

• 100% certified emission-free green electricity at Wiesbaden (largest site) and most other German locations; high share of district heating from CHP/renewables.
• Environmental/emissions data calculated with the VfU-Kennzahlen tool.
• Metering policy (cost ~EUR 60,000; expected ~97.2 t CO2 saving); heat-pump replacement (~EUR 30,000); ongoing LED retrofitting.
• ~EUR 2 million budgeted for 2024 energy costs (Wiesbaden, Essen, Berlin), expected to fall to ~EUR 1.6m (2025) and ~EUR 1.5m (2026/2027).
• 2025 plans: solar thermal upgrade, heating-pump modernisation, ventilation upgrades (~12.2 t CO2 expected saving).

All measures are climate change mitigation actions; no climate change adaptation actions have been taken for own buildings yet.

Reference: pages 225-226 (E1-4 Targets related to climate change mitigation and adaptation).

Own-operations target: climate neutrality achieved through offsetting, following an "avoid, reduce, offset" approach. This target is not currently based on scientific methods (no SBTi/1.5C alignment). Levers: green electricity, low-emission heating, fleet electrification, reduced travel via digital collaboration. Unavoidable emissions offset since financial year 2023.

Green finance targets (financed/portfolio):

Decarbonisation targets: As stated under E1-1, the ESRS transition plan information is planned for FY2026, to be used as the basis for deriving robust targets for 2030, 2035 and 2050.

NOT present (first-year gaps): no GHG emission reduction targets (own or financed) with quantified reduction percentages; no defined base year or interim milestones (to be set once the transition plan is developed); no SBTi-validated targets; no portfolio net-zero/alignment year. Targets to date are green-volume and transparency targets rather than emissions targets.

Reference: pages 226-227 (E1-5 Energy consumption and mix).

Scope: all national and international locations plus subsidiaries/equity interests under Aareal Bank's financial and operational control. Data collected with the VfU-Kennzahlen tool. As the first ESRS report, no prior-year comparison is available.

Energy consumption and mix (1 Jan - 31 Dec 2024, MWh):

Aareon (reported separately, prior-year data, owned only through September 2024): fossil 6,698 MWh; nuclear 0; renewable 2,072 MWh; Aareon total 8,770 MWh. Cumulative Aareal Bank Group + Aareon total energy consumption: 14,275 MWh.

Reference: pages 227-230 (E1-6 Gross Scopes 1, 2, 3 and Total GHG emissions).

Methodology: Scope 1 and 2 per GHG Protocol plus selected Scope 3 categories, calculated with the VfU metrics (2024 version, based on ecoinvent 3.10 and IPCC AR6/GWP100). Financed emissions in the loan portfolio (Scope 3 Cat 15) determined with external experts. First ESRS report, so no prior-year comparison, no base year and no milestones (to be defined once the transition plan is developed).

GHG emissions 2024 (tCO2e):

Financed emissions (Cat 15) split: CREF portfolio 607,197 t CO2 + Treasury portfolio investments 609,459 t CO2; detailed in the annual PCAF report. Foreclosed assets (no operational control, disclosed separately): Scope 1 5,784 t, Scope 2 location-based 10,119 t (total 15,903 t). Including Aareon and foreclosed assets, Group Scope 1 = 7,942 t and Scope 2 (location-based) = 13,382 t.

GHG intensity per net revenue (2024): location-based 1,180 and market-based 1,178 t CO2e/EUR mn (net revenue EUR 1,041 mn). Financed emissions dominate the footprint (~99.5% of total), consistent with the bank's business model.

Reference: pages 230-231 (E1-7 GHG removals and GHG mitigation projects financed through carbon credits).

Offsetting follows the "avoid, reduce, offset" approach and is applied only to emissions that could not be avoided or reduced, contributing to the climate-neutral-operations-through-offsetting target. The "corresponding adjustments" method was used for the first time in 2024 (to offset unavoidable 2023 emissions), avoiding double counting since only the acquiring country counts the credits.

Offsetting project: a single reduction project located outside Europe, operating since 2009 (production facility opened 2020), registered as CDM-compliant with the UNFCCC and additionally Gold Standard certified, aligned with Article 6 of the Paris Agreement.

Carbon credits cancelled in 2024 (for FY2023 emissions): 4,825 tCO2e

The credits cover unavoidable Scope 1, Scope 2 and Scope 3 business-travel emissions for FY2023 (covering Aareal Bank AG and all subsidiaries incl. Aareon). Credits planned for future cancellation: 2,000 tCO2e (FY2024 emissions, to be retired in 2025). No GHG removals reported (0% from removal projects).

Reference: page 231 (E1-8 Internal carbon pricing).

Aareal Bank Group does not currently use an internal carbon pricing system.

However, carbon prices are taken into account in two related contexts:

• National carbon prices linked to the use of fossil fuels are factored into the operational costs in feasibility studies when assessing the economic efficiency of energy-improvement measures (own operations).
• The carbon price trajectory used in the NGFS scenarios for modelling transition risks is taken into account for the collateral in the credit finance portfolio as part of the regular climate stress tests.

No internal shadow carbon price per tonne CO2e is applied to investment or product decisions.

Reference: page 233-235

The Code of Conduct for Employees, resolved by the Management Board, applies to all Aareal Bank Group employees, including senior executives (leitende Angestellte) and Management Board, supervisory body and committee members. It sets mandatory principles of conduct; no breaches are tolerated. Topics covered by the Code of Conduct (Group-wide) and the Diversity Guidelines (Aareal Bank AG) include equal opportunities and diversity, fairness and protecting human rights, such as the prohibition on forced labour and child labour.

For occupational safety, procedural guidelines and safety instructions are established for Aareal Bank AG employees, with safety officers and specialists responsible for compliance.

Human rights: As a signatory to the UN Global Compact since 2012, Aareal Bank AG bases its activities on the Universal Declaration of Human Rights, the OECD Guidelines and the ILO core labour standards. In 2024 the 2019 Human Rights Guidelines were integrated into and replaced by the Bank's Human Rights Policy Statement under the German Supply Chain Due Diligence Act (LkSG), resolved by the Management Board. A Human Rights Officer monitors LkSG due diligence. Aareal Bank AG has also signed Germany's Diversity Charter (Charta der Vielfalt).

Staff development is governed by Learning@Aareal (blended learning, coaching, mentoring, onboarding) and a mandatory Structured Appraisal and Target-Setting Dialogue for all managers and employees.

Reference: page 237-240

Aareal Bank AG involves staff in economic decisions through employee representatives, within the framework of the German Works Constitution Act (BetrVG). The local Works Council is primarily responsible for employee matters; the General Works Council comprises Works Council members from all German establishments and handles issues affecting the entire Group or multiple establishments. The General Works Council appoints an Economic Committee (section 106 BetrVG), which discusses the Company's economic position with the Employer and informs the Works Council.

Works councils are elected by eligible employees in secret, direct elections for four-year terms; employees aged 16+ may vote and those aged 18+ with at least six months' tenure may stand. Senior executives and Management Board members are neither eligible to vote nor stand. Works councils hold co-determination rights on social matters (working times, conduct rules) and human resources issues (recruitment, transfers, terminations) at German locations. Aareal Bank AG's Supervisory Board is codetermined.

Employee representatives are informed in scheduled monthly meetings with HR and the Management Board. Direct engagement formats include the biennial anonymous employee survey (the 2023 survey was the third in four years), Aareal Talk Q&A sessions, Management Meetings, the Buddy@Aareal programme, works meetings, the intranet and the Aareal ONE digital magazine.

Reference: page 240-241

Since Aareal Bank Group identified no material negative impacts on its own workforce in the materiality assessment, no remediation processes need to be described. Nonetheless, mechanisms exist to handle workforce complaints.

A confidential, anonymous whistleblowing channel (the "Speak-up" tool) lets staff report suspected rule breaches, fraud or white-collar crime online or by phone, guaranteeing confidentiality and protection. Staff may also submit reports to:

• Complaints Management (supported by Legal; open to employees and third parties)
• Human Resources
• Works Council / Executive Staff Representative Committee
• Contact form on the Aareal Bank AG website
• Central Fraud Prevention Office (Compliance department)
• AGG Complaints Office (for AGG-related reports)
• Representative Body for Disabled Employees

All reports are passed to the Whistleblowing Office and processed under the German Whistleblower Protection Act (HinSchG) using the dual-control principle, with a case team convened as needed. The procedure follows a defined timeline: preliminary examination within 48 hours; acknowledgement to the whistleblower within seven days; labour-law and follow-up consequences within one month of case analysis; and notification of progress to the whistleblower after three months at the latest. The Head of Compliance is responsible. Whistleblowers acting in good faith are protected from disciplinary action or discrimination.

Reference: page 241-246

Aareal Bank Group identified only positive impacts and opportunities and no negative impacts. Actions aim to retain staff, ensure their health, safety and equality, and uphold employee rights:

• Remote working: working-from-home support for childcare, family care and flexible hours; in-office attendance rate above 50%, with remote work from other EU Member States permitted for a set number of days.
• Information, consultation and participation: mandatory Structured Appraisal and Target-Setting Dialogues at all levels; biennial surveys (2023: over 80% of staff satisfied as an employer); Aareal Talk sessions with new CEO Dr Christian Ricken.
• Health and safety: B.A.D. Health Centre Wiesbaden partnership; Employee Assistance Program (EAP) 24/7, 365 days; health-promotion and work-life-balance programmes.
• Gender equality and equal pay: performance and skills are the sole criteria for appointments and promotions.
• Inclusion of people with disabilities; measures against violence and harassment (mandatory AGG training, whistleblowing channel, AGG Complaints Office, EAP).
• Diversity: unconscious-bias training, gender-neutral job adverts, 45 nationalities in 2024, talent and succession management, Hessen school-holiday childcare support.

An annual action plan, cascaded via target-setting dialogues, includes gender quotas for recruitment and promotion.

Reference: page 246-247

Aareal Bank AG conducts an employee survey every two years (covering organisational culture, management, employee satisfaction, diversity, and initial training/CPD); results are discussed by the Management Board and all management levels, shared with employee representatives, and used as an indicator of opportunities, risks and progress against targets.

Targets are linked to the identified IROs and set out in the Diversity Guidelines, Code of Conduct and various works agreements and procedural guidelines. They include:

• Promoting diversity (nationalities, age structure/generational diversity, gender distribution at all hierarchy levels, proportion of women in management)
• Actively promoting employee health, equal opportunities and safety
• Complying with equal treatment and equal pay for work of equal value
• Promoting flexible working hours and reducing carbon emissions (mobile-working agreement)
• Continuously enhancing corporate culture and supporting employee development (training and skills IRO)

To oversee targets, the Bank regularly measures and reports HR metrics (diversity, leave and part-time working, employees with disabilities, staff turnover, partial retirement, young-talent positions, surveys, training hours).

Current recruitment KPIs, valid until 2025:

Reference: page 247-248

Characteristics of Aareal Bank Group's staff as at 31 December 2024, expressed in head count. The S1 scope comprises Aareal Bank AG, Aareal Bank Asia Ltd., Aareal Capital Corporation, collect Artificial Intelligence GmbH, BauGrund Immobilien-Management GmbH, plusForta GmbH, Mercadea S.r.l. and the management board and second-level management at La Sessola Service S.r.l.

Employees by gender (head count):

By contract type:

By location: Germany 1,088 head count (other countries account for less than 10% of the workforce and are not separately disclosed).

Turnover: 140 employees left voluntarily or due to dismissal, retirement or death in service during the period, a turnover rate of 11.36% (largely due to a subsidiary in liquidation). Staff expenses excluding pensions were EUR 216 million (Note 39).

Reference: page 249

Aareal Bank Group's diversity metrics as at 31 December 2024, measured in head count.

Gender diversity at top management level:

Distribution of employees by age group:

"Top management" comprises the heads of division (managing directors) at Aareal Bank AG, Aareal Capital Corporation and Aareal Bank Asia Ltd., and the managing directors or other top-level management responsible for managing the other subsidiaries.

Reference: page 249-250

Health and safety metrics for 2024 are reported separately for Aareal Bank and for Aareon, since the figures relate to periods rather than a reporting date and Aareon AG was owned by Aareal Bank AG up to and including September.

Aareal Bank:

Aareon:

The total number of recordable work-related accidents at Aareal Bank Group including Aareon was 15, with zero fatalities. The incident rate expresses cases per million hours worked (per 500 full-time staff over one year). Hours worked were estimated via a five-stage methodology; the metrics were not validated by an external body other than the assurance provider.

Reference: page 250-251

Remuneration metrics captured as at 31 December 2024. Employee remuneration comprises base salary, benefits in cash, benefits in kind and direct remuneration; hourly remuneration was derived by dividing annual full-time remuneration by 52 weeks and weekly hours.

The gender pay gap is the difference in average pay between female and male employees as a percentage of the average male pay level. The figure disclosed is unadjusted and does not account for the uneven gender distribution across job levels, a material factor since remuneration is closely linked to corporate hierarchy level.

A large majority (91.8%) of employees are employed by Aareal Bank AG, which is subject to the German Regulation on Remuneration in Financial Institutions (Institutsvergutungsverordnung - IVV); other subsidiaries follow different policies, limiting comparability.

The annual total remuneration ratio of the highest-paid individual (CEO) to the median annual total remuneration of all employees (excluding the highest-paid individual) was 23.19. As no target achievement level had been set for the current CEO Dr Christian Ricken at data collection, the prior-year figure for the previous CEO Jochen Klosges was used.

Reference: page 251

Figures are reported separately for Aareal Bank Group and Aareon, since they relate to periods rather than a reporting date and Aareon AG was owned by Aareal Bank AG up to and including September.

Aareal Bank Group:

• One case of discrimination or harassment reported in 2024.
• Two complaints reported via own-workforce concern channels; one turned out to be unfounded and was not pursued further.
• Zero complaints via OECD National Contact Points.
• Zero severe human rights incidents related to the own workforce.
• No fines, sanctions or compensation for infringements of social and human rights factors. Provisions for litigation risks in the consolidated financial statements were EUR 1.7 million as at 31 December 2024 (no specific provisions earmarked for such fines).

Aareon AG (pro rata period):

• No cases of discrimination or harassment.
• One complaint via an own-workforce concern channel; the case was closed, a disciplinary measure was ordered and training conducted.
• Zero OECD National Contact Point complaints; zero severe human rights incidents; no related fines or sanctions.

Combined for 2024: one case of discrimination or harassment and three complaints reported via own-workforce concern channels.

Reference: page 252

Business conduct policies and corporate culture

Aareal's double materiality assessment identified a positive impact: a good corporate culture expressed through binding rules of good conduct and a zero-tolerance policy on bribery, corruption and accepting advantages.

Code of Conduct and culture

A Group-wide Code of Conduct (revised in the reporting period) is binding on all Management Board members, executives, staff and supervisory bodies, publicly available, and inspired by the UN Universal Declaration of Human Rights, ILO conventions and the UN Global Compact. It commits to avoiding conflicts of interest and combating corruption, money laundering, terrorist financing and fraud. Staff complete Code of Conduct training on joining and at least every three years. The Compliance Management System Framework Directive underpins the culture; risk culture is assessed via the Risk Culture Report.

Anti-corruption and bribery

The Group Compliance Officer (also Group Anti-Money-Laundering Officer) reports at least annually to the Management and Supervisory Boards on risk analyses and corruption incidents, supported by a Framework Directive on Preventing Corruption, Fraud Prevention Guidelines and training.

Whistleblowing and suppliers

The SpeakUp system enables anonymous reporting under dual control, with protections per the German Whistleblower Protection Act. New suppliers with order volume above EUR 100,000 undergo a credit-agency check.