In today’s reality, where companies are expected not only to deliver financial results but also to take responsibility for their impact on people and the environment, transparency has become one of the key elements of building organisational value.
In 2024, LemonTree implemented its Sustainability Strategy, which includes a number of strategic initiatives that have since been consistently implemented across all areas of our organisation’s operations. From the very beginning, we wanted it to be more than just a document presenting the company’s aspirations. Our goal was for it to become a practical tool supporting our day-to-day project, investment and operational decisions.
Implementing the Strategy is an ongoing and complex process that undoubtedly presents a challenge. At the beginning of 2026, after two and a half years of its implementation, we decided to prepare our first Sustainability Report in accordance with the European Sustainability Reporting Standards (ESRS).
Although the LemonTree Group is not subject to the reporting obligations arising from the Corporate Sustainability Reporting Directive (CSRD), we decided to prepare the Report and submit it for assurance by an independent audit firm. This decision was driven by our commitment to consciously managing our impacts, risks and opportunities, as well as by our intention to engage with our business Partners in a transparent and responsible manner. Another factor motivating us to prepare the Report was our desire to assess what we have already achieved since implementing the initiatives arising from the Strategy and how these have translated into our products, our team, our business Partners and our wider environment.
This first voluntary Report was prepared without a full assessment of compliance with the EU Taxonomy. We deliberately treated it as the first stage in organising our data, processes and reporting approach, focusing primarily on the Double Materiality Assessment (DMA), the identification of impacts, risks and opportunities, and building a solid foundation for further work. The Taxonomy project, covering a detailed assessment of the eligibility of our activities and their alignment with the EU Taxonomy criteria, still lies ahead of us and will be the next natural step in the subsequent stages of our work.
Omnibus – what comes next?
The adoption of the Omnibus package has undoubtedly changed the sustainability reporting landscape in Europe. The number of companies subject to mandatory reporting has been reduced, some requirements have been simplified, and certain deadlines have been postponed. This does not mean, however, that ESG issues have lost their importance. On the contrary, many of the key elements remain unchanged.
What is particularly important is that, despite these simplifications, the Double Materiality Assessment (DMA) remains one of the cornerstones of the sustainability reporting framework. Companies are still required to identify their material impacts, risks and opportunities through the DMA process. This means that understanding an organisation’s actual impact on its surroundings, as well as the impact of environmental, social and governance factors on its business, continues to form the basis of responsible management and reporting.
At LemonTree, we view these changes primarily from a strategic perspective. In our opinion, many of the arguments supporting the implementation of sustainability principles remain valid regardless of the evolving regulatory landscape. Banks, investors and investment funds continue to expect reliable ESG data and are increasingly using it in their risk assessment processes and investment decisions. At the same time, access to financing is becoming ever more closely linked to sustainability performance, energy efficiency and the resilience of assets to climate-related risks.
We must also remember the value chain. Even if some companies are no longer directly subject to mandatory reporting, ESG requirements will continue to cascade from the largest organisations to their suppliers, business Partners and contractors. In practice, this means that transparency, data availability and readiness to respond to questions regarding environmental and social impacts will remain an important element of business relationships.
From the perspective of the real estate sector, it is also becoming increasingly important that transparency and the quality of data influence asset valuations and the attractiveness of properties for investors and tenants alike. Energy efficiency, carbon footprint, applied technologies and the resilience of buildings to future challenges are becoming key factors in creating the long-term value of real estate.
We believe that collecting ESG data, managing emissions, calculating carbon footprints, analysing the supply chain, engaging in stakeholder dialogue and reporting on sustainability are not merely responses to regulatory requirements. Above all, they are elements of modern business management that support better decision-making, reduce risks and contribute to building long-term organisational value.
In short, the Omnibus package changes the scope of reporting obligations, but not the direction. And that direction still leads towards greater transparency, responsibility and conscious management of an organisation’s impact on its surroundings.
Double Materiality Assessment – the foundation of the entire process
The most important stage in preparing the Report was the Double Materiality Assessment (DMA), which forms the foundation of the new reporting standards. Its purpose was to examine LemonTree’s operations from two perspectives simultaneously: the impact we have on the environment and society, and the way environmental, social and governance issues may affect our operations, performance and future business value.
The process included workshops, an analysis of our business model and entire value chain, industry benchmarking, surveys, and interviews with both internal and external stakeholders. This enabled us to look at the organisation from a broader perspective than solely through the lens of our own operations. As a result, we identified 61 material Impacts, Risks & Opportunities (IROs), which became the foundation of the Report and the further development of our strategy.
Importantly, the assessment showed that many of the most significant challenges do not arise solely within LemonTree’s own operations. A substantial proportion of them are located within our value chain – among material suppliers, contractors, designers, business Partners, tenants and building users. This confirmed that effective sustainability management requires cooperation across the organisation’s entire ecosystem.
Stakeholder dialogue as a source of knowledge and development
One of the most valuable elements of the process proved to be stakeholder dialogue. Employees, tenants, investors, suppliers, general contractors, financing institutions, local communities and experts working with LemonTree all took part in the preparation of the Report. Such a broad dialogue not only enabled us to better identify our most significant areas of impact but also helped us understand the expectations of individual stakeholder groups.
Employees highlighted the high quality of the working environment, while business Partners emphasised the importance of efficient cooperation processes and occupational safety. Tenants and investors pointed to the growing importance of high environmental standards, transparency and asset quality. Local communities, in turn, stressed the need for responsible project delivery and for taking local conditions into account.
Risks and Opportunities
RThe Report also enabled us to view the Company’s operations through the lens of the risks and opportunities associated with the economic transition and ongoing social and environmental changes. Among the key challenges we identified were greenhouse gas emissions related to project delivery, the use of construction materials and waste management, the impact of our developments on biodiversity and land transformation, occupational health and safety throughout the value chain, our impact on local communities, and expectations regarding the safety and quality of building use.
At the same time, the assessment revealed numerous opportunities. These include, above all, the development of low-carbon construction technologies, the use of renewable energy sources, improving the energy efficiency of buildings, advancing circular economy solutions, and developing projects that support biodiversity.
The growing business benefits associated with high ESG standards are also becoming increasingly significant, including enhanced attractiveness of properties for investors and tenants, reduced regulatory risks, and the creation of long-term asset value.
Decarbonisation. Measuring what we want to improve
One of the most important steps taken in 2025 was the launch of a systematic process for calculating the organisation’s carbon footprint. For the first time, we calculated our greenhouse gas emissions under Scope 1 and Scope 2. This provided us with a reliable baseline for setting targets and monitoring our progress.
At the same time, we are aware that in the real estate sector a significant proportion of emissions lies beyond the organisation’s direct control – in construction materials, processes carried out by contractors, and the operation of buildings. From 2026 onwards, we will begin reporting Scope 3 emissions, covering our entire value chain. This will enable us to gain an even better understanding of the actual impact of our developments and to manage decarbonisation more effectively throughout the entire life cycle of a building. The results of this work will also enable LemonTree to establish its decarbonisation targets and join the Science Based Targets initiative (SBTi).
This is only the beginning
Preparing our first Report has shown us the significant potential of a structured approach to collecting data across all areas of LemonTree’s operations. It has also highlighted areas requiring further improvement – from data quality and tools supporting, for example, carbon footprint calculations, to documenting all activities and materials. In addition, the entire process demonstrated how important legal measures and the implementation of various policies and codes are. They play a vital role in embedding appropriate principles of conduct within the organisation, while also defining and setting expectations for our business Partners.
In the next stages, we will also continue developing our EU Taxonomy project, which will enable us to demonstrate even more comprehensively the extent to which our activities align with the European sustainable finance framework. We regard this Report as the beginning of a much longer journey. It will serve as a point of reference in the years ahead and represent an important step in strengthening the LemonTree Group’s strategy – one that is resilient to future challenges, focused on the continuous improvement of our product, responsible towards people and the environment, and committed to creating long-term value for all stakeholders.
I encourage you to read LemonTree’s first Sustainability Report for 2025!