Strategy
SBM-1 – Strategy, business model and value chain
Core elements of the general corporate strategy have an impact on sustainability-related aspects
The Lufthansa Group offers its customers short-haul, medium-haul and long-haul flights worldwide. These are primarily provided by its five biggest passenger airlines, Lufthansa Airlines, SWISS, Austrian Airlines, Brussels Airlines and Eurowings. Customers can also use the services of Lufthansa Cargo to transport goods around the world. Finally, the Lufthansa Group portfolio includes the technical maintenance of aircraft by Lufthansa Technik and other industrial IT solutions. The Lufthansa Group expanded its product portfolio in 2023 with Green Fares, which enable customers to reduce their flight-related carbon emissions and offset the remaining carbon emissions – thus aiming to achieve higher efficiency in the use of energy and resources. It will also expand its portfolio of passenger airlines by acquiring a stake in ITA Airways.
The Lufthansa Group offers its products and services both to private customers and to corporate customers and is active around the globe. Its multi-hub strategy offers customers of its passenger airlines an extensive route network with the corresponding flexibility in travel. The Eurowings business, by contrast, is focused exclusively on point-to-point traffic on European short-haul and medium-haul routes.
Moreover, commercial joint ventures with leading international airlines extend the passenger airlines route network. Commercial joint ventures exist with United Airlines and Air Canada on routes between Europe and North America, and with All Nippon Airways (ANA), Singapore Airlines and Air China on routes between Europe and Japan as well as Singapore and China respectively. There are also numerous code-share arrangements, where several airlines share a scheduled flight. The Lufthansa Group is continuing to expand its offering in Asian growth markets, too.
The Lufthansa Group is a global company based in Europe, operating flights to Europe, North, Central and South America, the Asia/Pacific region, the Middle East and Africa from its five main hubs (Frankfurt, Munich, Zurich, Vienna, Brussels). Lufthansa Technik also provides aircraft overhauls and repair shops in the Asia/Pacific region, Europe, the Middle East, Africa and North, Central and South America.
| T051 | ESRS 2 SBM-1 | 40a Distribution of employees by region1) as of the reporting date 31.12.2024 | |
|---|---|---|
| Region | ||
| Germany | Headcount | 66,290 |
| North/Central America | Headcount | 2,616 |
| South America | Headcount | 222 |
| Europe, other | Headcount | 26,470 |
| Asia/Pacific | Headcount | 5,061 |
| Middle East/Africa | Headcount | 763 |
| Total number | Headcount | 101,422 |
| 1) Based on regions of deployment | ||
In certain circumstances, such as armed conflicts, the Lufthansa Group may decide to temporarily halt flights to specific countries. This is due to security concerns, as was the case with Ukraine, for example. Flights to Ukraine were temporarily stopped as a result of the Russian invasion.
The ESRS make specific requirements of sustainability reporting that take into account not only sector-agnostic but also sector-specific characteristics. These sectors define industry-specific requirements and activities. In 2024, the Lufthansa Group was active in the following ESRS sectors and generated the following revenue:
| T052 | ESRS 2 SBM-1 I 40b Revenue by ESRS sector in 2024 | ||
|---|---|---|---|
| Business segment | ESRS sector | Activity | Revenue in the ESRS sector in €m |
| MRO | Defence (MDE) | Activity C.33.16 Repair and maintenance of aircraft and spacecraft for Lufthansa Technik | 5,036 |
| Passenger Airlines | Other transport services (TTR) | Activity H.51.10 Passenger air traffic for the passenger airlines | 28,905 |
| Logistics | Other transport services (TTR) | Activity H.51.21 Air cargo for Lufthansa Cargo | 3,213 |
The ESRS sectors listed were also taken into account in the Lufthansa Group’s double materiality analysis. Guided by this materiality analysis, the Lufthansa Group identified the most important topics on which to base its strategy.
In the area of the environment, the Lufthansa Group pursues the aim of minimising greenhouse gas emissions and waste on board. By 2030, the Company aims to achieve a net reduction in carbon emissions of 50% in comparison with 2019. This target applies to air operations worldwide and includes both passengers and cargo clients. Furthermore, the Lufthansa Group also plans to phase out single-use plastic and aluminium on board – an aim that covers global air passenger operations.
With regard to social topics, the Lufthansa Group has set itself targets for boosting customer satisfaction and diversity. Customer satisfaction is a central aim for the Lufthansa Group and applies to all products and services globally, as well as to all customer groups for the Company’s individual segments. In addition, the Lufthansa Group aims to increase its diversity. In specific terms, this means that 25% of management positions should be filled by women by the end of 2025. This target applies globally to the entire Lufthansa Group.
Finally, in terms of governance, the Lufthansa Group strives to ensure ethical conduct in all of its business relationships and compliance with all legal and regulatory requirements.
The companies in the Lufthansa Group carry on their business activities from Europe, in particular from Germany, Austria, Switzerland and Belgium. As a result, most of the site-specific impacts, risks and opportunities can be attributed to one of these countries. Because flights are the main source of greenhouse emissions in flight operations, the climate change impacts cannot be limited to a specific place or market.
The biggest challenge is achieving the climate target by 2050. The Lufthansa Group is therefore investing in aircraft with innovative technologies to boost fuel efficiency, and in other environmental projects, and is adapting to stricter environmental requirements.
Lufthansa Group business model extends across several value creation stages
The Lufthansa Group business model includes passenger and cargo flights, MRO services as well as IT and logistics services in particular.
Some of the biggest influencing factors are fuel, aircraft, replacement parts, infrastructure services from third parties (for example, airport services and air traffic control) and qualified staff. These advance expenses are guaranteed through long-term agreements with reliable suppliers and investments in training programmes for the Company’s own staff.
The core activities (outputs) extend across the following areas:
- Procurement and operation of aircraft: purchase or leasing of aircraft, goods and services for their maintenance and operation, as well as the operation of flights
- Flight services: passenger and cargo services, including distribution, logistics services, flight planning, airport handling, flight operations, customer support and catering
- Additional services: maintenance, repair and overhaul of aircraft, including defence, provision of IT and digital transformation solutions and consultancy services, flight training and advanced training for cockpit crews, cabin crew and customers
In 2024, the Lufthansa Group achieved results by providing passenger and cargo flight services, technical maintenance and IT and logistics solutions. The current and expected benefit to customers include improved travel experiences, better punctuality and reduced carbon emissions. Investors benefit from increased financial performance, other stakeholders benefit from the strong market position and sustainable business practices of the Lufthansa Group.
SBM-2 – Interests and views of stakeholders
The Lufthansa Group identified the following groups as their most important stakeholders:
The Lufthansa Group places great emphasis on open, continuous and trusting dialogue with its internal and external stakeholder groups and engages with them through a range of different formats. In 2023, a comprehensive stakeholder survey was conducted in order to obtain more in-depth findings. The Company communicates regularly with its investors via roadshows and investor conferences, as well as through direct dialogue. The integration of customers is supported via panels and customer surveys, while interaction with employees is conducted via established formats. These include “Offen gesagt” (“frankly speaking”), where the Chief Executive Officer and other members of the top management answer questions from employees, and the “involve me!” annual employee survey. Residents are integrated into the process through dialogue formats with local representatives at the Company’s key airports, as is the case with the ongoing dialogue in the Airport/Region forum in Frankfurt. Furthermore, the Lufthansa Group reports on its activities and progress in various formats, such as in the progress report on the UN Global Compact or the report on the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), in order to ensure transparency and the ongoing involvement of stakeholders.
The Lufthansa Group organises its stakeholder involvement via a coordinated structure that combines both centralised and decentralised efforts. The centralised coordination is managed by the relevant departments, such as Investor Relations and Corporate Communications, while the HR department manages the employee involvement initiatives, including employee surveys. The decentralised involvement is organised by the relevant local sites in order to ensure that the communication is tailored to the requirements of the communities and other local stakeholder groups.
Responsible corporate governance benefits from dialogue with the Company’s stakeholders. This continuous exchange aims to help the Lufthansa Group better understand its different stakeholder groups’ needs, expectations and wishes, which permits their inclusion in business practices. Topics that can potentially impact long-term opportunities for creating value can thus be better identified. The materiality analysis conducted as part of the CSRD-compliant reporting also included the dialogue with various stakeholder groups and internal representatives.
The results of the stakeholder involvement were used in the Lufthansa Group's materiality analysis, which serves as the basis for the strategic development of its corporate responsibility management and the selection of the aspects and issues addressed in the combined non-financial declaration. Beyond the materiality analysis itself, these results are also used for product development in order to ensure that the Company’s offering meets the expectations and requirements of its stakeholders.
The Lufthansa Group regards the interests and perspectives of its stakeholders as a contribution towards helping to shape its strategy and business model. These findings are collected systematically via various dialogue formats and through the materiality analysis. The stakeholder survey covered all ESRS topics and other relevant sustainability-related topics, such as social commitment. All sustainability-related topics deemed material are integrated into the strategic initiatives and the Company’s business practices.
Some examples of how the business model is adapted to the interests and perspectives of stakeholders include the expansion of holiday routes as a response to customer demand and the introduction of carbon offsetting offers as a means of climate change mitigation. The Company is also improving intermodal travel options by reducing the dependence on short-haul flights by integrating train and bus connections, thus helping to achieve other sustainability targets. The route network is adapted while taking into account political and safety-relevant factors in order to guarantee passenger safety.
Furthermore, the positive acceptance of Green Fares has enabled the Lufthansa Group to expand its offering and offer these fares for long-haul flights, too. This is an ongoing, exploratory process that does not adhere to any particular timeline due to the innovative nature of the topic. Based on the option of being able to select a Green Fare in the booking process and rolling this out, the Lufthansa Group expects that this will increase passengers’ perception of the Company’s commitment to climate change mitigation and thus will help safeguard the business model.
The Lufthansa Group wants to ensure that the perspectives and interests of relevant stakeholders are communicated effectively to the relevant decision-making bodies with regard to sustainability-related impacts of the Company. The results of the materiality analysis, which is based on stakeholder assessments, are validated by the management and then presented to both the Executive Board and the Supervisory Board. Updates and more in-depth treatments of specific sustainability topics are also presented to the ESG Committee twice a year.
SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model
| T053 | ESRS2 SBM-3 | 48 Material impacts, risks and opportunities in 2024 | ||||||
|---|---|---|---|---|---|---|---|
| Aggregated aspects | IRO | Allocation of value chain | Time horizon | Impacts on people and the environment/financial risks and opportunities | Impacts of material IROs on the business model, supply chain, strategy and decision-making of the Lufthansa Group | How the Company responded to this impacts or intends to respond to it | Current financial effects |
| E1 – Climate change | |||||||
| Extreme weather events | Negative impact | Upstream, own operations, downstream |
Long-term | Adjusting to extreme weather events may require disruptive changes to processes or sites, which may have a negative impact on customers, suppliers, business partners or communities. Airport infrastructure and runways may also be affected, which could lead to flight cancellations and diversions, thus resulting in additional costs and lost productivity, particularly for business travellers and logistics partners. Adjustments to flight routes, increased fuel consumption and greenhouse gas emissions also lead to limited accessibility for customers due to higher prices. | Influences and expenses caused by climate change adaptation are considered by the climate risk analysis and, specifically, the vulnerability analysis. See also ↗ESRS E1 Climate change – Climate-related risks and opportunities for the Lufthansa Group have been identified and ↗ESRS E1 Climate change – Climate change resilience analysis has been initiated in order to analyse resistance to climate change | Adaptation measures, particularly for heatwaves, are described in ↗ESRS E1 Climate change – Initial measures to mitigate climate-related physical and transition risks have been implemented | Costs resulting from the EU-ETS are already leading to financial effects being felt today, see ↗Legal and regulatory factors. |
| Risks | Upstream, own operations, downstream |
Medium- to long-term | Extreme weather events may lead to delivery delays, require faster turnaround times and damage the brand image and operational stability, as well as affect employees. Furthermore, physical climate risks may limit the performance of aircraft, require diversions and airspace to be temporarily blocked, as well as cause damage to infrastructure and aircraft, which could have a negative impact on costs and income. | ||||
| Opportunity | own operations, downstream |
Medium-term | Use of the en-route weather display may improve climate and weather forecasts, and help to protect the Company against higher insurance premiums and gain reputational advantages. | ||||
| Regulatory and market risks | Risk | Upstream, own operations, downstream |
Medium- to long-term | Political/regulatory climate change mitigation measures in aviation, such as a carbon tax, may require the Company to adjust its operational processes (increasing costs, refinancing costs). There may be rises in current costs, increased ticket prices and disruptions in the fuel market. On the one hand, this may occur due to rising prices for oil-based fuel and sustainable aviation fuel (SAF), which may exceed the costs for carbon emissions over the medium term. At the same time this may also occur due to greater regulatory monitoring, exposure to natural disasters and increasing geopolitical conflicts. Furthermore, customer preferences may change due to changes in average temperatures and seasons, which could lead to changes in air travel management and in destination planning, and higher current costs. | Transition risks are considered by the climate risk analysis and, specifically, the vulnerability analysis. See also ↗ESRS E1 Climate change – Climate-related risks and opportunities for the Lufthansa Group have been identified and ↗ESRS E1 Climate change – Initial measures to mitigate climate-related physical and transition risks have been implemented. Furthermore, costs from environmental regulations in Pillar 4 of the four-pillar strategy are addressed and managed by Financial Risk Controlling. See also ↗ ESRS E1 Climate change – Four-pillar climate change mitigation strategy addresses four areas for action. | The integration of environmental costs into ticket prices is currently being reviewed. The plan is to implement this for some flights from 2025 onwards. Further measures to manage transition risks are listed under ↗ESRS E1 Market-based represent the fourth pillar of the climate change mitigation strategy. | Costs resulting from the EU-ETS are already leading to financial effects being felt today, see ↗Legal and regulatory factors. |
| Impacts of carbon emissions on climate change | Negative impact | Upstream, own operations, downstream |
Medium- to long-term | Direct carbon emissions from energy-intensive and polluting processes in ground and flight operations, as well as in the training of flight crews, have a negative impact on the climate. Emissions in the upstream and downstream value chain, such as those caused by airport services, the manufacture of kerosene, engine manufacturing and aircraft disposal, also contribute to climate change. The reduction of emissions certificates in emissions trading may also have a negative impact on customers in Europe as a result of a likely increase in ticket prices, and potentially global customers as a result of new trading systems. | The four-pillar strategy, which is described in the chapter ↗ESRS E1 Climate change – Four-pillar climate change mitigation strategy addresses four areas for action, explains how climate change mitigation is enshrined in the corporate strategy and decision-making process. | Various measures to reduce carbon emissions and fuel consumption are described in detail in chapter ↗ESRS E1 Climate change – Actions and resources in relation to climate policies. | Costs resulting from the EU-ETS are already leading to financial effects being felt today, see ↗Legal and regulatory factors. Fleet modernisations are also reflected in the financial figures because of the high amounts of investment required ↗Financial position |
| Risk | Upstream, own operations, downstream |
Medium- to long-term | New or amended government regulations may lead to limited availability of low-carbon alternatives, such as green aluminium, and thus require changes to operational processes. This could be associated with financial losses, penalties or reputational damage. Stricter EU climate change mitigation requirements may move long-haul connections to hubs outside the EU and thus distort the competition with airlines from the Middle East. This would result in emissions simply being relocated rather than reduced, and would result in financial losses. Limited accessibility and higher costs for customers, as well as reduced upper emissions limits and free certificates may also affect revenue and current costs. | ||||
| Opportunity | Upstream, own operations, downstream |
Medium- to long-term | Climate change mitigation measures, such as fleet modernisation, the use of SAF and AeroSHARK technology, may lead to more efficient use of resources, lower costs and higher business volume. This could boost revenue and the share price, help with tapping into new markets and expanding the customer base. Furthermore, the reduction of emissions is a focal topic within the Lufthansa Group. This could act as a catalyst in order to achieve climate targets, strengthen the brand value of the Lufthansa Group and facilitate access to the capital market. Investments in fuel-efficient aircraft, SAF and intermodal transport solutions may also offer customers and investors attractive solutions for greater climate change mitigation. Mitigation measures (Scope 1 and 2) and research projects, such as VOLAR and STAM, may also promote long-term resource savings and innovation. Government subsidies and initiatives, such as in the field of hydrogen, may also support the development of new technologies and accelerate business activities. | ||||
| Impacts of contrails on climate change | Negative impact | own operations, downstream |
Medium-term | Contrails from flights contribute to climate change by trapping the Earth’s heat, warming the air below, and reflecting incident sunlight back into space. This affects the local climate of communities and the global climate. | Various research projects are currently investigating what the impacts of contrails on climate change are. These are described in the resilience analysis. See ↗ESRS E1 Climate change – Climate resilience analysis has been initiated in order to analyse resistance to climate change. The impact of contrails is not currently considered in the Lufthansa Group strategy or in its decision-making. | Initial measures relating to contrails are described in detail in chapter ↗ESRS E1 Climate change – Initial measures to mitigate climate-related physical and transition risks have been implemented. | No current financial effects |
| Risk | own operations, downstream |
Long-term | Public criticism of the climate impact of contrails by communities, governments, academia and non-governmental organisation could lower the sales volume. Furthermore, new governmental regulations on contrails may require operational adjustments, such as changes to routes and fuel specifications, thus significantly increasing operating costs. | ||||
| Opportunity | own operations, downstream |
Medium-term | The optimisation of flight routes, altitudes, engine constructions and the use of SAF enable reductions in operating costs and improve the brand value and public perception, particularly among non-governmental organisations and stakeholders. | ||||
| Energy efficiency | Negative impact | Upstream, own operations, downstream |
Medium-term | In order to provide flights, operate offices, process raw materials, ensure product deliveries and other services all over the world, energy is required. The inefficient use of this energy leads to excessive extraction of natural resources and contributes towards climate change. | The four-pillar strategy, which is described in chapter ↗ESRS E1 Climate change – Energy strategy for ground operations focusses on energy efficiency and renewable energy sources, addresses how climate change is enshrined in the corporate strategy and in its decision-making. | Various measures to increase energy efficiency are described in detail in chapter ↗ESRS E1 Climate change – Ground mobility and ground operations are to be carbon-neutral by 2045. | Costs resulting from the EU-ETS are already leading to financial effects being felt today, see ↗Legal and regulatory factors. |
| Positive impact | Upstream, own operations, downstream |
Medium-term | Enabling customers to reduce their energy consumption with energy-efficient fuels, alternative and sustainable fuels and adapting infrastructure, ground processes and offsetting measures may help to create a more diverse energy mix, improve energy supply security and reduce global emissions. | ||||
| Risk | Upstream, own operations, downstream |
Medium- to long-term | New or changing government regulations on energy consumption may require the Company to adapt its operational processes, such as new routes or limiting the use of resources, which could significantly increase operating costs. Inefficient energy use, such as with poorly insulated buildings and poor operational planning, may also lead to additional costs. Furthermore, there is the risk of disruption to the supply chain, particularly in regions with energy bottlenecks, which may lead to negative impacts on the Lufthansa Group’s operations. | ||||
| Opportunity | Upstream, own operations, downstream |
Medium-term | The ongoing modernisation of the fleet may improve efficiency by making transport performance independent from fuel consumption, which could result in lower costs. Investing in research and development in the field of innovative materials and alternative fuels may result in new technologies, processes and material use, which could facilitate energy savings and thus offer new sources of income and price advantages for procurement. Furthermore, revenue could be boosted via access to new markets and the expansion of the customer base, particularly with alternative fuels and digital solutions. Global government initiatives and subsidies may accelerate business activity in the areas of energy efficiency, the integration of renewable energies, as well as innovative technologies in up-and-coming industries such as hydrogen, while the active promotion of SAF by the Lufthansa Group is creating a competitive advantage. | ||||
| E2 – Pollution | |||||||
| Noise pollution | Negative impact | own operations | Medium-term | Lufthansa Group Airlines air traffic leads to noise pollution that affects habitats, ecosystems and biodiversity, as well as local communities. | The five-pillar strategy, which is described in chapter ↗ESRS E2 Pollution – Five-pillar strategy for active noise abatement aims to reduce noise pollution, explains which impacts, risks and opportunities are associated with the topic of aircraft noise. | Various measures relating to noise abatement are described in detail in the chapter ↗ESRS E2 Pollution – Actions and resources related to pollution. | No current financial effects |
| Risk | own operations | Medium-term | Amendments or new regulations on noise abatement and environmental requirements, such as restoring depleted resources in certain regions, may result in significant financial strain for the Lufthansa Group. In the event of non-compliance with noise pollution and other pollution guidelines, residents and nature conservation organisations may also threaten legal action, which could affect the Company financially, as well as jeopardise its reputation. | ||||
| Opportunity | own operations | Medium-term | By investing in quieter aircraft, using noise-abatement technologies, taking part in noise research, optimising flight processes and routes, and engaging in dialogue with stakeholders, the Lufthansa Group may achieve a competitive and reputational advantage, and become more attractive for customers and investors. | ||||
| E5 - Resource use and circular economy | |||||||
| Resource inflows, including resource use | Negative impact | Upstream, own operations |
Long-term | The use of non-renewable raw materials (such as metals and rare materials) by suppliers in aircraft manufacturing leads to the global depletion of natural resources and reduces their availability for local communities. The use of non-renewable resources in our own operations (such as fossil fuels, single-use plastic and packaging materials) also impacts global resource use and may affect local communities. | The policies outlined in the chapter ↗ESRS E5 Resource use and circular economy – Policies related to resource use and circular economy describe how the use of raw materials and other resources is addressed in the strategy and decision-making process of the airlines and Lufthansa Technik. | There are various measures for implementing the R strategies within the airlines and Lufthansa Technik. These are described in detail in chapter ↗ESRS E5 Resource use and circular economy – Actions and resources related to resource use and circular economy. | No current financial effects |
| Risks | Upstream, own operations, downstream |
Medium-term | The procurement of recycled materials may lead to higher product costs, which are passed on to the Lufthansa Group and its customers, which could reduce sales volume. Alternatively, prices for customers could stay stable, which would narrow the profit margin. The use of non-renewable raw materials by Lufthansa Group suppliers may also jeopardise the Company’s reputation as it contributes towards the global depletion of resources. New regulations that restrict the use of non-renewable resources (e.g. the EU directive on single-use plastic) may also lead to higher costs, for example, due to higher taxes on resource use. | ||||
| Opportunity | Upstream, own operations |
Medium-term | With reduced material use, the reuse of components and the use of recycled materials, the Lufthansa Group can become independent of rising costs for new raw materials and protect itself from procurement risks in conflict zones or regions subject to climate-related risks. Investments in research and development for innovative technologies, processes and the circular economy may also lead to new sources of income and price advantages. Actions such as the increased use of reused and recycled packaging materials and banning single-use plastic are viewed positively by customers. This improves the Company’s market and brand potential, as well as its reputation, while lowering cost risks owing to new raw materials at the same time. | ||||
| Resource outflows in connection with products and services | Negative impact | own operations, downstream |
Medium-term | Business models that create stimuli for increased consumption in that they introduce new products or generations of products and services that are incompatible with previous versions can make a significant contribution towards the overuse and depletion of natural resources globally. | To date, no explicit impact on strategy and decision-making. | Currently, no further adaptation measures have been defined. | No current financial effects |
| Risk | own operations, downstream |
Medium-term | A significant rise in current and production costs may occur due to new or amended global government regulations. Non-compliance with these regulations by the Lufthansa Group, suppliers and business partners may result in additional costs in the form of liabilities, penalties, fees, reputational damage or the loss of licences and approvals. | ||||
| Opportunity | own operations, downstream |
Medium-term | Global demand for solutions based on a circular economy is increasing, which may boost market and brand potential, as well as the Company’s reputation. Potential government initiatives and subsidies to reduce resource use or promote the circular economy, such as tax reforms, digital funding programmes and incentives for research and development may support activities within the circular economy. | ||||
| S1 – Own workforce | |||||||
| Flexible working time models | Positive impact | own operations | Medium-term | A healthy work/life balance for employees is supported with flexible working hours, remote working, part-time hours, sabbaticals, parental leave, caregivers’ leave and partial retirement. In addition, agreed working hours, various flexitime models and family benefits, such as childcare and caregiver consulting, also have a positive effect on employees’ quality of life. | Flexible working arrangements are included in the Lufthansa Group HR strategy under the item “New forms of work”. See chapter ↗ESRS S1 Own workforce – Policies related to own workforce. | These flexible working arrangements include and address various models. This is covered under the item “New forms of work”. See chapter ↗ESRS S1 Own workforce – Policies related to own workforce. | No current financial effects |
| Risk | own operations n | Medium-term | Due to shortage of skilled workers and risk of losing out to more attractive competitors offering a better work / life balance, the Lufthansa Group could be affected by increased employee turnover, which may damage its reputation and brand value. | ||||
| Opportunity | own operations | Medium-term | More flexible working conditions may lead to savings on current costs and energy costs thanks to remote working. It may also improve the Company’s reputation and competitive edge as an employer. This helps to retain existing employees and attract new ones. Safeguarding appropriate working hours and measures to promote a healthy work / life balance help to avoid overtime, boost employee satisfaction and increase productivity. This reduces employee turnover and saves on future recruitment costs, which equates to a financial benefit. | ||||
| Overtime and non-regulated working hours | Negative impact | own operations | Medium-term | Unregulated working hours, incorrect categorisation and high workloads lead to stress, burnout and health problems, which restrict employees’ satisfaction and their work/life balance. | Overtime and working hours models are included in the Lufthansa Group HR strategy under the item “New forms of work”, where they are specified and described in detail. See chapter ↗ESRS S1 Own workforce – Policies related to own workforce in this regard. | In order to address the topic from the perspective of demographic change and the skills shortage, it has been addressed under “New forms of work”. For more information, see chapter ↗ESRS S1 Own workforce – Policies related to own workforce. | No current financial effects |
| Risk | own operations | Medium-term | Non-compliance with regulations on restricted overtime and a lack of flexible working solutions could result in reputational damage for the Lufthansa Group, along with lower employee retention and higher recruitment costs. Furthermore, costs may increase due to strikes, fines and legal disputes. High workloads can reduce the attractiveness of an employer, which may result in job vacancies and a higher number of sick days, which reduces efficiency. | ||||
| Adequate wages and collective bargaining agreements | Negative impact | own operations | Medium-term | Inadequate wages may cause unequal pay, poverty and social problems, as well as lower living standards, health problems, second jobs, lower levels of education and a reduced sense of social solidarity. | In order to pay competitive staff costs, adequate wages and collective bargaining agreements play a key role in the Company’s remuneration policies. The Lufthansa Group is aware of this and it is also a core element of the HR strategy, as described in detail in chapter ↗ESRS S1 Own workforce - Material impacts, risks and opportunities and their interaction with strategy and business model. | In order to address the topic of competitive staff costs, the Lufthansa Group has raised wages through collective bargaining, as described in detail in chapter ↗ESRS S1 Own workforce – Material impacts, risks and opportunities and their interaction with strategy and business model. | No current financial effects |
| Positive impact | own operations | Medium-term | With its existing permanent employment contracts, collective bargaining agreements and a family-friendly HR policy that is bound by collective agreements, the Lufthansa Group provides fair working conditions and transparent pay for its employees. | ||||
| Risk | own operations | Medium-term | Higher labour costs for the Lufthansa Group due to collective bargaining agreements, and non-compliance with these agreements, may result in additional costs in the form of liabilities, penalties, fines, reputational damage or the loss of licences and approvals. | ||||
| Opportunity | own operations | Medium-term | Attractive collective bargaining agreements, a high proportion of trainees hired on a permanent basis and a family-friendly HR policy can make the Lufthansa Group an attractive employer and thus create a competitive advantage. | ||||
| Social dialogue and trade unions | Positive impact | own operations | Medium-term | Safeguarding the freedom of association at the Lufthansa Group leads to fairer working conditions in terms of pay and social benefits. | The social dialogue and free association of employees is one of the six pillars of the HR strategy as part of a trust-based social partnership. See chapter ↗ESRS S1 Own workforce – Policies related to own workforce in this regard. | This pillar of the HR strategy, a trust-based social partnership, is based on a joint responsibility for the Company and its employees. As such, the Lufthansa Group intends to continue to develop the agreed regulations with trade unions and employee representatives. This is described in chapter ↗ESRS S1 Own workforce – Material impacts, risks and opportunities and their interaction with strategy and business model. | No current financial effects |
| Risk | own operations | Medium-term | A lack of platforms for addressing employee concerns and limited freedom of association can result in dissatisfaction, lower productivity, strikes and walkouts, legal sanctions, lower employee retention and reputational damage. | ||||
| Opportunity | own operations | Medium-term | Employee involvement and platforms for raising issues, as well as unrestricted freedom of association can promote a cooperative working environment, boost employee satisfaction and morale, and lead to high employee retention and savings on recruitment costs. | ||||
| Health and safety at work | Negative impact | own operations | Medium-term | Psychosocial stressors and insufficiently ergonomic workplaces, as well as hazardous work processes, may increase the global risk of chronic diseases and serious accidents for employees. Handling hazardous substances may also result in acute and chronic health risks, such as respiratory disorders. | In order to ensure sustainable employability in the coming years, the Lufthansa Group has enshrined the topic of health and safety in both its HR strategy and in other Lufthansa Group policies. See chapter ↗ESRS S1 Own workforce – Policies related to own workforce in this regard. | Sustainable employability involves the implementation of occupational safety policies, as well as the promotion of employee health, as described in chapter ↗ESRS S1 Own workforce – Policies related to own workforce. | No current financial effects |
| Risk | own operations | Medium-term | Health problems may result in higher costs due to absences, lower productivity, increasing insurance premiums and the payment of damages. Furthermore, there is a risk of reputational damage and financial impacts, such as penalties or the loss of licences, due to breaches of safety regulations. | ||||
| Opportunity | own operations | Medium-term | Health services, preventive measures and sport programmes can strengthen employee retention and improve the Company’s image as an employer, which is associated with long-term financial advantages, such as lower staff turnover and improved recruitment. | ||||
| Diversity, equality and inclusion | Negative impact | own operations | Medium-term | Gender inequality in recruitment and pay, as well as insufficient protection against violence and harassment at work may have significant social and economic impacts. They may lead to pay inequality, reduced growth, social instability and negative consequences for families. Furthermore, mental health problems, untapped potential and increased strain for the healthcare and legal system may arise. | A modern leadership culture and active diversity policies at the Lufthansa Group encompass various strategic topics, and diversity, equality and inclusion are integral parts of this. The Lufthansa Group has set out specific targets for promoting diversity, which can be found in chapter ↗ESRS S1 Own workforce – Lufthansa Group staffing targets. | The modern leadership culture and active diversity policies at the Lufthansa Group are reflected in the internationalisation of the workforce, the establishment of talent programmes for specific groups of employees and further-reaching targets. More information is provided in chapter ↗ESRS S1 Own workforce – Comprehensive measures under the Human Resources strategy have been implemented. | No current financial effects |
| Positive impact | own operations | Medium-term | The Lufthansa Group can promote the equal treatment of its employees through the institutionalisation and introduction of equality regulations. This could also lead to stronger economic parity. The inclusion of people with disabilities and equal opportunities for all may strengthen economic parity, improve access to essential services, promote strong social systems, reduce discrimination and boost individual potential, while improving employees’ mental health. | ||||
| Risk | own operations | Medium-term | Gender inequality and a lack of diversity in recruitment, promotions and training may harbour financial risks for the Lufthansa Group, such as legal penalties, reputational damage and difficulties in winning the war for talent. Missed opportunities for innovation and productivity, as well as the insufficient inclusion of people with disabilities amplify these risks. | ||||
| Opportunity | own operations | Medium-term | The introduction of tried-and-tested practices for gender equality and equal pay, as well as family-friendly policies, can improve the image of the Lufthansa Group, expand the talent pool and boost innovation and productivity. The inclusion of people with disabilities may provide additional talent and regulatory advantages. A zero-tolerance policy to ensure a safe working environment can increase efficiency. Diversity can strengthen innovation and contribute towards business success by creating unique solutions, attracting new customers and increasing employee satisfaction. | ||||
| Training and development | Positive impact | own operations | Medium-term | By providing training and further education and training for all employees, the Lufthansa Group supports well-trained, more resilient employees. This enables them to manage changes effectively and to maintain their relevance on the labour market. | In the context of demographic change and the skills shortage, life-long learning is set to increase in importance. Continuous training and tailored qualifications are becoming a matter of course and they secure the employability of the workforce and the future viability of the Lufthansa Group. This is described in chapter ↗ESRS S1 Own workforce – Comprehensive measures under the Human Resources strategy have been implemented. | In order to safeguard this employability, the Lufthansa Group offers its employees training and further education programmes. See chapter ↗ESRS S1 Own workforce – Comprehensive measures under the Human Resources strategy have been implemented. | No current financial effects |
| Opportunity | own operations | Medium-term | Employee support programmes, training and career development options offered by the Lufthansa Group can strengthen employee retention and efficiency, as well as the employer brand, while keeping staff turnover and recruitment costs low thanks to well-qualified, committed employees. | ||||
| H&S management (hazard and security management) | Negative impact | own operations | Medium-term | Security threats and terrorist attacks on airports and aircraft can have significant impacts on people and the environment. Employees may be particularly affected as such events may affect their mental well-being and, in extreme cases, may lead to injury or even the loss of life. | The security and safety of its workforce is also part of the Lufthansa Group’s further-reaching policies. These aim to protect the workforce from external hazards in air transport, as well as in the other segments. This relates to the pillar of employability in the HR strategy. This is described in chapter ↗ESRS S1 Own workforce – Comprehensive measures under the Human Resources strategy have been implemented. | This is actively managed by the Lufthansa Group with the area of security and safety as well as further-reaching policies relating to the management of security and hazard prevention. This is presented in chapter ↗ESRS S1 Own workforce – The corporate occupational safety policy protects health. | No current financial effects |
| Positive impact | own operations | Medium-term | By offering supplemental healthcare options, the Lufthansa Group makes a significant contribution to the health and safety of its crews and employees. | ||||
| Risk | own operations | Medium-term | Delays and disruptions due to airport closures, aircraft damage or security measures increase operating costs and cash outflows for employee health and safety measures. This is associated with a significant financial risk. | ||||
| Opportunity | own operations | Medium-term | Regular health check-ups can promote employee well-being, boost their loyalty to the Company and improve the Company’s image. This can lead to work being completed with greater punctuality and increased operational efficiency, which can open up financial opportunities for business activities. | ||||
| Data security | Negative impact | own operations | Medium-term | Insufficient protection of privacy may breach the privacy rights of the Lufthansa Group's employees and constitute an intrusion into their private life. | Data security is enshrined in the Code of Conduct and thus in the Lufthansa Group’s corporate governance. This also applies to data security regarding the Company’s own employees. See chapter ↗ESRS S1 Own workforce – The Lufthansa Group’s Code of Conduct supports ethical values. | The Lufthansa Group has enshrined data security in its Code of Conduct, where it sets out clear guidelines that the Company’s employees must also observe in terms of data security. | No current financial effects |
| Risk | own operations | Medium-term | Data privacy violations may lead to legal sanctions, such as fines, reputational damage and potential industrial unrest. | ||||
| Social protection | Negative impact | own operations | Medium-term | Low job security and lack of social protection may lead to financial instability, mental health problems, unequal pay and social unrest. The basis for sustainable societies is undermined if there is low job security. | This topic was identified as being material within the Lufthansa Group’s materiality analysis. The Lufthansa Group is addressing the topic and is attempting to work out the implications for its business model. | The Lufthansa Group is engaging with employee retention and employer attractiveness actions that are described in more detail in chapter ↗ESRS S1 Own workforce - Comprehensive measures under the Human Resources strategy have been implemented. | No current financial effects |
| Risk | own operations | Medium-term | A lack of social protection may lead to higher staff turnover, lower productivity and potential boycotts, which may result in financial risks due to lower business volume and reputational damage. Furthermore, it may weaken the Company’s brand position as compared with its competitors and make it harder to access financing. | ||||
| Opportunity | own operations | Medium-term | Measures relating to employee retention and employer attractiveness are being continuously optimised in order to boost satisfaction, security and loyalty, which can have a positive impact on reputation and recruitment costs. | ||||
| Pandemic | Negative impact | own operations | Medium-term | Epidemics, endemic diseases and pandemics triggered by changing environmental and socio-economic conditions may result in reduced working hours for employees. This may result in financial instability, lower salaries and job losses. | The coronavirus pandemic had a significant impact on the Lufthansa Group’s business model, particularly due to the massive drop in air traffic. In this context, the risk of a national or international pandemic was identified and evaluated as a major influencing factor on business operations. | The Lufthansa Group addressed the topic intensively following the coronavirus pandemic and implemented the relevant remedial actions at the time. In view of the numerous unknown influencing factors, however, there is no further need for action in this area at the present time. | No current financial effects |
| Risk | own operations | Medium-term | Travel demand may drop as a result of travel restrictions to certain destination regions and worldwide. This may reduce the Lufthansa Group’s business volume and increase uncertainty regarding the industry’s recovery. | ||||
| S2 – Workers in the value chain | |||||||
| Human and labour rights in the value chain | Negative impact | Upstream, downstream |
Medium-term | Suppliers and downstream business partners can have a negative impact on human rights in the value chain with regard to secure jobs, working hours, adequate wages, freedom of association, collective bargaining, health and safety, gender equality and equal pay for equal work, measures to combat violence and harassment at work, child labour and forced labour. | Compliance with human rights and labour laws in the value chain is a key component of the due diligence processes and the Lufthansa Group’s supplier risk analysis and is described in more detail in chapter ↗ESRS S2 Workers in the value chain – Human rights and environmental risk analysis aims to protect the Lufthansa Group and its suppliers. | Various measures relating to human rights and labour laws in the value chain are described in detail in chapter ↗ESRS S2 Workers in the value chain – Taking action on material impacts on value chain workers, and approaches to managing material risks and pursuing material opportunities related to value chain workers, and effectiveness of those actions. | No current financial effects |
| Risk | Upstream, own operations, downstream |
Medium-term | Non-compliance with laws and regulations may result in legal consequences, reputational damage and sanctions against the Lufthansa Group, its suppliers and business partners, and may lead to the loss of business licences and a weaker financial situation. Social unrest (for example, strikes) due to human rights violations may lead to delays and disruption to the value chain, which can reduce productivity and increase current costs. | ||||
| Opportunity | Upstream, own operations, downstream |
Medium-term | Clear guidelines for suppliers and downstream business partners can strengthen the reputation of and customer confidence in the Lufthansa Group, create transparency and promote financial and operational stability for projects. Furthermore, they can facilitate access to regulated markets and open up new business opportunities, while promoting sustainability and human rights and having a positive impact on suppliers and business partners. | ||||
| Social dialogue in the value chain | Positive impact | Upstream, downstream |
Medium-term | Through social dialogue with its suppliers and business partners, the Lufthansa Group can improve working conditions within its value chain, including more secure jobs, fairer wages, health and safety, gender equality and protect other labour laws and human rights. | Options for contacting suppliers and partners, as well as implementing social dialogue are discussed in particular in chapter ↗ESRS S2 Workers in the value chain – Policies related to value chain workers. | Various measures relating to social dialogue in the value chain are described in detail in chapter ↗ESRS S2 Workers in the value chain – Taking action on material impacts on value chain workers, and approaches to managing material risks and pursuing material opportunities related to value chain workers, and effectiveness of those actions. | No current financial effects |
| Risk | Upstream, own operations, downstream |
Medium-term | A failure to engage in social dialogue with suppliers and business partners may also lead to inefficiency in the strategic management of the value chain, which in turn can result in less resilient value chains and higher current costs. | ||||
| Opportunity | Upstream, own operations, downstream |
Medium-term | ESG-related social dialogues may aid the Lufthansa Group in establishing an effective due diligence process with suppliers and business partners with regard to human rights. The strategic management of the supply chain may boost business efficiency thanks to a resilient value chain. | ||||
| Training and development opportunities in the value chain | Positive impact | Upstream, downstream |
Medium-term | By providing training and professional development options for suppliers and business partners, the Lufthansa Group can make a positive contribution to training workers in the value chain in health and safety matters. Human rights issues, further training, IT solutions and sustainability requirements can also be integrated more broadly in the value chain in order to improve health and safety standards. | The integration of training and professional development options for suppliers and partners within the due diligence processes of the Lufthansa Group is described in chapter ↗ESRS S2 Workers in the value chain – Policies related to value chain workers. | With the aim of implementing training and professional development options within the value chain, the Lufthansa Group has already implemented its initial measures, as described in more detail in chapter ↗ESRS S2 Workers in the value chain – Taking action on material impacts on value chain workers, and approaches to managing material risks and pursuing material opportunities related to value chain workers, and effectiveness of those actions. | No current financial effects |
| Opportunity | Upstream, own operations, downstream |
Medium-term | Well-qualified employees of suppliers and business partners may lead to increased efficiency along the global value chain. This may save on current costs that could arise due to delays owing to workplace accidents or absences due to ill health. | ||||
| Diversity in the value chain | Positive impact | Upstream, downstream |
Medium-term | Employees of suppliers and downstream business partners of the Lufthansa Group may contribute to diversity within the value chain, with the Lufthansa Group having an indirect influence through its guidelines, for example. Thus it is possible to help create a culture of fair, deliberate cooperation and also increase the visibility of people with different backgrounds within the general population. | Compliance with anti-discrimination guidelines within the value chain is a significant component of the due diligence processes described in chapter ↗ESRS S2 Workers in the value chain – Policies related to value chain workers. The Lufthansa Group continues to address diversity in the value chain and work out the implications for its business model. |
In order to promote diversity and prevent discrimination, the Lufthansa Group has already implemented its initial measures, as described in chapter ↗ESRS S2 Workers in the value chain – Taking action on material impacts on value chain workers, and approaches to managing material risks and pursuing material opportunities related to value chain workers, and effectiveness of those actions. | No current financial effects |
| Risk | Upstream, own operations, downstream |
Medium-term | Non-compliance with diversity regulations by the Lufthansa Group or its suppliers may lead to an increase in the number of discrimination cases (human rights violations) and disciplinary action throughout the Company as a result of poor prevention. This may result in additional costs in the form of liabilities, fines, reputational damage or the loss of licences and approvals around the world for the Lufthansa Group, its suppliers and business partners. | ||||
| Opportunity | Upstream, own operations, downstream |
Medium-term | The promotion of diversity among the employees of suppliers and business partners can expand their talent pool and lead to more qualified staff thanks to improved talent recruitment and retention. This can boost productivity and lower current costs, which may lead to a more robust and more efficient value chain for the Lufthansa Group. | ||||
| S4 – Consumers and end-users | |||||||
| Privacy | Positive impact | Downstream | Medium-term | Comprehensive information about data privacy enables customers to make well-informed decisions and protect their personal data. | The privacy of customers and end users is reflected in the Lufthansa Group’s Code of Conduct and is an integral part of its corporate governance. See also chapter ↗ESRS S4 Consumers and end-users – Policies related to consumers and end-users. | At the Lufthansa Group, the protection of customer data complies with the Code of Conduct and / or the data privacy guidelines. See also chapter ↗ESRS S4 Consumers and end-users – Policies related to consumers and end-users. | No current financial effects |
| Risk | own operations, downstream |
Medium-term | Non-compliance with data privacy legislation (such as the General Data Protection Regulation, GDPR) may result in fines, sanctions and reputational damage, which could have a negative impact on the Lufthansa Group’s financial performance. | ||||
| Opportunity | own operations, downstream |
Medium-term | By opening up access to data protection practices, the Lufthansa Group maintains a trusting business relationship, which ensures satisfied customers, increased customer loyalty and cost savings in customer service. | ||||
| Access to high-quality information | Risk | own operations, downstream |
Medium-term | Potential liability costs and regulatory fines for product and service-related accidents, as well as misleading information could reduce customer trust and loyalty, which could lead to loss of business and reputational damage. | The product design and associated customer safety is integrated into the Lufthansa Group business model See also chapter ↗ESRS S4 Consumers and end-users – Opportunities and risks in thoughtful product design. | Various Lufthansa Group products are currently being tested at the “co-creation hub” and adapted based on feedback. These are also brought to market in compliance with the relevant safety regulations and customer safety measures. For more details, see chapter ↗ESRS S4 Consumers and end-users – Customer satisfaction measurement through various tools. | No current financial effects |
| Health and safety | Negative impact | own operations, downstream |
Medium-term | The products and services of the Lufthansa Group may affect the health and safety of customers if their use and maintenance could potentially cause risk of injury or accident (e.g. food poisoning, malfunctions). | The health and safety of our customers and end users are the prime focus of the Lufthansa Group’s products. For more detailed information, please see chapter ↗ESRS S4 Consumers and end-users – Lufthansa Group commits to protecting customer health and safety. | The Lufthansa Group has a comprehensive safety management system. It is addressed in chapter ↗ESRS S4 Consumers and end-users – The Lufthansa Group’s passenger airlines implement safety policies and communication measures. | No current financial effects |
| Opportunity | own operations, downstream |
Medium-term | |||||
| Personal safety | Risk | own operations, downstream |
Medium-term | Safety risks for customers may lead to reputational damage and negative media coverage. | The health and safety of people are at the heart of the Lufthansa Group’s products. For more detailed information, please see chapter ↗ESRS S4 Consumers and end-users – Lufthansa Group commits to protecting customer health and safety. | The Lufthansa Group has a comprehensive safety management system, which is addressed in chapter ↗ESRS S4 Consumers and end-users – The Lufthansa Group’s passenger airlines implement safety policies and communication measures. | No current financial effects |
| Opportunity | own operations, downstream |
Medium-term | By providing advanced passenger information to the Data Insight Lab, the Lufthansa Group is able to improve the customer experience, secure competitive advantages and gain loyal customers. The API data analysis provides insights into passenger behaviour, trends and patterns, which may lead to optimised processes and increased revenue from targeted services and personalised recommendations. | ||||
| Child safety | Positive impact | Downstream | Short-term | The Lufthansa Group offers unaccompanied minors and families special services, such as check-in, early boarding, special meals, pushchairs, cots, on-board activities, free luggage allowance and childcare before and after the flight, which helps to protect children. | At the Lufthansa Group, children’s safety is documented in detail in internal procedural guidelines. For more detailed information, please see chapter ↗ESRS S4 Consumers and end-users – The Lufthansa Group is committed to avoiding barriers for customers. | Supporting families and protecting child safety is ingrained in the Lufthansa Group and is described in chapter ↗ESRS S4 Consumers and end-users – The Lufthansa Group is committed to avoiding barriers for customers. | No current financial effects |
| Risk | own operations, downstream |
Medium-term | Increased current costs may result from new or amended global child protection regulations. Non-compliance with these regulations may lead to liability costs, penalties, the loss of licences and reputational damage for the Lufthansa Group if child protection is jeopardised as a result of incidents involving Lufthansa Group products or services. | ||||
| Anti-discrimination | Negative impact | own operations, downstream |
Medium-term | Non-accessible products, services and solutions from the Lufthansa Group may unintentionally exclude certain social groups. | Non-accessible product design has been identified as material by the Lufthansa Group in the materiality analysis. A more in-depth review of the implications of this is currently underway. | As a result of this having been identified, there are currently no actions at the Lufthansa Group. | No current financial effects |
| Risk | own operations, downstream |
Medium-term | Inadequate design may lead to reputational damage and legal liability as a result of a lack of inclusiveness. | ||||
| Appropriate product design and accessibility | Negative impact | Downstream | Medium-term | High prices for Lufthansa Group flights and freight services may make them unaffordable for disadvantaged persons and therefore exclude them. | The Lufthansa Group is aware of the different needs of its travellers and strives to meet them, as described in chapter ↗ESRS S4 Consumers and end-users – Customer satisfaction measurement through various tools. | At the same time, the Lufthansa Group offers different services to different travel classes. For more details, see chapter ↗ESRS S4 Consumers and end-users – Customer satisfaction measurement through various tools. | No current financial effects |
| Risk | own operations, downstream |
Medium-term | Reduced accessibility and affordability for customers leads to decreased revenue, reputational damage and loss of customers. | ||||
| Responsible marketing | Risk | own operations, downstream |
Medium-term | False claims (for example, about the sustainability of amenity kits) may lead to reputational damage and legal liability. | The Lufthansa Group endeavours to provide responsible marketing and truthful product statements, as described in detail in chapter ↗ESRS S4 Consumers and end-users – The Lufthansa Group adopts a responsible approach to marketing practices and product statements. | The Lufthansa Group strives to provide truthful and non-misleading statements in its product promises and information. See chapter ↗ESRS S4 Consumers and end-users – Lufthansa Group pursues responsible marketing practices and product information. | No current financial effects |
| G1 – Business conduct | |||||||
| Corporate culture | Positive impact | own operations | Medium-term | By creating an ethical environment, the Lufthansa Group promotes a responsible, socially aware society to the benefit of employees and the local community. | Responsible conduct in compliance with legislation is a key element of the Lufthansa Group’s corporate culture and is embedded in the Group strategy. See also chapter ↗ESRS G1 Business conduct - Business conduct policies and corporate culture. | The Lufthansa Group has enshrined this corporate culture in its Code of Conduct and other policies, as described in detail in chapter ↗ESRS G1 Business conduct - Business conduct policies and corporate culture. | No current financial effects |
| Risk | own operations | Medium-term | Cooperation with defence companies and the provision of services for military missions may lead to divestment and weaker credit terms. | ||||
| Opportunity | own operations | Medium-term | A positive ethical and compliance culture can improve employee loyalty and commitment, attract future talents and reduce the likelihood of misconduct, which can lead to positive financial and reputational results and make recruitment easier. | ||||
| Protecting whistleblowers | Positive impact | Upstream, own operations, downstream |
Medium-term | The protection of whistleblowers makes it possible for the Lufthansa Group to detect misconduct, protect people and the environment, promote transparency and strengthen employees’ trust in the organisation. | The protection of whistleblowers is enshrined in the Lufthansa Group Code of Conduct and is addressed in chapter ↗ESRS G1 Business conduct - Lufthansa Group Code of Conduct defines the framework for moral and responsible behaviour. | In order to protect whistleblowers, the Lufthansa Group has established special notification channels and a comprehensive range of protections. For more details, see chapter ↗ESRS G1 Business conduct - Lufthansa Group Code of Conduct defines the framework for moral and responsible behaviour. | No current financial effects |
| Risk | Upstream, own operations, downstream |
Medium-term | Breaches of the German Whistleblower Protection Act and a lack of appropriate measures to protect whistleblowers may lead to fines, the publication of confidential information and significant reputational damage. | ||||
| Opportunity | Upstream, own operations, downstream |
Medium-term | The protection of whistleblowers may strengthen stakeholders’ trust in the compliance system, strengthen the corporate culture and reduce unethical behaviour and associated remediation costs. A modern, transparent system may increase credibility, prioritise employee safety, boost trust and employee retention, improve the Company’s reputation and save on recruitment costs. | ||||
| Animal welfare | Negative impact | Upstream, own operations, downstream |
Short to medium term | The use of animal products, such as leather for aircraft interiors, or meat-based meals, can impair animal welfare if this disturbs the animals’ biological function, causes them pain or restricts their natural behaviour. Facilitating and offering the transport of hunting trophies also makes a negative contribution to animal welfare. as hunting causes the animals fear and pain and may result in their death to permit their bodies (body parts) to be used as trophies. | The Lufthansa Group has integrated animal welfare in its business model and conducted an analysis of the associated risks. A more detailed analysis can be found in chapter ↗ESRS G1 Business conduct - Animal welfare requirements for Lufthansa Cargo for animals transported by air. | The Lufthansa Cargo group fulfils its requirements for animal transportation and various initiatives have already been instituted in the Passenger Airlines segment, which are described in chapter ↗ESRS G1 Business conduct - Animal welfare requirements for Lufthansa Cargo for animals transported by air. | No current financial effects |
| Risk | own operations, downstream |
Medium-term | New or amended global regulations and restrictions with regard to hunting practices and the transportation of hunting trophies may affect the Lufthansa Group and its customers. Non-compliance with these regulations may result in liability costs, penalties, reputational damage, the loss of licences and a decrease in business volume. Public mistrust and ethical concerns by local communities, non-governmental organisations and stakeholders with regard to the involvement of the Lufthansa Group in hunting practices may lead to lost revenue and reputational damage. | ||||
| Opportunity | Upstream, own operations, downstream |
Medium-term | Species-appropriate accommodation, feeding, examinations and well-qualified staff aim to help the pet policy of Lufthansa Cargo and of Passenger Airlines facilitate the best possible care of animals in transit, which could increase brand value and customer loyalty, as well as boost the Company’s reputation. Partnerships with certified animal welfare bodies may improve the Company’s brand value, increase customer loyalty and bring reputational advantage. Banning the transportation of hunting trophies may result in competitive and reputational advantages for the Lufthansa Group and make the Company more appealing for customers, employees, nature conservation organisations and investors. | ||||
| Management of relationships with suppliers including payment practices |
Positive impact | Upstream, own operations, downstream |
Medium-term | A close partnership with suppliers or via initiatives (for example, in the field of research and development) may lead to more environmentally friendly or socially responsible products. Clear selection criteria in the Supplier Code of Conduct and the relevant service ratings, which require social and environmental standards to be met, aim to safeguard responsible practices and drive sustainability along the global supply chain by protecting communities and the environment. Transparent payment and business solutions may boost the trust of employees, customers and business partners. | The Lufthansa Group strives to ensure that its suppliers comply in full with the relevant laws, guidelines and regulations on fair competition, integrity and responsible business practices, as described in chapter ↗ESRS G1 Business conduct - Management of relationships with suppliers. | This is implemented in the Lufthansa Group’s procurement processes and is addressed in chapter ↗ESRS G1 Business conduct - Management of relationships with suppliers. | No current financial effects |
| Risk | Upstream, own operations, downstream |
Medium-term | Non-compliance with the German Supply Chain Due Diligence Act (LkSG) and the European Corporate Sustainability Due Diligence Directive (CSDDD) by suppliers and the Lufthansa Group may lead to loss of business, delays and disruptions due to penalties, liabilities, reputational damage and exclusion from the procurement process. | ||||
| Opportunity | Upstream, own operations, downstream |
Medium-term | Clear selection processes and good supplier relationship management can boost the reputation of and trust in the Lufthansa Group, attract new customers and increase market share and the Company’s financial performance. Partnerships in the area of research and development, as well as knowledge sharing with external suppliers, facilitate new business solutions and may improve the Company’s financial performance. Secure, transparent and innovative payment systems can increase the trust and loyalty of customers, business partners and employees. Strategic management of the Company’s own supply chain may boost efficiency and resilience, which may be associated with lower costs. | ||||
| Political engagement | Positive impact | own operations | Medium-term | By engaging with members of parliament and political decision-makers, the Lufthansa Group can contribute its industry expertise, which may lead to more effective sustainability policies and better conditions for fair competition. | The Lufthansa Group champions integrity, which is in keeping with the corporate culture and includes responsible political engagement. More details can be found in chapter ↗ESRS G1 Business conduct - Business conduct policies and corporate culture. | The Lufthansa Group has enshrined these principles in its Code of Conduct and is committed to complying with them. More details can be found in chapter ↗ESRS G1 Business conduct - Business conduct policies and corporate culture. | No current financial effects |
| Risk | own operations | Medium-term | The ongoing political and social discussion about interest groups may lead to media reports that question the Lufthansa Group’s lobbying practices and their influence and transparency in the shaping of policies and regulatory decision-making. | ||||
| Opportunity | own operations | Medium-term | Participation in political dialogue enables the Lufthansa Group to represent its interests in national and international regulations, which helps it to protect its global competitiveness and profitability. It also aims to create favourable market conditions, which could expand potential markets and the need for the Lufthansa Group’s products and services. | ||||
| Prevention and detection of corruption and bribery, including training | Negative impact | own operations | Medium-term | A lack of guidelines on standards concerning corruption and bribery may increase the likelihood of unethical employee behaviour and reduce awareness of corruption, which could facilitate unfair competition and business practices. | Responsible and compliant behaviours form the basis for preventing and identifying corruption, which is something to which the Lufthansa Group is committed. The relevant details and guidelines can be found in chapter ↗ESRS G1 Business conduct - Business conduct policies and corporate culture. | To aid the prevention and detection of corruption and bribery, the Lufthansa Group has established a comprehensive compliance management system. Supplementary measures and details of these are explained in chapter ↗ESRS G1 Business conduct - Business conduct policies and corporate culture. | No current financial effects |
| Opportunity | own operations | Medium-term | By clearly communicating its core values (for example, in the Code of Conduct) as well as through regular training on corruption prevention, the Lufthansa Group intends to raise its employees’ awareness of their responsibility and prevent cases of corruption, which can damage the Company’s reputation and may result in lost business. The prevention and identification of corruption may increase the appeal of the Company for employees, investors, customers and political actors, which could increase revenue, improve access to financing and strengthen long-term relationships that support continuous growth and success. | ||||
| Cases of corruption and bribery | Negative impact | own operations | Medium-term | The Lufthansa Group’s global business activities may lead to frequent contact with public officials. A high level of direct contacts to public officials and high cash outflows for customer incentives may undermine fair market conditions, restrict development and innovation, slow economic growth, weaken democratic institutions, erode public trust and amplify inequality, poverty, social division, security concerns and the environmental crisis. | Responsible and compliant behaviours form the basis for preventing and identifying corruption, which is something to which the Lufthansa Group is committed. The relevant details and guidelines can be found in chapter ↗ESRS G1 Business conduct - Business conduct policies and corporate culture. | To aid the prevention and detection of corruption and bribery, the Lufthansa Group has established a comprehensive compliance management system. Supplementary measures and details of these are explained in chapter ↗ESRS G1 Business conduct - Business conduct policies and corporate culture. | No current financial effects |
Resilience of the strategy and business model with regard to material impacts, risks and opportunities
The Lufthansa Group continually analyses the resilience of its strategy and business model within all areas with regard to material impacts, risks and opportunities. In doing so, various approaches are used to evaluate resilience across different periods of time. In the strategy analysis, short, medium and long-term time horizons are considered from the Lufthansa Group’s perspective.
In the area of environment, the Lufthansa Group addresses key topics such as climate change (E1), pollution (E2) and the circular economy (E5).
E1 – Climate change:
The Lufthansa Group has conducted a climate risk analysis to evaluate the resilience of the corporate strategy and business model with regard to material impacts, risks and opportunities. The focus of the climate risk analysis is on the evaluation of physical risks, such as increasingly extreme weather and climate-related changes, as well as transitional risks with regard to the Lufthansa Group’s activities. ↗ E1 – ESRS 2 IRO-1 – Description of the processes to identify and assess material climate-related impacts, risks and opportunities
E2 - Pollution:
No dedicated resilience analysis was carried out for E2. However, the impacts, risks and opportunities associated with the topic of noise pollution are continually analysed and measured. This includes regular dialogue with the relevant stakeholders concerned with reducing aircraft noise. In order to reduce the impacts on residents living near airports and to reduce possible future risks in advance, the Lufthansa Group is continually investing in new, quieter aircraft. Furthermore, the Lufthansa Group adheres strictly to the relevant noise regulations and monitors any potential regulatory developments. On this basis, the net risks are estimated as low, which is why no further analyses were conducted.
E5 – Circular economy and resources:
To date, the Lufthansa Group has not performed a dedicated analysis but the impacts, risks and opportunities associated with the topics of resource inflows and outflows are regularly analysed. Furthermore, the passenger airlines in particular are preparing for the introduction of the EU directive on single-use plastic, which is expected in 2030. In defining strategies and targets, as well as initiating various measures, the Lufthansa Group assumes that any net risks would not significantly impact the resilience of the Lufthansa Group and that a more in-depth resilience analysis is not required.
The Lufthansa Group is also strengthening its resilience in the area of social matters by focussing on rights of own workforce (S1), human rights (S2) and customer satisfaction (S4).
S1 – Own workforce:
Ensuring employee safety and well-being is a top priority for the Lufthansa Group. Material impacts, risks and opportunities in this area were analysed as part of the HR strategy and evaluated in detail by committees and working groups. Building on these results, the Lufthansa Group has defined specific measures and targets, including increasing the proportion of women in executive positions to 25% by the end of 2025, as well as strengthening occupational safety and health improvement programmes. ↗ S1 – ESRS 2 SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model
S2 – Workers in the value chain:
Resilience to risks relating to human rights and labour laws is strengthened through the integration of the requirements under the German Supply Chain Due Diligence Act (LkSG) into business processes, as well as with various other established processes. In order to address human rights impacts, extensive analyses have been conducted that measure both the impacts and the potential risks and opportunities along the supply chain. These analyses include the systematic identification of human rights and labour impacts at various stages of the value chain, and weighting them by severity and likelihood of occurrence, as well as the Lufthansa Group’s role in causing them. Based on these results, measures have been defined in order to minimise the risks identified and to proactively prevent any potentially negative impacts. ↗ S2 – ESRS 2 SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model
S4 – Consumers and end-users:
The Lufthansa Group places great importance on the safety and satisfaction of its customers. Measures to optimise the customer experience and the use of modern technologies strengthen the resilience of the business model in the face of changing customer requirements. Based on feedback and customer experiences, working groups and the departments conduct analyses of the material impacts, risks and opportunities. To do this, customer surveys, one-to-one conversations and other methods are used in order to garner relevant findings. ↗ S4 – ESRS 2 SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model
G1 - Business conduct:
In terms of corporate management, resilience is strengthened through responsible business conduct. The Lufthansa Group has established a governance system that aims to ensure ethical behaviour and compliance with regulatory requirements. This governance and compliance system analyses and evaluates the impacts, risks and opportunities of the Lufthansa Group. This evaluation and analysis results, for example, in measures for fighting corruption as well as data privacy policies. Regular audits help the Lufthansa Group to safeguard the long-term resilience of the Company. In terms of corporate management, policies have been implemented that address material topics and that are controlled via guidelines and management systems. Extensive information on the content of these policies and their significance for the resilience of the business model and strategy in terms of the material impacts, risks and opportunities identified can be found in detail in ↗ ESRS G1 Business conduct – Business conduct policies and corporate culture.
Company-specific reporting obligations
The material topics for the Lufthansa Group are addressed in detail in the sustainability report through the binding reporting requirements for ESRS. Furthermore, the Lufthansa Group also reports on two topics by means of additional company-specific figures. These figures refer to noise pollution and single-use plastic.