BRIDGING PROSPERITY

MESSAGE FROM THE CHAIRMAN

MESSAGE FROM THE PRESIDENT

ABOUT

TEKFEN HOLDING

SUSTAINABILITY MILESTONES

HIGHLIGHTS OF

2022

SUSTAINABILITY

VISION

Why “Bridging Prosperity”?

Tekfen Group is one of the essential building blocks of the Turkish economy; the Group has been creating value and jobs for 67 years. We have been pursuing excellence in all areas with the motto “Do what you know best in the best way possible,” since the very first day. With another motto, “The future belongs to those who build it,” we build our business culture around people, social benefit, and the environment, and continue our activities for a sustainable future.

As our main lines of business, contracting and agriculture both “bridge prosperity.” At the Engineering and Contracting Group, we contribute to the development of countries with infrastructure projects such as highways and pipelines, industrial facilities such as refineries and terminals, and superstructure projects such as stadiums and high-rise buildings. We build facilities and undertake projects that meet the vital needs of societies and raise their living standards.

We provide quality resources to our farmers with high-quality and disease-free seeds and saplings, which are essential for quality production in agriculture. We also provide a much higher yield to farmers with our production of plant nutrients, which are key elements of food security. While supporting agricultural production with our fruit orchards, we supply fresh fruits to tables in many countries around the world.

The buildings we construct as part of our real estate development activities offer safe, comfortable, and environmentally friendly living and working spaces to tens of thousands of people.

With the Tekfen Foundation, we provide scholarships to successful young people to give them a brighter future and add value to social life with our initiatives for culture and arts.

We strive to build a brighter, more prosperous, and more sustainable future with all our activities, practices, priorities, and goals.

We regard human life as our top priority, and we aim to minimise our overall impact on the environment. We strive to constantly improve ourselves and make investments that will enable us to use our resources in the most efficient way possible. We closely follow the megatrends that are rapidly transforming our world, such as the climate crisis, population growth, demographic and social change, urbanisation, and technological developments. Besides integrating digital transformation and innovation into our business, we also allocate resources to initiatives that will enhance our activities with new technologies. We are proud to be setting an example for our industries with our good practices and remarkable performance in occupational health and safety.

As a Group that serves the welfare and development of societies with deep historical roots, our primary responsibility is to become a pillar of a sustainable future. There are no better words than “Bridging Prosperity” to express our quest for sustainability!

The business world plays a key role in developing solutions to stop climate change. On the road to a low-carbon economy, a clear and coherent climate policy must be established based on dialogue and global cooperation among all stakeholders for action and investment purposes.

Message from the Chairman

Dear Stakeholders,

Just as the world was attempting to heal the wounds incurred from the COVID-19 pandemic, we saw the emergence of a plethora of issues. The recent global instability persisted in 2022 as the Russo-Ukrainian War broke out early in the year. In addition to its effects on the economy, the Russo-Ukrainian War raised concerns for food security since both countries are global suppliers of basic foodstuffs such as barley, wheat, and corn. Combined with the climate crisis, the number of citizens facing acute food insecurity increased from 135 million in 2019 to 345 million in 2022.

The 2022 Sustainability and Human Development Report published by the United Nations Development Programme (UNDP) highlights the concerns caused by the rapidly changing geopolitical environment, conflicts, increasing poverty, insecurity and multi-layered and chronic global uncertainty, while addressing the risks posed by the climate crisis and the deteriorating ecological balance. It is estimated that the economic losses caused by the climate disasters that took place around the world in 2022 amounted to nearly $270 billion.

Fixing this negative outlook depends on the global acceleration of the fight against climate change. To reach the 1.5°C target, the world must reduce annual CO₂ emissions by 48 percent by 2030 and reach net zero by 2050, while cutting methane emissions by a third by 2030 and nearly halving it by 2050. However, despite all warnings, emissions continue to rise in every industry.

At Tekfen, we believe that our efforts towards the Carbon Net-Zero Roadmap are imperative for the future of our Group and the world. Thanks to these efforts, we became one of the 53 companies in Türkiye to score a “B” in the CDP’s Climate Change Program in 2022. As for the Water Security Program, we ranked 103rd among the 2,437 companies worldwide with our “A” rating.

We continue to review the business processes of our Group Companies thoroughly to boost their adaptive capacity to climate change’s negative impacts and align them with our carbon-free goal. We prepare our roadmaps in accordance with regulations such as the EU Green Deal, Carbon Border Adjustment Mechanism and Emissions Trading System and take concrete steps in line with their requirements. Through the various projects and R&D activities carried out in our Group Company Toros Agri, which operates in an emission-intensive industry, we improve the production process and the product itself. We believe that adapting to today’s rapidly changing market conditions and integrating business models supporting a sustainable future into our corporate culture serve as opportunities for the success of Tekfen Group Companies.

I would also like to touch on the earthquake disaster that struck our country in February 2023. At Tekfen, we mobilized all our resources immediately to reach out to millions of affected citizens and to help heal the wounds caused by the earthquake, which occurred in an area where we operate rather extensively. In coordination with the Disaster and Emergency Management Presidency (AFAD), we quickly sent the construction machinery, generators, transportation vehicles and various other equipment at our factories and facilities in the region to the areas in need. Many of our friends personally participated in search and rescue activities, and our employees in remote areas also started an aid campaign for the urgent needs of the earthquake victims. I would like to express my sincere thanks to all my colleagues for their selfless efforts at a time when our country needed cooperation the most.

Just like last year, Tekfen’s 2022 Sustainability Report was prepared entirely in the digital environment. All the projects and practices in this report summarise the work we have done and the steps we have taken for a better and more sustainable world in line with the values and sense of responsibility that have guided us since day one. As always, we would like to thank all our stakeholders and shareholders who joined us on this journey for their continued support.

Sincerely,

Zekeriya Yıldırım

Chairman

According to our new five-year strategic plan, decarbonisation, green energy, green hydrogen, green ammonia, and carbon capture, storage and use will form the third growth direction of our Group.

Message from the President

Dear Stakeholders,

As the world continues to suffer the negative consequences of the pandemic and the Russo-Ukranian War, the sustainability agenda maintains its priority in addition to the economic and political agenda. In addition to global problems such as high inflation, disruptions in supply chains, energy bottlenecks, slowdown in global trade and stagnation, extreme climate events that have increased in recent years continue to threaten our planet. Most climate-related disasters, which affect hundreds of millions of people every year and cause major loss of life and economic damage, bring along various issues that affect the masses, including poverty, social injustice, water and food crises, infectious diseases, refugee crises and increasing conflicts.

These issues come to the fore in the World Economic Forum’s 2023 Global Risk Report. As stated in the report, the situation will continue to worsen over the next 10 years, unless we as humanity begin to cooperate more effectively on climate change mitigation and climate adaptation. Failure to act on and adapt to climate change (failures in the reduction of emissions, water consumption, pollution, plastics, etc.), natural disasters, loss of biodiversity and environmental degradation represent five of the top 10 risks. It is believed that biodiversity loss will be one of the fastest worsening global risks in the next 10 years.

At Tekfen Holding, our main fields of operation are affected by factors beyond our control, such as economic and political developments and climatic events, which increase our risks. Additionally, global megatrends lead us to constantly review our activities and take agile steps to adapt to new conditions. By closely monitoring the changes in our two main industries, contracting and agricultural industry, we both ensure the sustainability of our current business and evaluate new investment opportunities in sustainable areas, especially in renewable energy.

The vision of “Bridging Prosperity,” which forms the framework of our Group’s sustainability strategy, represents the positive effects of our activities on human life and wellbeing. However, while making this positive impact on the welfare of societies, it is imperative that we minimise our impact on the ecological system. The “Tekfen Net-Zero Roadmap” established in 2021 guides our efforts to align all activities of our Group Companies with our carbon-free goal. In 2022, we accelerated these efforts to achieve net-zero emissions by 2030. This issue is especially important for the future of Toros Agri, as agriculture is one of the industries affected by the “Carbon Border Adjustment Mechanism.” We implement measures and investments that will reduce carbon emissions in all of Toros Agri’s facilities and activities. Thanks to the new filtering system we are installing at the Nitric Acid Production Facility, we are expecting to achieve a reduction of 80 to 85 percent in N₂O (nitrous oxide) emissions, which play a major role in climate change.

Reducing emissions in the transport industry is also vital for a net-zero economy. Sustainable biofuels, low-emission hydrogen and derivatives are the leading fuel alternatives for reducing carbon emissions from land, sea and air transportation. The ESCALATE project, supported by the European Commission’s Horizon Europe program involving Tekfen Engineering, aims to achieve zero emissions in heavy-duty vehicles with hydrogen fuel. As part of the project, Tekfen Engineering is responsible for the planning, construction and operation of a mobile hydrogen refueling station, and the preparation of a hydrogen refueling standard. Tekfen Engineering also handles all engineering works for the solar field of the Italian pasta brand Barilla, who initiated the EU-supported HiFlex Project together with 11 companies from seven countries to reduce carbon footprint in production.

Last year, our Group continued its investments and efforts for new technologies and innovation, which are key components of sustainability. Our R&D Centres operating under Toros Agri and Tekfen Agri continued to support sustainable agriculture with fertiliser, seed and seedling studies. Most recently, in 2022, Tekfen Ventures incorporated the new biotechnology venture Laverock, which aims to employ cell and gene therapy to treat various critical diseases, into its portfolio. Within the same year, the cooperation between the Tekfen Ventures investment Petra, a company working on no-contact tunnelling technologies, and Tekfen Contracting Group proved the possibilities of advances in our operating areas through innovative solutions and technologies. Another Tekfen Ventures investment, Phospholutions, continues to successfully cooperate with Toros Agri on field tests while Tropic Biosciences works with Agripark R&D Centre on banana saplings. Our Group aims to expand such value-creating synergies in other lines of business through Tekfen Ventures.

We support the active participation of women in the workforce for a sustainable society and local development. One of the most valuable initiatives in this field is the “Women Farmers Loan” project, which aims to empower women socially and economically by increasing the population of educated and conscientious women farmers in agriculture. To this end, Toros Agri works together with Tekfen Foundation and the Waste Prevention Foundation of Türkiye to encourage women entrepreneurs aspiring to work in agriculture yet lacking the financial sources to launch a business. The project provides financial support to women farmers through micro loans, while Toros Agri plays a key role as a field application partner in the training of women farmers. Social impact analysis of the first year of the “Women Farmers Loan” project showed that each lira invested in the project yielded 6.60 lira worth of social benefit. This valuable project was awarded in the “Cooperation: B2NGO Cooperation” category of the Sustainable Business Awards 2022 as the only finalist.

Efficient resource use is one of the vital building blocks of a sustainable future. At Tekfen, we constantly review our business processes to increase efficiency, while reducing resource consumption in all areas. We continue to carry out Scope 1 and 2 investments to achieve the net-zero target as well as digital transformation, customer experience, and R&D investments. Besides integrating digital transformation and innovation into our business, we also allocate resources to initiatives that will enhance our activities with new technologies. According to our new five-year strategic plan, decarbonisation, green energy, green hydrogen, green ammonia, and carbon capture, storage and use will form the third growth direction of our Group. We plan to include various cooperation opportunities in our business model through the “Tekfen Renewable Energy Solutions Company” we will establish to operate in this field.

At Tekfen, we will continue to move decisively on the path we set out for a more liveable world and a better future. The support of our stakeholders in achieving our goals will continue to be our biggest source of strength and motivation.

Sincerely,

Hakan Göral

President, Tekfen Group Companies

About Tekfen Holding

Established in 1956 by civil engineers Feyyaz Berker, Nihat Gökyiğit, and Necati Akçağlılar, Tekfen Group is one of the essential building blocks of the Turkish economy with the value it adds and the jobs it creates. Traded on the BIST 30 Index and the BIST Sustainability Index, Tekfen Holding carries out its activities with 38 companies and 13 subsidiaries that are highly reputable in their respective industries, with operations in five main areas of activity: Engineering and Contracting, Chemicals, Agricultural Production, Services, and Investment. As one of Türkiye’s most respected brands thanks to the values it stands for and the high recognition it enjoys, Tekfen Holding builds its business culture on people, social benefit, and the environment, and continues its activities in line with the principle of growth by sustainable profitability.

Tekfen Tower, İstanbul

4,866 employees

5,152 suppliers

7,787 customers

R&D budget of 73 million TRY

Engineering and Contracting Group

Tekfen Engineering and Contracting Group is a flagship Turkish brand that successfully represents the national contracting industry worldwide, with nearly 7,000 employees and more than 2,200 completed projects to date. The Group undertakes a significant portion of its projects abroad as a solution partner preferred by the world’s leading companies. This trust comes from the Group’s vast experience and know-how across different industries, its uncompromising commitment to global quality standards, its sustainability-oriented approach, and a business model founded on the principle of keeping promises.

With tremendous experience in a wide range of areas, the Group carries out its activities on the basis of EPC (Engineering, Procurement, Construction) and Design & Build, and provides its customers with turnkey solutions for various facilities, such as pipelines, oil and gas terminals, tank farms, oil refineries, offshore oil rigs, pump and compressor stations, power plants, industrial plants, petrochemical plants, highway and subway projects, sports complexes, and superstructure and infrastructure projects.

TANAP Pipeline, Türkiye

3,751 employees

729 suppliers

59 customers

Tekfen Construction and Installation, Inc.

Tekfen Construction, as the flagship company of the Group, is a well-established Turkish contracting company with a 67-year history. It is also a globally preferred business partner thanks to its extensive professional experience, know-how, and values.

Tekfen Engineering, Inc.

Providing engineering design, procurement, and project management services for both internal and external projects, Tekfen Engineering, Inc. is one of Türkiye’s largest multidisciplinary engineering companies with a strong staff of 450 people. The company is a competent solution partner in large-scale Engineering, Procurement, Construction (EPC) projects, Engineering, Procurement, Construction Management/Supervision (EPCM) projects, and Design & Build projects. It leverages the experience it gained in numerous domestic and international projects that were technologically challenging and required extensive know-how.

Tekfen Manufacturing and Engineering, Inc.

Tekfen Manufacturing was established in 1970 to produce storage and process equipment by international standards for the petroleum, petrochemical, and chemical industries, as well as for industrial facilities, such as gas plants, iron and steel plants, and power plants. In addition to Tekfen Group, Tekfen Manufacturing’s customers include international contracting firms, refineries, petrochemical, chemical, and fertiliser plants, and domestic and foreign companies engaged in LPG storage and distribution.

TEKFEN CONSTRUCTION VALUE CHAIN

Chemical Industry Group

Toros Agri Industry and Trade, Inc. (Toros Agri)

One of Tekfen Holding’s main lines of business, Chemical Industry Group primarily operates in fertiliser production, distribution, and trade. The Group’s umbrella organisation, Toros Agri Industry and Trade, Inc. (Toros Agri), strives to improve the structure of agriculture industry, serve Turkish agriculture and farmers ceaselessly, ensure food security and access to food, and preserve natural resources and the environment.

A regional actor and the largest company in the industry in terms of production volume and market share, Toros Agri was ranked 56th in the 2021 Top 500 Industrial Enterprises of Türkiye by the Istanbul Chamber of Industry. The Istanbul Chemicals and Chemical Products Exporters’ Association awarded the company the “IKMIB Star of Export” five years in a row from 2017 to 2021, making Toros Agri the export champion in Türkiye’s fertiliser industry.

Toros Agri works on mineral fertilisers, water-soluble specialty fertilisers, and organic/organomineral fertilisers. As part of its mineral fertiliser production activities, the company produces ammonium nitrate, calcium ammonium nitrate (CAN), diammonium phosphate (DAP), and compound (NPK) fertilisers at its three production facilities in Ceyhan, Mersin, and Samsun; inhibitor-added and water-soluble fertilisers at its Mersin facility; and bags used in fertiliser packaging at its Adana plant. The company continues to produce organic and organomineral fertilisers at its production facility in Ceyhan, as well as at the Toros Gönen Renewable Energy Production, Inc. facilities acquired in 2019, and the Toros Meram Renewable Energy Production, Inc. facilities established in 2020.

Toros Agri Mersin Plant

814 employees

2,095 suppliers

2,400 customers

796 dealers & 568 authorized dealers

TOROS AGRI VALUE CHAIN

Agricultural Production Group

Tekfen Agricultural Research, Production, and Marketing, Inc. (Tekfen Agri)

Tekfen Agricultural Production Group strives to bring a corporate perspective to agricultural production, which is vital in securing a sustainable future. The Group leverages its financial strength to transfer its know-how in agricultural inputs to the farming industry by embracing a scientific approach. It produces agricultural inputs such as seeds and seedlings and engages in direct agricultural production. The Group’s activities are organized under Tekfen Agricultural Research, Production, and Marketing, Inc. (Tekfen Agri).

With 63 agricultural engineers working in the company, Tekfen Agri combines agriculture with science and the latest technologies. Tekfen Agriculture produces bread and durum wheat seeds, edible and seed potatoes, banana fruit and banana saplings, and exports a large proportion of the fresh fruits it produces under the Alanar Fruit brand, which it acquired in 2019. In 2022, Alanar Fruit Company exported to 19 customers in 16 countries. When it comes to production diversity, Tekfen Agri is one of the world’s top agricultural production companies.

Tekfen Agri's potato production using its own seeds

91 employees

1,682 suppliers

444 customers

Services Group

Tekfen Services Group consists of Tekfen companies operating in port management, free zone management, building and facility management, and insurance brokerage. Group Companies are focused on high customer satisfaction in every area and refer to some of the best practices in their respective industries.

Torosport Ceyhan, Adana

149 employees

646 suppliers

4,884 customers

Toros Shipping Agency and Trade, Inc.

The Group’s port services are provided at the two terminals located at Toros Agri’s Ceyhan and Samsun Fertiliser Production Plants. Torosport Terminals, which primarily serve imports, also handle Toros Agri's own cargoes in addition to external customers. Torosport Ceyhan Terminal is one of the most important bulk and general cargo ports in İskenderun Bay due to its location and capacity. Similarly, Torosport Samsun Terminal provides handling services for both bulk solid cargo and liquid chemical products.

Toros Adana-Yumurtalık Free Zone Founder and Operator, Inc. (TAYSEB)

As one of the subsidiaries of Toros Agri, TAYSEB is the founder and operator of the Adana-Yumurtalık Free Zone, which is the first free zone to be established in Türkiye for industrial enterprises. The Adana Yumurtalık Free Zone, located in the same region as Toros Agri’s Ceyhan Production Facility and Torosport Ceyhan Terminal, is one of the largest free zones in Türkiye with an area of 4.64 million square meters.

Tekfen Tourism and Services, Inc.

Continuing its activities under “Tekfen Services,” Tekfen Tourism and Services, Inc. is a company that specialises in asset and real estate management and that operates and manages Tekfen’s various real estate projects, such as Tekfen Tower, Kağıthane OfisPark, Taksim Residences, Bomonti Apartments, and Yalıkavak Tekfen Houses. The company also supports these projects with asset management, leasing, contract management, and strategic portfolio and revenue-raising activities.

Tekfen Insurance Brokerage Services, Inc.

Tekfen Insurance, which was established in 1982 under Tekfen Holding, continues to serve as the agency of 18 leading insurance companies in Türkiye and all around the world. Tekfen Insurance focuses primarily on the risks faced by Group Companies in their operations. Tekfen Insurance also acts as an agent for many organisations and individual customers outside the Group in banking, construction, tourism, chemicals, food, textiles, agriculture, and other industries.

Investment Group

Tekfen Ventures L.P.

Tekfen Ventures is a corporate venture capital firm established in 2016 to seize opportunities in the world of global entrepreneurship and to invest in early-stage tech startups. The company closely monitors innovative ventures in Tekfen Group’s core industries, analyses in detail the market position, business models, and future plans of promising ventures, and invests in companies at the right stage in cooperation with world-class financial and institutional investors. As of the end of 2022, Tekfen Ventures has 12 ventures in its portfolio operating in different fields. In the new operating period, Tekfen Ventures will continue to support innovative ventures that redesign the global agriculture, construction, and manufacturing industries, focus on sustainability, and aim to improve people’s lives.

Pivot Bio, Tekfen Ventures

More information about the Groups is available in Tekfen Holding’s 2022 Annual Report.

Tekfen Holding’s Sustainability Milestones

1992

Tekfen Holding was among the founding members of the Turkish Foundation for Combating Soil Erosion (TEMA).

1993

The first consolidated independent audit was conducted.

1997

The first ISO 9001 Quality Management System Certificate was obtained.

1999

The Tekfen Foundation for Education, Health, Culture, Art, and Protection of Natural Resources (Tekfen Foundation) was established.

2002

The first OHSAS 18001 Occupational Health and Safety Management System Certificate was obtained.

2003

Tekfen Construction won the BP HELIOS award for the Sangachal Terminal project in Baku, Azerbaijan.*

* Tekfen Construction has been awarded the “Encouraging Social Development in Education and New Business Areas” award by BP for its success in the Sangachal Terminal Capacity Expansion project.

2004

Tekfen Construction won the International Pipe Line and Offshore Contractors Association (IPLOCA) Environmental Award.*
Tekfen Construction received the first ISO 14001 Environmental Management System Certificate.

* Tekfen Construction has been awarded the IPLOCA 2004 Environmental Award for its Sangachal (Azerbaijan) and BTC (Ceyhan-Türkiye) projects.

2007

Tekfen Real Estate Development was among the founding members of the Turkish Green Building Council (ÇEDBİK).
Tekfen Holding went public.

2010

Tekfen Holding started to monitor, measure and analyse its own the data on climate change.

2011

The Levent Office project received the first Green Building (LEED) certification.

2016

The Group held its first carbon neutral meeting.
Tekfen Ventures was established.
Tekfen Holding was included in the BIST Sustainability Index.

2017

The Sustainability Coordinatorship and the Sustainability Committee were established.
Tekfen Construction won the IPLOCA Social Responsibility Project Award.*
The first CDP Climate Change report was produced.
Tekfen Holding became a member of the Business Council for Sustainable Development Türkiye (BCSD Türkiye).

* Tekfen Construction received the “Social Responsibility” award from IPLOCA for its efforts to improve the living and hygiene conditions of seasonal agricultural workers along the TANAP Lot 3 Pipeline route.

2018

The UN Global Compact was signed.
The first CDP Water Security report was issued.
Stakeholder analysis identified material issues in the journey to sustainability.
Toros Agri became the first company in Türkiye to receive the Protect & Sustain certificate by the International Fertiliser Association (IFA).

2019

Tekfen Holding published its first Sustainability Report in accordance with the GRI Standard.
Sub-working groups were established under the Sustainability Committee.
Toros Agri was named an “Industry Stewardship Champion” by the International Fertiliser Association (IFA) for its effort in the areas of OHS, environmental management, product safety and energy efficiency.
Tekfen Holding ranked among Türkiye’s Climate and Water Leaders in CDP Climate Change and Water Security Programs based on 2019 data.

2020

Tekfen Holding became the only company from Türkiye to make CDP’s Global “A” List for both Climate Change and Water Security Programs.
A Group strategy for social investment-oriented activities was created in line with the Creating Shared Value (CSV) Approach.
Tekfen Holding published its “Fight Against Domestic Violence Policy” and as part of the Business Against Domestic Violence project.
Tekfen Agriculture received an award in the “Cooperation” category of the 7th Sustainable Business Awards for its project “Developing National and Domestic Bread Wheat Varieties Through the Use of Ancestral Seeds.”

2021

The “Women Farmers Loan Project” was implemented through the cooperative efforts of the Tekfen Foundation, Turkish Foundation for Waste Reduction, and Toros Agri.
Tekfen Construction commissioned its LEED Platinum-certified FNN Sustainability Centre in Adana, Ceyhan.
The remote working system, which was made mandatory during the COVID-19 pandemic, was made permanent in a hybrid system upon 82 percent positive feedback from employees.

2022

The Fourth Sustainability Report was prepared entirely in digital environment.
“Women Farmers Loan Project” was awarded in the “Cooperation: B2NGO Cooperation” category of the Sustainable Business Awards 2022.

Highlights of 2022

The “Women Farmers Loan” project, conducted in collaboration with the Tekfen Foundation, the Turkish Waste Prevention Foundation (TİSVA) and Toros Agri, was awarded in the “Cooperation: B2NGO Cooperation” category of the Sustainable Business Awards 2022 as the sole finalist.

Toros Agri received an award for its “Development of Domestic and National Wheat Varieties Through the Use of Ancestral Seeds” project at the “Future in Our Hands Award Ceremony” organized by the Turkish Federation of Automotive Maintenance Associations (TOBFED).

Toros Meram was acknowledged as “Highly Commended” in the “Anaerobic Digestion Pacesetter: Above 1Mwe” category by the UK-based Anaerobic Digestion and Bioresources Association (ADBA).

Tekfen Agriculture and the Sabancı University Nanotechnology Research and Application Centre (SUNUM) have signed a cooperation agreement for a prototype that enables the rapid diagnosis of plant diseases in the field.

Tekfen Holding became one of the Climate Leaders of Türkiye by achieving a “B” rating in the CDP Climate Change Program.

Tekfen Holding was one of only six companies in Türkiye to receive an “A” rating in the Water Safety Program, and one of 107 companies in the world.

R&D Specialist Cemre Avşar was awarded the “Best Researcher” prize at the SHEN Science, Health and Engineering Awards for the compilation article prepared with the contributions of Toros Agri R&D Centre team.

Toros Agri and Tekfen Agri, which continue to work at national and international level with the mission of “Sustainable Agriculture for a Sustainable World” to ensure agricultural sustainability, hosted the Belmont Forum meeting in Istanbul on October 20–21, 2022 together with Sabancı University.

Sustainability Vision

Tekfen’s sustainability vision is based on the concept of “Bridging Prosperity.” The main goal of all its economic activities is to improve social welfare and quality of life for all members of society. Tekfen Holding’s activities in engineering and contracting, chemistry, agricultural production, services, and investment industries go hand in hand with the fundamental aspects of social welfare, such as infrastructure services, food, energy, and access to shelter. Through its activities, Tekfen serves as a bridge that enables individuals to access the essential elements of a better life and better wellbeing, while laying the foundation for a sustainable future.

Strategic Areas

The climate crisis, employees and society, and innovation have been identified as Tekfen Holding’s main strategic areas for creating value, as they come with significant risks and opportunities in terms of sustainability.

Operational Roots

These roots define the business approach and priorities of Tekfen Holding, which has been one of the engines of the Turkish economy for the past 67 years. Economic performance, corporate governance, and customer loyalty will continue to be the building blocks of the company’s future.

Enablers

Operational excellence, digitalisation, talent management, and occupational health and safety (OHS) stand out as the main tools that will facilitate the realisation of the “Bridging Prosperity” vision.

Megatrends

In today’s world, mega-trends such as climate crisis and environmental destruction, rapid population growth, demographic and social change, urbanisation, technological advancements are shaping the global landscape as well as precipitating radical transformations in how businesses operate. Tekfen’s “Bridging Prosperity” vision expresses the goal of responding to this change sustainably and flexibly, as it redefines the Group’s business strategy.

Contributing to the Global Agenda

Tekfen’s vision is to develop a sustainable business model that covers the entire value chain and contributes to the UN Sustainable Development Goals (SDGs). Set by the United Nations Development Programme (UNDP) to end poverty, protect our planet, and ensure that all people enjoy peace and prosperity, these 17 goals offer a global agenda to all parties from governments to local administrations and from the public sector to the business world. As one of the signatories of the United Nations Global Compact, Tekfen Holding aims to create shared value by building its sustainability vision on specific SDGs in line with its areas of activity.

Investor Perspective

As sustainability gains traction around the world, more investors are starting to include the issue on their agenda. The exponential increase in the interest shown in sustainable investments is leading to significant changes in capital flows. Investors expect companies to disclose their environmental, social and governance (ESG) performance and be more transparent. Recent regulations are expected to improve the quality and accessibility of information disclosed by companies and increase the transparency of investments made in line with ESG criteria.

While new regulations such as the Corporate Sustainability Reporting Directive (CSRD) and the Sustainable Finance Reporting Regulation (SFDR) are rapidly finding a place on the agenda of companies, it is aimed to reduce greenwashing activities by providing investors with accurate and reliable information. Turkish companies with subsidiaries and significant business volume in the European Union are also expected to be affected by these regulations.

To keep up with the global agenda, Tekfen Holding expands and improves the scope of its ESG approach and performance, as demonstrated in its annual reports. It also responds to the annual assessments of different sustainability indices such as S&P Global, FTSE4Good, and the BIST Sustainability Index. Tekfen Holding is one of 53 companies in Türkiye to receive a “B” rating in the CDP’s Climate Change Program and ranks 103rd out of 2,437 companies in the world with an “A” rating in the Water Security Program. Its BIST Sustainability Score went up from “B” to “A-” in 2022. The Company supports global initiatives such as the United Nations Global Compact and the Sustainable Development Goals.

Material Issues

Materiality Analysis

Materiality analyses are conducted to determine Tekfen Holding’s strategic priorities for sustainability and to reveal the focus areas of the Sustainability Report. The intersections of the priorities of the stakeholders and those of Tekfen were determined with the Materiality Analysis covering the External Trend Analysis, the opinions of the Board members, strategic goals, and the Vision Workshop. Material issues are reviewed in light of external trends, risks, and opportunities.

Tekfen’s Priorities

Three outcomes were included in the analysis to identify Tekfen Holding’s priorities. These were:

The outcomes of the Sustainability Vision Workshop held with the managers of the Group Companies,
Opinions of the Board members,
The objectives in the company’s strategic plan and the outcomes of the Strategy Workshop.

Stakeholder Priorities

Stakeholder priorities were determined through Stakeholder Analysis and External Trend Analysis.

As part of the Stakeholder Analysis, Tekfen Holding’s employees, customers, suppliers, solution partners, public institutions and regulatory authorities, analysts, investors, nongovernmental and professional organisations, the media, international organisations, and universities were asked about their priorities and their sustainability expectations from Tekfen through surveys. In 2018, approximately 50 percent of the surveys were answered, totalling 2,578 people. The Stakeholder Analysis was conducted by an independent consultancy company with reference to the AA1000SE Accountability Stakeholder Engagement Standard.
With the External Trend Analysis, global and sectoral risks and trends were also included in the analysis, and subjects that are critical for the industries were determined.

Material Issues

The shared priorities of the stakeholders and Tekfen Holding are mapped in the Materiality Matrix. Subjects defined as top priority indicate the sustainability issues that need to be managed before everything else. These subjects form the basis of the “Bridging Prosperity” vision. The focus areas of the “Bridging Prosperity” vision and the material issues are in alignment.

In line with this year’s update, operational excellence and customer satisfaction have moved from very high priority to high priority. These issues continue to be among the priorities of Tekfen Tourism and Tekfen Insurance.

Tekfen’s operational roots cover already cover some of these material issues, namely “Economic Growth,” “Corporate Governance.” “Occupational Health and Safety” stands out as the top priority for the relevant industries and is also one of the facilitators.

Looking at the priorities of each company,

“Occupational Health and Safety” is one of the top priorities for Tekfen Construction.
“Climate Crisis” is the top priority for Toros Agri and Tekfen Agri.

“Digitalisation” and “R&D and Innovation,” megatrends with global impact, are also among the top priorities for Tekfen Holding. “Employee Development and Satisfaction” stands out as another major issue that will need attention in the coming period. “Climate Crisis,” another major issue in the industries in which Tekfen Holding operates, is one of the top priorities on the prioritisation map.

The “Climate Crisis”, “Innovation” and “Employees and Society” are Tekfen’s strategic value areas. While the Sustainability Report focuses on top-priority issues, it also covers highly material and material issues.

Sustainability Management

At Tekfen, the Sustainability Committee operates in service of realizing the “Bridging Prosperity” vision. Operating under the Corporate Governance Committee, the Sustainability Committee consists of senior officers appointed by the CEOs of Tekfen Holding and Tekfen Group Companies (Tekfen Construction, Tekfen Engineering, Tekfen Manufacturing, Toros Agri, Tekfen Agri, Tekfen Tourism, and Tekfen Insurance). The Sustainability Committee is chaired by the President of Tekfen Group Companies.

The Sustainability Committee is responsible for creating the strategies, roadmaps, targets, policies, and reports necessary for the realisation of the “Bridging Prosperity” vision, integrating sustainability into business processes in line with the Holding’s priorities, and ensuring the active participation of the Group Companies in these processes. The Committee is composed of 17 members and met twice in 2022.

Five working groups were formed to support the committee. Members of these working groups were determined by the leaders of the groups to obtain the expertise and diversity required for the implementation of the strategic sustainability roadmap. The groups convened regularly throughout the year and continued their activities in accordance with the relevant strategic sustainability roadmap.

The Tekfen Holding Board of Directors is responsible for monitoring sustainability approach, targets, and performance development. The Corporate Governance Committee, which reports to the Board of Directors, is responsible for the execution of sustainability policies, and reports the activities of five working groups to the Board of Directors at least once a year, as well as its own activities. Sustainability issues are regularly discussed by the Corporate Governance Committee and the Board of Directors.

Progress targets related to the actions in the sustainability roadmap and key performance indicators on occupational safety and the environment are included in the company scorecard targets, which affect the annual performance evaluations of senior management (including the CEO) and employees.

Sustainability Committee and Working Groups