Limited Assurance Report of the Independent Auditor regarding the supplementary sustainability information1
To the Management Board of Covestro AG, Leverkusen
We have performed an independent limited assurance engagement on the separately marked sections for supplementary sustainability information in the “Covestro Annual Report 2021” (hereinafter: “supplementary sustainability information”) of Covestro AG, Leverkusen, Germany for the period from January 1 to December 31, 2021.
The legal representatives of the Company are responsible for the preparation of the supplementary sustainability information in accordance with the reporting criteria. Covestro AG applies the principles and standard disclosures specified in the Global Reporting Initiative (GRI) Sustainability Reporting Standards in conjunction with the Corporate Accounting and Reporting Standard (Scope 1 and 2) of the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD) as reporting criteria (hereinafter: “Reporting Criteria”).
This responsibility of the legal representatives includes the selection and application of appropriate methods to prepare the supplementary sustainability information and the use of assumptions and estimates for individual disclosures which are reasonable under the given circumstances. Furthermore, the legal representatives are responsible for the internal controls they deem necessary for the preparation of the supplementary sustainability information that is free of – intended or unintended – material misstatements.
It is our responsibility to express a conclusion on the supplementary sustainability information based on our work performed within a limited assurance engagement.
We conducted our work in the form of a limited assurance engagement in accordance with the International Standard on Assurance Engagements (ISAE) 3000 (Revised): “Assurance Engagements other than Audits or Reviews of Historical Financial Information”, published by IAASB.
Accordingly, we have to plan and perform the assurance engagement in such a way that we obtain limited assurance as to whether any matters have come to our attention that cause us to believe that the supplementary sustainability information of the Company for the period from January 1 to December 31, 2021 has not been prepared, in all material respects in accordance with the aforementioned Reporting Criteria. We do not, however, issue a separate conclusion for each disclosure. As the assurance procedures performed in a limited assurance engagement are less comprehensive than in a reasonable assurance engagement, the level of assurance obtained is substantially lower. The choice of assurance procedures is subject to the auditor’s own judgement.
Within the scope of our engagement we performed, amongst others, the following procedures:
- Inquiries of group-level personnel who are responsible for the materiality analysis in order to understand the processes for determining material topics and respective reporting boundaries for Covestro AG
- A risk analysis, including media research, to identify relevant information on Covestro AG’s sustainability performance in the reporting period
- Evaluation of the design and the implementation of systems and processes for identifying, processing, and monitoring sustainability performance data and metrics within the scope of the audit, including the consolidation of data
- Inquiries of group-level personnel who are responsible for determining disclosures on concepts, due diligence processes, results and risks, performing internal control functions and consolidating disclosures
- Inspection of selected internal and external documents
- Analytical procedures for the evaluation of data and of the trends of quantitative disclosures as reported at group level by all sites
- Assessment of local data collection, validation, and reporting processes and the reliability of reported data through a sample survey at Dormagen (Germany), Caojing (China), Baytown (USA), Markt Bibart (Germany), Ankleshwar (India), Niihama (Japan), Meppen (Germany), Maasvlakte (Netherlands), and Waalwijk (Netherlands).
- Assessment of the overall presentation of the disclosures
In our opinion, we obtained sufficient and appropriate evidence for reaching a conclusion for the assurance engagement.
Independence and Quality Assurance on the Part of the Auditing Firm
In performing this engagement, we applied the legal provisions and professional pronouncements regarding independence and quality assurance, in particular the Professional Code for German Public Auditors and Chartered Accountants (in Germany) and the quality assurance standard of the German Institute of Public Auditors (Institut der Wirtschaftsprüfer, IDW) regarding quality assurance requirements in audit practice (IDW QS 1).
Based on the procedures performed and the evidence obtained, nothing has come to our attention that causes us to believe that the separately marked sections for supplementary sustainability information in the “Covestro Annual Report 2021” of Covestro AG for the period from January 1 to December 31, 2021 has not been prepared, in all material respects, in accordance with the Reporting Criteria.
Restriction of Use/General Engagement Terms
This assurance report is issued for purposes of the Management Board of Covestro AG, Leverkusen, only. We assume no responsibility with regard to any third parties.
Our assignment for the Management Board of Covestro AG, Leverkusen, and professional liability as described above was governed by the General Engagement Terms for Wirtschaftsprüfer and Wirtschaftsprüfungsgesellschaften (Allgemeine Auftragsbedingungen für Wirtschaftsprüfer und Wirtschaftsprüfungsgesellschaften) in the version dated January 1, 2017 (https://www.kpmg.de/bescheinigungen/lib/aab_english.pdf). By reading and using the information contained in this assurance report, each recipient confirms notice of the provisions contained therein including the limitation of our liability as stipulated in No. 9 and accepts the validity of the General Engagement Terms with respect to us.
Cologne, February 21, 2022
KPMG AG Wirtschaftsprüfungsgesellschaft
[Original German version signed by:]
ppa. Claudia Dietrich
1 Our engagement applied to the German version of the Covestro Annual Report 2021. This text is a translation of the Independent Assurance Report issued in German, whereas the German text is authoritative.