Limited Assurance Report of the Independent Auditor1
To the Management Board of Covestro AG, Leverkusen,
We have performed an independent limited assurance engagement on the GRI-Reporting, consisting of disclosures in the GRI-Supplement as well as the GRI-Information referred to in the GRI-Index and presented in the audited Management Report (GRI-Supplement together with the GRI-Index form the Appendix 1 to this report) of Covestro AG, Leverkusen, (further „Covestro“) for the period from January 1 to December 31, 2019.
The legal representatives of Covestro are responsible for the preparation of the disclosures in the GRI Reporting in accordance with the reporting criteria. Covestro applies the principles and standard disclosures set out in the standards of the Global Reporting Initiative (GRI) in conjunction with the Corporate Accounting and Reporting Standard (Scopes 1 and 2) of the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD) (further 'Reporting criteria').
This responsibility of the legal representatives includes the selection and application of appropriate methods to prepare the disclosures in the GRI-Reporting and the use of assumptions and estimates for individual disclosures which are reasonable under the given circumstances. Furthermore, this responsibility includes internal controls they have determined to be necessary for the preparation of the report in a way that is free of – intended or unintended – material misstatements.
Independence and quality assurance on the part of the auditing firm
We are independent from the entity in accordance with the requirements of independence and quality assurance set out in legal provisions and professional pronouncements and have fulfilled our additional professional obligations in accordance with these requirements.
Our audit firm applies the national statutory provisions and professional pronouncements for 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).
Our responsibility is to express a conclusion based on our work performed within our limited assurance engagement on the information provided in the GRI-Reporting.
We conducted our work 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. This Standard requires that we plan and perform the assurance engagement to obtain limited assurance whether any matters have come to our attention that cause us to believe that the disclosures in the GRI-Reporting for the business year January 1 to December 31, 2019 has not been prepared, in all material respects, in accordance with the aforementioned Reporting Criteria. We do not, however, provide a separate conclusion for each disclosure. In a limited assurance engagement the evidence gathering procedures are more limited than in a reasonable assurance engagement and therefore significantly less assurance is obtained than in a reasonable assurance engagement. The choice of audit procedures is subject to the auditor’s own judgement.
Within the scope of our engagement, we performed amongst others the following assurance procedures:
- Inquiries of personnel on group level, who are responsible for the materiality analysis, in order to gain an understanding of the processes for identifying material sustainability topics and respective reporting boundaries of Covestro
- A risk analysis, including a media search, to identify relevant information on Covestro sustainability performance in the reporting period
- Evaluation of the design and implementation of the systems and processes for the collection, processing and control of the disclosures and key figures included in the scope of this engagement, including the consolidation of the data
- Inquiries of personnel on group level who are responsible for identification, consolidation and implementation of internal control procedures for the data concerned, including accompanying explanations
- Analytical evaluation of data and trends which are reported by all sites for consolidation on group level
- Evaluation of selected internal and external documentation
- Assessment of local data collection and reporting processes and the reliability of reported data based via a sample at the sites in Baytown, South Charleston, Krefeld-Uerdingen, Antwerp and Brunsbüttel.
- Assessment of the overall presentation of the GRI-Reporting
Based on the procedures performed and the evidence obtained, nothing has come to our attention that causes us to believe that the disclosures in the GRI-Reporting for the period from January 1 to December 31, 2019 is not prepared, in all material respects, in accordance with the Reporting Criteria.
Restriction of Use / Clause on General Engagement Terms
This 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 is 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 report, each recipient confirms notice of provisions of the General Engagement Terms (including the limitation of our liability for negligence to EUR 4 million as stipulated in No. 9) and accepts the validity of the General Engagement Terms with respect to us.
Munich, February 17, 2020
[Original German version signed by:]
[German Public Auditor]
1 Our engagement applied to the German version of the GRI-Reporting 2019. This text is a translation of the Independent Assurance Report issued in German language, whereas the German text is authoritative.