Sustainability approach at Market Építő Zrt.

Market Építő Zrt. embarked on the path of sustainability in 2020 and this path has brought many challenges and new approaches to the Company’s operations. Over the past 4 years, we have systematically progressed in the implementation of the tasks included in our sustainability strategy.

As we were among the first in the industry to catch up in ESG in Hungary, we lacked a good example to follow. So we had to pave this path ourselves, which is not easy, but we have gained a lot of experience and successful sustainability-related projects.

The adoption of the ESG law at the end of 2023 has fundamentally shaken up large companies in Hungary. The Market Group is in the fortunate position that the steps it will take in compliance with its 2021’s strategy in place coincide with the challenges of aligning with the CSRD and EU taxonomy. Already in 2024, we have started to focus more on regulatory compliance.

What does this mean in practice?

We first published a Group-level ESG report for 2021, and the following year we published an audited report. Sustainability is managed at top executive level and dedicated specialists work in this area. Based on those results, we have achieved some of the legal compliance much earlier than expected.

In the future, we will strive to publish our sustainability report in Hungarian by 30 June each year, so we have set tighter deadlines for sub-tasks and optimised data collection processes. Currently we report according to the GRI standard, but this year we will start to take into account the ESRS standard framework.  There is some relief in the story given the significant overlap between GRI and ESRS requirements.

A key element of the CSRD is the Dual Materiality Assessment, which was prepared in February 2024 with the assistance of an external consultancy. Another important deliverable is that we will be able to include the total scope of emissions in our report, so that we can start assessing our scope 3 emissions in the first half of 2024 – this is expected to be a multi-year project.

The sustainability report should include a classification according to the EU taxonomy, that is our company should identify “environmentally sustainable” economic activities that “contribute significantly to (at least one of) the EU’s climate and environmental objectives, while not violating any of the DNSH objectives. The main way to achieve taxonomy compliance will be through the inclusion of financial and technical areas, which is already under preparation.

A major challenge for companies, and with it for the Market Group, is one of the requirements of ESG reporting: the environmental and social assessment of suppliers. Therefore, starting this year, we will inform and educate our partners about the upcoming ESG obligations. We are striving to help them to overcome the obstacles related to sustainability, as we know exactly how difficult it is to integrate the new approach into their operations.

Another important aspect of ESG reporting is that companies must establish and integrate a risk management system into all their relevant business processes, including the identification of social responsibility and environmental risks. This process is currently being planned in the Market Group.