Report by the Board of Directors
and Financial Statements 2025
Lassila & Tikanoja Plc
We unleash the
potential of the
circular economy
Annual Report 2025
1
Report by the Board of Directors . . . . . . . . . . . . . . 1
Key figures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Key figures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Definitions and reasons for the use of key figures . . . . . . 66
Financial statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Combined income statement . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Combined statement of comprehensive income . . . . . . . . 69
Consolidated statement of financial position . . . . . . . . . . . . 70
Combined statement of cash flows . . . . . . . . . . . . . . . . . . . . 71
Consolidated statement of changes in equity . . . . . . . . . . . 72
Notes to the consolidated financial statements . . . . . . . . . 73
Financial statements of the parent company . . . . . . . . . . . 108
Proposal by the Board of Directors for distribution
of profit and Auditor’s Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114
Auditor’s Report . . . . . . . . . . . . . . . . . . . . . . . . . . 115
Contents
Annual Report 2025
Report by the Board of Directors
1
Report by the
Board of Directors
Financial performance and governance ........................................... 1
Shares and shareholders .......................................................................... 3
Risks and risk management.................................................................... 6
Sustainability Report ................................................................................... 9
Annual Report 2025
Report by the Board of Directors
1
Financial performance and governance
Financial Statements 2025 of Lassila & Tikanoja
Lassila & Tikanoja Plc was incorporated through the partial demerger of Luotea
Oyj (formerly Lassila & Tikanoja plc), which was completed on 31 December
2025. The consolidated financial information as at 31 December 2025 has been
presented using actual figures for the statement of financial position as at 31
December 2025 and on a carve-out basis for the other financial information,
such as combined income statement and combined statement of cash flows, and
comparative periods.
This carve-out financial information does not necessarily reflect the combined
results of operations and financial position that Lassila & Tikanoja would have had
if it would have operated as an independent legal group and therefore prepared
standalone consolidated financial statements for the periods presented. Nor
does the carve-out financial information necessarily indicate the future results of
operations, financial position or cash flows of Lassila & Tikanoja.
Information in the consolidated financial statements is presented in millions
of euros unless otherwise stated. All figures have been rounded, and therefore
the sum of individual figures may differ from the total amount presented. Unless
otherwise mentioned, the figures in brackets refer to the corresponding period in
the previous year.
Financial performance
Net sales for 2025 were EUR 426.6 million (423.9), an increase of 0.7% year-
on-year. Organic decrease in net sales was 1.0%. Net sales in the Waste
Management and Recycling service area declined by 1.8% and amounted to EUR
278.1 million (283.1). The challenging economic environment and the decrease in
waste management material volumes affected net sales development throughout
the financial year. On the other hand, net sales were supported by growth in the
pallet business following the acquisition completed in June. Net sales in the
Hazardous Waste and Remediation service area increased by 12.0% to EUR 73.0
million (65.2). In remediation, net sales grew due to a strong project pipeline, while
demand in hazardous waste remained stable. Net sales in Industrial Services
and Water Treatment were in line with the comparison period at EUR 81.3 million
(81.3).
Adjusted EBITA was EUR 40.6 million (44.4), representing 9.5% (10.5) of net
sales. Adjusted EBITA for the Circular Economy business was EUR 42.1 million
(44.7), corresponding to 9.9% (10.5) of net sales. Relative profitability remained at
a good level, although the recession in the Finnish economy affected profitability
development throughout the financial year. The challenging economic situation
particularly affected waste management volumes. Although the net sales
of waste management in municipal contracts and producer responsibility
organisations increased compared to the previous year, net sales declined in
other customer segments. Efficiency measures implemented during the period
helped adjust service production costs to lower volumes. Profitability for the
year was burdened by approximately EUR 1 million in additional costs related to
the implementation of the new ERP system, as well as the start of amortisation
related to the system renewal investment, which had a negative earnings impact
of approximately EUR 1.1 million.
Operating profit was EUR 34.2 million (40.5), representing 8.0% (9.5) of net
sales. Operating profit included EUR 4.5 million in items affecting comparability.
Operating profit was improved by a EUR 0.9 million fair value adjustment related
to the deferred consideration for the acquisition of Sand & Vattenbläst i Tyringe
AB (“SVB”). Operating profit was reduced by expenses totalling EUR 5.4 million
in items affecting comparability, mainly related to the preparation of the partial
demerger and business acquisitions. Earnings per share were EUR 0.67 (0.83).
Lassila & Tikanoja completed three acquisitions in 2025. In June, L&T acquired
the pallet business of Stena Recycling Oy, which has generated annual net
sales of approximately EUR 10 million. The acquisition strengthens L&T’s service
offering and supports the growth of the circular economy business in line with
the strategy. Lassila & Tikanoja acquired the shares of Viemärihuolto Reinikka Oy
on 1 December 2025. Viemärihuolto Reinikka Oy provides sewer maintenance
services in Central Ostrobothnia, employs 10 people, and had net sales of
approximately EUR 2 million in 2024. The acquisition strengthens L&T’s local
service network as well as sewer maintenance services for industrial, SME, and
private customers in the Kokkola area. In Sweden, Lassila & Tikanoja expanded its
process cleaning business by acquiring RecondConcept i Ånge AB on 1 December
2025. The acquisition strengthens L&T’s chemical cleaning and process and
energy industry services. In the previous financial year, RecondConcept had net
sales of approximately EUR 1.2 million and employed 7 people.
In December, Lassila & Tikanoja announced that it will invest in plastics
recycling in Merikarvia. A property lease agreement with the municipality
enables the expansion of L&T’s plastics recycling operations. At the same time,
L&T is purchasing plastic-processing equipment from a bankruptcy estate of a
company that previously operated at the site. In addition to the lease agreement
and the equipment purchase, L&T is investing more than one million euros in
modernising the industrial facility and developing the processing lines. With the
new independent plastics recycling plant, L&T’s plastics recycling capacity in
Merikarvia will increase by approximately 1.5 times.
Net financial expenses for the financial year were EUR -4.6 million (-4.7).
The share of the profit of the joint venture Laania Oy was EUR 1.9 million (3.2).
Laania’s results were burdened by an exceptionally warm spring, which reduced
demand for energy wood.
Key figures
In EUR million,
unless otherwise indicated
2025
Carve-out
2024
Carve-out Change %
Net sales 426.6 423.9 0.7
Net salse growth, % 0.7 0.4
Adjusted EBITDA 84.3 86.0 -2.0
Adjusted EBITDA margin, % 19.8 20.3
EBITDA 79.8 83.8 -4.8
EBITDA margin, % 18.7 19.8
Adjusted EBITA 40.6 44.4 -8.6
Adjusted EBITA margin, % 9.5 10.5
Operating profit 34.2 40.5 -15.4
Result for the period 25.7 31.5 -18.4
0.67 0.83 -18.4
Net cash flow from operating activities
after investments
41.4 34.3 20.8
Net cash flow from operating activities
1.08 0.90 20.8
Gross capital expenditure 41.7 36.1 15.3
31 December 2025.
Net sales by service area
MEUR
2025
Carve-out
2024
Carve-out Change %
Waste management and recycling 278.1 283.1 -1.8
Hazardous waste and remediation 73.0 65.2 12.0
Industrial and water 81.3 81.3 0.0
Net sales between service areas -5.9 -5.8
Total net sales 426.6 423.9 0.7
Annual Report 2025
Report by the Board of Directors
2
Financing and capital expenditure
In 2025, net cash flow from operating activities amounted to EUR 73.4 million
(74.0). A total of EUR 0.3 million in working capital was tied up during the
financial year (EUR 1.5 million released). Net cash flow from operating activities
after investments totalled EUR 41.4 million (34.3). Net cash flow from operating
activities after investments for the financial year was supported by lower
operative investments than in the comparison period and reduced by acquisitions,
which had an impact of EUR 11.1 million (1.5).
At the end of the financial year, interest-bearing liabilities amounted to EUR
187.6 million. Net interest-bearing liabilities totalled EUR 150.2 million. The average
interest rate on long-term loans, excluding lease liabilities, was 3.2%.
External loans of the company have not been included in the carve-out
financial information for the comparative period. As part of the financing
arrangements, the EUR 75 million unsecured notes, the EUR 35 million and
EUR 15 million term loans, and the EUR 40 million revolving credit facility were
transferred to Lassila & Tikanoja in the demerger. At the end of the review period,
the committed EUR 40 million revolving credit facility was fully unused. More
information on the financing arrangements is presented in Notes 4.1 Financial
assets and liablitities and 4.2 Financial risk management in the notes to the
consolidated financial statements.
Net financial expenses totalled EUR -4.6 million (-4.7). Net financial expenses
were 1.1% (1.1) of net sales.
The equity ratio was 35.0% and gearing was 86.9%. Net debt / adjusted EBITDA
was 1.8x. The Group’s total equity amounted to EUR 172.8 million. Cash and cash
equivalents at the balance sheet date totalled EUR 37.4 million.
Gross capital expenditure for the financial year totalled EUR 41.7 million
(36.1). Operative capital expenditure excluding acquisitions amounted to EUR
29.2 million (34.3). The capital expenditure consisted primarily of machine
and equipment purchases, as well as investments in information systems.
Acquisitions accounted for approximately EUR 12.5 million (1.8) of the gross
capital expenditure.
Loans, liabilities and contingent liabilities to related
parties
Related-party transactions are accounted for in Note 5.4 Related-party
transactions in the notes to the consolidated financial statements. Subsidiary
loans and their terms are presented in Note 9 in the notes of the financial
statements of the parent company.
Outlook
In 2026, net sales are estimated to be EUR 420–450 million and adjusted EBITA
EUR 38–44 million.
Partial demerger of the former Lassila & Tikanoja
On 13 December 2024, the former Lassila & Tikanoja (Demerging Company,
Luotea Plc from the date of the demerger) announced, that the Board of Directors
of the Company has decided to initiate the planning of the possible separation
of its circular economy businesses Environmental and Industrial Services and
facility services businesses into two independent listed companies. The plan was
to separate the circular economy businesses into a newly listed company through
a partial demerger of fhe former Lassila & Tikanoja plc.
According to the preliminary assessment of the Board of Directors’ of the
Demerging Company, the separation of the circular economy and facility services
businesses could increase shareholder value by enabling both businesses to
pursue their own strategies and growth opportunities more effectively.
On 7 August 2025, the Demerging Company announced that its Board of
Directors has approved a demerger plan, pursuant to which the Demerging
Company will demerge so that all assets, debts and liabilities relating to the
Circular Economy business area will be transferred in the demerger to New
Lassila & Tikanoja Plc to be incorporated in connection with the demerger.
According to the demerger plan, the planned completion date of the demerger
was 31 December 2025.
On 4 December 2025, the Extraordinary General Meeting of the Demerging
Company resolved on the partial demerger of the Demerging Company in
accordance with the demerger plan approved by the Board of Directors and
signed on 7 August 2025. As part of the demerger resolution, the Extraordinary
General Meeting also adopted other resolutions relating to Lassila & Tikanoja.
Further information on these resolutions is presented under ‘Resolutions by the
Extraordinary General Meeting’.
The implementation of Luotea Plc’s partial demerger was registered with the
Finnish Trade Register on 31 December 2025. Trading in the shares of Lassila &
Tikanoja commenced on 2 January 2026 on the official list of Nasdaq Helsinki
Ltd under the trading code LASTIK
Resolutions by the Extraordinary General Meeting
The Extraordinary General Meeting of the former Lassila & Tikanoja plc (currently
Luotea Plc), which was held on 4 December 2025, resolved on the partial
demerger of Lassila & Tikanoja and, as part of the demerger resolution and
conditional upon the completion of the demerger, on the establishment of a
new independent company to be named Lassila & Tikanoja (the “New Lassila
& Tikanoja”), the composition of the Board of Directors of the New Lassila &
Tikanoja, authorising the Board of Directors of the New Lassila & Tikanoja to
issue shares and special rights entitling to shares in the New Lassila & Tikanoja
and to decide on repurchase of the New Lassila & Tikanoja’s own shares and
on acceptance as pledge of the New Lassila & Tikanoja s own shares. The
Extraordinary General Meeting resolved, conditional upon the completion of
the demerger, on the remuneration of the Board of Directors, the election and
remuneration of the auditor and the verifier of the New Lassila & Tikanoja’s
sustainability report and the establishment of the Shareholders’ Nomination
Board of the New Lassila & Tikanoja and adopted the remuneration policy of the
New Lassila & Tikanoja.
As part of the demerger resolution and conditional upon the completion of the
demerger, the Extraordinary General Meeting confirmed the number of members
of the Board of Directors of the New Lassila & Tikanoja as five (5). Jukka Leinonen
was elected as Chair of the Board of Directors, Sakari Lassila as Vice Chair of
the Board of Directors, and Tuija Kalpala, Teemu Kangas-Kärki and Anna-Maria
Tuominen-Reini as members of the Board of Directors of the New Lassila &
Tikanoja.
Conditional upon the completion of the demerger, the Extraordinary General
Meeting elected PricewaterhouseCoopers Oy, Authorised Public Accountants, as
the New Lassila & Tikanoja’s auditor. PricewaterhouseCoopers Oy has informed
the Company that Samuli Perälä, Authorised Public Accountant, would act as
the New Lassila & Tikanoja’s auditor with principal responsibility. Conditional
upon the completion of the demerger, the Extraordinary General Meeting elected
PricewaterhouseCoopers Oy, Authorised Sustainability Audit Firm, as the verifier
of the New Lassila & Tikanoja’s sustainability report. PricewaterhouseCoopers Oy
has informed the Company that Samuli Perälä, Authorised Sustainability Auditor,
would act as the principal verifier of the New Lassila & Tikanoja’s sustainability
report.
The resolutions of the Extraordinary General Meeting were announced in more
detail in a stock exchange release by Luotea Plc on 4 December 2025.
Events after the financial year
The company announced the composition of Lassila & Tikanoja Plc’s Nomination
Board on 29 January 2026. Lassila & Tikanoja Plc’s three largest shareholders,
who are entitled to appoint a representative to Lassila & Tikanoja Plc’s
Shareholders’ Nomination Board are the first groups of shareholders (Evald and
Hilda Nissi Foundation and Bergholm Heikki), the second group of shareholders
(Chemec Oy, CH-Polymers Oy, Maijala Eeva, Maijala Investment Oy, Maijala
Juhani, Maijala Juuso, Maijala Miikka, Maijala Mikko, Maijala Roope and Maijala
Tuula) and Nordea Funds Ltd (through 11 funds managed by it).
The following persons have been appointed as their representatives in Lassila
& Tikanoja’s Nomination Board: Juhani Lassila, Miikka Maijala and Josefin
Degerholm. The Chairman of Lassila & Tikanoja Plc’s Board of Directors, Jukka
Leinonen, acts as the fourth member of the Nomination Board. The Chairman of
the Nomination Board is Juhani Lassila.
Lassila & Tikanoja Plc received a notification from Protector Forsikring ASA
on 30 January 2026, according to which its shareholding in Lassila & Tikanoja
decreased below 5 per cent on 29 January 2026.
Lassila & Tikanoja Plc announced on 16 February 2026, that a member of
Lassila & Tikanoja Plc’s Group Executive Board, Hilppa Rautpalo (Senior Vice
President, Legal, HR and EHSQ), has announced her decision to leave the
company to take up a new position outside the organization by August 2026 at
the latest.
Lassila & Tikanoja announced on 26 February 2026 Lassila & Tikanoja’s
Shareholders’ Nomination Board proposals for the 2026 Annual General Meeting.
The Shareholders’ Nomination Board proposes the Board of Directors to
have five (5) members. The Nomination Board proposes that all of the current
members, Tuija Kalpala, Teemu Kangas-Kärki, Sakari Lassila, Jukka Leinonen and
Anna-Maria Tuominen-Reini be re-elected to the Board of Directors. In addition,
Annual Report 2025
Report by the Board of Directors
3
the Nomination Board proposes that Jukka Leinonen be re-elected as Chairman
of the Board of Directors and Sakari Lassila as Vice Chairman.
The Shareholders’ Nomination Board proposes that the remuneration of the
members of the Board of Directors be as follows:
• chairman, EUR 70,000 per year (2025: EUR 70,000);
• vice chairman, EUR 47,000 per year (2025: EUR 47,000);
• members, EUR 35,000 per year (2025: EUR 35,000);
However, if a member of the Board of Directors were to serve as the chairman
of the Audit Committee or the Personnel and Sustainability Committee, and not
simultaneously serve as the chairman or vice chairman of the Board of Directors,
their annual remuneration will be EUR 47,000.
Lassila & Tikanoja announced on 27 February 2026 that the Company will
launch a share repurchase programme for share-based incentive schemes
and remuneration of the Board of Directors. The Board of Directors of Lassila
& Tikanoja Plc has decided to exercise the authorisation granted by the
Extraordinary General Meeting held on 4 December 2025 to repurchase the
Company’s own shares. The repurchase of shares will commence at the earliest
on 2 March 2026 and end at the latest on 28 April 2026. The maximum number
of shares to be repurchased is 150,000, representing approximately 0.39 per cent
of all shares in Lassila & Tikanoja Plc.
Lassila & Tikanoja announced on 27 February 2026 that the company’s Board
of Directors has decided to establish a new long-term share-based incentive
scheme for the Group’s key employees. The aim of the new scheme is to align
the objectives of the Company, shareholders and key employees to increase
the value of the Company in the long term, to strengthen the commitment of
key employees to the Company and to offer them a competitive reward plan
that is based on earning and accumulating the Company’s shares as well as on
appreciation of the share price.
The Performance Share Plan 2026–2030 comprises three (3) three-year (3)
performance periods, covering the calendar years 2026–2028, 2027–2029
and 2028–2030. In the plan, a participant has the opportunity to earn Lassila &
Tikanoja Plc shares based on the achievement of performance criteria. The Board
of Directors decides on the performance criteria of the plan and the performance
levels to be set for each performance criterion at the beginning of a performance
period. The potential rewards based on the plan will be paid after the end of each
performance period. During the performance period 2026–2028, the earning of
rewards is based on the following performance criteria:
• Return on capital employed (ROCE) (30 %) during the period 2026–2028;
• Revenue growth (30 %) during the period 2026–2028;
• Total shareholder return (rTSR) (30 %) during the period 2026–2028;
• Reduction of the carbon footprint (ESG) (10 %) during the period 2026–2028.
The rewards to be paid based on the performance period 2026–2028
correspond to the value of approximately 218,677 Lassila & Tikanoja Plc shares in
maximum total, also including the portion to be paid in cash. The target group of
the Performance Share Plan during the performance period 2026–2028 consists
of approximately 25 key employees, including the Group’s President and CEO and
the Group Executive Board.
Lassila & Tikanoja Plc announced on 19 March 2026, that Eero Hautaniemi,
who has served as President and CEO of Lassila & Tikanoja Plc since 2019, has
informed the company of his wish to step down from his position no later than 30
June 2027. The Board of Directors of the company has initiated the recruitment
process for a new President and CEO.
Medium-term targets
Lassila & Tikanoja’s medium-term targets are presented in the table below.
Lassila & Tikanoja does not consider its medium-term financial targets to
constitute market guidance for any specific year.
Indicator Target 2025 2024
Annual growth in net sales, % 6 % 0.7 % 0.4 %
Adjusted EBITA margin, % 11 % 9.5 % 10.5 %
Net debt / Adjusted EBITDA 1.5x-2.5x 1.8x n/a
Dividend policy
Lassila & Tikanoja Plc aims to distribute dividends amounting to at least 50% of
the Group’s net profit.
Proposal for profit distribution
In 2025, the Group’s earnings per share on a carve-out basis were EUR 0.67
(0.83). The Board of Directors proposes to the Annual General Meeting to be held
on 28 April 2026 that a dividend of EUR 0.42 per share be paid for the financial
year 2025. The Board of Directors proposes that the dividend be paid in two
instalments. The first instalment of EUR 0.21 per share would be paid in May
2026 and the second instalment of EUR 0.21 per share in October 2026.
Shares and
shareholders
Share capital and number of shares
Lassila & Tikanoja Plc was incorporated through the partial demerger of Luotea
Plc (formerly Lassila & Tikanoja Plc), the implementation date of which was 31
December 2025. In connection with the partial demerger, the shareholders of
Luotea Plc received, as demerger consideration, one (1) share in Lassila & Tikanoja
Plc for each share they held in Luotea Plc. No demerger consideration was given
for the treasury shares held by Luotea Plc (587,150 shares as at 31 December
2025). Accordingly, at the commencement of trading, Lassila & Tikanoja Plc had
24,234 shareholders and 38,211,724 shares in issue. Trading in the Company’s
shares commenced on 2 January 2026 on the official list of Nasdaq Helsinki
under the trading symbol LASTIK.
The registered share capital of Lassila & Tikanoja Plc amounts to EUR 80,000.
The Company has 38,211,724 shares outstanding. At the end of the financial
year, the Company did not hold any treasury shares. Each share carries one vote.
The Articles of Association do not specify a maximum number of shares or a
maximum share capital. The shares have no nominal value and no accounting par
value. The Company’s shares are included in the book-entry system maintained
by Euroclear Finland Ltd. Euroclear Finland Ltd maintains the Company’s official
shareholders’ register.
Shareholders
At the end of the financial year, the company had 24,234 shareholders. Nominee-
registered holdings accounted for 13.2% of the total number of shares.
Holdings of the Board of Directors, the President and CEO and the
Executive Board
The members of the Board, the President and CEO and the Executive Board, and
organisations under their control held a total of 184,858 shares in the company
on 31 December 2025, representing 0.5 per cent of the total number of shares
and votes.
Share-based incentive plans
The purpose of the Lassila & Tikanoja’s long-term incentive plans is to commit
their participants to the long-term interests and to enhance the shareholder
value, as well as to offer a competitive, ownership-based reward scheme. The
company has the following share-based incentive plan under which share
rewards remain to be paid on the balance sheet date:
Performance-based share incentive plan 2023–2027, which includes three-
Annual Report 2025
Report by the Board of Directors
4
year performance periods 2023–2025, 2024–2026 and 2025–2027. During the
performance periods, performance is measured based on the criteria set by the
demerged company (old Lassila & Tikanoja, currently Luotea Plc). The rewards
payable based on the performance periods will be paid no later than five months
after the end of the performance period in a combination of shares and cash.
According to the demerger plan, the Board of Directors of the former Lassila &
Tikanoja have resolved on the effects of the demerger on the Performance Share
Plan’s performance periods in accordance with the terms of the Performance
Share Plan. For the 2023–2025 performance period of the Performance Share
Plan, the result is calculated as per the number of the former Lassila &Tikanoja’s
shares and confirmed in euros. The reward amount earned in euros is converted
into shares of the Performance Share Plan participant’s employer company at the
time of payment.
The New Lassila & Tikanoja intends to continue the former Lassila & Tikanoja’s
existing Performance Share Plan on substantially the same terms, but with
the amendment that the rewards will be in the new Lassila & Tikanoja’s shares
instead of the former Lassila & Tikanoja’s shares and the rewards payable, as
expressed in number of the new Lassila & Tikanoja shares, will be adjusted
accordingly. The rewards payable under the current Performance Share Plan for
the performance periods 2024–2026 and 2025–2027 will be converted into
shares in the new Lassila & Tikanoja based on the formation of the price of the
new Lassila & Tikanoja’s shares after the listing.
Following the completion of the demerger, the Board of Directors of the New
Lassila & Tikanoja will resolve on the details of the New Lassila & Tikanoja’s
share-based incentive plans.
Flagging notifications
The company did not receive notifications pursuant to chapter 9, section 5 of the
Securities Markets Act during the review period.
Own shares
At the end of the period, the company held no own shares.
Authorisations for the Board of Directors
The Extraordinary General Meeting of the former Lassila & Tikanoja plc (currently
Luotea Plc), which was held on 4 December 2025, resolved as part of the
demerger resolution and conditional upon the completion of the demerger,
on authorising the Board of Directors of the New Lassila & Tikanoja to the
repurchase of the company’s own shares using the company’s unrestricted
equity. In addition, the Extraordinary General Meeting authorised the Board of
Directors to decide on a share issue and the issuance of special rights entitling
their holders to shares.
The Board of Directors is authorised to purchase a maximum of 2,000,000
company shares (5.2% of the total number of shares). The authorisation is valid
until the conclusion of the first Annual General Meeting held by the New Lassila &
Tikanoja following the completion of the demerger.
The Board of Directors is authorised to decide on the issuance of new shares
or shares which may be held by the company through a share issue and/or
issuance of option rights or other special rights conferring entitlement to shares,
referred to in Chapter 10, Section 1 of the Finnish Companies Act, so that under
the authorisation, a maximum of 2,000,000 shares (5.2% of the total number
of shares) may be issued and/or conveyed. The authorisation is valid until the
conclusion of the first Annual General Meeting held by the New Lassila & Tikanoja
following the completion of the demerger.
Annual Report 2025
Report by the Board of Directors
5
Number of
shareholders % Number of shares
% of shares and
votes
Breakdown of shareholding by sector on 31 December 2025
Corporations and housing associations 911 3.8 3,799,596 9.9
Financial and insurance corporations 47 0.2 8,413,697 22.0
General government 15 0.1 2,718,622 7.1
Households 23,007 94.9 16,531,229 43.3
Non-profit institutions serving households 185 0.8 5,731,862 15.0
Foreign shareholders 69 0.3 976,190 2.6
Shares not transferred to the book-entry securities system 0 40,528 0.1
Total 24,234 100 38,211,724 100
Nominee registered 10 5,059,005 13.2
Breakdown of shareholding by size of holding on 31 December 2025
Number of shares
1–1 000 21,671 89.4 4,710,175 12.3
1 001–5 000 2,092 8.6 4,450,877 11.6
5001–10 000 254 1.0 1,811,223 4.7
10 001–100 000 181 0.7 4,923,984 12.9
100 001–500 000 23 0.1 4,995,375 13.1
over 500 000 13 0.1 17,279,562 45.2
Shares not transferred to the book-entry securities system 0 40,528 0.1
Total 24,234 100 38,211,724 100
Nominee registered 10 5,059,005 13.2
Major shareholders on 31 December 2025,
excluding nominee-registered shares
Shareholder
Number of
shares
% of shares and
votes
1 Evald ja Hilda Nissi’s Foundation 3,496,487 9.2
2 Nordea Nordic Small Cap Fund 2,009,300 5.3
3 Maijala Juhani 1,529,994 4.0
4 Bergholm Heikki 895,057 2.3
5 Ilmarinen Mutual Pension Insurance
Company 790,000 2.1
6 Maijala Mikko 730,000 1.9
7 Varma Mutual Pension Insurance
Company 729,791 1.9
8 Stiftelsen för Åbo Akademi Sr 645,282 1.7
9 Aktia Capital Fund 580,218 1.5
10 Elo Mutual Pension Insurance
Company 574,180 1.5
11 The State Pension Fund 512,000 1.3
12 Turjanmaa Kristiina 469,000 1.2
13 Oy Chemec Ab 420,000 1.1
14 Seligson & Co Phoebus Investment
Fund 405,000 1.1
15 Maijala Eeva 370,000 1.0
16 Samfundet folkhälsan i
Svenska Finland rf 336,800 0.9
17 Security Trading Oy 330,000 0.9
18 Brotherus Ilkka 285,000 0.7
19 Maijala Investment Oy 210,000 0.5
20 Lassila Juha 184,785 0.5
20 largest owners total 15,502,894 40.6
L&T has a defined risk management process that includes a review of financial,
strategic, operational, sustainability-related responsibility risks, as well as
damage-related risks.
Key risk management principles
Risk management at L&T aims to identify significant risk factors, prepare for
them and manage them in an optimal way. The purpose of risk management is
to support management and decision-making so that the objectives set for the
company are achieved. Comprehensive risk management endeavours to manage
the Group’s risk as a whole and not just individual risk factors.
Risk management is carried out by different functions and in accordance with
are summarised and prioritised development measures are identified.
In accordance with the risk management process, risks are assessed annually
• Strategic risks
• Financial risks
• Operational risks
• Sustainability risks
• Supply chain risks and
• Information management risks
The risk management process also aims to assess the opportunities presented
Responsibilities
The principles of L&T’s risk management are approved by the company’s Board
of Directors. The Board monitors the implementation of risk management and
assesses the efficiency of the methods employed. The President and CEO is
responsible for the organisation and implementation of risk management. Risk
management at L&T Group is controlled by the risk management and insurance
policy confirmed by L&T’s Board of Directors and the related risk management
principles, which are regularly updated. The policy specifies the objectives and
principles, organisation and responsibilities, and procedures of the Group’s risk
management. The Group’s financing policy confirmed by L&T’s Board of Directors
is followed in the management of financial risks. The principles for insurance risk
management are specified in the Risk Management and Insurance Policy.
Identification, assessment and reporting of risks
Risks are surveyed regularly and systematically at both the business level and
in support functions and functions considered to be critical. The survey also
covers risks related to the collection and reporting of sustainability information,
such as potential errors in connection with the collection or consolidation
for managing and minimising the identified risks are prepared, and responsibility
for these measures is allocated to specified individuals or units. The impact of
risks is analysed in terms of their effects on EBIT, among other things, and the
assessment of the probability of the realisation of the risks takes into account
the nature of operations and the risk mitigation measures taken by the Group.
The most significant identified risks, and the preparations for those risks,
Risk analysis
The tables on the following pages describe the most important strategic,
operational and sustainability related risks of L&T’s business which, if realised,
can endanger or prevent the achievement of business objectives. Financial risks
are described in Note 4.2 Financial risk management to the consolidated financial
ESRS 2 SBM-3 of the Sustainability Report.
Near-term risks and uncertainties
General economic uncertainty may affect the level of economic activity among
customers, which may reduce the demand for L&T’s services.
Lassila & Tikanoja’s business is subject to economic cycle fluctuations, and
changing market conditions and fluctuations in L&T’s customers’ industries
Lassila & Tikanoja’s operating areas are highly competitive, and increased
competition or failure to react to the competitive situation may result in L&T
losing market share.
The Finnish Waste Act was amended in July 2021. Under the reforms to the
Waste Act, municipalities take on a larger role in organising the collection of
packaging materials and biowaste from housing properties. As a consequence
of the reform, L&T’s direct customer agreements with housing properties on the
separate collection of packaging waste and biowaste will be gradually transferred
to municipalities for competitive bidding between 1 July 2022 and 1 July 2025.
of the Finnish waste management market will be moved out of the scope of
free competition between 2024 and 2028. L&T participates in the competitive
tendering of municipal contracts and is a significant operator in municipal
Lassila & Tikanoja may be held liable for environmental damage, which could
result in significant costs and reputational damage.
Risks and risk management
Several ERP system deployment stages are in progress at the company.
Temporary additional costs related to the deployment of systems and the
establishment of the operating model as well as tied-up working capital may
weaken the company’s profit.
Lassila & Tikanoja operates in a people-intensive sector and failures in
recruiting skilled personnel, the loss of senior managers or other key personnel
or other disruptions in the availability of personnel or their work ability may have
a negative impact on L&T’s business and it may not be possible to recruit and/
Lassila & Tikanoja’s operations and the services it provides are largely
dependent on information networks and digital solutions, and disruptions to them,
and breaches or attacks targeting them, as well as any failure of information
system development projects and the lack of adequate data processing
agreements, may have an adverse impact on L&T’s business and financial
position and cause damage to its reputation.
The geopolitical situation involves uncertainty due to ongoing conflicts and
various tariff systems. The tensions are also reflected in EU regulations and
political priorities. The indirect impacts on energy and raw material prices and
demand as well as overall economic activity in Finland and Sweden may have
Annual Report 2025
Report by the Board of Directors
6
Strategic, operational and sustainability risks
Strategic risks
Risk Risk description
Risk management
Markets
• The general economic development of L&T’s operating countries, changes in the competitive landscape
• Uncertainty in the operating environment slows down investments and the commercialisation of growth
concepts
• Weak outlook and transformation of traditional process industry in Finland. Finland’s competitiveness
• Decrease in final disposal volume
• Creating and regularly updating scenarios, regular assessment, sharpening and updating of the strategy,
taking industry changes into account and recognising the need for renewal as part of the continuous
strategy process.
• Active in-house development activity, building solutions and industrial integration
• Future growth projects. Design of development roadmaps and close monitoring of the market.
• Advocacy work on the Waste Act, the Procurement Act and the Competition Neutrality Act
•
solutions for emerging industrial sectors.
• Own efficient treatment centres, capabilities for treating challenging fractions and plans for utilising
streams
Regulation
• Municipalisation may limit L&T’s ability to provide its services, which may have a negative impact on L&T’s
business and profitability.
• Active monitoring of legislative developments, anticipating future changes in a timely manner, and dialogue
with the public authorities and legislators.
• Development of own competitiveness and efficient operating models
Technology
•
offered by the use of data.
• L&T continuously evaluates and develops the capabilities required for the implementation of strategic development
• Resource allocation, prioritisation of activities and active review of opportunities
Employees
• Availability of labour and loss of key personnel
• The potential reduction of employee satisfaction may affect L&T’s competitive advantage, which is largely
based on the work of skilled and motivated personnel.
• Development of the employer image
• High-quality management and supervisory work, community and cooperation
• Succession planning and growing new key employees
• Efficient recruitment networks
Strategic
development
projects
• Limited capabilities in emerging technologies/commercialisation of new solutions and implementation
• Failure in inorganic growth
• Careful resource allocation and accurate prioritisation of projects
• Allocation of resources/investments to growth
• Engaging key personnel
• Increasing market knowledge
Annual Report 2025
Report by the Board of Directors
7
Operational risks
Risk Risk description
Risk management
ICT systems,
data security
and data
protection
• Disruptions, delays and functional challenges related to information and communications systems and
• The renewal of business-critical systems may cause disruptions in service production.
• Cyber crime could pose risks to the company’s data security and business continuity.
•
identifying which systems are critical to operations and defining the allocation of responsibilities between
the system vendors and L&T.
• Comprehensive planning of the deployment of new systems and related operating models.
• Data security guidelines and employee training.
Damage-
related risks
•
The significance of the risk of fire is reduced by the fact that individual plants or production lines have
•
on how to respond to a fire or other hazardous situations.
•
policies for injuries, property damage, business interruption, third-party liability, environmental damage and
Procurement
risks
• Rising fuel, electricity and other procurement costs could have a negative impact on L&T’s profitability. • Supply chain management, the diversification of propulsion sources and the improvement of efficiency.
Acquisitions
• The success of acquisitions may affect the achievement of the Group’s growth and profitability targets. Failures
in acquisitions may impact the Group’s competitiveness and profitability and change the Group’s risk profile.
• Acquisition agreements, the strategic and financial analysis of potential acquirees’ business operations,
comprehensive due diligence.
•
Financing
risks
• Translation risk, L&T has investments denominated in foreign currencies (SEK) • More detailed information on the management of financial risks is presented in Note 4.2 Financial risk
management to the financial statements.
Sustainability risks
Risk Risk description
Risk management
Environ-
mental
risks
• Transition risks related to the green transition and circular economy related to regulation, financing,
• Regulation may cause changes in the pricing of energy and emissions.
•
• Failure to meet the climate targets may affect the fulfilment of the loan terms.
• L&T’s own climate targets, the actions aimed at achieving the targets and the separate climate targets
set for the supply chain are in line with the observations made in the scenario analysis. L&T manages
• More detailed information on climate risk management is provided in paragraph E1 SBM-3 of the
Sustainability Report.
Social risks
• Safety is at the heart of L&T's operations. Accidents are possible in spite of thorough occupational safety
processes and training.
• Comprehensive training, communication, safety management guidelines and principles, as well as regular
safety surveys and proactive safety efforts.
• Careful compliance with legislation and collective agreements. Careful risk assessment and implementing
risk-based preventive measures.
Ethical
business
• Involvement in corruption or bribery • Anti-corruption and anti-bribery policy and other guidelines
• Monitoring the training coverage of key personnel in the prevention of corruption and bribery
• More detailed information on corruption risk management is provided in paragraph G1 of the Sustainability
Report.
Annual Report 2025
Report by the Board of Directors
8
Annual Report 2025
Report by the Board of Directors Sustainability Report
9
Sustainability
report
ESRS 2 General disclosures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
EU taxonomy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
E1 Climate change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
E5 Resource use and circular economy . . . . . . . . . . . . . . . . . . . . . 50
S1 Own workforce . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
G1 Business conduct . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
BP-1 - General basis for preparation of the
Lassila & Tikanoja Plc (hereinafter referred to as "L&T") is a company that offers
circular economy services in Finland and Sweden. The company was established
on 31 December 2025 in the partial demerger of Luotea Plc (formerly Lassila &
Tikanoja plc). In the partial demerger, the circular economy businesses belonging
to the group were demerged into an independent listed company, which will con-
tinue under the company name Lassila & Tikanoja Plc.
This first Sustainability Report of L&T, which was established in the demerger,
has been prepared in accordance with Commission Delegated Regulation (EU)
2023/2772 (hereinafter referred to as "European Sustainability Reporting Stan-
dards") supplementing Directive 2013/34 of the European Parliament and of
the Council with regard to sustainability reporting standards (CSRD), the provi-
sions of which concerning sustainability have been implemented in Chapter 7
of the Finnish Accounting Act (1336/1997). This Sustainability report covers all
L&T Group companies presented in the consolidated financial statements for the
financial year 31 December 2025, p. 104, unless otherwise stated in connection
with the reported information.
The information in the Sustainability report is reported in alignment with the
accounting policy presented in the Notes to the consolidated financial state-
ments, p. 73. For the financial year, the information in the Sustainability Report
is reported at the Group level with the actual figures for 31 December 2025,
including, in addition to the parent company Lassila & Tikanoja Plc (hereinafter
L&T or the company), all subsidiaries or information reported on carve-out basis
that can be directly allocated to L&T. The information concerning the company's
own workforce is also divided into country-specific figures. L&T does not report
information on a company-specific basis. L&T reports value chain information in
accordance with disclosures in relation to specific circumstances. Information
concerning trade secrets and intellectual property rights has not affected the
reporting of information that is material to L&T.
BP-2 – Disclosures in relation to specific circumstances
The reported sustainability topics and sustainability indicators are based on the
double materiality assessment of L&T's circular economy businesses, which was
carried out in 2025 before the partial demerger of the former Lassila & Tikanoja
Group. The definitions of short-, medium- and long-term presented in section 6.4
of ESRS 1 have been applied in the double materiality assessment. The same defi-
nitions of time horizons are followed in this Sustainability Report.
The operating principles and policies related to the company’s material
impacts, risks and opportunities described in this report were prepared by the
demerger committee before the partial demerger of the former Lassila & Tikanoja
Group, and L&T’s Board of Directors confirmed them at its organisational meeting
on 2 January 2026.
The assessment of impacts, risks and opportunities, as well as the company’s
related policies, actions, targets and metrics, apply, as a rule, to L&T’s own oper-
ations, with the exception of the following disclosures, which apply to the value
chain:
• The carbon handprint describes the emissions avoided through the services
provided by L&T to its customers.
• Carbon footprint, which also includes emissions generated in L&T’s value
chain.
• L&T’s inflows and outflows relate to materials collected from customers.
The calculation principles applicable to each topic and the background data
used in the calculations are presented in connection with each topic. The disclo-
sure indexing related to the European Sustainability Reporting Standards (ESRS)
is reported in section ESRS 2 IRO-2, pp. 25–35. Aside from the verification of
sustainability reporting, L&T has not otherwise certified or obtained third-party
assurance for the metrics presented in the Sustainability Report.
No comparative data is presented in L&T's Sustainability Report. For comparative
data, L&T utilises the transitional provision concerning comparative values presented
in ESRS 1, paragraph 7.1, in the first year of preparing the sustainability report.
With regard to transitional provisions, the Commission’s "quick-fix" delegated
act concerning the ESRS standard of 11 July 2025 and the list set out in Amend-
ment C to ESRS 1 have been applied, and they are listed in the disclosure index
ESRS 2 IRO-2, pp. 25–35. L&T also uses the transitional provision when calcu-
lating the anticipated financial impacts related to the SBM-3 disclosure require-
ments. In addition, L&T applies the transitional provision related to the value chain
presented in ESRS 1 paragraph 10.2 in the following topics:
• E1 Biogenic CO emissions in all Scope 3 categories
• E1 Emission data in Scope 3 category 2 (capital goods)
L&T uses the European Commission’s delegated “quick fix” regulation for the fol-
lowing topics during the reporting period:
• S1-7 Characteristics of non-employee workers in the undertaking’s own
workforce
• S1-8 Collective bargaining coverage and social dialogue
• S1-11 Social protection
• S1-13 Training and skills development
• S1-14 Health and safety: non-employees
• S1-14 Health and safety: cases of work-related ill-health and number of days
lost to injuries, accidents, fatalities and work-related ill health
• S1-15 Work-life balance metrics
• S2 Workers in the value chain - topical disclosure requirements
• E4 Biodiversity and ecosystem services topical disclosure requirements
With regard to the sustainability matters S2 Workers int the value chain and E4
Biodiversity and ecosystem services, the identified material impacts and opportu-
nities, together with the associated objectives, policies, actions, and metrics, are
described in section ESRS 2 SBM-3, pages 17–21.
The Sustainability Report is published annually. The reporting period is the same
as for financial reporting, i.e. 31 December 2025 in 2025.
L&T’s Board of Directors is the most senior body responsible for sustainability.
The Board of Directors is responsible for the management of the company, the
proper arrangement of the company’s operations, and the proper arrangement
and supervision of the company’s accounting and financial management. The
Board of Directors decides upon matters that are of major importance, in view
of the scope of the operations of the company. The Board of Directors is also
responsible for the duties specified in the Limited Liability Companies Act and the
Articles of Association, and in other regulations.
The duties of the Board of Directors include overseeing the company’s strategy,
major business decisions and the risk management process, and approving key
policies and principles pertaining to business conduct. The Board of Directors
approves the company’s strategic sustainability targets and metrics, the key
policies that guide the company's operations, and the results of the company’s
double materiality assessment, for example. Progress towards strategic targets is
presented to the Board of Directors four times per year, in connection with each
interim report. In addition, the Board of Directors annually reviews the results of
the company’s risk management, which also cover the company’s climate risks.
The company does not have a separate control procedure in place for managing
sustainability-related impacts, risks and opportunities. Instead, the company
assesses them as part of the strategic risk management process. The company’s
climate risks, for example, are assessed in accordance with L&T’s risk manage-
ment process.
The Board of Directors has two committees: an Audit Committee and a Per-
sonnel and Sustainability Committee. The Audit Committee and the Personnel
and Sustainability Committee consist of three Board members each. The com-
mittee members must have the expertise and experience required by the duties
of the committee. The Board of Directors confirms the charters of the committees
annually. The committees have no independent decision-making authority; the
Board of Directors makes the decisions based on the preparation work by the
committees. The Personnel and Sustainability Committee prepares the double
materiality assessment on behalf of the Board of Directors. The double materi-
ality assessment is then discussed by the Audit Committee and approved by the
Board of Directors. The double materiality assessment is updated and approved
10
annually by the Board of Directors. The Chair of the committee reports on the
work of the committee at the Board meeting following the committee meeting.
Minutes of the committees’ meetings are provided to the Board members for
information.
The focus areas of corporate responsibility and annual development areas are
discussed regularly by the Personnel and Sustainability Committee of the Board
of Directors. Based on a presentation by L&T's Senior Vice President, Corporate
Relations and Responsibility, the committee prepares the results of the compa-
ny’s double materiality assessment, which are based on an assessment of the
company’s impacts, risks and opportunities. The Personnel and Sustainability
Committee also monitors and assesses the development of L&T's business envi-
ronment, regulation and stakeholder support. The Personnel and Sustainability
Committee did not meet during the financial year.
The charter of the Audit Committee includes monitoring and assessing the devel-
opment of sustainability in the company and the results of the company's ESG
assessments and analyses, and assisting the Board of Directors in the prepa-
ration and monitoring of sustainability reporting. The Committee monitors and
evaluates sustainability-related target setting in the short and long term and the
effectiveness of risk management systems. The Audit Committee did not meet
during the financial year.
Both genders are represented in the Board of Directors and its committees. The
Board of Directors that started on 31 December 2025 consists of 5 members,
of whom 3/5 (60%) were male and 2/5 (40%) were female. The age range of
the Board members was 45–70 years. None (0%) of the members of the Board
of Directors are in an employment relationship with the company. The Board of
Directors has assessed that all (100%) of its members are independent of the
company.
The members of the Board of Directors are familiar with the circular economy
sector. They have extensive experience in different business areas and an under-
standing of different markets and their special characteristics through their pre-
vious experience. The experience and competence of the members of the Board
of Directors supports the strategic development of the service business. The
Board of Directors has assessed its own operations and competence in the areas
that are key to the company.The Board members have assessed how well their
competence corresponds to the company’s business, industry, services, geo-
graphical scope and areas that are material to sustainability. From the perspec-
tive of sustainability, the key areas of expertise of the Board of Directors are:
• environmental responsibility (ESRS E1 Climate change, ESRS E4 Biodiversity
and ecosystems, ESRS E5 Resource use and circular economy),
• human resource management (ESRS S1 Own workforce),
• corporate governance (ESRS 2 General Disclosures, ESRS G1 Business conduct),
• supply chain management (ESRS S2 Workers in the value chain, ESRS G1
Business conduct),
• International market knowledge (Finnish and Swedish markets) and
• industry expertise (ESRS E5 Resource use and circular economy, ESRS S1
Own workforce).
The President and CEO is responsible for L&T's operations in keeping with the
instructions of the Board of Directors, and is in charge of the company's strategy
process. The President and CEO reports to L&T’s Board of Directors. The Presi-
dent and CEO is assisted by the members of the Group Executive Board, each
of whom is, in their own area of responsibility, in charge of the development of
sustainability and the management and implementation of the identified devel-
opment themes. These include, among other things, the policies submitted to the
company's Board of Directors for approval, the sustainability targets and related
development measures, and the results of the double materiality assessment.
L&T’s President and CEO monitors the implementation of the sustainability tar-
gets and reports to the Board of Directors and its committees on their impacts,
risks and opportunities. The members of the Group Executive Board report to
L&T's President and CEO.
L&T’s sustainability work is guided an developed via the company’s strategy
and material sustainability impacts, risks and opportunities. The company's tar-
gets related to the development of sustainability have been approved by the
Board of Directors, and they are derived from the company's material impacts.
The focus areas of the programme have been determined based on the impacts
of L&T’s operations, the expectations of key stakeholders and the Group’s stra-
tegic priorities. L&T has also taken into account the special characteristics of the
operations and business environment of a service company in the environmental
sector, as well as the UN’s sustainable development principles and the objectives
of the Global Compact initiative in sustainability work.
The Group Executive Board steers the development of the sustainability targets
and monitors them quarterly. The Senior Vice President, Corporate Relations and
Sustainability, and the communications and sustainability organisation operating
under their supervision are in charge of the development and practical coordina-
tion of sustainability efforts. Sustainability reporting is the responsibility of the
Chief Financial Officer and the financial accounting team under them. The busi-
nesses and other functions are in charge of the sustainability and compliance of
their operations in accordance with the Group’s management system. L&T’s man-
agement system has been certified in accordance with the ISO 9001, ISO 14001
and ISO 45001 standards. On 31 December 2025, L&T’s Group Executive Board
consisted of seven members, of whom 1 (14%) was female and 6 (86%) were male.
Policies and principles are prepared by the compliance task force, which operates
under L&T’s Senior Vice President, HR and Legal, and meets at least four times per
year. The President and CEO and the Group Executive Board approve all policies
and principles, and some are also subsequently approved by the Board of Directors.
The compliance task force also reviews compliance related to sustainability
reporting, develops the company's monitoring activities related to legislation, and
monitors incidents reported via the company's whistleblowing channels. In 2025,
the compliance task force consisted of the Senior Vice President, HR and Legal,
and the HR Manager, Environmental Manager, Head of Sustainability and Senior
Vice President, Corporate Relations, as permanent members. The compliance
task force prepares a separate compliance review for the Group Executive Board
at least twice a year and for the Audit Committee at least once a year.
L&T’s compliance task force ensures that the company’s policies are up to date.
Most of the company’s sustainability-related policies are public and can be found
on the company’s website. L&T also has internal plans that guide its operations,
such as business-specific diversity plans and guidelines that supplement poli-
cies, which can be found via the company’s internal communication channels.
The policies were drafted before the partial demerger of the former Lassila &
Tikanoja Group, and they were approved by the Board of Directors meeting on 2
January 2026, unless otherwise mentioned in the Sustainability Report. Going
forward, the policies will be updated every two years together with experts,
and the responsible parties and approvers have been defined for them. The
governance-related Employee Code of Conduct and Supplier Code of Con-
duct, anti-corruption and anti-bribery policy, data protection policy, information
security policy, guidelines on gifts and hospitality in procurement activities, and
related targets and metrics are described in more detail in section ESRS G1-1, pp.
61–62. The occupational safety policy, personnel policy and human rights policy
are described in more detail in section ESRS S1-1, pp. 54–55. The environmental
policy is described in more detail in section ESRS E1-2, p. 42.
L&T also requires that employees complete online training on policies and prin-
ciples on a job role-specific basis. Statistics on the completion of these training
activities are monitored by the compliance task force and the Group Executive
Board. The development of competence is the responsibility of the Senior Vice
President, HR and Legal, together with the HR organisation. The HR organisation
also prepares company-specific personnel development plans. The company's
key policies and principles with relevance to the Sustainability Report are listed
in the table "Key policies, responsibilities and training related to policies for man-
aging material sustainability impacts and risks" on p. 13. All of the listed policies
and principles, with the exception of the information security policy and tax
policy, are publicly available on L&T’s website.
At L&T, employees are primarily represented by shop stewards or representa-
tives elected from among the personnel. The election and duties of shop stew-
ards are laid down in collective agreements and, in part, in labour legislation.
The election and duties of the shop steward, on the other hand, are laid down in
labour legislation.
11
Name
since
companies
Jukka Leinonen 2025
• Environmental responsibility (E1, E4, E5)
• Human resources management (S1)
Chair 2
Teemu
Kangas-Kärki
2025 • Governance (ESRS 2, G1) Chair 1
Tuija
Kalpala
2025
• Environmental responsibility (E1, E4, E5)
• Industry expertise (E5, S1)
member
Sakari Lassila 2025
• Governance (ESRS 2, G1)
• Supply chain management (S2, G1)
• Industry expertise (E5, S1)
member member
Anna-Maria
Tuominen-Reini
2025
• Environmental responsibility (E1, E4, E5)
• Governance (ESRS 2, G1)
• Industry expertise (E5)
• International market expertise (Sweden, Fin-
land)
member
The table presents the key areas of expertise of the Board members on 31 December 2025. An area of expertise not being separately listed for a Board member does not mean that the Board member in question does not have this expertise.
Environmental responsibility
Human resources management
Governance
International market expertise
Industry expertise
Supply chain management
0 1 2 3 4
Male, 3
Female, 2
40%
60%
12
Policy
Governance
Employee Code of
Conduct
Senior Vice President,
HR and Legal
Board of Directors
2 January
2026
Online training
Governance
Anti-corruption and
anti-bribery policy
Senior Vice President,
HR and Legal
Board of Directors
2 January
2026
Online training
Governance
Information security
policy
Chief Information Officer CEO and Group Executive Board
to be approved
in 2026
Online training
Governance Data protection policy
Senior Vice President,
HR and Legal
Board of Directors
2 January
2026
Part of online training on the
information security policy
Governance Tax policy CFO Board of Directors
to be approved
in 2026
Part of the induction of
separately identified experts
Governance
Policy on gifts
and hospitality in
procurement
Senior Vice President,
Public Affairs and Sustain-
ability
Board of Directors
(in the future, CEO and Group
Executive Board)
2 January
2026
Part of the induction of
separately identified experts
Society HR policy
Senior Vice President,
HR and Legal
Board of Directors
2 January
2026
Part of induction
Society
Occupational safety
policy
Senior Vice President,
HR and Legal
Board of Directors
(in the future, CEO and Group
Executive Board)
2 January
2026
Online training
Society Human rights policy
Senior Vice President,
HR and Legal
Board of Directors
2 January
2026
Part of online training on the
Code of Conduct
Society
Supplier Code of
Conduct
Chief Purchasing Officer
Board of Directors
(in the future, CEO and Group
Executive Board)
2 January
2026
Part of the contract requirements
Society Sanctions control policy
Senior Vice President,
HR and Legal
Board of Directors
(in the future, CEO and Group
Executive Board)
2 January
2026
Part of the induction of
separately identified experts
Environment Environmental policy
Senior Vice President,
Public Affairs and
Sustainability
Board of Directors
2 January
2026
No specific training,
implementation through
objectives, targets, indicators
L&T’s strategy is based on the idea of unlocking the potential of the circular
economy. The company's aim is to mitigate climate change and biodiversity loss
and promote the sustainable use of raw materials and natural resources. Sus-
tainability issues are a key part of the company’s strategy and major business
decisions. An annually updated assessment of material sustainability impacts,
risks and opportunities provides information for strategy work and is part of the
company’s risk management process. As part of the risk management process,
the Board of Directors monitors that L&T has sufficient capabilities to identify,
assess and manage risks effectively. The Board of Directors annually approves
the results of L&T’s double materiality analysis, which address L&T’s material
impacts, risks and opportunities. L&T's key sustainability targets are reported
to the Board of Directors and the market four times per year in connection with
interim reports, and they are part of the company's strategic objectives. In con-
nection with interim reports, the Board of Directors assesses the measures nec-
essary for achieving the targets and metrics. The sustainability risk management
process is part of the company’s overall risk management process. The due dili-
gence process related to acquisitions is described in more detail in section ESRS
2 GOV-4, p. 14.
During 31 December 2025, the Board of Directors, its committees and the Group
Executive Board did not convene and no information related to sustainability issues
was submitted to or processed by the Board of Directors or the Group Executive
Board.
-
L&T complies with the Remuneration Policy drawn up by Lassila & Tikanoja Plc’s
Personnel and Sustainability Committee and approved by the Board of Direc-
tors and presented to the Extraordinary General Meeting 2025 preceding the
demerger. The Remuneration Policy describes the remuneration principles con-
cerning the company’s governing bodies, namely the Board of Directors and
the President and CEO. During the financial year 2025, L&T complied with the
Remuneration Policy presented to the Annual General Meeting. There were no
deviations from the Remuneration Policy and no clawback of remuneration. In
accordance with the Remuneration Policy, the aim of the remuneration scheme of
the Board of Directors and the President and CEO is to contribute to the positive
development of shareholder value, as well as to enhance the company’s competi-
tiveness, long-term financial success, and fulfilment of the strategy and goals set
by the company.
In accordance with the proposal of the Shareholders’ Nomination Board, the
Extraordinary General Meeting on 4 December 2025, preceding the demerger,
decided on the remuneration of L&T’s Board of Directors and the grounds thereof
for 2025. The remuneration of the Board of Directors did not include remunera-
tion components related to sustainability matters.
The remuneration of the President and CEO consists of a fixed monthly salary
and benefits, and a separate annually decided short-term incentive.
13
The objectives of the short-term incentive scheme are set – and their achieve-
ment assessed – annually. In addition, the President and CEO is included in the
share-based incentive scheme, which serves as a long-term incentive scheme.
The Board of Directors decides on the remuneration and financial benefits pay-
able to the President and CEO. Before decision-making by the Board of Directors,
the matter is prepared by the Personnel and Sustainability Committee of the
Board.
As the company was registered on 31 December 2025 due to a partial demerger,
the incentive scheme for the President and CEO for 2025 preceding the demerger,
according to which the remuneration will be paid by the company in 2026, is
described here. The President and CEO’s incentive bonus for the earnings period
that corresponds to the financial year 2025 was based on the Group’s profit perfor-
mance and strategic targets defined by the Board of Directors as follows: consol-
idated operating profit (70% weight), improving working capital (20% weight), and
the employee Net Promoter Score (eNPS, 10% weight). Based on the achievement
of the earnings criteria for the earnings period that corresponded to the financial
year 2025, the incentive bonus was earned at 37.97% of the maximum amount,
which represents, by criteria, consolidated operating profit at 33.97%, improving net
working capital at 0%, and employee Net Promoter Score at 4%. The President and
CEO will be paid EUR 103,658 in the financial year 2026 for the earnings period
that corresponds to the financial year 2025.
The long-term incentive scheme includes a share-based incentive programme
that covers the financial years 2023–2027. L&T’s emission reduction targets
(Scopes 1 and 2) are part of the company’s strategic goals and they have been
taken into account in the long-term incentive scheme for senior management.
As a rule, the earnings period of the plan is three calendar years. L&T's Board of
Directors decides on the earnings criteria for each earnings period based on the
Personnel and Sustainability Committee’s proposal. The Board of Directors moni-
tors and evaluates performance annually.
The share-based incentive schemes with the three three-year earnings periods of
2023–2025, 2024–2026 and 2025–2027 are described below:
• The share-based incentive scheme with the financial years 2023–2025 as
the earnings period. The reward is based on the Group’s average return on
capital employed (ROCE) for 2023–2025 (50% weight), the total shareholder
return (TSR) of the Lassila & Tikanoja Plc share relative to the stock market
index for the Helsinki Stock Exchange (30% weight), and carbon footprint
reduction (20% weight). Payment of the rewards under the share-based
incentive scheme in question will take place after the three-year earnings
period, in 2026.
• The share-based incentive scheme with the financial years 2024–2026 as
the earnings period. The reward is based on the Group’s average return on
capital employed (ROCE) for 2024–2026 (50% weight), the total shareholder
return (TSR) of the Lassila & Tikanoja Plc share relative to the stock market
index for the Helsinki Stock Exchange (30% weight), and carbon footprint
reduction (20% weight). Payment of the rewards under the share-based
incentive scheme in question will take place after the three-year earnings
period, in 2027.
• The share-based incentive scheme with the financial years 2025–2027 as
the earnings period. The reward is based on the Group’s average return on
capital employed (ROCE) for 2025–2027 (30% weight), the total shareholder
return (TSR) of the Lassila & Tikanoja Plc share relative to the stock market
index for the Helsinki Stock Exchange (30% weight), carbon footprint reduc-
tion (20% weight), and revenue during the period 2025–2027 (20% weight).
Payment of the rewards under the share-based incentive scheme in question
will take place after the three-year earnings period, in 2028.
L&T applies due diligence in its operations. Information related to sustainability
themes has been taken into account as part of the company’s processes con-
cerning acquisitions, procurement and human rights risk assessment.
In connection with acquisitions, various practices of the company being acquired
are identified and assessed. Examples of these include employment contracts,
occupational safety management and occupational health. Depending on the
nature of the operations, compliance with environmental permits and the cur-
rent state of production are also examined, provided that they may have impacts
related to L&T’s climate targets, for instance. Due diligence always includes a
financial and legal evaluation. L&T's due diligence obligation concerning acquisi-
tions is fulfilled at the business management level, in collaboration with the com-
pany's Legal Affairs function. If necessary, external M&A professionals are utilised
to assist in the evaluation of the subject of the acquisition. The due diligence
reports are available to the President and CEO, the Group Executive Board and
the Board of Directors when they make the investment decision.
-
Code of Conduct, which is included in the appendices to L&T’s procurement
agreements. Compliance is verified during the cooperation through self-assess-
ment questionnaires, audits and monitoring in accordance with the Contractor’s
Liability Act. In addition, the supplier’s financial and legal information is reviewed
in connection with contract negotiations. L&T uses many long-term suppliers,
which promotes the transparency of the chain and enables the long-term devel-
opment of various operating models. The Group’s Chief Purchasing Officer is
responsible for supplier cooperation and its development.
L&T observes the Universal Declaration of Human Rights, workers’ rights as
defined by the International Labour Organization (ILO), international agreements,
and the UN Guiding Principles on Business and Human Rights. L&T is committed
to supporting the UN Global Compact initiative and its principles pertaining to
human rights and labour rights. Human rights are also taken into account in L&T’s
public policies and plans, such as the Employee Code of Conduct, Supplier Code
of Conduct, human rights policy, occupational safety policy, and internal diversity
plan, which were prepared before the partial demerger of the former Lassila &
Tikanoja Group. L&T’s human rights policy and Employee Code of Conduct will be
submitted to Board of Directors for approval in 2026.
L&T’s Board of Directors decides on the priorities and targets of sustainability
work, which includes human rights work and human rights targets. The implemen-
tation of the targets and policies is the responsibility of the line organisation. In
close cooperation with the company’s HR and procurement functions, L&T’s sus-
tainability organisation is responsible for assessing human rights impacts. Human
rights issues have also been taken into account in personnel training, such as the
online training on the Code of Conduct and occupational safety training.
L&T has an anonymous whistleblowing channel in place. All workers and other
operators in the value chain can use it to report suspected misconduct related
to working conditions or human rights violations. The whistleblowing channel
is described on L&T’s public website and intranet, and in the Employee Code of
Conduct and Supplier Code of Conduct. A more detailed description of whis-
tleblowing practices and reports is provided in section G1-1, pp. 61–62.
In order to identify and comply with international sanctions, L&T has entered into
an agreement with the service provider on continuous sanctions monitoring. In
2025, a Group-wide sanctions control policy was prepared for L&T, which will be
submitted to the Group Executive Board for approval in 2026.
Risk management pertaining to sustainability reporting takes into account the
processes related to sustainability reporting, the data used and its quality, as well
as the necessary internal and external systems and resources. The aim of the risk
management model is to ensure the identification, assessment and management
of key risks related to the sustainability report. Risks are monitored at all stages
of the sustainability reporting process so that they are identified and assessed
proactively and any deficiencies can be addressed in a timely manner.
The risk assessment is the responsibility of L&T’s sustainability organisation
together with L&T's CFO. Its key results are reported annually to the President
and CEO and the Group Executive Board, as well as the Audit Committee. This
ensures that risk management measures are implemented consistently and sup-
port the company’s sustainability targets.
The risk assessment model in use includes risk prioritisation methods that
involve the assessment of risks based on their impacts and likelihood. The final
results also take into account the company’s existing policies and practices.
The most significant risks are related to topics that are material in terms of their
impact or likelihood.
The risks related to sustainability reporting in 2025 were assessed before the
partial demerger of the former Lassila & Tikanoja Group. In risk assessment, the
most significant risk related to sustainability reporting concerns the demerger
of L&T into an independent listed company, prepared in 2025 and completed on
14
31 December 2025. The partial demerger has effects on the schedule of annual
reporting, and this has been taken into account in the planning of sustainability
reporting.
L&T conducts internal audits to ensure that the risk management and control sys-
tems function as expected and that they are complied with. The risk management
process related to sustainability reporting can also be addressed in connection
with internal audits. Internal audit results are reported to the President and CEO
and the Group Executive Board, as well as the Audit Committee.
L&T’s business builds sustainable future growth based on the circular economy
and the opportunities it brings, creating added value for customers, investors and
other stakeholders. In 2025, the company had three service areas:
• In waste management and recycling, L&T offers comprehensive waste man-
agement and recycling solutions to customers in the retail, industry, construc-
tion and public sectors, among others. The offering includes waste collection,
collection equipment, waste sorting, pre-treatment and treatment with a
strong focus on recycling and reuse of materials
• Industrial services and water treatment includes cleaning of industrial and
power plant production equipment, sewer maintenance services and survey
services for industrial, municipal, private and commercial operators. It also
offers solutions for water treatment and decontamination.
• Hazardous waste and remediation covers the collection, treatment and
routing of hazardous waste for reuse and recycling. The restoration busi-
ness cleans and restores contaminated land, treats industrial waste and side
streams and takes care of their recycling or safe disposal. In addition, the
restoration business builds, closes and operates final disposal areas.
L&T operates in the service sector and is a significant employer. With this in mind,
the occupational well-being and work ability of the personnel are key success
factors for the company's business. L&T employs 2,236 people in Finland and
Sweden. The distribution of personnel by country is presented in section S1-6, p.
58.
In its circular economy business, L&T operates in the waste and side stream
value chains of its customers. The customer sites vary from households to large
industrial plants.
In the upstream value chain, we help our customers to replace virgin and fossil
raw materials with recycled raw materials and offer various solutions for the
reuse of materials and products.
At the source of the waste, we offer our customers guidance on waste sorting
and offer optimal collection equipment for sorting. After sorting at source, the
materials are efficiently collected and directed either directly or through recycling
plants, primarily to reuse or recycling.
L&T mainly processes the material streams in its own recycling plants, but also
uses its partners' plants. From the recycling plants, the materials are primarily
directed to use as industrial raw materials. The aim is to recover non-recyclable
material as energy, and if this is not possible, it is disposed of safely. L&T does not
have its own energy plants, but final disposal takes place mainly at the compa-
ny's own landfill sites.
The same operating logic applies to ordinary waste, hazardous waste and indus-
trial side streams.
In the environmental construction business, we treat contaminated land areas
and, where possible, use the soil in various infrastructure construction proj-
ects. Environmental construction not only restores contaminated areas, but also
improves the state of the habitat with various nature solutions.
The purpose of L&T's operations is to provide circular economy solutions to miti-
gate climate change and biodiversity loss. With our services, we ensure the func-
tioning of society’s critical infrastructure, and by replacing virgin and fossil nat-
ural resources with recycled raw materials, we promote the sufficiency of critical
raw materials.
With its business solutions, L&T wants to unleash the full potential of the cir-
cular economy and help its customers in their sustainability work.
L&T aims for profitable growth in its strategy (2026–2028). Growth is sought in
three main areas:
1. Investments in new technologies and solutions to increase the added value
of material
2. Expansion in Sweden
3. Strengthening the market position in the core business in Finland.
Customer orientation, growing markets, and a business model covering the entire
value chain are the robust foundation of Lassila & Tikanoja’s business operations.
L&T measures the success of its strategy by financial, responsibility and stake-
holder targets. The strategy has been prepared while L&T was part of the former
Lassila & Tikanoja Group and will be finalised and approved by the President and
CEO, the Group Executive Board and the Board of Directors in 2026. In connec-
tion with the confirmation of the strategy, the company’s strategic sustainability
targets will also be decided.
The business environment remained challenging in 2025. The expected economic
turnaround in construction did not take place, the outlook for industry remained
uncertain throughout the year, and the development of consumer purchasing
power was not yet reflected in trade volumes. The economic cycle was directly
reflected in the volume of material flows.
The same uncertainty also characterised the market for recycled raw materials.
The recovery of separately collected materials developed positively due to the
tightening of sorting obligations, but recycled raw materials are not competitive
with virgin raw materials without steering measures. Market shortages are
slowing down the adoption of new technologies in several materials. The aim of
the Ecodesign for Sustainable Products Regulation (ESPR) is to strengthen the
market for recycled raw materials through various use obligations, but it still lacks
industrial impact.
The European Commission’s work programme emphasises strengthening com-
petitiveness, security and resilience. The circular economy is strongly linked
to the Clean Industrial Deal, which aims to accelerate the clean transition of
industry from fossil raw materials to recycled and bio-based raw materials. The
new Circular Economy Act expands the focus from waste and side streams to
natural resources and raw materials. The proposal for the Act is scheduled for the
end of 2026.
The aim is also to improve the competitiveness of European companies by
developing regulation. The EU aims to reduce the administrative burden on com-
panies, clarify sustainability regulation and target it at large companies with
significant impacts. Regulatory development is implemented through Omnibus
initiatives.
The key Omnibus initiatives for L&T’s operations are related to environmental
and corporate responsibility regulation.
The policy chosen by the EU Commission to ensure the competitiveness of the
European economy is vital. L&T strongly supports the Clean Industry Deal vision
of modernising European industry. The circular economy has been identified as
playing a key role not only in mitigating climate change and biodiversity loss, but
also in strengthening the raw material self-sufficiency of industry.
The EU’s goals of streamlining regulation, particularly with regard to the Corpo-
rate Sustainability Reporting Directive, are also expected to reduce the reporting
work in companies and make it possible for sustainability efforts to increasingly
focus on the strategic work of companies to reform their business in line with
sustainable development and the clean transition. The EU’s Sustainable Develop-
ment Goals remain in force. From the perspective of the predictability of the oper-
ating environment and the development of the market, it is important that the
long-term goals are maintained.
In Finland, the most important regulation under preparation for L&T’s operations
was related to the reform of the Waste Act. The aim was to identify ways for Fin-
land to achieve the EU’s key recycling targets for municipal waste and packaging
waste. Finland faces the EU’s sanctions and warning procedure with regard to
waste policy. The recycling targets for 2025 will not be achieved in Finland. The
recycling rate of materials (CMUR) in Finland is 3.3%, compared to the EU average
of 11.7%.
Finland’s government programme includes significant reforms concerning the
promotion of the circular economy market, which will be implemented by devel-
oping waste regulation gradually. In 2025, measures were prepared to increase
sorting at source and separate collection of materials as well as to reduce the
amount of incinerated waste. In addition, in accordance with the Government Pro-
gramme objective, the reforms are intended to correct the competition disadvan-
tages that have arisen in municipalities’ secondary waste management responsi-
bility and tighten the external sales limits of in-house entities.
The Finnish Government is implementing a reform of the Public Procurement
Act, which is important for the entire service sector. The aim is to promote the
market for public procurement and open up publicly produced services to compe-
tition. The Public Procurement Act aims to set a minimum ownership limit of 10%
for the ownership of a municipality’s in-house entity, but the company believes
that the waste sector would be excluded from this minimum ownership limit.
15
In this case, the aim is to promote competitive conditions in the waste sector through
the Waste Act.
As a company promoting the circular economy, L&T strongly supports initiatives to
strengthen the role and position of the circular economy in the clean transition. Cir-
cular economy regulation must be integrated into economic and industrial policy in
order to achieve industrial impact. L&T considers it important that effective steering
measures also create financial incentives for the use of recycled raw materials.
Sustainability targets are set for the strategy period and confirmed by the Board. The
medium-term development of the operating environment is taken into account in
setting the targets. The targets concern L&T’s climate targets, the recycling rate, the
frequency of occupational safety incidents among the personnel, the health and job
satisfaction of the personnel, and the coverage of training on the Code of Conduct.
Compliance in the supply chain is measured by the coverage of the Supplier Code of
Conduct and related self-assessments.
In addition to L&T’s targets for the strategy period, L&T has committed to the
2045 net zero target for climate change mitigation, which was set before the partial
demerger of the former Lassila & Tikanoja Group and which will be confirmed in 2026.
The targets promote L&T’s mission to unlock the potential of the circular economy
throughout the value chain.
• L&T is moving towards a fully circular economy together with its customers.
Through its services, L&T creates solutions to mitigate climate change and biodi-
versity loss, promotes the circularity of materials and prevents pollution.
• L&T values diversity and equality at the workplace and invests in well-being at
work and occupational safety.
• L&T acts appropriately and transparently throughout the value chain. Good corpo-
rate governance is a cornerstone of L&T’s sustainability
L&T is committed to supporting the following key declarations and agreements:
• UN sustainable development principles since 2018
• Global Compact principles
• ILO Declaration on Fundamental Principles and Rights at Work
• Universal Declaration of Human Rights
• Society's commitments to sustainable development.
L&T is committed to supporting the UN Sustainable Development Goals (SDGs) in its
operations. The company has identified the following SDGs as especially relevant to
its operations:
• SDG 7: affordable and clean energy
• SDG 8: decent work and economic growth
• SDG 10: reduced inequalities
• SDG 11: sustainable cities and communities
• SDG 12: responsible consumption
• SDG 13: climate action
• SDG 15: life on land.
Customers Customer service and customer satisfaction, operational
quality, circular economy, recycling and remediation,
sustainability.
A customer survey to measure the net promoter score
(NPS) among corporate customers, and several customer-
specific surveys. Customer service (telephone, digital service
channels) and dialogue with customer relations officers and
sales. Marketing communications and events.
Personnel The employees’ physical and mental well-being, ability to
cope with work, training and competence development, as
well as job satisfaction and the employee experience.
Feedback and development discussions, Fiilinki personnel
surveys, co-operation, development workshops, personnel
events and internal communication channels such as the
intranet and Teams.
Potential employees Employer brand and the employee experience. Co-operation with educational institutions, recruitment and
career events, development of the employer image and
sharing information through social media channels.
Investors and shareholders Financial performance, the strategy and its progress, the
sustainability of operations and ESG ratings, customer
satisfaction and employee satisfaction.
Stock exchange releases, financial reports, annual reporting,
the Group’s website, webcasts, regular investor meetings and
the Annual General Meeting.
Decision-makers and influencers
(including national and regional
decision-makers), industry
organisations and employer
organisations
Circular economy and climate change mitigation,
employment, the functioning of the market and
competitive neutrality.
Participation in associations, dialogue with the public
authorities and decision-makers, co-operation projects, other
projects, responding to surveys, the company website and
annual reporting.
Media and NGOs Practical steps related to the circular economy, actions to
promote biodiversity, and human rights.
Press releases, interviews, publications, media events, the
company website and social media channels. Dialogue and
responding to surveys.
Suppliers and subcontractors Circular economy, quality, sustainable procurement. Dialogue, responding to surveys, audits and self-assessments.
16
human rights risks in the supply chain in cooperation with the procurement func-
tion. The assessment is part of the company’s human rights principles, and it was
carried out before L&T's demerger into a separate listed company from the former
Lassila & Tikanoja Group.
L&T has a separate, public and anonymous whistleblowing channel through
which value chain workers can report misconduct. L&T processes potential
human rights violations in accordance with clear procedures and carries out cor-
rective measures as necessary. The impacts related to value chain workers are
described in more detail in section ESRS 2 SBM-3, p. 21.
The material impacts, risks and opportunities of L&T are based on the double mate-
riality analysis update made in 2025 prior to L&T's demerger into a separate listed
company from the former Lassila & Tikanoja Group. The update reviewed materiality
both with regard to the former Lassila & Tikanoja Group's sectors' facility services
and circular economy business, and the company as a whole. The update work
assessed changes in the former Lassila & Tikanoja Group's business operations
and business environment and the significance of the changes to the previous
materiality assessment carried out in 2024. A summary of the material impacts,
risks and opportunities identified for the circular economy business of the current
L&T, and where they focus in the value chain, is presented in the table on pp. 18-20.
L&T’s material impacts on society and the environment (impact materiality) and
sustainability-related risks and opportunities (financial materiality) are related to
climate change (E1), biodiversity and ecosystems (E4), resource use and the cir-
cular economy (E5), and to the company’s own workforce (S1) and workers in the
value chain (S2). In addition, the business conduct theme (G1) is material for L&T.
All of these themes are also included in L&T’s current sustainability work and are
linked to the company’s strategy.
L&T’s environmental impacts are largely related to the company's strategy and
business models. L&T’s business model promotes the circular economy in society.
The services produced for customers reduce emissions and the value chain's
dependence on virgin raw materials. For the customers, this is reflected in efficient
waste management in which the recycling of materials is the priority, regardless
of the type of waste. At the same time, the sustainable use of natural resources is
promoted and pressures on ecosystems are mitigated.
The nature-related services produced by the company, such as contaminated soil
remediation projects in environmental construction, meadow restoration projects,
and the removal of invasive species, have a positive impact on biodiversity. These
measures support the preservation of biodiversity and improve the state of the
environment, and they are a growth opportunity.
L&T’s business units are dependent on energy with regard to logistics, con-
tracting and plants, for example. This also generates a significant amount of carbon
dioxide emissions. However, most of the emissions are generated in the supply
chain.
reporting period, L&T has not interacted with key stakeholders.
The results of the customer and employee satisfaction survey and the rep-
utation survey, as well as any related development areas, are reported at least
once a year to the President and CEO and the Group Executive Board, as well
as to the Personnel and Sustainability Committee of the Board of Directors.
L&T’s current strategy and the targets of the sustainability programme are in
line with stakeholder expectations. The sustainability targets are updated reg-
ularly, taking into account any changes in the business environment and stake-
holder expectations. The key future development areas are described in con-
nection with each topic as part of the company’s sustainability reporting.
L&T has summarised stakeholder expectations into the following three
perspectives:
• As a leader in its field, L&T is expected to develop the entire industry in the
right direction for society and to conduct itself correctly and sustainably in
environmental matters.
• As a company in the personnel-intensive service sector, L&T is expected to
be a responsible employer that looks after the well-being of its personnel
and treats its personnel well and fairly while exercising special care with
regard to occupational safety.
• L&T is expected to be a useful partner to its customers, developing new ser-
vices that mitigate GHG emissions and biodiversity loss and supporting the
customers in their work towards their goals, as well as keeping its promises.
L&T takes the interests, views and rights of its own workforce into account
in its strategy and business model in many ways. L&T has identified and
assessed the impacts, risks and opportunities related to its own workforce.
The key themes include employment security; working time; adequate wages;
freedom of association; the information, consultation and participation rights
of workers; social dialogue; work–life balance; health and safety; and gender
equality. Attracting the best professionals in the industry is a strategic priority
for L&T, and the well-being of the personnel is a key success factor for the
company's business. L&T engages in extensive and diverse dialogue with its
personnel, and the views of the personnel are taken into account in drawing up
the business strategy. In addition, L&T’s Employee Code of Conduct, personnel
policy, human rights policy and occupational safety policy guide operations
and ensure respect for employees’ rights. The company’s own workforce is
described in section S1, pp. 54–60.
L&T also takes the interests, views and rights of value chain workers and
respecting their human rights into account in its operations. L&T’s Supplier
Code of Conduct lays down minimum requirements that suppliers must
respect and adhere to in their own operations and the supply chain. The Sup-
plier Code of Conduct covers topics including respect for workers' rights, occu-
pational safety, and the prohibition of the use of child labour and forced labour,
for example. L&T requires its suppliers to commit to these principles, and they
are also incorporated into L&T’s procurement agreements. L&T also uses a sep-
arate self-assessment model to monitor and assess compliance with the Sup-
plier Code of Conduct. The company has also identified and assessed potential
Value creation
By investing in the sustainable circular solutions, L&T aims to create increasing
value for all of its key stakeholders.
Resources
• L&T has robust expertise in circular economy and remediation services and
the development of sustainable products. The company offers diverse ser-
vices in different areas of the circular economy to facilitate the improved cir-
cularity of materials.
• L&T continuously develops new solutions to promote industrial side streams,
nature-related services and the circular economy. The solutions improve the
efficiency of the customers’ operations and reduce environmental impacts.
• L&T looks after the well-being and safety of employees and invests in work ability
14001 and ISO 45001, support the quality and sustainability of operations.
Results
• Reuse and recycling mitigate the consumption of natural resources and
reduce waste.
• The restoration of contaminated soil and enhancing biodiversity in
environmental construction strengthen ecosystem services.
• Occupational safety has improved from each year to the next, and L&T also
introduces good practices to its subcontractors and partners.
• L&T is the first workplace for many young people.
The analysis of the key stakeholders for L&T and their interests and views was
carried out before L&T demerged from the former Lassila & Tikanoja Group into a
separate listed company. L&T stakeholder engagement is focused on the stake-
holders who are the most affected by the impacts of the company's operations
and whose actions have the greatest influence on the achievement of L&T's busi-
ness objectives and sustainability targets. Stakeholder expectations are taken
into account in L&T’s strategy development and business choices. Stakeholder
views were also a key part of L&T’s double materiality assessment.
The company's key stakeholders include customers, current and potential
employees, and investors, as well as national and regional policy-makers and
influencers, non-governmental organisations, the media, and suppliers and
subcontractors.
L&T engages in active dialogue with its key stakeholders. The company regu-
larly measures stakeholder support by means of customer and employee satis-
faction surveys and a reputation survey carried out by a third party. L&T also par-
ticipates in the Ecovadis corporate responsibility assessment, which measures
the quality of L&T’s sustainability work and through which L&T receives questions
and development suggestions related to corporate responsibility from its cus-
tomers. Through dialogue and measurements, L&T identifies stakeholder expec-
tations and determines what development measures are necessary. During the
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18
Material sustainability topics
Sub-sub-topics Description
Actual negative impact
SML
Potential positive impact
SML
Risk
SML
Self-classified sub-topic:
Nature services offered
by the company and
circular economy
Potential positive impact
SML
Self-classified sub-topic:
Nature services offered
by the company and
circular economy
Opportunity
SML
Actual positive impact
SML
Opportunity
SML
Actual positive impact SML
Opportunity
SML
Waste Actual negative impact SML
E
19
Material sustainability topics
Sub-sub-topics Description
Secure employment Actual positive impact SML
Working time Actual negative impact SML
Adequate wages Actual negative impact SML
Freedom of association,
the existence of works
councils and the
information, consultation
and participation rights
of workers
Actual positive impact SML
Social dialogue Actual positive impact SML
Collective bargaining Actual positive impact SML
Health and safety Potential negative impact
SML
Health and safety Opportunity SML
Work-life balance Actual positive impact SML
opportunities for all
Gender equality and
equal pay
Actual positive impact SML
opportunities for all
Training and skills
development
Actual positive impact SML
opportunities for all
Measures against
violence and harassment
in the workplace
Potential negative impact
SML
opportunities for all
Diversity Actual positive SML
S
Society
20
Material sustainability topics
Sub-sub-topics Description
Health and safety Potential negative impact SML
opportunities for all
Measures against vio-
lence and harassment in
the workplace
Potential negative impact -
SML
G
Material sustainability topics
Sub-sub-topics Description
Actual positive impact SML
Prevention and detection,
including training.
Risk Participation in bribery or corruption SML
agement practices, adaptability to market changes and close monitoring of the
business environment. L&T seeks growth in circular economy business operations
by investing in business solutions related to the circular economy of materials.
Growth is pursued by developing core services and expanding the business in
Sweden, as well as possible complementary acquisitions.
The environmentally material sustainability aspects (E1, E4 and E5) are in line
with L&T’s strategy, which aims to mitigate climate change and biodiversity loss
and promote the sustainable use of raw materials. The circular economy plays a
key role in achieving these targets. L&T’s strategy is also dependent on society
and people, which is reflected in the impacts, risks and opportunities of L&T’s
own workforce (S1) and workers in the value chain (S2). L&T’s aim is to provide
employees with a balanced daily life in which everyone can be who they are, and
to promote human rights in the supply chain. The policies concerning business
conduct (G1) and the corporate culture provide the foundation for sustainable
business. L&T aims for good and fair governance.
The current and anticipated effects of the company's material impacts,
risks and opportunities on its business model, value chain, strategy and deci-
sion-making are subject to continuous monitoring. L&T responds to these effects
by making changes to its strategy and business model as necessary. L&T has set
comprehensive sustainability targets that apply to the entire value chain, espe-
cially with regard to the climate. The sustainability of the supply chain is also
promoted through requirements set out in procurement agreements and their
monitoring.
L&T has also described the material impacts, risks and opportunities related to
climate change and own workforce and their interaction with the strategy and
business model as part of the following topical ESRS standards:
• The impacts, risks and opportunities related to climate change are also
described in section E1 Climate change, under disclosure requirement SBM-3
Material impacts, risks and opportunities and their interaction with the
strategy and business model p. 41.
• The impacts, risks and opportunities related to own workforce are also
described in section S1 Own workforce, under disclosure requirement SBM-3
Material impacts, risks and opportunities and their interaction with the
strategy and business model p. 54.
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L&T's double materiality assessment focused on L&T’s impacts on society, the
environment and governance, as well as the financial risks and opportunities
associated with these impacts. The analysis is based on the ESRS sustainability
topics and their sub-topics and sub-sub-topics.
In 2025, L&T’s double materiality analysis was updated as internal expert work
before L&T demerged into a separate listed company from the former Lassila
& Tikanoja Group. The update was carried out for the then Group as a whole,
including the review of both the Group’s circular economy and facility services
businesses as separate entities. This Sustainability Report only presents the
results of the analysis of the circular economy business operations (current L&T).
L&T recognises that potential impacts can also occur farther in the value chain,
especially in countries where working life practices or legislation are inadequate.
These countries are more likely to have violations related to working conditions
and human rights than non-high risk countries. Examples of such supply chains
include the manufacture of L&T’s workwear and the procurement of raw materials
for equipment and ICT equipment.
Good governance practices form the basis for L&T’s business operations. The
key positive impacts of business conduct are related to L&T’s good corporate
culture, such as the company’s ethical principles, anti-corruption and anti-bribery
practices, and whistleblowing processes. The company’s own policies, principles
and instructions guide the practices in both its own operations and the value
chain, and the actions in them strengthen the company’s reliability in the eyes of
customers and stakeholders.
Risks related to corruption and bribery can cause reputational and financial
damage to the company. L&T uses regular training, inspections and strict rules
to engage the parties. Compliance with the ethical principles offers significant
opportunities for L&T. It strengthens the company’s reputation as a responsible
operator and creates trust among customers and stakeholders.
So far, L&T has not defined any metrics or targets for potential negative impacts
related to workers in L&T’s value chain. L&T has set out ethical principles con-
cerning the health and safety of supply chain workers, as well as their fair and
non-discriminatory treatment, in its Supplier Code of Conduct, to which L&T
requires upstream and downstream suppliers to commit themselves. L&T has not
implemented, nor does it have plans to implement, measures specifically aimed
at ensuring the health and safety of value chain workers or their appropriate and
non-discriminatory treatment.
-
The company assesses opportunities and risks annually, as well as their financial
effects and risk management methods.
During the reporting period, L&T managed material impacts, risks and oppor-
tunities on its financial position, financial performance and cash flows using the
company’s existing risk management methods and operating principles. There
were no significant financial effects from material sustainability risks during the
reporting period. No adjustments related to carrying amounts are expected for
these during the next financial year. The material opportunities related to the cir-
cular economy and biodiversity are related to L&T’s existing service business and
they have generated financial benefits for L&T during the financial year. The mag-
nitude of the financial benefit has not been assessed in more detail. The actual
financial benefits related to occupational safety have not been assessed for the
financial year.
The resilience of L&T’s strategy and business models to address the com-
pany’s material impacts, risks and opportunities is expected to be good in the
upcoming strategy period 2026-2028. The company has established risk man-
Climate change mitigation measures are key to reducing these impacts.
The carbon handprint reveals the extent to which a company has, through con-
scious choices and decisions, avoided emissions and adverse environmental
impacts compared to its previous operating practices. L&T’s goal is to increase
the positive climate impact of operations faster than the growth of net sales. The
carbon handprint is L&T's entity-specific positive impact and metric.
The potential risks are related to regulation aiming to mitigate climate change,
financial drivers supporting regulation and the development of the market. The
achievement of L&T’s climate targets depends on the development of low-emis-
sion fleet technology and the development of the recycled raw material market.
L&T has identified services related to restoration and the remediation of contam-
inated soils as business growth areas. L&T is conducting a project to survey the
nature impacts and nature value of L&T’s services. The project will continue until
the end of 2026. For the time being, L&T has not defined any metrics or targets
for the positive nature impacts created through L&T’s services. L&T is committed,
through its environmental policy, to promoting the objectives set out in the EU
Biodiversity Strategy. The principles for safeguarding biodiversity are defined in
L&T’s environmental policy. During 2026, L&T will specify its measures for the
development of restoration services as part of the implementation of its growth
strategy.
As a service sector company, our own personnel are a key resource in the imple-
mentation of the company’s strategy and services. L&T’s operations are also depen-
dent on the supply chain and the services and products it produces. Through its
operating methods, the company influences the well-being, occupational safety,
occupational health, diversity and work practices of its own workforce and value
chain workers.
L&T’s actions may indirectly affect the workers of direct suppliers in the supply
chain. L&T’s operations depend on, for instance, subcontracting, such as transport
subcontracting, which is used to supplement L&T’s own logistics. Typically, sub-
contracted workers work on L&T’s or customers’ premises, particularly in logistics,
environmental construction projects and process cleaning production tasks, where
there may actually be an increased occupational safety risk, for example.
With regard to the value chain, discrimination and exploitation of workers can
occur in service sectors that employ a large number of foreign workers. At L&T,
these include the subcontracting of cleaning and property maintenance. In addi-
tion, the potential impacts may be related to inadequate working conditions, such
as unclear working time entries. L&T has assessed that young and foreign workers
are the most vulnerable groups in the value chain in terms of material impacts
Potential impacts are minimised through procurement agreements that take into
account L&T’s Supplier Code of Conduct. In addition, L&T regularly reviews occu-
pational safety observations made at its own or customers’ premises together with
suppliers and their workers and takes corrective measures, if necessary.
21
The company’s sustainability, business, EHSQ, procurement, legal and human
resources management from both divisions participated in the update.
The update work assessed the coverage and timeliness of the impacts, risks
and opportunities arising from the company’s operations identified by the former
Lassila & Tikanoja Group in the previous assessment, and assessed whether
there have been changes in the business environment or business model that
would change the previous assessment. The update work was carried out as
a workshop. In the workshop, the expert groups reassessed the scoring of the
latest double materiality analysis and supplemented the existing list of identified
impacts, risks and opportunities. The materiality of the ESRS-aligned themes for
L&T was analysed bi-directionally. The review was extended to L&T's value chain
and its sustainability impacts.
In addition to own operations, the value chain review included contractual sup-
pliers and waste treatment partners as well as customers. No material changes
were identified in the value chain or stakeholders for 2025, so the stakeholder
analysis or value chain description were not updated in connection with the
update work of the double materiality analysis.
The assessment took into account the results of the human rights risk assess-
ment conducted by the former Lassila & Tikanoja Group in 2024. With regard to
the double materiality results, it has been verified that they do not conflict with
the human rights assessment.
The views of key stakeholders were collected through targeted interviews. The
interviews presented an updated list of material impacts, risks and opportunities
for the company to the stakeholders and asked the stakeholders for their assess-
ment of the coverage of the list. More in-depth stakeholder interviews were con-
ducted with key suppliers, customers and other stakeholders, and the aim was to
survey stakeholder sustainability expectations and potential development needs
more broadly. Stakeholder views were taken into account in the scoring. Stake-
holders’ views on sustainability topics, impacts, risks and opportunities that are
material to L&T were consistent with the company’s own internal assessment.
An updated list of the company’s material impacts, risks and opportunities
was presented to Luotea's European Works Council, discussed by the former
Lassila & Tikanoja Group's Executive Board and the Personnel and Sustainability
Committee, and finally the Board of Directors confirmed the double materiality
of L&T. The update process was carried out by the Group Head of Sustainability,
who reported on the methods used in the process, the progress of the process
and the results to the steering group assigned for the double materiality analysis
three times during the process.
Impact materiality
L&T's assessment of impact materiality took into account the scale, scope and irre-
mediable character of the impacts on a five-point scale, where a score of five was
deemed significant for each aspect. The assessment took into account changes in
potential impacts in the short term (reporting period), medium term (2–5 years) and
long term (over 5 years) and examined the likelihood of occurrence of the poten-
tial impacts. The assessment took into account potential negative human rights
impacts, the severity of which takes precedence over their likelihood. The materiality
threshold was defined as a score of eight (maximum score 15), which meant that
the impact would be deemed significant for the company. In addition, the results of
stakeholder surveys and interviews were taken into account in the assessment.
Financial materiality
The assessment of L&T’s financial effects was based on L&T’s risk assessment
process. The impact of risks is analysed in terms of their effects, and the assess-
ment of the likelihood of their realisation took into account the nature of opera-
tions and the risk mitigation measures taken. The aim of the application of L&T’s
risk assessment process was to ensure that sustainability-related risks are iden-
tified in a similar way to the company’s strategic and operational risks. Changes
in the markets for recycled raw materials, the development of regulation with
regard to waste management, for example (E5 Circular economy) and challenges
related to the availability and turnover of labour (S1 Own workforce) have also
been taken into account in L&T’s strategic risks.
The assessment took into account changes in potential impacts in the short
term (reporting period), medium term (2–5 years) and long term (over 5 years) and
examined the likelihood of occurrence of the potential impacts. The materiality
threshold was defined as a score of eight (maximum score 15), which meant that
the risks and opportunities would be deemed significant for the company.
During the double materiality assessment process, L&T reviewed its impacts and
dependencies as well as their links to risks and opportunities by analysing the impact
of each sustainability topic on the company’s business model, current risk manage-
ment methods, processes and personnel. L&T has also assessed the risks and oppor-
tunities caused by changes in legislation. The assessment also took into account
dependencies on natural resources, human resources and social resources.
Financial risks related to climate change mitigation are managed by the com-
pany’s climate-related transition plan, which includes emission reduction targets
and the investments required for them. Investments in workplace safety and
well-being, in turn, can improve the availability and retention of personnel, which
reduces the risks arising from these factors.
-
L&T's material impacts, risks and opportunities related to climate change have been
assessed as part of the update of the former Lassila & Tikanoja Group's double
materiality in 2025, in which the previously prepared scenario analyses were not
updated.
Climate impact assessment
The assessment of the company’s material impacts related to climate change
mitigation is based on the company’s energy consumption and the calculation of
the carbon footprint and carbon handprint. L&T’s management and sustainability
organisation monitors the direct emissions arising from its own operations, as well
as the entity-specific impact and carbon handprint, at quarterly levels. The emis-
sions generated in the company’s value chain are assessed on an annual basis.
Assessment of climate risks and opportunities
The Task Force for Climate-related Financial Disclosures (TCFD) recommenda-
tions have been applied in assessing the risks and opportunities related to climate
change. The results of L&T’s climate scenarios have been used as background
material in assessing the impacts of changes in the environment, markets and
regulation. Climate risks have been assessed in accordance with L&T’s risk model
in the short term (reporting period), medium term (2–5 years), and long term (over
5 years), and they were most recently updated in 2024 before the demerger of
L&T into a separate listed company from the former Lassila & Tikanoja Group. The
impact of risks is analysed through EBIT effects and likelihood, taking into account
the nature of the risk and the existing mitigation measures. The short and medi-
um-term horizons correspond to the time horizons applied for the company’s stra-
tegic risks. The actions are described in more detail in section E1-3, p. 42.
The assessment took into account physical risks and transition risks and their
impact on L&T’s own personnel and business. The value chain impacts are mainly
based on changes in the service offering of the businesses. Physical risks may
arise from the effects of natural phenomena, such as temperature changes
(chronic risk) or potential flooding (acute risk). These are expected to intensify due
to climate change. Transition risks include the potential impacts of regulatory and
market changes on L&T’s key business areas, as well as the impacts of new tech-
nologies, particularly on the development of L&T’s low-emission fleet. L&T regu-
larly assesses climate risks as part of its risk assessment and adapts its strategy
accordingly. The climate scenarios and the related assumptions have not had sig-
nificant impacts on the company’s financial statements or key financial figures.
Physical risks
L&T’s physical risks related to climate change were assessed in the resilience
analysis of the former Lassila & Tikanoja Group. Chronic climate risks, such as
rising temperatures and an increase in extreme weather, have been identified as
potential impacts on the company’s logistics and the energy efficiency of prop-
erties. The analysis is based on IPCC’s RCP scenarios (1.5°C, <2°C and 4°C) and
IEA’s APS, NZE2050 and STEPS scenarios, which have been mirrored to weather
fluctuations in Finland and Sweden. The review covers the short-term (5 years)
and long-term (until 2035) impacts.
The impacts of acute climate risks, such as flooding, on L&T's properties
have been estimated to be minimal, as the sites are not located in particularly
flood-sensitive areas. The geographical review covered operations in Finland and
Sweden. Based on the analysis, no significant risks were identified that would
prevent the achievement of the company’s climate targets.
According to L&T’s assessment, the company’s assets and businesses are not
sensitive to these climate-related risks to a significant extent. L&T’s operations
are evenly distributed across Finland and Sweden, which means that operations
can be temporarily relocated as necessary in the event of a disturbance, with the
exception of recycling facilities. In addition, L&T’s properties and movable prop-
erty are insured.
22
23
The double materiality assessment separately examined the impacts, risks
and opportunities of each sustainability topic, sub-topic and sub-sub-
topic on L&T’s operations. In addition, the impacts, risks and opportunities
of L&T's operations on the environment, people and society were exam-
ined for each sustainability topic, sub-topic and sub-sub-topic, on a scale
of 0–15.
All sub-topics and sub-sub-topics whose score exceeded the threshold
value for impact materiality or financial materiality were considered to be
material topics. The threshold value was eight for both impact materiality
and financial materiality. The materiality threshold is indicated by a blue
background colour in the graph. In the graph, the X and Y axes take into
account the maximum scores assigned to each ESRS sustainability topic,
even if they consist of different sub-topics.
The average score of the impact assessment of the ESRS sustainability
topics is expressed in the graph by the size of the point. This makes it
possible to identify how large a proportion of the sub-topics or sub-sub-
topics under each topic were identified as material in the double materi-
ality assessment. For example, E4 Biodiversity and ecosystems is a topic
that is identified as material, but the average score for the topic is rela-
tively low, which means that only a few sub-sub-topics were identified as
material in the assessment.
Material sub-topics
Non-material sub-topics
Environment (E)
Society (S)
Governance (G)
FINANCIAL EFFECTS
S3
ENVIRONMENTAL AND SOCIAL IMPACTS
Not material
materiality
8 15
15
8
S4
G1
Business
S1
E4
ecosystems
E5
circular economy
E1
E2
Pollution
S2
E3
resources
Transition risks
The material transition risks are related to regulatory changes that affect, in par-
ticular, the carbon neutrality goals of transport and the promotion of the circular
economy, as well as potential market changes that may affect the availability of
renewable fuels or the development of low-emission technologies. In L&T’s risk
assessment, the background factors behind regulatory risks include the price
development of emission rights, bioeconomy and low-carbon economy scenarios,
the EU’s circular economy package, potential changes in national waste legisla-
tion, and national recycling and reuse targets. The reference framework used in
the assessment was a climate scenario in which global warming can be limited to
1.5°C.
L&T has assessed the exposure and sensitivity of its businesses to identified
transition events. The assessment takes into account the likelihood, scope and
duration of transition risks. These transition risks are significant for L&T's mate-
rials business in particular. L&T’s activities and business models are sensitive
to changes in legislation, as the waste industry is subject to strong regulatory
steering. Investments made by energy sector operators, particularly in renewable
fuels, or the growing adoption of new technologies in the use of heavy equipment,
for example, will, in turn, influence the achievement of L&T’s emission targets and
the company’s climate transition plan. These also indirectly affect the fulfilment of
the loan terms linked to the company’s climate targets.
The current targets, operating models and measures increase L&T’s resilience in
the changing business environment. The company has a strong market position in
all of its business areas. In addition, the climate transition plan enables the effective
implementation of changes. Increasing the use of renewable energy sources and
sustainable raw materials, and phasing out fossil carbon, particularly in transport,
will continue to be key focal points. Risk management is enhanced by assessing
regulatory and market changes and reacting to them in a timely manner. The com-
pany seeks to proactively influence legislative processes through key industry
advocacy organisations, for example.
As part of the double materiality analysis of the former Lassila & Tikanoja Group,
L&T's impacts on the sub-topics and sub-sub-topics of E2 Pollution and E3 Water
and marine resources were also assessed. The assessment of pollution and water
and marine resources took into account the location and ownership of sites. L&T's
actual and potential impacts, risks and opportunities were assessed on the basis
of the location, the assessment of environmental aspects related to the operations
of the sites, and the environmental observations made at the sites. With regard to
the value chain, the review was limited to L&T's direct suppliers and the impacts
potentially related to these sectors in terms of the sustainability topic. No material
impacts were identified for the most significant procurements. No separate stake-
holder consultation related to these topics was organised in connection with the
assessment.
The material impacts, risks and opportunities related to biodiversity and ecosys-
tems of L&T’s own operations were updated in connection with the double mate-
riality analysis before the partial demerger of the former Lassila & Tikanoja Group.
The identification of environmental impacts used the company’s environmental
assessments, information obtained from the environmental permit process, cus-
tomer feedback, particularly with regard to production sites, and geographical
information on the locations of the sites in relation to valuable natural sites. L&T has
consulted the affected communities regarding potential negative environmental
impacts related to the sites during the environmental permit applications. No actual
impacts on local communities have been identified in the consultations. All valid
environmental permit decisions have been received before the partial demerger. No
separate stakeholder consultation related to the sustainability topic was organised
in connection with the double materiality assessment.
In 2025, the impacts and dependencies related to L&T's divisions and value chain
were examined using the TNFD leap framework and the ENCORE analysis tool. The
analysis clarified the understanding of the industry’s nature impacts with regard to
own operations and aimed to identify significant nature impacts with regard to the
value chain. The review was carried out before L&T demerged from the former Las-
sila & Tikanoja Group into a separate listed company, but it was limited to circular
economy business operations.
Based on the geographical data analysis, L&T has identified locations that are
close to biodiversity-sensitive areas. With regard to the operations of sites in the
vicinity of biologically sensitive areas, the impact materiality of negative impacts
on the deterioration of natural habitats and the habitats of species was assessed
as internal expert work based on the environmental permit entries, internal con-
trol procedures and stakeholder feedback received. Based on the assessment, it
is estimated that L&T's sites have a low impact on the environment in biologically
sensitive areas. No mitigating measures related to biodiversity have been imposed
separately on L&T’s sites by the authorities.
L&T has not assessed the physical, transition and systemic risks of the com-
pany's identified impacts and dependencies on biodiversity and ecosystems, but
they have been considered indirectly as part of climate risks. Climate change is a
significant driver of biodiversity loss and the deterioration of ecosystem services,
on which L&T has a direct impact through its own emissions and those of its value
chain. The climate risk assessment assesses the financial effects of extreme
weather on the company’s own operations. The deterioration of ecosystem services
may also lead to an increase or intensification of extreme weather and related
effects, such as flooding or droughts.
L&T identified and assessed material impacts, risks and opportunities related to
resource inflows and outflows and waste as part of the double materiality analysis.
L&T analysed its operations to identify and assess the actual and potential impacts,
risks and opportunities in its own operations and the value chain. The material
impacts and opportunities related to resource use and the circular economy are
focused on discontinued operations and are listed in the table in section ESRS 2
SBM-3, p. 28.
L&T has analysed its assets and operations to identify the actual and potential
impacts, risks and opportunities in its own operations and the upstream and down-
stream value chain. The information used in the analysis included environmental
permits concerning the company’s operations, information about inflows and out-
flows of waste received from customers, general national and international reports
and studies, and stakeholder consultations in various forums.
L&T did not separately consult the local communities around recycling plants
or processing centres as part of the double materiality assessment. The com-
pany engages in regular dialogue with local residents about the environmental
impacts of its sites within the environmental permit processes for sites and regional
co-operation.
In its double materiality assessment, L&T has identified and assessed the impacts,
risks and opportunities related to its own workforce. L&T has established an under-
standing of the impacts and risks related to workers through, for example, regular
dialogue, the identification of special groups and the assessment of occupational
safety risks and observations and the human rights review carried out by the
former Lassila & Tikanoja Group in 2024.
Material impacts and opportunities related to the following sub-sub-topics were
identified and assessed: employment security, occupational health and safety,
working hours, adequate wages and pay equality, work-life balance, freedom of
association, the existence of works councils, employees’ access to information,
rights of consultation and participation, competence development, support for
diversity and prevention of harassment, inappropriate behaviour and discrimination.
These topics play a key role in L&T's strategy and business model, and they have a
direct impact on the company’s operations and its adaptation. The material impacts,
risks and opportunities related to the company's own workforce are described in
more detail in section S1 SBM-3, p. 54.
L&T has identified and assessed the material impacts, risks and opportunities con-
cerning value chain workers as part of the double materiality assessment. The
assessment was based on the results of the human rights risk assessment pre-
pared in 2024, an assessment of the nature of L&T’s subcontracting work and risks
related to occupational safety, procurement co-operation and L&T’s own supplier
risk assessment. Material impacts related to the following sub-sub-topics were
identified and assessed: occupational safety and well-being of value chain workers
and discrimination against value chain workers.
L&T has identified that certain value chain workers who possess particular
characteristics, who work under particular conditions, or who engage in partic-
ular activities, may be at greater risk of harm. Among workers in subcontracting,
24
workers with a foreign background may have inadequate language proficiency
in particular, which can make it more difficult to understand and implement the
appropriate occupational safety practices. They may also have inadequate knowl-
edge of national work practices. Young employees who lack previous work experi-
ence can also be more vulnerable to various types of violations. In addition, workers
who work at L&T’s or customers’ premises, particularly in logistics, environmental
construction projects, and process cleaning and property maintenance in produc-
tion-related tasks, which may involve an actual elevated occupational safety risk,
may be at risk of harm. Potential impacts may also be related to the inadequate
implementation of work practices, such as unclear records of working time.
The material impacts and risks identified in the double materiality assessment were
related to the following sub-topics and sub-sub-topics: corporate culture and the
prevention, detection and incidents of corruption and bribery. The geographical
location, activities, industry and business structure of L&T’s businesses have been
taken into account as background data in the assessment of the related material
impacts.
Corporate culture emerged as a material topic on the basis of impact materiality
in the double materiality assessment. With regard to financial materiality, the pre-
vention of corruption and bribery emerged as a material risk related to business
conduct.
The double materiality assessment process is integrated into L&T’s risk manage-
ment process and implemented in co-operation with business-level specialists, risk
management functions and financial organisations. The impacts, risks and oppor-
tunities associated with sustainability matters are assessed during the process,
taking into account potential changes in the business environment.
-
cussed and approved by L&T’s Group Executive Board and Board of Directors.
statements
The following tables provide a list of the disclosure requirements of the Sustain-
ability Reporting Standard (ESRS) that L&T has complied with in preparing this
Sustainability Report on the basis of double materiality, as well as information on
the disclosure requirements that L&T has assessed as not material on the basis
of double materiality. The table also includes L&T’s entity-specific disclosures.
-
ment in the Sustainability Report.
If L&T has not had to report information related to a specific disclosure require-
ment on the basis of double materiality, this is indicated by a dash. The absence
of information with regard to material disclosure requirements is specified in an
explanation.
25
BP-1 General basis for preparation of sustainability statements
Sustainability Report ESRS 2 General Disclosures, p. 10 Material
BP-2 Disclosures in relation to specific circumstances
Sustainability Report ESRS 2 General Disclosures, p. 10 Material
GOV-1 The role of the administrative, management and supervisory bodies
Sustainability Report ESRS 2 General Disclosures, p. 10 Material
GOV-2 Information provided to and sustainability matters addressed by the undertaking’s
administrative, management and supervisory bodies
Sustainability Report ESRS 2 General Disclosures, p. 13
Material
GOV-3 Integration of sustainability-related performance in incentive schemes
Sustainability Report ESRS 2 General Disclosures, p. 13 Material
GOV-4 Statement on due diligence
Sustainability Report ESRS 2 General Disclosures, p. 14 Material
GOV-5 Risk management and internal controls over sustainability reporting
Sustainability Report ESRS 2 General Disclosures, p. 14 Material
SBM-1 Strategy, business model and value chain
Sustainability Report ESRS 2 General Disclosures, p. 15
SBM-2 Interests and views of stakeholders
Sustainability Report ESRS 2 General Disclosures, p. 17 Material
SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business
model
Sustainability Report ESRS 2 General Disclosures, p. 17
Material
IRO-1 Description of the processes to identify and assess material impacts, risks and
opportunities
Sustainability Report ESRS 2 General Disclosures, p. 21
Material
IRO-2 Disclosure requirements in ESRS covered by the undertaking’s sustainability statement
Sustainability Report ESRS 2 General Disclosures, p. 25
Material
E1 ESRS 2 GOV-3
Integration of sustainability-related performance in incentive schemes Sustainability Report ESRS 2 General Disclosures, p. 13 Material
E1-1
Transition plan for climate change mitigation Sustainability Report ESRS E1 Climate change, p. 41 Material
E1 ESRS 2 SBM-3
Material impacts, risks and opportunities and their interaction with strategy and
business model
Sustainability Report ESRS E1 Climate change, p. 41
Material
E1 ESRS 2 IRO-1
Description of the processes to identify and assess material climate-related
impacts, risks and opportunities
Sustainability Report ESRS 2 General Disclosures, p. 21
Material
E1-2
Policies related to climate change mitigation and adaptation Sustainability Report ESRS E1 Climate change, p. 42 Material
E1-3
Actions and resources in relation to climate change policies Sustainability Report ESRS E1 Climate change, p. 42 Material
E1-4
Targets related to climate change mitigation and adaptation Sustainability Report ESRS E1 Climate change, p. 42 Material
E1-5
Energy consumption and mix Sustainability Report ESRS E1 Climate change, p. 43 Material
26
E1-6
Gross Scopes 1, 2, 3 and Total GHG emissions Sustainability Report ESRS E1 Climate change, p. 44 Material
E1-7
GHG removals and GHG mitigation projects financed through carbon credits L&T has no plans to purchase climate units from the voluntary market,
and L&T does not promote greenhouse gas emissions removal or
storage projects in its own operations or value chain. Non-material
E1-8
Internal carbon pricing L&T does not use an internal carbon pricing mechanism Non-material
E1-9
Anticipated financial effects from material physical and transition risks and poten-
tial climate-related opportunities
L&T makes use of the transitional provision with regard to the required disclosures
and does not report for 2025
Material
E2 ESRS 2 IRO-1
Description of the processes to identify and assess material pollution-related impacts,
risks and opportunities
Sustainability Report ESRS 2 General Disclosures, p. 21
Material
E2-1
Policies related to pollution - Non-material
E2-2
Actions and resources related to pollution - Non-material
E2-3
Targets related to pollution - Non-material
E2-4
Pollution of air, water and soil - Non-material
E2-5
Substances of concern and substances of very high concern - Non-material
E2-6
Impact metrics related to biodiversity and ecosystems change - Non-material
E3 ESRS 2 IRO-1
Description of the processes to identify and assess material water and marine
resources-related impacts, risks and opportunities
Sustainability Report ESRS 2 General Disclosures, p. 21
Material
E3-1
Policies related to water and marine resources - Non-material
E3-2
Actions and resources related to water and marine resources - Non-material
E3-3
Targets related to water and marine resources - Non-material
E3-4
Water consumption - Non-material
E3-5
Anticipated financial effects of impacts, risks and opportunities related to water and
marine resources
-
Non-material
27
E4-1
Transition plan and consideration of biodiversity and ecosystems in strategy
and business model
L&T uses the "quick-fix" delegated act concerning the ESRS standard issued on 11 July 2025
and does not report for 2025 Material
E4 ESRS 2 SBM-
3
Material impacts, risks and opportunities and their interaction with strategy
and business model
Sustainability Report ESRS 2 General Disclosures, p. 17
Material
E4 ESRS 2 IRO-1
Description of the processes to identify and assess material biodiversity
and ecosystem-related impacts, risks and opportunities
Sustainability Report ESRS 2 General Disclosures, p. 21
Material
E4-2
Policies related to biodiversity and ecosystems L&T uses the "quick-fix" delegated act concerning the ESRS standard issued on 11 July 2025
and does not report for 2025 Material
E4-3
Actions and resources related to biodiversity and ecosystems L&T uses the "quick-fix" delegated act concerning the ESRS standard issued on 11 July 2025
and does not report for 2025 Material
E4-4
Targets related to biodiversity and ecosystems L&T uses the “quick-fix” delegated act concerning the ESRS standard issued on 11 July 2025
and does not report for 2025
Material
E4-5
Impact metrics related to biodiversity and ecosystems change L&T uses the "quick-fix" delegated act concerning the ESRS standard issued on 11 July 2025
and does not report for 2025
Material
E4-6
Anticipated financial effects from biodiversity and ecosystem-related risks and
opportunities
L&T makes use of the transitional provision with regard to the required disclosures and does
not report for 2025 Material
E5 ESRS 2 IRO-1
Description of the processes to identify and assess material resource use and cir-
cular economy-related impacts, risks and opportunities
Sustainability Report ESRS 2 General Disclosures, p. 21
Material
E5-1
Policies related to resource use and circular economy Sustainability Report ESRS E5 Resource use and circular economy, p. 50 Material
E5-2
Actions and resources related to resource use and circular economy Sustainability Report ESRS E5 Resource use and circular economy, p. 50 Material
E5-3
Targets related to resource use and circular economy Sustainability Report ESRS E5 Resource use and circular economy, p. 51 Material
E5-4
Resource inflows Sustainability Report ESRS E5 Resource use and circular economy, p. 51 Material
E5-5
Resource outflows Sustainability Report ESRS E5 Resource use and circular economy, p. 51 Material
E5-6
Anticipated financial effects of impacts, risks and opportunities related to resource
use and circular economy
L&T makes use of the transitional provision with regard to the required disclosures and does
not report for 2025
Material
28
S1. ESRS 2 SBM-2
Interests and views of stakeholders Sustainability Report ESRS 2 General Disclosures, p. 17 Material
S1. ESRS 2 SBM-3
Material impacts, risks and opportunities and their interaction with strategy and
business model
Sustainability Report ESRS S1 Own workforce, p. 54
Material
S1-1
Policies related to own workforce Sustainability Report ESRS S1 Own workforce, p. 54 Material
S1-2
Processes for engaging with own workers and workers’ representatives about impacts Sustainability Report ESRS S1 Own workforce, p. 55 Material
S1-3
Processes to remediate negative impacts and channels for L&T's own workers to raise
concerns
Sustainability Report ESRS S1 Own workforce, p. 55
Material
S1-4
Taking action on material impacts on own workforce, and approaches to mitigating
material risks and pursuing material opportunities related to own workforce, and
effectiveness of those actions
Sustainability Report ESRS S1 Own workforce, p. 56
Material
S1-5
Targets related to managing material negative impacts, advancing positive impacts,
and managing material risks and opportunities
Sustainability Report ESRS S1 Own workforce, p. 57
Material
S1-6
Characteristics of the undertaking’s employees Sustainability Report ESRS S1 Own workforce, p. 57 Material
S1-7
Characteristics of non-employee workers in the undertaking’s own workforce L&T makes use of the transitional provision with regard to the required disclosures Material
S1-8
Collective bargaining coverage and social dialogue L&T makes use of the transitional provision with regard to the required disclosures Material
S1-9
Diversity metrics Sustainability Report ESRS S1 Own workforce, p. 59 Material
S1-10
Adequate wages Sustainability Report ESRS S1 Own workforce, p. 59 Material
S1-11
Social protection L&T makes use of the transitional provision with regard to the required disclosures Material
S1-12
Persons with disabilities - Non-material
S1-13
Training and skills development metrics L&T makes use of the transitional provision with regard to the required disclosures Material
S1-14
Health and safety metrics Sustainability Report ESRS S1 Own workforce, p. 59. L&T makes use of the transitional
provision 88 d and e with regard to the disclosures
Material
S1-15
Work-life balance metrics L&T makes use of the transitional provision with regard to the required disclosures Material
S1-16
Compensation metrics (pay gap and total compensation) Sustainability Report ESRS S1 Own workforce, p. 59 Material
S1-17
Incidents, complaints and severe human rights impacts Sustainability Report ESRS S1 Own workforce, p. 60 Material
29
S2 ESRS 2 SBM-2
Interests and views of stakeholders Sustainability Report ESRS 2 General Disclosures, p. 17 Material
S2 ESRS 2 SBM-3
Material impacts, risks and opportunities and their interaction with strategy and
business model
Sustainability Report ESRS 2 General Disclosures p. 17 Material
S2-1
Policies related to value chain workers L&T uses the "quick-fix" delegated act concerning the ESRS standard issued on 11 July 2025
and does not report for 2025
Material
S2-2
Processes for engaging with value chain workers about impacts L&T uses the "quick-fix" delegated act concerning the ESRS standard issued on 11 July 2025
and does not report for 2025
Material
S2-3
Processes to remediate negative impacts and channels for value chain workers to
raise concerns
L&T uses the "quick-fix" delegated act concerning the ESRS standard issued on 11 July 2025
and does not report for 2025
Material
S2-4
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
L&T uses the "quick-fix" delegated act concerning the ESRS standard issued on 11 July 2025
and does not report for 2025
Material
S2-5
Targets related to managing material negative impacts, advancing positive impacts,
and managing material risks and opportunities
L&T uses the "quick-fix" delegated act concerning the ESRS standard issued on 11 July 2025
and does not report for 2025
Material
ESRS 2 SBM-2
Interests and views of stakeholders - Non-material
ESRS 2 SBM-3
Material impacts, risks and opportunities and their interaction with strategy and
business model
- Non-material
S3-1
Policies related to affected communities - Non-material
S3-2
Processes for engaging with affected communities about impacts - Non-material
S3-3
Processes to remediate negative impacts and channels for affected communities to
raise concerns
- Non-material
S3-4
Taking action on material impacts on affected communities, and approaches to
managing material risks and pursuing material opportunities related to affected
communities, and effectiveness of those actions
- Non-material
S3-5
Targets related to managing material negative impacts, advancing positive impacts,
and managing material risks and opportunities
- Non-material
30
ESRS 2 SBM-2
Interests and views of stakeholders - Non-material
ESRS 2 SBM-3
Material impacts, risks and opportunities and their interaction with strategy and
business model
-
Non-material
S4-1
Policies related to consumers and end-users - Non-material
S4-2
Processes for engaging with consumers and end-users about impacts - Non-material
S4-3
Processes to remediate negative impacts and channels for consumers and end-us-
ers to raise concerns
-
Non-material
S4-4
Taking action on material impacts on consumers and end-users, and approaches to
managing material risks and pursuing material opportunities related to consumers
and end-users, and effectiveness of those actions
-
Non-material
S4-5
Targets related to managing material negative impacts, advancing positive impacts,
and managing material risks and opportunities
-
Non-material
G1 ESRS GOV-1
The role of the administrative, management and supervisory bodies Sustainability Report ESRS 2 General Disclosures, p. 10 Material
G1 ESRS IRO-1
Description of the processes to identify and assess material impacts, risks and
opportunities
Sustainability Report ESRS 2 General Disclosures, p. 21 Material
G1-1
Corporate culture and business conduct policies and corporate culture Sustainability Report ESRS G1 Business conduct, p. 61 Material
G1-2
Management of relationships with suppliers - Non-material
G1-3
Prevention and detection of corruption and bribery Sustainability Report ESRS G1 Business conduct, p. 62 Material
G1-4
Confirmed incidents of corruption or bribery Sustainability Report ESRS G1 Business conduct, p. 62 Material
G1-5
Political Influence and lobbying activities - Non-material
G1-6
Payment practices - Non-material
31
The following table contains all other data points derived from EU legislation listed in Appendix B of ESRS 2. The table shows where the data points can be found in our report and which data points have been assessed to be non-material on the basis of
the double materiality assessment. If L&T does not yet have information related to a specific data point, it is indicated with a dash (-).
Data point Pillar 3
ESRS 2 GOV-1 21 (d) Board's gender diversity
GOV-1 – The role of the administrative, management and supervisory
bodies, p. 10 x x
ESRS 2 GOV-1 21 (e) Percentage of board members who are independent
GOV-1 – The role of the administrative, management and supervisory
bodies, p. 10 x
ESRS 2 GOV-4 30 Statement on due diligence GOV-4 – Statement on sustainability due diligence, p. 14 x
ESRS 2 SBM-1 40 (d) i Involvement in activities related to fossil fuel activities Non-material x x x
ESRS 2 SBM-1 40 (d) ii Involvement in activities related to chemical production Non-material x x
ESRS 2 SBM-1 40 (d) iii Involvement in activities related to controversial weapons Non-material x x
ESRS 2 SBM-1 40 (d) iv
Involvement in activities related to cultivation and pro-
duction of tobacco Non-material x
ESRS E1-1 14 Transition plan to reach climate neutrality by 2050 E1-1 – Transition plan for climate change mitigation, p. 41 x
ESRS E1-1 16 (g) Undertakings excluded from Paris-aligned Benchmarks Not applicable x x
ESRS E1-4 34 GHG emission reduction targets E1-4 – Targets related to climate change mitigation and adaptation, p. 42 x x x
ESRS E1-5 38
Energy consumption from fossil sources disaggregated
by sources (only high climate impact sectors) E1-5 – Energy consumption and mix, p. 43 x
ESRS E1-5 37 Energy consumption and mix E1-5 – Energy consumption and mix, p. 43 x
ESRS E1-5 40–43
Energy intensity associated with activities in high climate
impact sectors E1-5 – Energy consumption and mix, p. 43 x
32
Data point Pillar 3
ESRS E1-6 44 Gross Scopes 1, 2, 3 and Total GHG emissions E1-6 – Gross Scopes 1, 2, 3 and Total GHG emissions, p. 44 x x x
ESRS E1-6 53–55 Gross GHG emissions intensity E1-6 – Gross Scopes 1, 2, 3 and Total GHG emissions, p. 44 x x x
ESRS E1-7 56 GHG removals and carbon credits Non-material x
ESRS E1-9 66
Exposure of the benchmark portfolio to climate-related
physical risks
L&T makes use of the transitional provision with regard to the required
disclosures x
ESRS E1-9 66 (a); 66 (c)
Disaggregation of monetary amounts by acute and chron-
ic physical risk; Location of significant assets at material
physical risk
L&T makes use of the transitional provision with regard to the required
disclosures x
ESRS E1-9 67 (c)
Breakdown of the carrying value of the undertaking's real
estate assets by energy-efficiency class
L&T makes use of the transitional provision with regard to the required
disclosures x
ESRS E1-9 69
Degree of exposure of the portfolio to climate-related
opportunities
L&T makes use of the transitional provision with regard to the required
disclosures x
ESRS E2-4 28
Amount of each pollutant listed in Annex II of the E-PRTR
Regulation emitted to air, water and soil Non-material x
ESRS E3-1 9 Water and marine resources Non-material x
ESRS E3-1 13 Dedicated policy Non-material x
ESRS E3-1 14 Sustainable oceans and seas Non-material x
ESRS E3-4 28 (c) Total water recycled and reused Non-material x
ESRS E3-4 29
Total water consumption in m3 per net revenue on own
operations Non-material x
ESRS 2 SBM-3 – E4 16 (a) List of material sites in own operations
L&T makes use of the transitional provision with regard to the required
disclosures x
ESRS 2 SBM-3 – E4 16 (b) Sites located in affected biodiversity-sensitive areas
L&T makes use of the transitional provision with regard to the required
disclosures x
ESRS 2 SBM-3 – E4 16 (c) Operations that affect threatened species
L&T makes use of the transitional provision with regard to the required
disclosures x
ESRS E4-2 24 (b) Sustainable land/agriculture practices or policies
L&T makes use of the transitional provision with regard to the required
disclosures x
ESRS E4-2 24 (c) Sustainable oceans/seas practices or policies
L&T makes use of the transitional provision with regard to the required
disclosures x
33
Data point Pillar 3
ESRS E4-2 24 (d) Policies to address deforestation
L&T makes use of the transitional provision with regard to the required
disclosures x
ESRS E5-5 37 (d) Non-recycled waste E5-5 - Resource outflows, p. 51 x
ESRS E5-5 39 Hazardous waste and radioactive waste E5-5 - Resource outflows, p. 51 x
ESRS 2 SBM-3 – S1 14 (f) Risk of incidents of forced labour
S1 SBM-3 – Impacts, risks and opportunities from the perspective of the
strategy and business model, p. 54 x
ESRS 2 SBM-3 – S1 14 (g) Risk of incidents of child labour
S1 SBM-3 – Impacts, risks and opportunities from the perspective of the
strategy and business model, p. 54 x
ESRS S1-1 20 Human rights policy commitments S1-1 – Policies related to own workforce, p. 54 x
ESRS S1-1 21
Due diligence policies on issues addressed by the funda-
mental International Labour Organization Conventions 1
to 8 GOV-4 – Statement on sustainability due diligence, p. 14 x
ESRS S1-1 22
Processes and measures for preventing trafficking in hu-
man beings S1-1 – Policies related to own workforce, p. 54 x
ESRS S1-1 23
Workplace accident prevention policy or management
system S1-1 – Policies related to own workforce, p. 54 x
ESRS S1-3 32 (c) Grievance/complaints handling mechanisms
S1-3 – Processes to remediate negative impacts and channels for L&T's
own workforce to raise concerns, p. 55 x
ESRS S1-14 88 (b) & (c)
Number of fatalities and number and rate of work-related
accidents S1-14 – Health and safety metrics, p. 59 x x
ESRS S1-14 88 (e)
-
ness S1-14 – Health and safety metrics, p. 59 x
ESRS S1-16 97 (a) Unbalanced gender pay gap S1-16 – Compensation metrics (pay gap and total compensation), p. 59 x x
ESRS S1-16 97 (b) Excessive CEO pay ratio S1-16 – Compensation metrics (pay gap and total compensation), p. 59 x
ESRS S1-17 103 (a) Incidents of discrimination S1-17 – Incidents, complaints and severe human rights impacts, p. 60 x
34
Data point Pillar 3
ESRS S1-17 104 (a)
Non-respect of UNGPs on Business and Human Rights
and OECD Guidelines Non-material x x
ESRS 2 SBM-3 – S2 11 (b)
Significant risk of child labour or forced labour in the
value chain
L&T makes use of the transitional provision with regard to the required
disclosures x
ESRS S2-1 17 Human rights policy commitments
L&T makes use of the transitional provision with regard to the required
disclosures x
ESRS S2-1 18 Policies related to value chain workers
L&T makes use of the transitional provision with regard to the required
disclosures x
ESRS S2-1 19
Non-respect of UNGPs on Business and Human Rights
and OECD Guidelines Non-material x x
ESRS S2-1 19
Due diligence policies on issues addressed by the
fundamental International Labour Organization
Conventions 1 to 8
GOV-4 – Statement on sustainability due diligence,
p. 14 x
ESRS S2-4 36
Human rights issues and incidents connected to
upstream and downstream value chain
L&T makes use of the transitional provision with regard to the required
disclosures x
ESRS S3-1 16 Human rights policy commitments Non-material x
ESRS S3-1 17
Non-respect of UNGPs on Business and Human Rights,
ILO principles or OECD Guidelines Non-material x x
ESRS S3-4 36 Human rights issues and incidents Non-material x
ESRS S4-1 16 Policies related to consumers and end-users Non-material x
ESRS S4-1 17
Non-respect of UNGPs on Business and Human Rights
and OECD Guidelines Non-material x x
ESRS S4-4 35 Human rights issues and incidents Non-material x
ESRS G1-1 10 (b)
Anti-corruption and anti-bribery principles aligned with
the United Nations Convention against Corruption Non-material x
ESRS G1-1 10 (d) Protection of whistleblowers Non-material x
ESRS G1-4 24 (a) Fines for violation of anti-corruption and anti-bribery laws G1-4 - Corruption and bribery, p. 62 x x
ESRS G1-4 24 (b) Standards of anti-corruption and anti-bribery G1-3 – Prevention and detection of corruption and bribery, p. 62 x
35
Annual Report 2025
Report by the Board of Directors Sustainability Report
36
In this section, L&T discloses information on environmentally sustainable eco-
nomic activities in accordance with the EU Taxonomy. The information is based
on Regulation (EU) 2020/852 of the European Parliament and of the Council
(Taxonomy Regulation). The Regulation contains key figures that companies are
required to report on their environmentally sustainable economic activities.
The EU Taxonomy specifies six key environmental objectives on the basis of
which the company’s various business operations are assessed. The environ-
mental objectives include climate change mitigation, climate change adaptation,
water and marine resources, circular economy, pollution, and biodiversity and
ecosystems. Lassila & Tikanoja Plc was founded on 31.12.2025. L&T has reported
taxonomy-aligned, taxonomy-eligible and non-taxonomy-eligible proportions
of its business activities for three key performance indicators (turnover, oper-
ating expenditure and capital expenditure) on a carve-out basis. Carve-out based
reporting is discussed in more detail in section ESRS 2 BP-1, p. 10. The company’s
taxonomy reporting does not use the reliefs provided by the European Commis-
sion’s Omnibus package.
Taxonomy alignment reflects the extent to which the company’s business in
question supports the environmental goals. An activity is considered to be taxon-
omy-aligned if it substantially contributes to one of the specified environmental
objectives while doing no significant harm (DNSH) to the other objectives. In addi-
tion, the activity must comply with the criteria for minimum safeguards.
L&T’s assessment
Assessments of taxonomy eligibility and taxonomy alignment have been carried
out by L&T on the basis of the best interpretation of the EU Taxonomy Regulation,
the Climate Delegated Act, the Complementary Climate Delegated Act and the
Environmental Delegated Act, as well as the currently available guidelines issued
by the European Commission.
Taxonomy eligibility has been assessed on the basis of the descriptions of eco-
nomic activities and related NACE codes in accordance with the European Com-
mission’s delegated regulations. The taxonomy-related assessment covers turn-
over, capital expenditure and operating expenditure from business operations, as
specified in relation to the six environmental objectives of the EU Taxonomy. L&T
has no business activities related to nuclear energy or fossil natural gas.
The financial indicators related to the taxonomy are based on figures obtained
from financial and ERP systems. When calculating the proportion of turnover
of taxonomy-aligned and taxonomy-eligible economic activities (note 1.2 to the
financial statements), L&T takes into account revenue from services and prod-
ucts that have a clear connection to the identified economic activities. For cap-
ital expenditure and operating expenditure, the entries for the reporting year are
reviewed and the alignment between the assessment criteria and the recorded
data is assessed.
L&T’s capital expenditure consists of additions in tangible fixed assets, intan-
gible assets and right-of-use assets, including additions arising from acquisitions.
(notes 3.1, 3.3 and 3.4 to the financial statements). Operating expenditure consists
of non-capitalised direct expenses that are necessary to ensure the continuous
and efficient operation of property, plant and equipment. These expenses include
maintenance, repair and maintenance costs of equipment and buildings, short-
term leases and similar expenses and other direct costs related to the mainte-
nance of assets. Assessments of taxonomy eligibility and alignment take into
account only those operating and capital expenditures that meet the technical
requirements for the activities. L&T has no separate capital or operating expendi-
ture plans for the taxonomy.
L&T reports on taxonomy at Group level. Specialists from each division and
representatives of business functions have assessed whether the economic
activities identified in the taxonomy meet the criteria for taxonomy alignment.
The assessment is based on the activity-specific technical screening criteria
described in the DNSH criteria and the Taxonomy Regulation. L&T’s climate risks
are described in section E1 SBM-3, p. 41.
L&T’s business is regulated and requires separate environmental permits that
specify environmental requirements for water, soil pollution and nature. Environ-
mental permits apply to L&T’s processing and storage areas and waste disposal
plants. L&T strives to comply with all environmental requirements applicable to its
operations.
L&T uses a management system that covers all of L&T’s services with regard
to the ISO 9001, ISO 14001 and ISO 45001 certificates. The EHSQ management
model ensures that L&T’s operations comply with the permit conditions, which are
monitored and reported regularly. In addition, L&T aims to manage and reduce the
environmental impacts of its operations through training and technical solutions.
The technical screening criteria have been reviewed in parallel to ensure that the
reporting is as consistent as possible and to avoid double calculation.
Minimum safeguards
In addition to technical screening criteria, the Taxonomy Regulation provides for
minimum safeguards covering labour and human rights, prevention of corruption
and bribery, fair competition and taxation. At L&T, the minimum safeguards have
been assessed at Group level.
L&T respects the human rights defined in the UN Declaration of Human Rights,
the rights of workers of the International Labour Organisation (ILO), international
conventions and the UN Guiding Principles on Business and Human Rights. In
addition, L&T complies with the six steps of the OECD Guidelines for Multinational
Enterprises. L&T’s human rights impacts are discussed in more detail in section
ESRS 2 GOV-4, p. 14.
EU Taxonomy
In the prevention of corruption and bribery, L&T complies with national legislation
and agreements. These principles are also documented in a separate anti-corrup-
tion and anti-bribery policy, which prohibits bribery, the receipt and giving of gifts,
and other unethical activities. L&T’s guidelines for receiving gifts and hospitality
are public and available on the company’s website and intranet. The prevention of
corruption and bribery is discussed in more detail in section G1-3, p. 62.
The main principles concerning taxation are described in the tax policy
approved by L&T’s Board of Directors. The tax policy covers all of L&T’s divisions
in all operating countries and applies to all employees. L&T complies with local
legislation in the payment, collection, accounting and reporting of taxes. A key
principle is the high-quality and timely reporting of tax forms and other statutory
reports to the authorities.
L&T pays and collects taxes in the countries in which it operates and creates
value, and does not shift value to low-tax jurisdictions. The pricing of intra-Group
transactions complies with the applicable transfer pricing legislation, the OECD
guidelines and recommendations of the tax administration. All L&T’s investment
and location decisions are based on business needs. Tax impacts are analysed
and taken into account as part of decision-making, and business operations and
group structures are reviewed on the basis of their financial content. L&T does
not participate in arrangements made solely for tax reasons without a business
substance.
L&T operates in Finland and Sweden, supports fair competition and complies
with good business conduct and the rules of competition law in all of its business
operations. All business activities undertaken by L&T either in full or in part are
complies with competition law, carries out due diligence on the subjects of acqui-
sition, and submits the legally required notifications to the competition authori-
ties.
L&T’s Code of Conduct includes basic rules on compliance with competition
law and legislation. In addition, L&T provides training on competition law for
employees whose role involves an identified need for more in-depth training. The
purpose of the training is to help the personnel to identify situations that may be
questionable or prohibited from the perspective of the rules of competition law,
and to provide more detailed instructions on the course of action to take in dif-
ferent situations.
L&T has due diligence processes in place with regard to taxation, anti-corrup-
tion, anti-bribery and fair competition. Requirements concerning human rights,
labour rights and corruption have been taken into account as separate princi-
ples, included in the Code of Conduct and training. In addition, these principles
have been taken into consideration in the company’s procurement processes and
guidelines. The Group-level policies apply to all of L&T’s business operations in
Finland and Sweden.
Annual Report 2025
Report by the Board of Directors Sustainability Report
37
Identified taxonomy-eligible activities
The taxonomy-eligible and taxonomy-aligned activities of L&T’s Environmental
Services and Industrial Services divisions include, among other things, the
collection and transport of waste, recovery of materials from non-hazardous
waste, hazardous waste treatment, wastewater collection and treatment,
sale of second-hand goods, and environmental construction services related
to the remediation of contaminated sites and areas. These circular economy
businesses include activities related to climate change mitigation 5.5 (Collection
and transport of non-hazardous waste in source segregated fractions) and 5.9
(Material recovery from non-hazardous waste). Activities related to the transition
to a circular economy and the prevention and recycling of waste 2.3 (Collection
and transport of non-hazardous and hazardous waste), 2.7 (Non-hazardous
waste sorting and material recovery) and 5.4 (Sale of second-hand goods).
Activities related to pollution prevention and control 2.1 (Collection and transport
of hazardous waste), 2.2 (Hazardous waste treatment) and 2.4 (Remediation of
contaminated sites and areas).
Transitional activities (nuclear power and natural gas)
A transitional activity is an economic activity that supports the transition to a
climate-neutral economy and for which there are no technologically and econom-
ically feasible low-carbon alternatives. L&T does not have any taxonomy-eligible
or non-taxonomy-eligible nuclear power or natural gas-related economic activ-
ities as described in the Complementary Climate Delegated Act. Consequently,
Template 1: Nuclear and fossil gas-related activities (Complementary Climate Del-
egated Act, Annex III) is presented on the right, and templates 2–5 are omitted.
Nuclear energy-related activities
The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of innovative electricity generation
facilities that produce energy from nuclear processes with minimal waste from the fuel cycle.
No
The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear installations to produce electricity or process
heat, including for the purposes of district heating or industrial processes such as hydrogen production, as well as their safety upgrades, using best
available technologies.
No
The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that produce electricity or process heat,
including for the purposes of district heating or industrial processes such as hydrogen production from nuclear energy, as well as their safety
upgrades.
No
Fossil gas-related activities
The undertaking carries out, funds or has exposures to construction or operation of electricity generation facilities that produce
electricity using fossil gaseous fuels.
No
The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined heat/cool and
power generation facilities using fossil gaseous fuels.
No
The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat generation facilities
that produce heat or cooling using fossil gaseous fuels.
No
Annual Report 2025
Report by the Board of Directors Sustainability Report
38
Turnover
Financial year N
2025 Substantial Contribution Criteria DNSH criteria (Does Not Significantly Harm)
Economic activities
Code Turnover
Propor-
tion of
Turnover,
year N
Climate
change
mitigation
Climate
change
adaptation Water Pollution
Circular
economy Biodiversity
Climate
change
mitigation
Climate
change
adaptation Water Pollution
Circular
economy Biodiversity
Minimum
safeguards
Taxonomy-
aligned (A.1)
or taxonomy-
eligible (A.2.)
proportion of
turnover, year
N-1
Category
enabling
activity
Category
transition-
al activity
(MEUR) (%) Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N Y; N Y; N Y; N Y; N; Y; N Y; N (%) E T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Collection and transport of non-hazardous waste in
source segregated fractions
CCM 5.5 12.2 2.9% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 2.7 %
Material recovery from non-hazardous waste CCM 5.9 1.8 0.4% Y N/A N/A N/A N/A N/A Y Y Y Y Y Y Y 0.6 %
Collection and transport of hazardous waste PPC 2.1 22.4 5.2% N/A N/A N/A Y N/A N/A Y Y Y Y Y Y Y 4.9 %
Treatment of hazardous waste
PPC 2.2 4.7 1.1% N /A N/A N/A Y N/A N/A Y Y Y Y Y Y Y 1.1 %
Remediation of contaminated sites and areas PPC 2.4 3.4 0.8% N/A N/A N/A Y N/A N/A Y Y Y Y Y Y Y 0.8 %
Collection and transport of non-hazardous and hazardous
waste
CE 2.3 25.9 6.1% N/A N/A N/A N/A Y N/A Y Y Y Y Y Y Y 7.8 %
Sorting and material recovery of non-hazardous waste CE 2.7 10.7 2.5% N /A N/A N/A N/A Y N/A Y Y Y Y Y Y Y 2.7 %
Sale of second-hand goods
CE 5.4 16.0 3.7% N /A N/A N/A N/A Y N/A Y Y Y Y Y Y Y 2.1 %
Turnover of environmentally sustainable activities
(Taxonomy-aligned) (A.1)
96.9 22.7% 3.3% 0.0% 0.0% 7.1% 12.3% 0.0% Y Y Y Y Y Y Y 22.8 %
Of which Enabling 0.0 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% Y Y Y Y Y Y Y 0.0 % E
Of which Transitional
0 0% 0.0% Y Y Y Y Y Y Y 0 % T
EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL
Material recovery from non-hazardous waste CCM 5.9 0.4 0.1% EL N/EL N/EL N/EL N/EL N/EL 0.1 %
Collection and transport of hazardous waste
PPC 2.1 1.7 0.4% N/EL N/EL N/EL EL N/EL N/EL 0.4 %
Collection and transport of non-hazardous and hazardous
waste
CE 2.3 9.0 2.1% N/EL N/EL N/EL N/EL EL N/EL 2.4 %
Sorting and material recovery of non-hazardous waste CE 2.7 8.2 1.9% N/EL N/EL N/EL N/EL EL N/EL 1.8 %
Turnover of Taxonomy-eligible but not
19.2 4.5% 0.1% 0.0% 0.00% 0.4% 4.0% 0.0% 4.7 %
116.2 27.2% 3.4% 0.0% 0.00% 7.5% 16.3% 0.0% 27.4 %
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
310.5 72.8%
426.6 100%
Code: CCM = Climate Change Mitigation, PPC = Pollution Prevention and Control, CE = Circular Economy.
A.1: Y – Yes, a taxonomy-eligible and taxonomy-aligned activity with regard to the environmental objective in question, N – No, a taxonomy-eligible but not taxonomy-aligned activity with regard to the environmental objective in question, N/A - Not applicable, a non-taxonomy-eligible activity with regard to the environmental objective in question
A.2: EL – A taxonomy-eligible activity with regard to the objective, N/EL – A non-taxonomy-eligible activity with regard to the objective
Annual Report 2025
Report by the Board of Directors Sustainability Report
39
Capital Expenditure
Financial year N
2025 Substantial Contribution Criteria DNSH criteria (Does Not Significantly Harm)
Economic activities
Code CapEx
Propor-
tion of
CapEx,
year N
Climate
change
mitigation
Climate
change
adaptation Water Pollution
Circular
economy Biodiversity
Climate
change
mitigation
Climate
change
adaptation Water Pollution
Circular
economy Biodiversity
Minimum
safeguards
Taxonomy-
aligned (A.1)
or taxonomy-
eligible (A.2.)
proportion of
CapEx year N-1
Category
enabling
activity
Category
transition-
al activity
(MEUR) (%) Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N Y; N Y; N Y; N Y; N; Y; N Y; N (%) E T
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Collection and transport of non-hazardous waste in
source segregated fractions
CCM 5.5
0.2 0.4% Y N/A N/A N/A N /A N/A Y Y Y Y Y Y Y 3.5 %
Material recovery from non-hazardous waste CCM 5.9 0.7 1.2% Y N/A N/A N/A N /A N/A Y Y Y Y Y Y Y 1.7 %
Collection and transport of hazardous waste PPC 2.1 2.0 3.5% N/A N/A N /A Y N/A N /A Y Y Y Y Y Y Y 4.4 %
Treatment of hazardous waste PPC 2.2 0.2 0.4% N/A N /A N /A Y N/A N /A Y Y Y Y Y Y Y 0.9 %
Collection and transport of non-hazardous and hazardous
waste
CE 2.3 2.2 3.9% N /A N/A N/A N/A Y N/A Y Y Y Y Y Y Y 7.3 %
Sorting and material recovery of non-hazardous waste CE 2.7 0.9 1.6% N/A N /A N/A N/A Y N/A Y Y Y Y Y Y Y 2.6 %
Sale of second-hand goods CE 5.4 1.3 2.4% N/A N /A N/A N/A Y N/A Y Y Y Y Y Y Y 2.0 %
CapEx of environmentally sustainable
7.5 13.3% 1.6% 0.0% 0.0% 3.9% 7.9% 0.0% Y Y Y Y Y Y Y 22.3 %
Of which Enabling 0.0 0.0% 0.0% 0% 0% 0% 0% 0% Y Y Y Y Y Y Y 0.0 % E
Of which Transitional
0.0 0.0% 0.0% Y Y Y Y Y Y Y 0.0 % T
EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL
Material recovery from non-hazardous waste CCM 5.9
0.2 0.3% EL N/EL N/EL N/EL N/EL N/EL 0.4 %
Collection and transport of hazardous waste PPC 2.1 0.1 0.3% N/EL N/EL N/EL EL N/EL N/EL 0.3 %
Collection and transport of non-hazardous and hazardous
waste
CE 2.3 0.8 1.3% N/EL N/EL N/EL N/EL EL N/EL 2.2 %
Sorting and material recovery of non-hazardous waste CE 2.7
0.7 1.2% N/EL N/EL N/EL N/EL EL N/EL 1.7 %
CapEx of Taxonomy-eligible but not environmentally
(A.2)
1.8 3.1% 0.3% 0.0% 0.00% 0.3% 2.6% 0.0% 4.6 %
9.3 16.5% 1.9% 0.0% 0.00% 4.2% 10.4% 0.0% 26.9 %
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
CapEx of Taxonomy-non-eligible activities 47.2 83.5%
TOTAL
56.5 100%
Code: CCM = Climate Change Mitigation, PPC = Pollution Prevention and Control, CE = Circular Economy.
A.1: Y – Yes, a taxonomy-eligible and taxonomy-aligned activity with regard to the environmental objective in question, N – No, a taxonomy-eligible but not taxonomy-aligned activity with regard to the environmental objective in question, N/A - Not applicable, a non-taxonomy-eligible activity with regard to the environmental objective in question
A.2: EL – A taxonomy-eligible activity with regard to the objective, N/EL – A non-taxonomy-eligible activity with regard to the objective
Annual Report 2025
Report by the Board of Directors Sustainability Report
40
Operating Expenditure
Financial year N
2025 Substantial Contribution Criteria DNSH criteria (Does Not Significantly Harm)
Economic activities
Code OpEx
Propor-
tion of
OpEx,
year N
Climate
change
mitigation
Climate
change
adaptation Water Pollution
Circular
economy Biodiversity
Climate
change
mitigation
Climate
change
adaptation Water Pollution
Circular
economy Biodiversity
Minimum
safeguards
Taxonomy-
aligned (A.1)
or taxonomy-
eligible (A.2)
proportion of
OpEx, year N-1
Category
enabling
activity
Category
transition-
al activity
(MEUR) (%) Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N; N/A Y; N Y; N Y; N Y; N Y; N; Y; N Y; N (%) E T
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Collection and transport of non-hazardous waste in
source segregated fractions
CCM 5.5 0.8 2.8% Y N /A N /A N /A N/A N /A Y Y Y Y Y Y Y 0.7 %
Material recovery from non-hazardous waste CCM 5.9 0.02 0.1% Y N/A N/A N/A N /A N/A Y Y Y Y Y Y Y 0.0 %
Collection and transport of hazardous waste PPC 2.1 0.7 2.6% N /A N/A N/A Y N/A N/A Y Y Y Y Y Y Y 0.6 %
Treatment of hazardous waste PPC 2.2 0.2 0.5% N/A N/A N/A Y N/A N/A Y Y Y Y Y Y Y 0.1 %
Remediation of contaminated sites and areas PPC 2.4 0.03 0.1% N/A N /A N /A Y N/A N /A Y Y Y Y Y Y Y 0.0 %
Collection and transport of non-hazardous and hazardous
waste
CE 2.3 1.9 6.7% N/A N /A N /A N /A Y N/A Y Y Y Y Y Y Y 2.1 %
Sorting and material recovery of non-hazardous waste CE 2.7 0.8 2.8% N/A N/A N/A N/A Y N/A Y Y Y Y Y Y Y 0.8 %
Sale of second-hand goods CE 5.4 1.2 4.1% N /A N/A N/A N/A Y N/A Y Y Y Y Y Y Y 0.6 %
OpEx of environmentally sustainable
5.6 19.7% 2.9% 0.0% 0.0% 3.3% 13.5% 0.0% Y Y Y Y Y Y Y 5.0 %
Of which Enabling 0.0 0.0% 0.0% 0% 0% 0% 0% 0% Y Y Y Y Y Y Y 0.0 % E
Of which Transitional 0.0 0.0% 0.0% Y Y Y Y Y Y Y 0.0 % T
EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL
Material recovery from non-hazardous waste CCM 5.9 0.005 0.02% EL N/EL N/EL N/EL N/EL N/EL 0.0 %
Collection and transport of hazardous waste PPC 2.1 0.1 0.2% N/EL N/EL N/EL EL N/EL N/EL 0.0 %
Collection and transport of non-hazardous and hazardous
waste
CE 2.3 0.7 2.3% N/EL N/EL N/EL N/EL EL N/EL 0.7 %
Sorting and material recovery of non-hazardous waste CE 2.7 0.6 2.1% N/EL N/EL N/EL N/EL EL N/EL 0.5 %
OpEx of Taxonomy-eligible but not environmentally
(A.2)
1.3 4.6% 0.0% 0.0% 0.00% 0.2% 4.4% 0.0% 1.2 %
6.9 24.3% 2.9% 0.0% 0.00% 3.5% 17.9% 0.0% 6.2 %
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
OpEx of Taxonomy-non-eligible activities 21.5 75.7%
TOTAL 28.4 100%
Code: CCM = Climate Change Mitigation, PPC = Pollution Prevention and Control, CE = Circular Economy.
A.1: Y – Yes, a taxonomy-eligible and taxonomy-aligned activity with regard to the environmental objective in question, N – No, a taxonomy-eligible but not taxonomy-aligned activity with regard to the environmental objective in question, N/A - Not applicable, a non-taxonomy-eligible activity with regard to the environmental objective in question
A.2: EL – A taxonomy-eligible activity with regard to the objective, N/EL – A non-taxonomy-eligible activity with regard to the objective
E1-1 – Transition plan for climate change mitigation
L&T’s target is to achieve net zero for its own operations and the entire supply
chain by 2045. The target is recorded in L&T's environmental policy, which has
been approved by the Board of Directors of L&T. The plan for climate change mit-
igation is part of L&T's strategy, and it also includes phasing out fossil fuels in
the long term. L&T’s planned climate targets are described in more detail in sec-
tion E1-4, p. 42. The net zero target is in line with the Paris Agreement. L&T is not
excluded from the EU’s Paris Agreement benchmarks.
To achieve the net zero emissions level, L&T has drawn up a separate climate
transition plan that includes an assessment of the key measures concerning
L&T's own operations and supply chain until 2030. The transition plan was pre-
pared before L&T's demerger into a separate listed company from the former L&T
Group, and it will be updated and confirmed by the Board of Directors in 2026.
The key aspects of the transition plan are related to the company's measures
to phase out fossil carbon in transport operations with respect to both fuel use
and the fleet, so that by 2030, nearly one-half of the energy used by the compa-
ny’s fleet is renewable or emission-free, in addition to which the number of elec-
tric equipment is increased each year.
In addition to its own operations, L&T seeks to promote the value chain emis-
sion reduction targets concerning the value chain by intensifying its cooperation
with value chain partners, especially in transport and earthworks subcontracting.
L&T will continue this work in 2026.
The lock-in of potential GHG emissions is not estimated to cause a signifi-
cant transition risk or prevent the achievement of emission reduction targets in
respect of the company’s own operations, as the power source of the fleet in use
can be adjusted during use, for example by replacing fossil energy with renew-
able energy. Moreover, the availability of renewable energy is expected to remain
good in the future.
The transition examines the effectiveness of the key measures targeted at the
company’s own operations in relation to the emission targets, and their potential
financial effects. The plan takes into account the anticipated capital and oper-
ating expenditure to achieve the climate targets set for the company’s own oper-
ations by the end of 2030. The long-term measures extending to 2045 are not
yet at a sufficiently detailed level due to difficulty of forecasting. The adequacy of
the measures and the related financing plan will be reviewed annually as part of
L&T’s investment decisions.
The most significant capital expenditure required to implement L&T’s planned
measures is related to increasing the relative share of low-emission equipment
in the fleet by 2030. The planned measures will increase L&T’s annual capital
expenditure, which in turn will increase depreciation and amortisation in L&T's
income statement. As a counterbalance to increasing depreciation and amor-
tisation, L&T anticipates that low-emission equipment will reduce the annual
E1 Climate change
operating expenditure of the fleet in the income statement. During this financial
period, the investments pursuant to the transition plan have not had material
effects on the financial statements. Increasing the use of renewable fuels in will
have an effect on operating expenditure due to the higher price of renewable
fuels compared to fossil fuels. This measure is expected to increase annual fuel
expenditure in L&T's income statement by a maximum of 5% by 2030. The effects
of climate change on income and balance sheet are taken into account in the set-
ting of short- and medium-term objectives.
The alignment of the company's economic activities with the criteria estab-
lished in Commission Delegated Regulation (EU) 2021/2139 is mainly focused on
the renewal of the fleet, which is expected to reduce the company's general envi-
ronmental impact. Although the renewal of the fleet is not directly related to the
activities specified in the taxonomy to a significant degree, it supports the com-
pany's aim of operating more sustainably.
SBM-3 – Material impacts, risks and opportunities and
their interaction with strategy and business models
Based on the double materiality assessment, L&T’s material impacts and
risks related to climate change were related to climate change mitigation and
improving energy efficiency. L&T’s entity-specific disclosure obligations apply to
the carbon handprint and carbon intensity (gCO2 /km), which is also one of the
sustainability conditions of L&T’s bond issued in 2022. The bond was transferred
to L&T in the partial demerger.
The company’s positive impacts arise from services provided by its businesses
that produce solutions that facilitate the transition to a low-carbon circular
economy, by promoting the recycling of materials and raw materials and reducing
the amount of waste directed to final disposal and incineration.
The negative impacts of L&T’s own operations arise from transport-related
emissions and emissions in the value chain. L&T’s own operations (Scope 1 and 2)
account for approximately 9% of total emissions, of which approximately 98% are
generated by transport (Scope 1 emissions). Scope 2 emissions accounted for 2%
of the emissions in L&T's own operations. Scope 2 emissions include all green-
house gas (GHG) emissions arising from the use of electricity, heating and cooling
energy at L&T’s properties. The majority, approximately 91%, of L&T’s total emis-
sions are generated in the value chain (Scope 3). L&T’s emissions for 2025 are
reported in detail in this Sustainability Report on a carve-out basis. More informa-
tion on carve-out-based reporting is described in section ESRS 2 BP-1, p. 10.
The transition to a low-emission fleet and significantly increasing the use of
renewable energy are key measures for reducing L&T’s emissions. L&T’s material
transition risks are also associated with these, namely delays in the technological
development of low-emission and electrically powered heavy equipment and the
availability and price of renewable fuels in the long term.
The positive climate impact of the services is measured using the carbon hand-
print. It describes the emissions avoided through companies’ conscious choices
and solutions relative to previous operating practices. L&T’s carbon handprint is
created through services produced for customers, such as material recycling and
production of solid recovered fuel.
The monitoring of the outcomes of climate change related to business oper-
ations is integrated in L&T’s strategy process. The company has assessed the
impacts of climate change both during the short strategy period of five years and
in the long term, extending to 2035. The resilience analysis is based on a quali-
tative assessment of the uncertainties in the business environment, which takes
into account changes in the market and the operating environment and their
significant financial effects. The most recent scenario review was carried out in
2023 before L&T demerged from the former Lassila & Tikanoja Group.
The resilience analysis was focused on L&T’s own operations. With regard to
transition risks, it considered changes in markets and regulation and, with regard
to physical risks, it considered weather fluctuations in Finland and Sweden. The
analysis takes into account L&T’s own climate targets and related measures, such
as L&T’s emissions reduction measures in logistics as well as fleet investments
and measures promoting the recycling of materials.
The company's resilience analysis applies the IPCC scenarios of climate
warming of 1.5°C, less than 2°C and 4°C by the end of the century (RCP 2.6 and
RCP 6.0), which have been assessed in relation to the latest climate research
data on changes in weather in Finland. The International Energy Agency's
(IEA) background data and assumptions (APS, NZE2050 and STEPS) have also
The evaluated scenarios included a business environment in which legislation
and measures support and guide companies towards targets aligned with the net
zero objective. The other extreme was a business environment in which change
slows down and the necessary measures are implemented slowly. The busi-
ness effects of climate change were assessed in the different scenarios through
aspects of change in the industry related to regulation, the business model and
technological development.
The uncertainties in the resilience analysis are related to regulatory changes
and market changes. They have been taken into account in the background of
L&T's climate transition plan as influencing factors related to low-emission fleet
investments. The flexibility of the business model in the operating environments
outlined in the different climate scenarios is on a stable foundation. The reference
scenario was a business environment in which the status quo supports the 1.5°C
climate path in the short term and the long term. The resilience analysis will be
updated in 2026 in connection with the update of the transition plan.
Annual Report 2025
Report by the Board of Directors Sustainability Report
41
E1-2 – Policies related to climate change mitigation
L&T’s long-term net zero target is recorded in the company’s environmental
policy, which describes not only L&T's own operations but also the principles per-
taining to the value chain. The environmental policy, which is published on L&T’s
website, has been approved by L&T's Board of Directors.
L&T’s environmental policy describes the company’s material targets and prin-
ciples with regard to climate change mitigation, the use of renewable energy and
the promotion of energy efficiency. L&T is committed to net zero targets by 2045
and also encourages its partners to set their own climate targets and reduce their
dependence on fossil raw materials. In addition, emissions generated in L&T's own
operations and the value chain are reduced by promoting the use of renewable
raw materials and improving energy efficiency. The environmental policy takes
into account customer solutions by which L&T promotes its customers’ climate
targets. The positive climate impact of the value chain arises when the company’s
services are used to replace virgin raw materials with recycled and renewable raw
materials. At the same time, L&T’s own carbon handprint increases.
The principles laid down in the policy are reviewed regularly, at two-year
intervals. The responsibility for updating the policy and its content lies with the
company’s SVP, Public Affairs and Sustainability, who prepares the key princi-
ples of the policy together with L&T’s specialists. Other stakeholders have not
-
mentation of the policy and allocating the necessary resources in their respective
operations. Climate targets concerning the supply chain have been taken into
account in L&T’s new procurement agreements.
E1-3 – Actions and resources in relation to climate
change policies
L&T’s environmental policy and net zero target are put into action through L&T's
transition plan and circular economy solutions implemented for customers. The
progress of the transition plan is regularly reviewed by the Group Executive Board
and the Board of Directors, and the SVP, Public Affairs and Sustainability, Chief
Procurement Officer and Chief Financial Officer are responsible for the progress
of emission reductions. In addition, climate targets and their monitoring are one of
the key themes of L&T’s communications, and the progress towards the targets is
monitored quarterly and the results are presented to the entire personnel in per-
sonnel briefings.
Measures to reduce emissions caused by L&T's own operations
Information on the company’s measures to reduce emissions is reported on a
carve-out basis in accordance with section ESRS 2 BP-2, p. 10. The key measures
related to climate change mitigation and renewable energy deployment in L&T's
own operations are focused on the deployment of low-emission equipment and
the use of renewable fuel in the fleet. Energy efficiency is also supported by stat-
utory training on driving and the use of the equipment for drivers. The measures
support L&T’s efforts to phase out fossil carbon both in the long term (by 2045).
of the fleet and a significant increase in the use of renewable fuels had a sub-
stantial impact on the Scope 1 emissions caused by L&T's own operations.
The following measures were taken in 2025 to promote the targets related to
L&T's own operations, for example:
• Driving style monitoring equipment had been installed in all 1,345 vehicles by
the end of 2025.
• L&T has 91 low-emission heavy-duty vehicles and work machines that run on
either biogas or electricity.
• L&T pioneered the deployment of electric heavy equipment in the Nordic
countries, including an electric suction jetting combination vehicle.
• 28% of the diesel oil used by L&T in transport operations was replaced with
HVO (Hydrotreated Vegetable Oil) made from renewable raw materials.
• L&T engages in route planning on an ongoing basis. It has enabled L&T to
improve the efficiency of operations and reduce emissions, kilometres driven
and working hours.
L&T’s properties will switch to renewable electricity by 2030. Currently, the elec-
tricity used in Finland is produced with nuclear energy and certified with guaran-
tees of origin. The energy efficiency of properties is being improved, for example,
by optimising the controls of building systems, LED lighting modernisations, reno-
vations of ventilation equipment, and building automation and changes in heating
methods. In 2025, energy efficiency measures were taken at 13 properties. The
measures have led to emission reductions of 121 tCO
2
e, corresponding to approx-
imately 26.6% of Scope 2 emissions.
L&T's carbon handprint
L&T’s carbon handprint is created by services that promote the circular economy
in the value chain and replace fossil or virgin materials with recycled materials.
L&T also offers a blast cleaning method for the cleaning of boilers in industrial
power plants, which reduces emissions and improves efficiency.
In 2025, the carbon handprint of L&T’s operations was 377.5 MtCO
2
eq. The
decrease in the carbon handprint was particularly attributable to a decrease in
the volume of municipal and construction waste and decreased demand for solid
recovered fuels.
Climate efforts in the supply chain
Most of L&T’s total emissions consist of supply chain emissions, such as emis-
sions arising from purchased goods and services, waste processing and transport
contracting. L&T has analysed the most significant sources of Scope 3 emissions
in the supply chain and prepared an action plan extending to 2030 as part of
the climate transition plan. The measures contribute to climate change mitiga-
tion, promote the deployment of renewable energy, and reduce the value chain's
dependence on fossil carbon.
Approximately 58% of L&T’s scope 3 emissions arise from the incineration of
waste, such as plastics contained in mixed waste and waste-to-energy material,
and the disposal of hazardous waste. The company’s goal is to enhance sorting
at source in cooperation with customers by facilitating the recycling of raw mate-
rials in mixed waste and waste-to-energy material, which also reduces the cli-
mate impact of the waste. L&T also develops solutions to improve the recycling
of hazardous waste. It is also key to improve the quality of supply chain data so
that emissions calculations are increasingly based on primary data received from
suppliers.
A significant proportion of L&T’s Scope 3 emissions are generated during trans-
port subcontracting. In 2025, emissions from transport subcontracting decreased
by 5% when compared to the previous year’s emissions, and they were 11.6%
lower than the emissions in the base year (2020).
Going forward, L&T will increase cooperation with its suppliers to accelerate the
emission reductions of transport subcontracting.
Anticipated financial effects
The emission reduction measures related to L&T’s own operations require finan-
cial capital and operating expenditure that L&T's taxonomy reporting does not
fully take into account, as some of the measures are not taxonomy-eligible due
to the sector classification included in the Taxonomy Regulation. The most signif-
icant capital expenditures are allocated particularly to low-emission fleet invest-
ments in accordance with the transition plan, while the key operating expendi-
tures include the costs incurred from the use of renewable fuel, for example. The
significant capital and operational expenditures of L&T’s measures are described
as part of the financial analysis of the transition plan in section E1-1, pp. 41. Dis-
closures required by the Taxonomy Regulation are reported as part of the tax-
onomy, pp. 36-40.
L&T’s measures are also partially dependent on external factors, such as
market development, technological innovations and changes in legislation, which
may either promote or hinder the achievement of climate targets. The company
closely monitors the development of the business environment and adapts its
strategy accordingly.
Future development areas
In addition to the existing measures, L&T will focus particularly on developing the
monitoring of the supply chain’s climate targets and the practical implementation
of emission reduction measures.
E1-4 - Targets related to climate change mitigation and
adaptation
L&T’s operations are guided by the net zero target throughout the value chain
(Scopes 1, 2 and 3) in such a way that absolute greenhouse gas emissions across
the chain will be reduced by at least 90% by 2045. The target is part of L&T’s envi-
ronmental policy, which has been approved by L&T’s Board of Directors. The target
requires offsetting the remaining emissions after emission reductions through
carbon sinks, climate positive projects or carbon sequestration. The base years for
the target will be set in 2026 in connection with the update of the transition plan.
L&T will set short- and medium-term climate targets in connection with the confir-
mation of the company’s strategy in 2026. No separate stakeholder consultations
have been conducted in connection with the setting of targets.
Annual Report 2025
Report by the Board of Directors Sustainability Report
42
L&T's former Group company issued a EUR 75 million bond linked to the compa-
ny’s sustainability targets in May 2022. The financial characteristics of the bond
are linked to the following targets through interest rate development:
• L&T’s GHG intensity per kilometre driven (gCO2eq/km) will decrease by 37.5%
from the 2018 level by 2027 (2018: 1,590 gCO2eq/km).
• 21% reduction in emissions from transport subcontracting by 2027 compared
to 2020 (2020: 16,881 tCO
2
eq).
In 2025, the terms and conditions of the bond were amended in connection
with the partial demerger and the new terms and conditions will apply from 31
December 2025. As a result of the demerger, the sustainability targets of the
bonds were revised, limiting the baseline values to correspond to the emission
volumes of L&T, which was established in the demerger and to which the obliga-
tions and responsibilities related to the bonds were transferred on 31 December
2025.
The net zero 2045 climate target is aligned with the goal of limiting global
warming to 1.5°C in accordance with the Paris Agreement and the European
Union’s climate targets.
The key decarbonisation levers of the emission targets are described in more
detail in section E1-1, p. 41. The net zero 2045 climate targets take into account
GHG removal or GHG emission mitigation projects as possible measures. In 2025,
L&T had no such initiatives to offset its own emissions. The company does not
apply internal carbon pricing schemes in measures related to its targets. The
results of the previously presented scenario analysis and the expectations of
external stakeholders, which have been surveyed in connection with L&T’s double
materiality assessment process, for example, have been taken into account as
background data for the targets.
Acquisitions, divestments or changes in calculation principles and methods
may affect the recalculation of the emission values for the benchmark years
selected for the climate targets. The long-term climate target and transition plan
were set before L&T demerged from the former Lassila & Tikanoja Group as an
independent listed company and will be updated as necessary in 2026. The emis-
sion calculation principles are presented in section E1-6, p. 44.
E1-5 - Energy consumption and mix
Renewable energy accounted for 31% of total energy consumption. In L&T's oper-
ations, fuels account for 83% of total energy consumption, and the amount of
renewable energy produced by the company itself came to 119 MWh.
In 2025, the energy consumption of L&T’s properties in Finland was 30,600
MWh, of which 78% was emission-free. The origin of the purchased electricity
used by L&T in Finland is certified with guarantees of origin. L&T’s own energy
consumption is disaggregated in the attached table.
Calculation principles
The energy consumption calculation has been made on a carve-out basis for the
period from 1 January to 31 December 2025, and it includes all energy purchased
and produced by L&T, measured in MWh. The end-use of energy includes the fuel
purchased by L&T during the reporting year, renewable electricity produced by
L&T itself and the amount of purchased electricity and heat. The information is
obtained from L&T’s own systems and the energy suppliers’ reporting systems.
The calculation excludes the energy use of leased premises where the use of
electricity or district heat is included in the lease costs and L&T does not have an
agreement with the energy supplier.
Local factors are used to calculate the energy content of different fuels. The
origin of L&T's purchased electricity in Finland is certified with guarantees of
origin. In Sweden, L&T uses multiple electricity suppliers, and the origin of the
purchased electricity depends on the agreement. Purchased electricity is clas-
sified as fossil when the electricity production method is a mixture of nuclear
energy and renewable energy, or contains fossil production. 78% of the energy
purchased by L&T has been certified to be emission-free by means of an agree-
ment or guarantees of origin acquired from the market afterwards.
The energy intensity is calculated on operations in industries that have signifi-
cant climate impacts. Commission Delegated Regulation (EU) 2022/1288 defines
high-impact climate sectors as the NACE sectors listed in Sections A to H and Sec-
tion L of Annex I to Regulation (EC) No 1893/2006 of the European Parliament and
of the Council.
The calculation of L&T's energy intensity is based on the Group's total energy
consumption and total net sales, as the reporting of energy consumption does
not currently enable categorisation according to NACE classification. L&T’s total
net sales amounted to EUR 426.6 million (note 1.2 to the financial statements).
The following table lists, at the two-digit level of detail, the NACE sectors in
which L&T has significant operations:
NACE
Rev.2 classification
Description
C16 Manufacture of wood and of products of wood and
cork except furniture; manufacture of articles of straw
and plaiting materials
C22 Manufacture of rubber and plastic products
E37 Sewerage
E38 Waste collection, treatment and disposal activities;
materials recovery
E39 Remediation activities and other waste management
services
F43 Specialised construction activities
N71 Architectural and engineering activities; technical
testing and analysis
Own energy consumption, MWh
2025
Fuel consumption from coal and coal products
0
Fuel consumption from crude oil and petroleum products
93,850
Fuel consumption from natural gas
0
Fuel consumption from other fossil sources
0
Consumption of purchased or acquired electricity, heat, steam,
or cooling from fossil sources
6,640
Total fossil energy consumption
100,500
Share of fossil energy sources in total energy consumption, %
56
Consumption from nuclear sources
24,000
Share of consumption from nuclear sources in total energy
consumption, %
13
Fuel consumption for renewable sources including biomass
54,990
Consumption of purchased or acquired electricity, heat, steam,
and cooling from renewable sources
190
Consumption of self-generated non-fuel renewable energy
120
Total renewable energy consumption
55,300
Share of renewable sources in total energy consumption, %
31
Total energy consumption
179,800
Aggregate consumption data reporting is based on raw data.
Energy intensity 2025
Total energy consumption from activities in high climate impact
sectors, MWh
179,800
Total energy consumption from activities in high climate impact
sectors per net revenue from activities in high climate impact sectors,
MWh/MEUR
421
Annual Report 2025
Report by the Board of Directors Sustainability Report
43
E1-6 – Gross Scope 1, 2, 3 and Total GHG emissions
In 2025, the emissions of L&T’s own operations amounted to 19,900 tCO
2
eq,
of which 98% was generated by the fuel consumption of the fleet. L&T reports
Scope 2 emissions using the market-based approach, as it better reflects the
company’s choices regarding purchased energy and the emissions arising from
energy production.
The majority of L&T’s total emissions arise in the supply chain (Scope 3),
including the procurement of purchased products and services, fuel consump-
tion by contractors and emissions generated by the final processing of materials.
Scope 3 emissions accounted for 91% of L&T’s total emissions in 2025. L&T did
not carry out any GHG removal during the reporting period, and L&T did not have
any contractual emissions related to purchased energy.
Biogenic emissions arise from the use of bio-based fuel, such as renewable
diesel. For 2025, L&T only reports the biogenic emissions of its own operations.
In 2025, L&T reports emissions data on a carve-out basis for the period 1 Jan-
uary 2025-31 December 2025.
GHG calculation principles
GHG emissions are calculated in accordance with the GHG Protocol and they are
based on the reporting requirements of the GHG Protocol Corporate Standard
and Scope 3. Biogenic CO2 emissions arise from the combustion of biofuels and
organic materials. Scope 1 and Scope 2 biogenic carbon dioxide emissions are
determined in accordance with the fuel classification of Statistics Finland so that
Scope 1 emissions are based directly on the fuel classification and Scope 2 emis-
sions from district heating are derived from emissions factors pursuant to the
same classification.
Financial control has been used as the consolidation method in L&T's GHG
calculations. The report covers the Scope 1 emissions of all of L&T’s produc-
tion plants and vehicles. Scope 2 emissions are reported using both the mar-
ket-based and location-based approaches. Scope 3 emissions are reported for
L&T as a whole. 22% of the calculation of Scope 3 emissions is based on infor-
mation obtained from suppliers.
GHG calculation includes all greenhouse gases covered by the GHG Protocol
(CO
2
, CH
4
, N
2
O, HFCs, PFCs, SF6 and NF3). Emissions have been converted into
carbon dioxide equivalents based on the Global Warming Potential (GWP) factors
of different greenhouse gases, as specified in the IPCC Fifth Assessment Report.
GHG intensity 2025
GHG intensity based on net revenue, Scope 1 and 2 (market-based), tCO
2
eq/MEUR 47
GHG intensity based on net revenue, Scope 1, 2 and 3 (market-based), tCO
2
eq/MEUR 508
GHG intensity based on kilometres driven, Scope 1 and 2 (market-based), tCO
2
eq/km 637
Biogenic CO
2
emissions, tCO
2
2025
Biogenic Scope 1 CO
2
emissions 18,200
Biogenic Scope 2 CO
2
emissions 5,800
Retrospective
Milestones and
target years
GHG emissions
Base
year
2025
%N/N-1
2030 2045
Annual
target
Scope 1 GHG emissions
Gross scope 1 GHG emissions, tCO
2
eq 19,480
Scope 1 GHG emissions from regulated emission trading schemes, % 0
Scope 2 GHG emissions
Gross location-based Scope 2 GHG emissions, tCO
2
eq 2,300
Gross market-based Scope 2 GHG emissions, tCO
2
eq 460
Significant Scope 3 GHG emissions
Total gross indirect (scope 3) GHG emissions, tCO
2
e 196,600
1 Purchased goods and services 53,950
2 Capital goods 1,080
3 Fuel and energy-related activities (not included in Scope 1 or Scope 2) 8,650
4 Upstream transportation and distribution
16,881
(2020) 14,930
6 Business travel 650
7 Employee commuting 1,880
12 End-of-life treatment of sold products 115,500
Total GHG emissions
Total GHG emissions (location-based), tCO
2
eq 218,400
Total GHG emissions (market-based), tCO
2
eq 216,500
The base years for L&T’s Scope 1 and Scope 2 emission reduction targets will be set in connection with the emission reduction targets in 2026. The base year for the Scope 3 category 4 emission
reduction targets is 2020. L&T’s bond is tied to this target.
Aggregate emissions data reporting is based on raw data.
Annual Report 2025
Report by the Board of Directors Sustainability Report
44
GHG intensity based on kilometres driven: an entity-specific metric
established on the basis of the double materiality assessment
GHG intensity based on kilometres driven is a metric that indicates the amount
of GHG emissions generated by the company in relation to the kilometres driven
during its operations. The calculation is based on the principles of the GHG Pro-
tocol and takes into account the emissions of the company’s own operations and
the data on kilometres driven collected by the fleet’s on-board computers. The
metric does not take biogenic emissions into account.
In 2025, L&T’s GHG intensity per kilometre driven was 637 gCO2eq/km. Emis-
sion intensity has decreased due to the electrification of light vehicles and the
increased use of renewable fuels in heavy vehicles. More detailed emissions data
is presented in the tables on page 44.
Carbon handprint: an entity-specific metric established on the basis of
the double materiality assessment
The carbon handprint measures the positive climate impacts of L&T’s ser-
vices. Emission reductions are created when fossil and virgin raw materials are
replaced by renewable and recycled raw materials or when the energy efficiency
of customers’ operations is improved. The calculations take into account the
entire value chain from waste collection to the use of secondary raw material.
Increasing the carbon handprint is a key long-term target for L&T and a metric of
circular economy impact.
In 2025, emissions avoided as a result of L&T’s operations totalled -377.5
tCO
2
eq. Intensity describes the carbon handprint generated by services relative
to the Group’s total net sales. In 2025, L&T’s carbon handprint intensity was -885
tCO
2
eq/EUR million. The decline in the carbon handprint is particularly attribut-
able to the decline in the volume of commercial and municipal waste, which has
reduced the volume of recyclable materials processed by L&T, and to the decline
in the demand for solid recovered fuels. The carbon handprint and carbon hand-
print intensity are reported on a carve-out basis.
Calculation principles
The carbon handprint describes the computational avoided emissions attribut-
able to L&T’s services. L&T’s carbon handprint calculation takes into account
emissions avoided through waste recycling, energy production and blast
cleaning.
For recycled materials, the carbon handprint has been calculated on a mate-
rial-specific basis, and it is based on the degree to which the recycled material
reduces emissions compared to the corresponding production using virgin raw
materials. Data on the weight of materials is obtained from L&T’s own systems.
For waste, the emission data for recycled materials is based on a scientific study
of the emission factors of separately collected waste materials diverted from
disposal. The emission factors are generic, and there is a high degree of uncer-
tainty related to the assumed carbon handprint of recycled materials. The carbon
handprint of products refined by L&T from oil-based waste has been calculated
by L&T’s experts and is based on L&T’s own emissions calculation and emissions
from alternative final treatment.
In energy production, GHG emissions are reduced when fossil fuels are replaced
with biofuels and solid recovered fuels. For fuels, the carbon handprint takes into
account L&T’s solid recovered fuel deliveries and the resulting greenhouse gas
emissions compared to producing the corresponding amount of energy using
fossil fuels. The reference values used in the calculations are primarily based on
coal. The emission factors are based on Statistics Finland’s fuel classification
2025.
Blast cleaning carried out by L&T’s process cleaning services improves the
energy efficiency of power boilers. GHG emissions are reduced when less fuel is
used for producing energy. The calculation is based on a model created by VTT
Technical Research Centre of Finland regarding the effects of cleaning on the
energy efficiency and CO2 emissions of power boilers.
Calculated reductions in emissions have been calculated using the model cre-
ated by VTT for the entire value chain, from the collection of waste to the use of
the secondary raw material or fuel.
Carbon handprint, MCO
2
eq 2025
Material recycling -289.4
Biofuel and recovered fuel deliveries -85.5
Energy efficiency measures -2.6
Total -377.5
Carbon handprint intensity, tCO
2
eq/MEUR -885
Annual Report 2025
Report by the Board of Directors Sustainability Report
45
Summary of Scope 3 calculations
List of Scope 3 categories included in the report Category 1: Purchased goods and services
Category 2: Capital goods (fleet)
Category 3: Indirect emissions from purchased energy (other than Scope 1 and Scope 2)
Category 4: Emissions from subcontracted transport
Category 6: Business travel Category
Category 7: Employee commuting Category
Category 12: Final treatment of materials
List of Scope 3 activities excluded
from the report and the reasons
for their exclusion
Category 5: Waste generated in own operations - excluded
• L&T processes its own waste alongside the waste it processes on behalf of its customers. Their emissions are reported in Scope 3 Category 12. Based on a qualitative assessment,
these emissions are less than 2% of the company’s Scope 3 Category 12 emissions and are therefore not reported on a disaggregated basis.
Category 8: Upstream leased assets – excluded
• Based on a qualitative assessment, this category is not relevant. L&T does not have leased assets that are not yet included in Scope 1 or 2 calculations or other Scope 3 activities.
Category 9: Downstream transportation and distribution – excluded
• Based on a qualitative assessment, this category is not relevant. Due to the current system limitations, it is not possible to make a precise distinction between upstream and down-
stream transportation based on the participation of the transport subcontractor, and therefore emissions related to downstream transport subcontracting are reported in their en-
tirety in scope 3 category 4.
Category 10: Processing of sold products – excluded
• Based on a qualitative assessment, this category is not relevant. L&T primarily produces services. Emissions related to the processing of sold products are estimated
to be minimal (less than 2%) compared to the other Scope 3 categories. Emissions from waste materials sold for recycling are included in the calculations for category 12.
Category 11: Use of sold products – excluded
• According to a quantitative assessment, the emissions during use of products and equipment sold by L&T are less than 1% of the company’s total Scope 3 emissions,
so they have been excluded from the calculation. This estimate is based on the energy consumption of the equipment and the emission factors of electricity production in Finland.
Category 13: Downstream leased assets – excluded
• Based on a qualitative assessment, the category is not relevant, as L&T does not have leased assets that are not yet included in Scope 1 or 2 calculations or other Scope 3 activities.
Category 14: Franchises – excluded
• Based on a qualitative assessment, the category is not relevant, as L&T does not have a franchising chain owned by the company.
Category 15: Investments - excluded
• Based on a qualitative assessment, this category is not relevant. L&T has no emissions related to investments that are not yet included in Scope 1 or 2 calculations or other Scope 3
activities. L&T does not provide financial services.
Annual Report 2025
Report by the Board of Directors Sustainability Report
46
Scope Description of the data types and sources used in calculating emissions Description of the calculation principles, allocation methods and assumptions used in calculating emissions
Scope 1, Direct emissions Activity data (primary data):
• Finland: Fuel data measured in kilogrammes or litres and registered in the Alekstra
(SaaS) reporting system or the supplier’s system
• Sweden: Fuel data measured in kilogrammes or litres collected from the fuel
supplier's invoices
Emission factors (secondary data):
• Finland: Finland: Statistics Finland Fuel Classification 2025
1
• Sweden: Swedish Energy Agency – drivmedel 2024
2
Scope 2, Emissions
from the production
of purchased energy
Activity data (primary data):
• Finland: Energy consumption data measured in kWh and entered in the Enerkey
reporting system (SaaS)
• Sweden: Energy consumption data collected from the energy suppliers' invoices
(kWh)
Emission factors (secondary data):
Market-based, Finland:
• Electricity: L&T’s purchases Guarantees of origin for electricity (Veni)
• District heating: Supplier-specific emission data from the Enerkey reporting system (SaaS)
Market-based, Sweden:
• Electricity: Supplier-specific emission data based on energy supply agreements
• District heating: Supplier-specific emission data collected from the energy supplier
Location-based, Finland:
• Electricity: Motiva
3
• District heating: Motiva
3
Location-based, Sweden:
• Electricity: Swedish Energy Agency
4
• District heating: Energiföretagen Sverige (industry organisation)
5
Annual Report 2025
Report by the Board of Directors Sustainability Report
47
Scope Description of the data types and sources used in calculating emissions Description of the calculation principles, allocation methods and assumptions used in calculating emissions
Upstream Scope 3 emissions
1: Purchased products
and services
Activity data (primary data): Quantities (weight or volume) and amounts (EUR) of purchases
obtained from L&T's procurement data.
Emission factors (secondary data): ENVIMAT 2019 publication (euro-based emission factors
adjusted for annual inflation)
6
The calculation of purchased products and services includes all materials and services that are not included in Scope 1,
2 or other Scope 3 calculations. Emission calculations for products and services are based on purchase data and euro-
based emission factors. The emission factors have been obtained from external publicly available sources (literature)
and adjusted for annual inflation.
Coverage: All activities in Finland and Sweden
2: Capital goods Activity data (primary data): Quantities obtained from L&T procurement data (weight or
volume) and the amount of purchases (EUR)
Emission factors (secondary data): ENVIMAT 2019 publication (euro-based emission factors
adjusted for annual inflation)
6
The calculation of capital goods includes the procurement of production equipment and is based on purchase data and
euro-based emission factors. The calculation includes all fleet-related purchases that are considered to be capital goods.
The emission factors have been obtained from external publicly available sources (literature) and adjusted for annual
inflation.
Coverage: All activities in Finland and Sweden
3: Activities related to fuel
and energy (not included in
Scope 1 or 2)
Activity data (primary data): Fuel and energy consumption data as measured and entered
in suppliers' reporting systems
Emission factors (secondary data): DEFRA 2025: WTT and T&D emission factors for fuels,
electricity and heat
7
Indirect energy emissions (other than Scope 1 and Scope 2) include upstream emissions from energy production and
distribution and WTT emissions for purchased fuels. The emission factors are based on DEFRA's location-based public
data, and the basic data is the amount of fuel/energy purchased during the reporting year.
Coverage: All activities in Finland and Sweden
4: Upstream transportation
and distribution
Activity data (primary data): Fuel consumption data provided by the supplier or, if the data
is not available, the monetary purchase amounts (in euros) from L&T’s procurement system.
Emission factors (secondary data): Statistics Finland Fuel Classification 2025
1
,
7
, Cost Index of Road Transport of Goods
2025
8
The emission calculations of transport and machinery contractors are based on procurement data and estimated fuel
consumption, as well as
actual fuel consumption data provided by contractors. The data is combined with fuel classification data published by
Statistics Finland and the WTT emission data for fuels published by DEFRA.
Coverage: All divisions in Finland. There are no significant purchases related to transport contracting in Sweden
6: Business travel Activity data (primary data): CWT travel agency, monetary purchase amounts obtained from
L&T’s procurement systems (in euros), kilometre allowances entered in L&T’s HR system
Emission factors (secondary data): DEFRA 2025: Passenger car emissions/km
7
The information concerning business travel is based on total emission data for flights and train journeys received from the
travel service provider (travel-based). Emissions generated by taxi journeys are estimated on the basis of taxi travel costs.
All purchases of taxi journeys are compared to the average price per taxi kilometre, supplemented by the WTW emission
factors for passenger car transport per kilometre driven published by DEFRA. Business travel by private car is based on
kilometre allowances paid, combined with the WTW emission factors per kilometre driven provided by DEFRA.
Coverage: All divisions in Finland
Annual Report 2025
Report by the Board of Directors Sustainability Report
48
Scope Description of the data types and sources used in calculating emissions Description of the calculation principles, allocation methods and assumptions used in calculating emissions
7: Employee commuting Activity data (primary data): Employee’s home address, Traficom’s national commuting
survey
9
Emission factors (secondary data): DEFRA 2025: Passenger travel emission data and
WTT emission factors for fuels
7
, Aalto University study: Public transport emissions/km
10
Emissions from commuting are calculated on the basis of the postal code provided by the employee to the employer. The
average commute and form of commuting were assessed on the basis of a national transport survey, which examined the
share of different modes of transport and daily journeys in cities and communities of different sizes. The annual working
days of part-time employees were estimated on the basis of average weekly working hours. The calculation method and
the sources used involve a significant amount of uncertainties, so they can only be used as a very high-level estimate of
the climate impacts of commuting by L&T employees.
Coverage: All activities in Finland and Sweden. For Swedish personnel, commuting emissions were estimated based on
the number of personnel and the calculated average commuting emissions of Finnish personnel. The estimate accounts
for 4% of the total reported commuting emissions.
Downstream Scope 3 emissions
12: End-of-life treatment of sold
products
Activity data (primary data): Waste data from L&T’s ERP system
Recovered fuels directed to co-incineration plants and biowaste are excluded from the cal-
culation, as they function as industrial raw materials. Of the materials directed to recycling,
only hazardous waste (such as WEEE) is included, as there is significant uncertainty about
their recovery as materials. The calculation also includes uncertainties regarding the limita-
tions of material masses.
Emission factors (secondary data): Emission factors reported by the suppliers,
Ecoinvent 3.11, Statistics Finland Fuel Classification 2025
1
, SYKE
11
The end-use of products includes waste fractions delivered to L&T’s partners, mainly for energy incineration, earthworks,
landfill or final disposal. The calculation is based on the provided tonnage data. The emission factors were obtained from
partners or publicly available sources when supplier-specific information was not available. Emissions from waste col-
lection and transport are included in L&T’s own direct emissions, and the processing emissions of external recipients are
not taken into account. The further processing of materials is excluded from the calculation. Recovered fuels directed to
co-incineration plants and biowaste are excluded from the calculation, as they function as industrial raw materials. Of the
materials directed to recycling, only hazardous waste is included, as there is significant uncertainty about their recovery
as materials. The calculation also includes uncertainties regarding the limitations of material masses.
Coverage: All operations in Finland and Sweden.
Sources:
1) Statistics Finland: Fuel Classification 2025, https://stat.fi/tup/khkinv/khkaasut_polttoaineluokitus.html
2)Swedish Energy Agency, https://www.energimyndigheten.se/statistik/ovrig-energistatistik/statistik-om-biobranslen-och-drivmedel/
3) Motiva, https://www.motiva.fi/ratkaisut/energiankaytto_suomessa/co2-paastokertoimet
4) Swedish Energy Agency, https://www.energimyndigheten.se/klimat/hallbarhetskriterier/fragor-och-svar-om-hallbarhetskriterier/
5) Energiföretagen, https://www.energiforetagen.se/statistik/fjarrvarmestatistik/miljovardering-av-fjarrvarme/
6) Finnish Environment Institute: The carbon footprint and natural resource usage of public procurement and household consumption, http://hdl.handle.net/10138/300737
7) DEFRA (2025) , https://www.gov.uk/government/publications/greenhouse-gas-reporting-conversion-factors-2025
9) Traficom: Henkilöliikennetutkimus 2021, https://www.traficom.fi/fi/julkaisut/henkiloliikennetutkimus-2021-suomalaisten-liikkuminen
10) Sree Manikanta Kumar Kanujula Kanujula (2022) Carbon Emission Estimator for Public Transportation in Finland. Aalto University, https://urn.fi/URN:NBN:fi:aalto-202301291841
11) Finnish Environment Institute (SYKE) Y-Hiilari, https://www.syke.fi/fi/ymparistotieto/laskurit-ja-tyokalut#y-hiilari-%E2%80%93-hiilijalanj%C3%A4ljen-laskentaan-yrityksille
Annual Report 2025
Report by the Board of Directors Sustainability Report
49
E5-1 - Policies related to resource use
L&T’s activities, material impacts, risks and opportunities related to resource use
and the circular economy are managed by means of L&T's business strategy,
Environmental Policy, obligations laid down in environmental permits, and internal
operating instructions and certifications.
The purpose of L&T's operations is to provide circular economy solutions to
mitigate climate change and biodiversity loss. With our services, we promote the
adequacy of critical raw materials by replacing virgin and fossil natural resources
with recycled raw materials. With its business solutions, L&T wants to unleash
the full potential of the circular economy and help its customers in their sustain-
ability work. L&T implements this strategic intent in its strategy 2026–2028 by
investing in new technologies and solutions to increase the value added of mate-
rials.
Environmental Policy
L&T’s Environmental Policy describes the key targets and key objectives related
to resource use and the circular economy, which the company follows in its busi-
ness operations with regard to its own operations and the value chain. The Envi-
ronmental Policy applies to all of L&T's business operations in all operating coun-
tries. The Environmental Policy is public and it has been approved by the Board of
Directors.
L&T’s environmental policy does not include policies concerning the process of
monitoring targets. The company monitors the development of significant non-fi-
nancial targets at the quarterly, half-yearly or yearly level.
L&T’s Environmental Policy does not address the transition away from the use
of primary resources, but it takes into account the increased use of secondary
resources in the value chain. In its Environmental Policy, the company commits
to promoting the sustainable use of natural resources by preventing waste, man-
aging the recovery of materials to be recycled and reused and by replacing fossil
fuels with bio-based and recycled raw materials.
L&T’s circular economy-related targets and environmental policy principles are
put into action through circular economy services and solutions offered to cus-
tomers. The implementation is the responsibility of the business units with the
support of the strategy, EHSQ and sustainability functions. Recycling and waste
management services, circular economy-related consulting and environmental
construction are among the company’s core businesses, which include separate
commercial business unit and division-specific targets in addition to Group-level
targets.
economy is based on L&T’s ISO 9001 and ISO 14001-certified management sys-
tems. All of L&T's operations are certified and meet the requirements of the ISO
9001 and ISO 14001 standards, the administration of which is the responsibility
of the Group’s Senior Vice President in charge of risk management.
L&T’s Senior Vice President, Public Affairs and Sustainability, is in charge of the
environmental policy. L&T's business lines and units are responsible for the imple-
mentation of the Policy and the allocation of the necessary resources in their
respective operations. Stakeholders have not been separately consulted in con-
nection with the preparation of the Environmental Policy. The principles of the
Environmental Policy are reviewed regularly, at two-year intervals.
E5-2 – Actions and resources related to resource use
and circular economy
L&T promotes the sustainable use of natural resources by preventing waste, man-
aging the recovery of materials to be recycled and reused and by replacing fossil
fuels with bio-based and recycled raw materials. The company also strives to pro-
mote the preconditions of the circular economy in its operating environment. L&T
promotes the implementation of the principles of circular economy in its services,
and its strategic target is to increase the recycling rate of the materials it collects
and processes. The monitoring of the recycling rate is presented in more detail in
section E5-3, p. 51.
L&T influences the operating conditions of the circular economy among its
customers and the end-users of secondary raw materials. L&T takes care of the
collection of waste from customer sites and directs the material flows it collects
for treatment in accordance with the priority order of the waste hierarchy. The
company provides the pre-treatment of materials received from customers as
a service, and the company has recycling plants of its own where recycled raw
materials are produced for industrial use from the materials collected from cus-
tomers. Waste fractions for which L&T does not have its own processing facilities
are forwarded to partners that have an environmental permit and the expertise
required for processing the waste fraction in question.
Resources inflows and outflows directly related to L&T’s own operations are rel-
atively minimal. Examples of such inflows include products and equipment pur-
chased by L&T, while the outflows directly related to L&T's own operations include
the company’s own waste flows.
L&T’s measures to achieve the targets and objectives are related to the preven-
tion and reuse of waste, preparation for reuse, recycling, other recovery, and dis-
posal in accordance with the EU's waste hierarchy. L&T’s inflows and outflows are
presented on page 52.
The company’s recycling facilities are geographically located in Finland, where
there is comprehensive environmental legislation and the operations are subject
to site-specific environmental permits. The environmental permit process includes
consultation of stakeholders. Any environmental incidents caused by the oper-
ations are addressed together with the Finnish environmental authorities, and
the authorities approve the remedies for potential environmental incidents. L&T
monitors its disposal sites after the closure of each site, and the company has
recognised the necessary provisions in its financial accounts for potential future
remedies.
L&T’s business model and operations are founded on promoting the circular
economy. In 2025, L&T implemented the following measures (reported on a
carve-out basis in accordance with ESRS 2 BP-1, p. 10) or is planning the following
measures to achieve the targets and objectives of the aforementioned policies
related to resource use and the circular economy:
Preventing the generation of waste
L&T supports and consults its corporate customers on waste prevention. The com-
pany’s comprehensive customer reporting tools provide customers with visibility
into the waste streams generated in their operations, enabling the customer to
take measures to reduce the generation of waste. A total of 340 customers were
supported in waste prevention and source separation during 2025.
Preparation for reuse
L&T engages in reuse business activities that involve repairing damaged pallets
and returning them to use. In 2025, L&T expanded its pallet repair business when
the competition authorities approved the acquisition of Stena Recycling’s pallet
repair business. In the coming strategy period, L&T will seek growth in the reuse
business, invest in the service development of packaging and transport platforms
and investigate new processing solutions and technologies.
Recycling
With its expert services, L&T supports and develops its customers’ sorting at
source and other circular economy-related upstream activities in the value chain
in order to direct customers’ waste and side streams to recycling. L&T forwards
separately collected waste fractions from customers to be utilised with the
highest possible degree of processing.
In 2025, L&T organised several training activities, customer events and webi-
nars related to the development of the circular economy and the correct sorting
of different waste fractions. The company engaged in active dialogue with cor-
porate customers and partners on the technological choices and opportunities
related to the recycling of plastic packaging. In 2026, the company will continue
its work with customers to improve the efficiency of separate collection.
L&T has its own waste pre-treatment facilities that process different waste
fractions, such as fibres, wood waste, glass and metals, and treatment plants that
produce secondary raw materials, such as plastic granulates.
In 2025, the company had ongoing several research and development projects
seeking to increase the degree of processing of materials and increasing reuse
and recycling. In addition to investments in the pallet business, the company had
ongoing projects to develop recycling solutions for wood, and the company has
investigated the use of recycled wood in the production of biochar. The company
will continue the development projects in 2026.
E5 Resource use and circular economy
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The separate collection of packaging plastics has developed positively in 2025,
and the company has developed its mechanical recycling process and investigated
the possibilities of chemical recycling. In 2025, the company decided to expand its
plastics recycling business in Merikarvia by leasing an industrial property located
in Tuorila from the municipality of Merikarvia and acquiring equipment for plastics
processing from the bankruptcy estate of the company that had previously oper-
ated there. In the upcoming strategy period, the company intends to increase its
plastic recycling capacity and develop its plastic pretreatment process.
Contaminated soil masses at customer sites are cleaned in the environmental
construction business. The soil masses are processed at the customer site or
transported to L&T’s treatment centres for processing. After cleaning, the soil
masses are returned to the site, used in earthworks at another site or disposed
of. The company aims to maximise the use of recycled materials in environmental
construction.
The company has also expanded its service offering in water treatment solu-
tions to remove harmful substances from various types of contaminated water.
During the strategy period, L&T will invest in scaling mobile water solutions and
offering new water treatment solutions to industry.
A research project is also underway to find solutions for the treatment and
recycling of waste containing PFASs.
L&T’s own sites have comprehensive sorting opportunities for waste fractions
generated in the company's own operations, and the fractions are recycled in
accordance with the priority order of the waste hierarchy. The amount of material
flows related to L&T’s own operations is very small compared to the customer
material flows handled by the company.
Other recovery
L&T produces recycled fuel from customers’ non-recyclable waste materials to
replace fossil fuels in, e.g. district heat production. During the strategy period, L&T
will prepare for changes in the incineration market and legislation by increasingly
efficiently directing energy-recovered fractions to recycling.
L&T received approval for the end of waste classification in its hazardous waste
productisation project in 2025. Going forward, the L&T Tehomix product will
enable the refinement and recycling of a number of solid hazardous wastes in a
new way. In the coming years, L&T will continue to develop and expand its refine-
ment process.
Disposal
The company has its own disposal sites for soil masses and fractions that cannot
be safely reused or recycled. A new final disposal site was completed at the
Munaistenmetsä processing centre in Uusikaupunki in 2025. Another expansion
of a disposal site is also under construction in Pori’s Kipsikorpi, which is expected
to be completed in 2026–2027.
E5-3 – Targets related to resource use and circular
economy
L&T monitors the recycling rates of the materials processed by the company and
sets short- and medium-term targets for recycling rates as part of its strategic
targets and a longer-term target as part of its Environmental Policy. In its environ-
mental policy, L&T has set a target of increasing the recycling rate of the mate-
rials processed by the company to 70% by 2030. The target applies in particular
to separately collected and sorted waste fractions. L&T’s Board of Directors sets
the short- and long-term goals. The recycling rate is the weight-based sum of
the recycling rates of materials collected and processed by L&T’s customers’.
L&T reports the recycling rate of all materials it processes, both separately col-
lected and sorted waste. The latter includes municipal waste collected from
L&T's corporate customers, hazardous waste, industrial waste and construction
waste in Finland. It also includes materials that cannot be recycled, such as haz-
ardous waste containing PFAS compounds. The calculation of the recycling rate
of separately collected and sorted fractions does not take into account industrial
side streams and contaminated soil received by environmental construction and
sludge generated from process cleaning and sewer maintenance.
The recycling rate is related to resource outflows. The development of the
recycling rate ultimately depends on the recycling and material choices made by
L&T’s customers and the industries they operate in. L&T’s goal is to provide cus-
tomers with the opportunity to process different waste fractions in accordance
with the highest possible level of the waste hierarchy. The final decision on the
processing of each waste fraction is always made by the customer. The industries
of L&T’s customers also differ in the waste fractions generated by the business
activities. For example, the commerce sector achieves a higher recycling rate
than the construction industry due to the different nature of the business and the
associated material flows. There are still several waste fractions that cannot be
recycled safely, and some hazardous waste is processed at an incineration plant
that is authorised to process hazardous waste.
Developing the recycling rate of separately collected and sorted waste frac-
tions supports L&T’s policy of promoting the circular economy and recycling by
increasing the proportion of secondary raw materials used in the value chain. The
recycling target is related to the “recycling” section of the order of priority laid
down in the waste hierarchy. L&T also encourages and supports its customers to
set a recycling rate target for their waste.
In 2025, the carve-out-based recycling rate of L&T’s separately collected
and sorted waste fractions was 61.8%. The recycling rate was influenced by a
decrease in the volume of materials directed to incineration and an increase in
the volume of municipal waste directed to recycling.
The carve-out-based recycling rate of all materials received by L&T was 49.8%.
The tonnage of contaminated soil masses handled by L&T’s environmental con-
struction project business varies significantly from year to year, depending on the
number and profile of project sites. The tonnage of contaminated soil masses is
substantially larger in magnitude than other material recycling streams, such as
plastic, wood or fibre material streams, and therefore, they significantly affect the
overall recycling rate.
E5-4 - Resource inflows
L&T is a service company that collects, processes and refines various types of
received from corporate customers at its premises. Examples of such waste and
raw materials include plastic, wood, glass, cardboard and paper, as well as haz-
ardous waste, such as oil and treated wastewater. Products produced by L&T are
recycled plastic granulates, recovered fuels, recycled products processed from
hazardous waste and reusable pallets. L&T also receives industrial ash, which it
uses in its own operations in the stabilisation of soluble waste to replace cement.
Stabilisation processes the soluble properties of waste so that the waste can be
placed in the final disposal area.
The procurement of biological materials required for service production and
products is low, and the procurement of renewable fuels is described in section
E1-3, p. 42. The technical materials used for the production of products and ser-
vices are related to transport equipment and collection containers. L&T has its
own repair operations for these products used in service production and the life
cycle of the products is kept as long as possible. The total weight of the technical
materials and biological materials used for products during the reporting period
has not been estimated as material in L&T’s double materiality analysis.
As L&T is a recycling and waste management operator, some of the cus-
tomers’ waste streams could also be defined as resource inflows. To avoid double
counting, L&T addresses all flows in section E5-5, p. 51.
Inflows of materials directly related to L&T’s own operations are low. An
example of such an inflow are the products acquired by L&T, which the company
uses to produce its services.
Packaging or packaging waste is not material for L&T’s own operations.
E5-5 - Resource outflows
As a recycling and waste management operator, L&T collects and processes sig-
nificant amounts of various waste materials and soil masses from its customers.
Waste materials and soil masses are processed, recycled or forwarded as they
are for further use by the same customer or a different customer.
The significant material flows forwarded to reuse and recycling consisted
mainly of municipal waste collected from corporate customers, such as plastic,
paper, cardboard and biowaste, hazardous waste sorted at source, industrial
waste and construction waste in Finland. In addition, L&T produces solid recov-
ered fuel and forwards waste to incineration. The disposal of waste mainly takes
place in disposal sites owned by L&T. The waste streams processed by L&T are
affected by the industries in which the company’s customers operate and the
development of their business.
L&T is a producer of recycled raw materials. The company’s plastics refinery in
Merikarvia produces plastic granulates from customers’ plastic waste, which can
be used to manufacture new plastic products. The company recycles hazardous
waste, such as glycol and waste oil, for reuse.
The total amounts of waste collected and received by L&T are shown by pro-
cessing method in the table on p. 53.
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Waste-to-
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Virgin raw material entering the cycle
Harmful materials exiting the cycle
Sorting and treatment at the source
Infrastructure for sorting and treatment
at customer sites
Collection
Nationwide presence with well-invested infrastructure
Sorting and recovery
Intermediate storing and sorting of fractions for treatment
Treatment and processing
Treatment capabilities across segments and
for various waste types
Customer processes
Integration to customer processes with long-standing
relationships and broad waste access
Reporting and advising
Industry leading reporting and client advisory
Recycling and utilisation
Recycling and re-use as secondary
raw materials and products
Harmful materials removed from circulation
L&T provides circular economy solutions
for all stages of the value chain
Annual Report 2025
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Calculation principles
The reporting of data on waste and materials includes waste and materials col-
lected from L&T's customers and the waste generated at L&T's own sites. The
data is obtained from L&T’s own ERP systems. The amounts indicated in tonnes in
the reporting are based on either the actual weighed weight or assumed weights
based on container-specific average weight measurements. Waste quantities are
stated inclusive of moisture.
In determining the waste treatment method, information received from the
recipients of the materials on the waste treatment method or waste fraction-spe-
cific assumptions on the waste treatment method are used to the extent that
supplier-specific information is not available. It is estimated that there are no sig-
nificant differences between the assumed and actual treatment methods at the
level of Group reporting.
Waste and material flows managed by Lassila & Tikanoja in 2025
1,000 kg Non-hazardous waste Hazardous waste Total
1
Waste and material flows 902,000 164,000 1,066,000
Materials redirected from disposal 742,700 52,200 795,000
Preparation for reuse 44,600 0 44,600
Recycling 447,000 40,000 487,000
Other recovery 251,100 12,300 263,400
Materials directed to disposal 159,200 111,900 271,000
Incineration 1,690 16,700 18,400
Landfill disposal 155,500 91,400 247,000
Other disposal 2,000 3,700 5,700
Non-recycled waste 410,300 124 100 534,500
Non-recycled waste, % 45 76 50
1
The figures in the column are based on data that has not been rounded
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SBM-3 - Impacts, risks and opportunities from the
perspective of the strategy and business model
In its double materiality assessment, L&T has identified and assessed the impacts,
risks and opportunities related to its own workforce with reference to the sub-
topics and sub-sub-topics of the European Sustainability Reporting Standards. The
identified material impacts, risks and opportunities included employment security,
working time, adequate wages, freedom of association, the existence of works
councils and the information, consultation and participation rights of workers, social
dialogue, collective bargaining, work-life balance, health and safety, gender equality
and equal pay for work of equal value, training and skills development, measures
against violence and harassment in the workplace, and diversity. A description of
the material impacts, risks and opportunities is presented in the ESRS 2 section, in
L&T operates in the service sector and is a significant employer. With this in mind,
the well-being of its personnel is a key success factor and asset for the company's
business. One of L&T’s strategic priorities is to attract the industry's best profes-
sionals from the employment sector. Personnel’s decreased well-being or motiva-
tion can impair the company’s business, as L&T’s services and the customer expe-
rience it provides are created through interactions with motivated and competent
employees. For a company that operates in the service sector, the availability of
personnel is a key factor that can either enable or limit the growth of the business.
In the competition for suitable employees, a sustainable personnel policy and sus-
tainable operating practices are very important. The company engages in contin-
uous and diverse dialogue with its personnel.
The company's goal is to ensure that L&T’s personnel have the right competence,
and that the amount, quality and retention of personnel are at a level required for
profitable operations. The work community is diverse and equal, the personnel’s
work ability and ability to function are maintained throughout their working life. In
addition, the members of the personnel are encouraged and motivated to perform
at a high level so that the company’s goals can be achieved.
In this Sustainability Report, L&T’s own workforce covers employees and
non-employee workers. Employees refer to persons employed by an L&T company
in Finland or Sweden. Non-employees are workers who work for L&T companies as
temporary workers or self-employed persons. The definition of own workforce does
not include subcontractors.
L&T strives to provide its personnel with an excellent employee experience, a
safe and healthy work community, high-quality management and opportunities to
-
icies, activities and geographical location into account, the potential negative
impacts on the personnel are not widespread or systemic.
L&T’s personnel responsibility perspectives are in line with national laws, agree-
ments and other obligations. We respect human rights as defined by the Universal
Declaration of Human Rights and workers’ rights as defined by the International
Labour Organization (ILO). In addition, we comply with international conventions
and the UN Guiding Principles on Business and Human Rights. We are also com-
mitted to supporting the UN Global Compact initiative and its principles pertaining
to human rights and labour.
L&T has more than 2,200 employees in Finland and Sweden. The largest groups
of employees are drivers. The company also has employees in
various roles in sales, customer service, financial management, communications,
IT and HR, service production and other expert roles. L&T uses temporary workers
and subcontractors in some of its business operations, especially in annual main-
tenance work in process cleaning. Temporary workers are trained for their duties
in the same way as employees, and they are covered by L&T’s occupational safety
systems.
L&T has assessed potential negative impacts on the company's various per-
sonnel groups. L&T has recognised that young summer workers could be at greater
risk in terms of occupational safety than other personnel groups if the induction
training of young seasonal workers is not carried out as required by the company’s
occupational safety guidelines.
L&T operates in Finland and Sweden, where the legal requirements related to
working conditions, such as reasonable working hours, occupational safety, annual
holiday, parental leave and part-time work, are at a high level. All employees in both
operating countries have the right to belong to, or not belong to, a trade union.
L&T does not operate in countries where the risk of forced labour or child labour is
high. However, the company actively monitors incidents in different industries and
actively updates its risk assessments.
In Finland and Sweden, legislation, collective agreements and the supervisory
activities of the authorities establish minimum requirements for occupational
safety and health. Potential negative impacts related to working conditions could,
if realised, weaken employees’ physical and mental work ability and worsen their
financial position. L&T could also face legal and/or financial consequences. Should
they materialise, such impacts could have a detrimental effect on the employer's
reputation. This, in turn, would reduce labour availability and increase personnel
turnover. The impacts are managed by means of standardised processes and con-
tract templates, as well as regular supervisor training. Employment contracts are
always concluded in writing.
Through its membership in industry organisations, L&T also demonstrates its com-
mitment to the applicable collective agreements and ensures that the employer
has access to the latest interpretations on the application of collective agreements.
L&T monitors compliance with collective agreements, environmental legislation,
labour law, occupational safety legislation, and regulations pertaining to financial
management. L&T also complies with the applicable local legislation governing
contractors’ obligations and liability, and requires the same of its suppliers. L&T’s
S1 Own workforce
Code of Conduct emphasises fair and equal treatment and respect for the human
dignity, privacy and rights of each individual. Supervisor training, support for super-
visors, and measures such as the monitoring of working hours ensure that super-
visors act in accordance with the applicable rules and guidelines and know how to
support the personnel in urgent situations.
As a service industry company, L&T is dependent on its own personnel resources.
A description of the material impacts, opportunities and dependencies related to
has been identified in accordance with the double materiality analysis process pre-
sented on page 24.
S1-1 - Policies related to own workforce
L&T’s actions, impacts and risk management related to the company's own work-
force are guided by the public Code of Conduct, business strategy, HR Policy,
Human Rights Policy, Occupational Safety Policy and various guidelines. The princi-
ples and policies apply to all business operations in all operating countries.
Code of Conduct
L&T's Code of Conduct sets expectations for sustainable and ethical conduct by
L&T's personnel. The Code of Conduct calls for compliance with laws, rules and reg-
ulations, integrity and transparency, respect for human rights and colleagues, and
safety at work, among other things. The Code of Conduct is approved by the com-
pany’s Board of Directors and updated at two-year intervals. The Code of Conduct
applies to L&T Group. The company has a separate Supplier Code of Conduct for
the supply chain. The Senior Vice President, HR and Legal, is in charge of the imple-
mentation of the Code of Conduct, and the Group Executive Board monitors com-
pliance with it. The Code of Conduct for personnel is available on L&T’s website and
intranet, as well as on the notice boards of the company's operating locations. The
Code of Conduct has been the subject of dialogue with employee representatives
when L&T was part of the former Lassila & Tikanoja Group.
HR Policy
Objectives related to L&T's own workforce are guided by the Group's HR Policy. In
the HR Policy, L&T commits to compliance with national legislation, collective labour
agreements, internationally recognised human rights, and the core principles of the
International Labour Organization (ILO). The Policy lays down L&T’s commitment to
equality and to combating the use of child labour and all forms of discrimination.
The HR Policy is updated on a regular basis at two-year intervals. The Senior Vice
President, HR and Legal, is in charge of its implementation together with the HR
organisation. The HR Policy is put into action as part of the Group's personnel man-
agement processes. The HR Policy has been discussed with the company’s shop
stewards before its entry into force.
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Human Rights Policy
L&T’s Human Rights Policy aims to influence the company’s potential direct or
indirect human rights impacts concerning its personnel, supply chain and cus-
tomers. In the Human Rights Policy, L&T commits to respecting human rights as
defined by the Universal Declaration of Human Rights, workers’ rights as defined
by the International Labour Organization (ILO), the OECD Guidelines and the UN
Guiding Principles on Business and Human Rights. The HR Policy describes the
company's commitment to supporting the UN Global Compact initiative and its
principles concerning human rights and labour rights, and to complying with
national laws, agreements and other obligations.
L&T does not, under any circumstances, tolerate trafficking in human beings,
forced labour, the use of child labour in violation of children’s rights, or modern
slavery in its own operations or in the activities of its supply chain. The Human
Rights Policy also establishes zero tolerance for all forms of inappropriate
behaviour, harassment and discrimination in our own operations and in our supply
chain. At L&T, no one is discriminated against on the basis of gender, pregnancy,
childbirth, gender identity, gender expression, age, ethnicity, nationality, language,
religion, ideology, opinion, political activities, union activities, family relations,
health, disability, sexual orientation or any other reason pertaining to an individual.
Race, ethnic origin, skin colour and national or social origin are also prohibited
grounds for discrimination.
The Human Rights Policy has been approved by the company’s Board of Direc-
tors, and L&T’s senior management is committed to respecting and promoting
human rights. The Human Rights Policy has been discussed with the compa-
ny’s shop stewards when L&T was part of the former Lassila & Tikanoja Group.
Responsibility for the Human Rights Policy lies with the Group’s Senior Vice
President, HR and Legal, and it is implemented as part of the company's HR pro-
cesses. The Policy covers all L&T Group companies and divisions in all operating
countries, and it applies to the entire personnel. The Policy is updated at two-year
intervals. The company does not have a separate compensation mechanism for
human rights violations. Instead, L&T complies with Finnish and Swedish legisla-
tion with regard to any compensation.
Occupational Safety Policy
L&T's Occupational Safety Policy covers both the Group's own operations and the
company's supplier network. The Policy describes the key occupational safety
goals, responsibilities and organisation, as well as our commitment to com-
plying with legislation and regulatory requirements concerning our operations.
The Occupational Safety Policy is the responsibility of the Senior Vice President,
HR and Legal, who puts the Policy into action together with the occupational
safety organisation. The goal of L&T's occupational safety activities is to guar-
antee a safe workplace for all personnel. The company is committed to the idea
of zero accidents and believes that all accidents can be prevented. In the event
of any action or conduct in violation of the applicable legislation, orders issued
by the authorities or instructions, the company takes immediate action in accor-
dance with mutually agreed rules. L&T's Occupational Safety Policy is discussed
together with the Group’s shop stewards, it has been approved by the Board of
Directors, and it is updated at two-year intervals.
Guidelines and plans
L&T’s policies are supplemented by division-specific and country-specific
guidelines and plans, which apply only to employees as a rule. In Finland,
the company has drawn up guidelines on the prevention of inappropriate
behaviour, harassment and discrimination that apply to the entire per-
sonnel, as well as an occupational health and safety action plan, an occu-
pational health care action plan, and a substance abuse programme. L&T
also prepares division-specific equality and non-discrimination plans in
Finland, as well as wage surveys in accordance with the Equality Act. The
company has a process for conducting target-setting and development
discussions. In addition, L&T has an EHSQ manual that contains the com-
pany’s operating instructions related to occupational health and safety,
among other things. The purpose of the manual is to make it easier to find
information and to ensure that all information is up to date. The information
in the manual is reviewed at least once a year or whenever the operating
models in the area in question are updated.
In Sweden, the process cleaning business has its own non-discrimina-
tion guidelines, substance abuse policy, operating guidelines and occupa-
tional safety guidelines.
S1-2 - Engaging with own workers and their
representatives
L&T's own workforce constitutes one of the company's most important
stakeholders. L&T engages in diverse and close engagement with the
company's own workers and their representatives. The company primarily
engages with its own workers at the local level, in the units and teams,
between the personnel, personnel representatives and supervisors. The
primary methods of engagement include the company’s intranet and
notice boards, internal newsletters, personnel briefings, strategy days and
other events, supervisor communications, target-setting and development
discussions, and, in Finland, the activities of L&T Finland's Group Cooper-
ation Forum and industry-specific dialogue in accordance with the Act on
Co-operation within Undertakings.
Planning the process of engaging with the company’s own workers and
their representatives is the responsibility of the Senior Vice President, HR
and Legal, and the plan is prepared in close cooperation with communi-
cations experts. In addition to the Senior Vice President, HR and Legal,
engagement with workers' representatives in Finland is the responsibility
of the Senior Vice Presidents in charge of each division, who are members
of the Group Executive Board; the employee relations team, which works
under the Senior Vice President, HR and Legal; and the occupational
safety team, which includes the occupational safety manager. In Sweden,
engagement with workers and their representatives is the responsibility of
the HR Manager for Sweden.
In Finland, engagement with workers' representatives on actual and
potential material impacts on the company’s own workforce takes place in
quarterly dialogue pursuant to the Act on Co-operation within Undertak-
ings, in change negotiations pursuant to the Act on Co-operation within Under-
takings, in the twice-yearly meetings of the Finnish Group Co-operation Forum, or
in the quarterly meetings of occupational safety and health committees.
The meetings are organised at the Group level, legal entity level or unit level,
depending on the topic and forum. For personnel groups that do not have a rep-
resentative, direct engagement with the employees belonging to the personnel
group in question is used instead.
Each L&T company also has its own occupational safety and health committee.
The occupational safety and health committees discuss themes related to occu-
pational safety and health in particular. Each committee convenes in accordance
with the legally required meeting schedule.
L&T engages in dialogue with internal and external stakeholders on the promo-
tion of human rights. Employee representatives in Finland and Sweden have been
consulted in drawing up L&T’s Human Rights Policy.
Fiilinki personnel survey
All of L&T's personnel have the opportunity to give feedback on themes related
to their work and management through the annual Fiilinki personnel satisfaction
be completed in Finnish, Swedish, English, Estonian and Russian. The survey is
anonymous.
S1-3 - Processes to remediate negative impacts and
channels for L&T's own workforce to raise concerns
L&T aims for an organisational culture in which everyone can speak up if they
suspect or observe any violations of the law or L&T’s policies and instructions.
The personnel are encouraged to report any grievances they observe and
potential violations related to L&T’s activities. Grievances and incidents can be
reported to one's direct supervisor or by using the whistleblowing channel, which
runs on the technical platform of an external service provider. In addition, all
reported incidents of harassment are recorded in a separate electronic harass-
ment reporting system in Finland and Sweden.
Suspected incidents of misconduct can be reported anonymously via the whis-
tleblowing channel. Instructions concerning the whistleblowing channel and
guidelines for the prevention of harassment, discrimination and inappropriate
behaviour are available to all of the company's personnel on the intranet. The
instructions concerning the whistleblowing channel are also available on the
company's external website. Updates to the instructions concerning the whis-
tleblowing channel are discussed in dialogue with employee representatives, and
the representatives have the opportunity to ask questions and comment on any
planned changes.
Employee representatives and employees also have the opportunity to raise
concerns to the management in regular dialogue meetings and other formal and
informal discussions with management. The annual personnel satisfaction survey
also provides the opportunity to anonymously raise concerns through answers
given to open-ended questions.
All violations and suspicions of inappropriate conduct that L&T becomes aware
Annual Report 2025
56
Report by the Board of Directors Sustainability Report
of are appropriately investigated. Reports of suspected misconduct received
via the whistleblowing channel are handled confidentially by the Legal Affairs
department, by a separately designated individual holding a Master's degree in
law. Reports of suspected misconduct are reviewed by the Compliance team and
with the President and CEO, and reported to the Audit Committee of the Board of
Directors. L&T decides on any further measures, takes corrective measures and
issues instructions, if necessary, and monitors their effectiveness by the persons
responsible for the matter.
Persons belonging to L&T’s own workforce who may be subject to potential
negative impacts can use the channels at the level of the company in which they
are employed or have been hired to work. The whistleblowing channel can also
be used to report suspected misconduct concerning operations carried out by
another L&T Group company.
L&T prohibits retaliation against any person who submits a whistleblower report
in good faith, and it takes disciplinary action against anyone found to have been
guilty of retaliation. This is separately mentioned in the instructions concerning
the whistleblowing channel and in the company’s Human Rights Policy and
Anti-corruption and Anti-bribery Policy.
Third-party mechanisms, such as those maintained by the state, NGOs,
industry associations and other co-operation initiatives to raise concerns, are
available to all members of the company's own workforce and their represen-
tatives. L&T does not prevent the use of such mechanisms unless the matter
concerns a trade secret, for example, in which case the requirement for non-dis-
closure could restrict the use of such mechanisms. L&T regularly monitors any
complaints made regarding the company through the OECD National Contact
Point and reports of suspected misconduct received in the OECD database.
L&T Group has a grievance mechanism for processing employee-related mat-
S1-4 - Taking action on material impacts on own
workforce, and approaches to mitigating material risks
and pursuing material opportunities related to own
workforce, and effectiveness of those actions
The material aspects related to L&T's own workforce include increasing employee
satisfaction, strengthening the work ability of the personnel, developing diversity
and improving occupational safety. The Employee Net Promoter Score (eNPS) is
one of the key metrics of social responsibility for L&T. The Board of Directors sets
the target level for the strategy period. The most significant impacts related to
the company's own workforce in L&T's business environment concern occupa-
tional safety. The company also strives to maintain a non-discriminatory, harass-
ment-free and equal workplace.
The company’s impacts and opportunities related to its own workforce are
L&T is a diverse work community that accepts and respects differences. At L&T,
we believe that our extensive diversity work strengthens the employee experi-
ence of everyone at L&T. We develop the culture and operating practices so that
everyone finds it easy to join L&T and to enjoy being part of the work community.
L&T prevents discrimination and inappropriate behaviour, and it builds an equal
work community by various means, including processes, wages that are in line
with the applicable collective agreements, job classification based on how
demanding each role is, and provision of guidance and training to the personnel,
and to supervisors in particular.
Atypical employment relationships, such as part-time and fixed-term employ-
ment relationships may pose particular human rights risks from the perspective of
adequate wages and working hours. The use of such employment relationships at
L&T is always based on legislation, the nature of the business and customer needs.
Development of job satisfaction and strengthening the work ability of
the personnel
Employees with a high level of work ability and well-being are L&T's most
important asset and one of its key success factors. Well-being encompasses
physical, mental and social well-being. The work performed by L&T’s employees is
primarily physically strenuous, but mental resources are also significant. The com-
pany helps its personnel find their own way of looking after their well-being. As
an employer, L&T also constantly looks for ways to develop work and the working
environment to support work ability.
One of L&T's targets for work ability management is to reduce sickness-related
absences. The targets for the strategy period will be confirmed by the Board
of Directors in 2026. Reducing sickness-related absences requires purposeful
actions to promote healthy and safe working conditions.
Among L&T's operating countries, occupational health care is a statutory right in
Finland. The company provides its personnel with preventive and statutory occu-
pational health care and medical care through its occupational health provider. The
company also complements its occupational health care services with the com-
pany's sickness fund in Finland. During the reporting period, occupational health
services covered all of the Group’s personnel in Finland. Leased employees are
covered by statutory occupational health care through their respective employers.
In Sweden, the personnel are covered by the national health care system.
In co-operation with the occupational health provider, the company promotes
musculoskeletal health and prevents prolonged symptoms, expedites the start of
rehabilitation, and influences working methods and working conditions. Measures
related to ergonomics and work arrangements are implemented according to
local and job-specific needs.
Mental well-being is supported through low-threshold services that employees
can take advantage of during times of stress or change, relationship crises, or
challenges related to supervisory work. For more complicated challenges related
to mental well-being and mental health, employees are provided with support and
short-form therapy by an occupational health psychologist.
L&T aims to reduce sickness-related absences by using L&T’s early care model
and diverse measures to support employees’ return to work. During the reporting
period, no reportable data was accumulated with regard to sickness absences for
the operations in Finland and Sweden.
According to the early care model, potential challenges related to work ability
are addressed through co-operation between the employee, the supervisor and
occupational health services at the earliest possible stage. The implementation
of early care discussions is monitored by using the early care implementation
percentage as the indicator. There were no reportable discussions during the
reporting period.
L&T organises regular work ability briefings. They involve supervisors having
unit-specific meetings to discuss practical measures related to early support, inter-
action and supporting health and well-being with other supervisors and the per-
sonnel. L&T also regularly organises training related to the early care model. The aim
is to improve the supervisors’ ability to enhance interaction, address problems, and
seek solutions to difficult situations and potential challenges related to work ability.
The company supports returning to work after extended sickness-related
absences and uses various support measures to this end. These typically include
supporting the employee’s return to their previous job or a similar position by
temporarily adapting the work duties, as well as using partial sickness allow-
ance or workplace rehabilitation. If the current job is no longer suitable for the
employee, they can receive assistance in finding a more suitable position that
corresponds to their work ability and skills through vocational rehabilitation or the
Suitable Work operating model.
Target-setting and development discussions are a key tool for developing job
satisfaction. The aim of the discussions is to ensure that everyone at L&T has tar-
gets that promote the achievement of the shared objectives. The discussions also
ensure that job descriptions are clear and that employees have the required com-
petencies and conditions for successful performance. These measures support
job satisfaction.
As a rule, a target-setting and development discussion is held with all
employees at least once a year. The discussion is voluntary for employees on
fixed-term employment relationships of less than one year, and for part-time
employees whose weekly working hours do not exceed 20 hours. The purpose
of the discussions is to evaluate the past period, set targets for the upcoming
period and discuss the employee’s workload, well-being, competence and career
wishes. No reportable data was collected for the target-setting and development
discussions during the reporting period.
The quality of supervisory work has a significant impact on the development of
job satisfaction. Good leadership requires effective dialogue between supervisors
and employees, as well as between coworkers.
L&T provides support for success in supervisory work through various training
activities, for example. The company organises regular training for new supervi-
sors to familiarise them with L&T’s supervisory practices and help them manage
success. Supervisors are also offered brief training activities on topics such as
employment relationships, managing teams and holding successful target-setting
and development discussions. In the divisions, the development of leadership and
supervisory work is closely linked to enabling the achievement of strategic goals.
Annual Report 2025
Report by the Board of Directors Sustainability Report
Diversity
L&T has made a long-term commitment to promoting the employment of people
with reduced work ability. The company constantly looks for new ways to reach
a broader audience of applicants in population groups that have previously
not been recognised in society as skilled workers. To achieve good results, it is
important to seek progress by focusing on carefully selected groups of people
with reduced work ability. This makes it possible to plan the best possible support
for people with reduced work ability employed by L&T, and to ensure in advance
that supervisors have sufficient capability to support such employees at work.
Occupational safety
At L&T, occupational safety work is carried out systematically in all units and
teams. The prevention of safety risks is the key to occupational safety work. The
majority of the personnel work at customer sites, which is why site-specific risk
assessments are carried out in cooperation with the customers. The results of the
risk assessments are reviewed with the employees working at each site as part
of induction training or occupational safety briefings.
The key measures during the review period include regular safety briefings for
employees in production roles, safety walks to observe potential risk areas in the
working environment, and safety observations and various risk surveys for all
personnel. Every L&T employee has access to a system for making occupational
safety observations on a mobile phone. The observations are forwarded to the
supervisor for further processing. The reporting of proactive safety measures is
based on information obtained from L&T’s systems. In this Sustainability Report,
-
Proactive safety measures
2025
Safety observations
Safety Walks
Occupational safety sessions
Risk assessments
Total
The employees’ awareness of occupational safety and risks is increased already
as part of the induction training, by using online occupational safety training and
clear guidelines, as well as by providing regular briefings on instructions and oper-
ating models. It is also carefully ensured that the subcontractors who work at our
operating locations are trained in occupational safety. L&T's employees also par-
ticipate in occupational safety training organised by customers to ensure that we
always adhere to the occupational safety instructions of each operating location.
If an accident occurs in spite of the proactive measures, it is investigated. Acci-
dent investigations are conducted using a method that helps us better identify
the root causes of accidents and target corrective actions appropriately. In addi-
tion to accident investigations, accident panels carry out a further review of acci-
dents to ensure that the corrective actions are sufficient.
Resource allocation for the management of material risks and
opportunities arising from the personnel
L&T has allocated a wide range of resources for the management of material risks
arising from the personnel. L&T has an adequate and comprehensive HR man-
agement organisation and occupational health and safety organisation in all of its
operating countries. The organisation includes the work ability team, employee
relations team, payroll administration, business-specific HR Business Partners,
HR service team, competence development team and HR system team. Each divi-
sion also has its own occupational safety manager.
In Finland, L&T has also provided medical care as part of occupational health
care services and a comprehensive sickness fund.
S1-5 Targets related to managing material negative
impacts, advancing positive impacts, and managing
material risks and opportunities
The targets and target levels related to the company’s own workforce for the
strategy period will be set by the company’s Board of Directors in 2026. The
targets are time-linked, performance-oriented, and apply to the entire Group.
The targets concern the development of the eNPS, TRIF, and sickness-related
absence rate indicators and they are the subject of regular dialogue with per-
sonnel representatives through dialogue meetings held in L&T's Finnish compa-
nies. The personnel representatives have the opportunity to share their thoughts
regarding development measures that promote achievement of the targets. The
indicators related to the company’s own workforce are reported on a carve-out
The development of the indicators related to the company's own workforce,
and progress towards the targets derived from them, is monitored on a quarterly
basis, and the results are presented to the entire personnel in personnel briefings.
The results of the personnel satisfaction survey are discussed in team-specific
workshops. The workshop participants together agree on concrete measures for
the team to increase employee satisfaction and develop supervisory work in day-
to-day operations.
S1-6 – Characteristics of the undertaking's employees
In reporting, an employee refers to a person who is in an employment relation-
ship with an L&T company in Finland or Sweden. The term "personnel" is used to
refer to employees. The term "own workforce" covers employees and non-em-
ployees. Non-employees refer to persons who work in L&T companies as leased
employees or self-employed people. The definition of own workforce does not
include subcontractors.
L&T uses temporary workforce only as necessary. Fixed-term employment con-
tracts are typically used for seasonal roles, such as summer jobs, and to balance
out seasonal fluctuations in Industrial Services. Long-term temporary employees
are mainly used in project-type roles or as substitutes in connection with family
Key figure outcome in 2025
eNPS
Sickness absences (%) 5.2
TRIF 22
Personnel in figures 2025
Men
Women 324
Other
0
Not specified
Total number of employees 2,236
Finland
Sweden
Average number of employees, reported as full-time equiva-
lents
leave. Fixed-term employees are provided social benefits and other employment
benefits that correspond to those of permanent employees and are offered on the
same terms.
L&T aims to offer full-time employment where possible. The number of
employees on part-time and "zero hours" contracts varies by division. Part-time
work is common among the youngest and oldest wage-earners. As a rule, part-
time duties include process cleaning work in Industrial Services, and customer
service and lorry driver roles in Environmental Services.
The number of employees on "zero hours" contracts is very low. In the Environ-
mental Services division, part-time employees work under "zero hours" contracts
and, as a rule, at their own request. L&T has surveyed the reasons for part-time
positions in a selective manner. Typically, part-time positions in Environmental
Services are sought by students and people looking for additional work and in the
Industrial Services division, part-time positions are sought by project workers.
Employee turnover 2025
Number of employees who have left the undertaking
during the reporting period
Employee turnover, %
Annual Report 2025
Report by the Board of Directors Sustainability Report
Employees by gender, reported by head count
2025 Women Men Other
1
Not specified Total
'Number of employees 324 0 2,236
Number of permanent employees 0
Number of temporary employees 0 0
Number of non-guaranteed hours employees 0 0
Number of full-time employees 0
Number of part-time employees 23 0 0 50
Gender, self-reported by the employees
Employees by country, reported by head count
2025 Finland Sweden Total
Number of employees 2,236
Number of permanent employees
Number of temporary employees 0
Number of non-guaranteed hours employees 0
Number of full-time employees
Number of part-time employees 3 50
Calculation principles
The reporting is based on information obtained from the HR systems of the L&T
Group and its subsidiaries.
The number of employees is reported as the head count, unless otherwise
stated. The reporting does not include employees on long-term absences. L&T
employs approximately 200 seasonal summer workers, thesis workers and
trainees per year, not all of whom are in an employment relationship at the end of
the reporting period, when the number of employees is calculated.
The calculation of the average number of personnel (FTE) is based on actual
working days. Working days are based on all days worked, regardless of the dura-
tion of the working day. In other words, if an employee works one hour in a day,
this counts as one actual working day in the calculations. The calculation does
not take overtime into account, which means that a person cannot count for more
Non-guaranteed hours employees
Non-guaranteed hours employees refers to persons who are called in when neces-
sary. Personnel called in when necessary are often called in to work at short notice.
It is typical of this type of work that the parties have not made an advance commit-
ment to offering work repeatedly, or coming to work. The employment contracts of
personnel called in when necessary may be temporary or valid until further notice.
In Finland, employees called in when necessary refers to employees who are
on a "zero hours" contract and have no fixed weekly working time obligation. The
reporting on non-guaranteed hours employees does not include employment con-
week), as the HR system used by L&T's companies in Finland does not recognise
these types of range-based contracts/variable working hours. However, persons
on these types of contracts are reported as part-time employees.
In Sweden, employees called in when necessary refer to employees who are on
a temporary employment contract with a zero-percent employment relationship.
This means that they do not have guaranteed working hours and are called in
according to their employer’s needs. The employer submits work requests at the
agreed hourly wage.
Exit turnover of the personnel
The exit turnover of the personnel is reported on a carve-out basis. Reporting
on the exit turnover of the personnel includes employment relationships termi-
nated on the employee’s initiative. This refers to the termination of a trial period on
the employee’s initiative, resignation, retirement, death, or the cancellation of an
employment relationship. Fixed-term employment relationships are not included
in the reporting of exit turnover. This means that summer workers, for example, are
not included. The reported exit turnover also includes employment relationships
terminated on the employer's initiative, such as dismissals on personal and collec-
tive grounds, terminations of trial periods on the employer's initiative, cancellations
of employment contracts, and severance agreements. L&T’s exit turnover of the
personnel is calculated as follows: The total number of employment relationships
terminated at the employee’s initiative and those terminated at the employer’s ini-
tiative during the reporting period, divided by the total number of employment rela-
tionships in force on the last day of the reporting period.
Distribution of employees by age group, number of persons 2025
Under 30 years old 422
Over 50 years old
Gender distribution at top management level
2025
Number Percentage
Men 6
Women
Annual Report 2025
Report by the Board of Directors Sustainability Report
S1-9 – Diversity
At L&T, we believe that purposefully building a diverse workplace community is
one way of ensuring sustainable growth. Our objective is to increase diversity in
all of our personnel groups.
At L&T, men and women are employed in different roles in a balanced manner,
and the company offers work for people of different ages and at different career
stages.
Calculation principles
The reporting is based on information obtained from the HR systems of the L&T
Group and its subsidiaries. In the reporting, senior management comprises the
members of L&T's Group Executive Board.
S1-10 - Adequate wages
In Finland and Sweden, all L&T employees with an employment contract are paid
wages in accordance with the applicable collective agreement.
We assess the realisation of pay equality between the genders as part of our
two-year diversity plans.
Remuneration at L&T is influenced by, for example, the content and demands of
the job, the employee’s competence, performance and experience, and the provi-
sions of any applicable collective agreement. At L&T, non-discrimination in remu-
neration is promoted by ensuring that remuneration is based on the demands of
the role, which are assessed by means of objective criteria. The categories used
for the demands of each role and wages are based on the collective agreements
applied at L&T, for example.
L&T operates in a number of different industries, which is why average pay
is not an appropriate indicator for the level of structure of wages. During the
reporting period, L&T continued to prepare for the amendments to the EU’s Pay
S1-14 - Health and safety metrics
L&T's occupational safety target is zero accidents. The company’s health and
safety targets for the strategy period will be set by the Board of Directors in
2026. The number of occupational accidents among L&T’s employees is reported
on a carve-out basis. Safety is on the agenda of meetings from the Group Exec-
utive Board down, and it is also linked to personal bonuses of most service pro-
duction supervisors. The development of occupational safety is reported on a
monthly basis to the Group Executive Board, the Board of Directors and the divi-
sions, down to the unit level.
L&T’s occupational safety activities are certified and audited by a third party.
-
of L&T’s business operations and personnel.
The company engages in effective co-operation with the personnel, and each L&T
company has its own occupational safety committee. Each committee convenes
in accordance with the legally required meeting schedule.
Calculation principles
The reporting is based on information obtained from the EHSQ systems of the L&T
Group and its subsidiaries. The number of occupational accidents, the number
of fatal accidents and the total recordable incident frequency (TRIF) cover both
employees and non-employees. The accident frequency has been calculated per
million working hours.
Entity-specific metric: Sickness-related absence rate
The sickness-related absence rate measures the working hours lost due to ill-
ness or accident in relation to the planned working hours for the reporting period.
Calculation principles
The reporting is based on information obtained from the HR systems of the L&T
Group and its subsidiaries. The calculation takes into account absences of per-
sons working at L&T due to an illness or accident. Absences related to a child's ill-
ness or care are excluded from the calculation. The calculation takes into account
absences with a medical certificate issued by a health care professional and sick-
ness-related absences reported by employees themselves.
Entity-specific metric: Employee Net Promoter Score
(eNPS)
The Employee Net Promoter Score (eNPS) is an indicator of the employees' sat-
isfaction with their employer. The Employee Net Promoter Score is measured
by means of an annual online survey that is sent to all employees. The survey is
available in Finnish, Swedish and English. The personnel survey measures per-
sonnel motivation, the day-to-day work of the teams, teamwork, supervisory
work and leadership, as well as the personnel’s willingness to recommend L&T.
The employee Net Promoter Score is reported on a carve-out basis.
Calculation principles
The reporting is based on information obtained from the internal systems of the
L&T Group and its subsidiaries.
S1-16 – Compensation metrics
(pay gap and total compensation)
L&T reports the percentage-based gender pay gap of its employees by personnel
group. The personnel groups used are "blue-collar employees" and "white-collar
employees", with the latter category including all of L&T's white-collar employees,
Occupational health and safety 2025
Total reportable incident frequency (TRIF) 22
Employees 22
Finland 20
Sweden
Number of accidents
Employees
Finland
Sweden
Fatal accidents 0
Cases of occupational illnesses 0
Occupational diseases resulting in death 0
Working hours, million hours 4.3
Employees 4.3
Finland
Sweden 0.2
Other workers
Finland 0.03
Sweden 0.04
Occupational health and safety management
system coverage, all employees, %
Finland
Sweden
Entity-specific metric: Sickness-related absence rate 2025
Sickness-related absence % 5.2
Finland 5.2
Sweden
Annual Report 2025
60
Report by the Board of Directors Sustainability Report
senior white-collar employees and executives. The percentage-based pay gap is
also reported on a country-specific basis for Finland and Sweden. The reporting
of the pay comparison between hourly paid male and female workers is based
on payroll data for positions for which pay comparisons in accordance with the
Equality Act can be reliably conducted without compromising the protection of
privacy. The wage survey will be conducted in 2026 as part of L&T's diversity
plans.
Calculation principles
The reporting is based on information obtained from the HR systems of the
Ratio between the remuneration of female and male employees
L&T reports the percentage-based gender pay gap of its employees by personnel
group. The pay is based on total hourly wages, average hourly earnings and, for
employees on monthly salaries, the total salary.
The personnel groups used are "blue-collar employees" and "white-collar
employees", with the latter category including all of L&T's white-collar employees,
senior white-collar employees and executives. Persons who have indicated a
gender other than male or female in the HR system, or who have not specified
any gender information, are not included in the figures. In other words, the com-
parison is based on the pay of men and women. The percentage-based pay gap is
also reported on a country-specific basis for Finland and Sweden.
L&T’s Swedish operations report information on pay in the local currency. The
necessary currency conversions are carried out after the end of the reporting
period using the average exchange rate for the reporting period.
Annual total remuneration ratio
The calculation takes into account the taxable pay of all employees. L&T’s
Swedish operations report information on pay in the local currency. The necessary
currency conversions are carried out after the end of the reporting period using
the average exchange rate for the reporting period.
S1-17 – Incidents, complaints and severe human rights
impacts
L&T does not tolerate any kind of discrimination, harassment, bullying, racism or
inappropriate treatment. The company does not approve the use of child labour,
any form of forced labour or any other practices in violation with basic human
rights in its own operations or in its supply chain.
No confirmed incidents of discrimination or harassment, and no serious human
rights incidents, were reported to L&T during the reporting period. No other dis-
crimination-related reports were reported to L&T during the reporting period. Con-
sequently, L&T did not pay any fines, penalties or compensation for damages in
relation to complaints and incidents of misconduct. In the reported information, a
"reported incident of discrimination or harassment" refers to a suspected incident
of harassment or discrimination on the basis of gender, pregnancy, childbirth,
gender identity, gender expression, age, ethnicity, nationality, language, religion,
ideology, opinion, political activities, union activities, family relations, health, dis-
ability, sexual orientation or any other reason pertaining to an individual, or any
other form of inappropriate behaviour or harassment brought to the attention of
the company.
Calculation principles
L&T’s Finnish companies have their own electronic harassment reporting system.
The Swedish Industrial Services company SVB has no electronic harassment
reporting systems in place. The number of reported incidents is monitored and
maintained at the Group level using the company's internal system.
Ratio between the remuneration of the highest paid individual
and the median remuneration for employees
2025
Ratio between the annual remuneration of the highest paid
individual and the median annual remuneration for employees
(excluding the highest paid individual)
Ratio between the remuneration of female
and male employees, %
2025
Finland Sweden
Total
-6 -3
Blue-collar employees
4
White-collar employees
The difference of average pay levels between female and male employees,
expressed as percentage of the average pay level of male employees
Incidents and human rights violations reported
via the whistleblowing channel
2025
Incidents of discrimination or harassment reported
during the reporting period 4
Confirmed incidents of discrimination and harassment 0
Other complaints 0
Total amount of fines, penalties and compensation
for damages as a result of confirmed incidents, €
0
Annual Report 2025
Report by the Board of Directors Sustainability Report
61
G1-1 - Business conduct policies and corporate culture
L&T’s the compliance and corporate culture of business conduct are guided by
applicable legislation and by the company’s own policies and principles. The poli-
cies and principles concerning governance and corporate culture include the prin-
ciples of good governance, which the company adheres to in all of its operations
and in all countries of operation.
L&T is committed to supporting the UN Global Compact initiative and its princi-
ples concerning human rights, employees, the environment and anti-corruption.
L&T’s Code of Conduct, human rights policy, disclosure, data protection,
anti-corruption and anti-bribery policies, the corporate governance code for listed
companies and other Group-wide policies concerning corporate culture and busi-
ness operations have been approved by the company’s Board of Directors. Going
forward, certain Group-wide policies, such as procurement and supply chain pol-
icies and guidelines, will be approved by the President and CEO and the Group
Executive Board.
The Senior Vice President, HR and Legal, who is a member of the Group Exec-
utive Board, is responsible for preparing and updating policies that create and
develop L&T’s corporate culture. The implementation of the policies is the respon-
sibility of the line organisation with the support of the Legal unit, which reports to
the Senior Vice President, HR and Legal.
At L&T, corporate culture is created, developed and promoted through various
measures. Training ensures that employees are aware of the policies and princi-
ples that they are required to follow. The training covers examples of situations
that the personnel may encounter. Course completion is recorded so that HR and
Legal can ensure that employees have completed the trainings that are relevant
to their role. L&T has separate training courses on topics such as the Code of Con-
duct, data security including data protection and the prevention of corruption and
bribery, including guidance on receiving gifts and hospitality in procurement.
Internal communications and personnel briefings are used to develop and pro-
mote L&T's corporate culture. Themes related to ethical business conduct are
regularly discussed on L&T’s intranet and in internal newsletters and personnel
briefings. The company's senior management communicates its commitment to
the principles and leads by example in demonstrating the importance of the prin-
ciples in the company.
Corporate culture and commitment to the Code of Conduct will be assessed
annually as part of the employee satisfaction survey, which provides all
employees with an opportunity to give anonymous feedback on supervisory work,
the company’s commitment to sustainability, day-to-day operations and various
changing themes.
The results of the personnel survey are discussed by the company’s Board of
Directors, the Group Executive Board and team level. The results of the survey
are analysed and actions are taken on the basis of the results at both team and
Group level. L&T has not defined goals or actions for the year 2025.
Policies, principles and guidelines that are essential to corporate
culture
Code of Conduct for employees
L&T’s Code of Conduct for employees guides the responsible and ethical con-
duct of its personnel. The Code of Conduct requires compliance with laws, rules
and regulations, acting integrity and transparently, respecting human rights and
colleagues, and working safely. The Code of Conduct is included in the personnel
policy and the Code of Conduct guideline for personnel, both of which have
been approved by the company’s Board of Directors and are updated every two
years. The Senior Vice President, HR and Legal, is responsible for implementing
the Code of Conduct, while compliance with the Code is monitored by the Group
Executive Board. The Code of Conduct for employees is public and available on
L&T’s website, intranet, and the notice boards at the operating locations. The Code
of Conduct was discussed in dialogue with employee representatives while L&T
was still part of the former Lassila & Tikanoja Group.
L&T has an online training course for employees on the Code of Conduct, which
covers the content of the ethical operating principles and practical examples.
L&T’s Board of Directors will set Group-wide targets for employee Code of Con-
duct training coverage in 2026.
The Code of Conduct online training is a mandatory part of the onboarding
process for every new employee. Separate online courses are available for white-
collar and blue-collar employees. In Finland, the course can also be completed on
a mobile device, which makes it easier for employees working remotely to partici-
pate.
Code of Conduct for suppliers
L&T has a separate Code of Conduct guideline for suppliers, which defines the
ethical operating principles and expectations for representatives of the supply
chain. The company requires suppliers to familiarise themselves with the Code of
Conduct for suppliers, adhere to it and continuously develop their operations in
line with it. The Code of Conduct for suppliers covers issues such as corruption,
bribery, data security, compliance, human and labour rights, health and safety,
supplier self-assessment and whistleblowing.
Suppliers are responsible for ensuring that their personnel, suppliers and sub-
contractors adhere to this Code. Suppliers are required to inform L&T of the use of
subcontractors. L&T may ask suppliers to conduct a self-assessment at the start
of or during the cooperation. The Supplier Code of Conduct has been approved by
the Board of Directors, and in the future it will be approved by the CEO and the
Group Executive Board. The company’s Chief Purchasing Officer is responsible for
implementing the Code, and the procurement management team monitors com-
pliance with it. The Code of Conduct for suppliers is public and available on L&T’s
website. The Code is also incorporated into procurement contracts.
To monitor the implementation and effectiveness of the Code, L&T’s Board of
Directors sets targets for the supply chain’s commitment to the Code of Con-
duct for suppliers and for the coverage of the supplier self-assessments in 2026.
From 2026 onwards, the Code of Conduct for suppliers will be included in every
new agreement, and the operating principles will be submitted separately for
approval by suppliers that already have an existing agreement.
Anti-corruption and anti-bribery policy
L&T’s anti-corruption and anti-bribery policy defines the Group’s rules for pre-
venting corruption and bribery. The company complies with applicable legisla-
tion in all its operations. L&T is committed to the principles of the UN Convention
against Corruption. The company prohibits all forms of bribery and corruption. In
its policy, L&T takes a position on lawful and ethical business conduct, fair com-
petition, acceptable hospitality, avoidance of conflicts of interest and the identifi-
cation and prevention of corruption and bribery.
L&T’s anti-corruption and anti-bribery policy has been approved by the Board
of Directors. Responsibility for and implementation of the anti-corruption and
anti-bribery policy lies with the Senior Vice President, HR and Legal, and its
effectiveness is monitored by the Group Executive Board. L&T updates the policy
every two years. The policy covers all of the Group’s companies and divisions and
applies to L&T’s own workforce in all operating countries and other parties par-
ticipating in the business, such as consultants. The policy has been the subject
of dialogues with employees and employee representatives and it has been dis-
cussed in at a European Works Council meeting when L&T was part of the former
Lassila & Tikanoja Group. The policy will be submitted to the Group Executive
Board for approval in 2026.
The company has assessed that among its internal functions, procurement,
sales and business management are more vulnerable to corruption and bribery. In
these roles, completion of the anti-corruption and bribery online course is moni-
tored particularly closely. If an employee fails to complete the course within the
deadline, a separate anti-corruption and bribery discussion will be held with the
person. The anti-corruption and anti-bribery policy is public and available on L&T’s
website and intranet. Actions to prevent and detect corruption and bribery are
described in more detail in section G1-3, p. 62.
L&T’s target is for all employees to comply with the policy. The company will
also ensure that the white-collar employees and executives identified as partic-
ularly relevant to the company’s operations in Finland and Sweden have com-
pleted the online training on the content of the policy.
G1 Business conduct
Annual Report 2025
Report by the Board of Directors Sustainability Report
62
lines on authorisation on the basis of position with support of Legal Affairs. The
guideline applies to all employees and is approved by the CEO and the Group
Executive Board.
Reporting prohibited conduct
If employees observe or suspect prohibited activities at L&T, such as corruption,
bribery or conflicts of interest, they must report the matter to their supervisor, HR
or Legal Affairs. Reports can also be submitted via L&T’s whistleblowing channel.
Reports via the whistleblowing channel can be submitted anonymously. The link
and instructions for the whistleblowing channel can be found on the company’s
intranet and website, in the Code of Conduct guidelines for employees and sup-
pliers, and on notice boards.
L&T investigates all suspected incidents of misconduct. Anyone who, in good
faith, reports their suspicions within the scope of the whistleblowing legislation
and participates in the investigation and clarification of possible suspicions of
misconduct will not suffer negative consequences as a result, such as the risk of
subsequent discrimination or being placed in a disadvantageous position. L&T will
take disciplinary action against anyone found guilty of any prohibited retaliation.
Reports submitted via the whistleblowing channel are investigated by the
Legal Affairs or other individuals with a Master’s degree in law, reporting to the
Senior Vice President, HR and Legal. L&T’s compliance team processes all reports
leadind to an investigation, and the team reports all violations and critical inci-
dents to the Audit Committee of the Board of Directors.
G1-3 - Prevention and detection of corruption and bribery
L&T has a separate anti-bribery and anti-corruption policy approved by the Presi-
dent and CEO and the Group Executive Board. The Senior Vice President, HR and
Legal, is responsible for implementing the policy together with the Legal. The
Legal Affairs is supported in the implementation by the business functions.
The company has identified roles where the exposure to corruption is greater
than other roles, such as roles in procurement, sales and business management,
including the Group Executive Board. All persons working in these roles (99%) are
trained in the content of L&T’s anti-bribery and anti-corruption policy and case
examples, and the completion of training is monitored. During 2026, L&T’s Board
of Directors will also complete an online training course on the prevention of
corruption and bribery. A more detailed description of the operating principles is
provided in section G1-1, p. 61.
The company has a separate online training course on the prevention of cor-
ruption and bribery. The training specifies prohibited practices, provides case
examples of these and provides instructions on how to act if the organisation
encounters or suspects corruption or bribery. The training takes approximately
completed during the reporting period.
Suspicions of corruption and bribery can be reported to one's supervisor, HR, or
the Legal Affairs function, or through the whistleblowing channel. Reports can be
submitted anonymously via the whistleblowing channel.
Reports are processed by the Legal Affairs function or other persons with a
Master’s degree in law, who report to the Senior Vice President, HR and Legal.
The persons processing the reports do not process reports concerning their own
organisation and are thus separate from the chain of command involved.
Reports are processed by L&T’s Compliance team and reported to the Audit
Committee of the Board of Directors once a year.
G1-4 - Incidents of corruption or bribery
During the reporting period, L&T has no reported violations related to corruption
or bribery and the company has not paid any fines or sanctions related to corrup-
tion or bribery. No L&T’s management representative has not been convicted of
bribery or corruption.
Data protection and information security policies
The data protection policy defines L&T’s internally approved data protection prin-
ciples to be followed when processing the personal data of customers, partners
and other stakeholders as well as employees and job applicants. L&T aims to
ensure the lawful processing of personal data and an appropriate level of data
protection by means of the data protection policy and function-specific data pro-
tection instructions derived from the policy. The data protection policy is supple-
mented by a separate information security policy, which is guided by external and
internal requirements, such as requirements set by legislation and authorities,
contractual requirements and the general situation and development related to
information security and threats to it. L&T is subject to the Cybersecurity Act. The
implementation of the information security policy is supported by supplementary
information security guidelines, specifications, plans and training. The data pro-
tection and information security policies apply to the entire company.
The data protection policy has been approved by the Board of Directors and
the information security policy is approved by the CEO and the Group Executive
Board. The policies are reviewed and updated every two years as necessary. The
Senior Vice President, HR and Legal, is responsible for implementing the data
protection policy and monitoring compliance with data protection legislation and
guidelines at L&T. The Chief Information Officer is responsible for implementing
and monitoring the information security policy.
Due to the nature of the policies, L&T has not engaged in direct dialogue with
the personnel. The data protection policy is public and available on L&T’s website
and intranet. The information security policy is intended for internal use and is
available to employees on the intranet.
L&T provides its employees with instruction and training on data protection and
information security. Every employee must know and comply with the data pro-
tection and information security obligations related to their work duties.
Guidelines concerning gifts and hospitality in procurement
L&T has a separate guideline on receiving gifts from suppliers and hospitality.
The guideline complements the company’s Code of Conduct for employees
and anti-corruption and anti-bribery policy. It defines what is a reasonable gift
or hospitality and when no hospitality of any kind can be accepted. The guide-
line applies to L&T’s management and all procurement personnel. It has been
approved by the Board of Directors, and in the future it will be approved by the
CEO and the Group Executive Board, and it will be updated every two years. The
Chief Purchasing Officer is responsible for the implementation. No separate
goals have been set for the guideline.
Guidelines on authorisation on the basis of position
L&T's position-based authorisation guideline defines the decision-making bodies
and the order of decision-making. The guideline defines who can decide on mat-
ters and up to what euro amount. It also defines situations in which a decision
must be escalated or consulted with Legal or another expert organisation before
making a decision. Decisions must be made in accordance with the defined
guidelines. The Senior Vice President, HR and Legal, is responsible for the guide-
Annual Report 2025
Key figures
63
Key figures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Definitions and reasons for the use of key figures . . . . . . . 66
Key figures
Annual Report 2025
Key figures
64
Key figures of the Group
Key figures per share
In EUR million, unless otherwise indicated
1-12/2025
Carve-out
1-12/2024
Carve-out
1-12/2023
Carve-out
Earnings per share, EUR
1
0.67 0.83 0.85
Diluted earnings per share, EUR1 0.67 0.82 0.85
Equity / share, EUR
1
4.52 n/a n/a
Dividend/share, EUR
2
0.42 n/a n/a
Payout ratio, %
2
62.4 n/a n/a
Effective dividend yield, %
2
5.2 n/a n/a
P/E Ratio 12.0 n/a n/a
Net cash flow from operating activities after investments per share, EUR
1
1.08 0.90 1.03
Market capitalization
3
308.2 n/a n/a
Share issue-adjusted number of shares, 1,000 shares
average during the period 38,212 n/a n/a
at the end of the period 38,212 n/a n/a
average during the period, diluted 38,320 n/a n/a
1
All periods are calculated based on the number of shares at the date of the demerger 31 December 2025.
2
Proposal by the Board of Directors
3
Calculated based on the closing price on the first trading day (2 January 2026).
Key figures on financial performace
In EUR million, unless otherwise indicated
1-12/2025
Carve-out
1-12/2024
Carve-out
1-12/2023
Carve-out
Net sales 426.6 423.9 422.1
Net salse growth, % 0.7 0.4 -6.4
Adjusted EBITDA 84.3 86.0 82.9
Adjusted EBITDA margin, % 19.8 20.3 19.6
EBITDA 79.8 83.8 82.6
EBITDA margin, % 18.7 19.8 19.6
Adjusted EBITA 40.6 44.4 40.5
Adjusted EBITA margin, % 9.5 10.5 9.6
Operating profit 34.2 40.5 38.3
Result for the period 25.7 31.5 32.4
Net cash flow from operating activities after investments 41.4 34.3 39.4
Gross capital expenditure 41.7 36.1 58.2
Capital employed
1
360.4 321.4 316.4
Return on capital employed, % (ROCE) 10.6 13.7 13.2
Return on equity, % (ROE) 12.1 n/a n/a
Net interest-bearing liabilities
1
150.2 67.4 62.3
Net debt / Adjusted EBITDA 1.8x n/a n/a
Equity ratio, %
1
35.0 n/a n/a
Gearing, %
1
86.9 n/a n/a
Average number of employees in full-time equivalents (FTEs) 1,907 1,875 1,890
Number of employees at the end of the period 2,236 2,219 2,312
1
The key figure of year 2025 is based on actual figures..
Differences between the actual figures and the carve-out principles affect the presentation of certain key performance
indicators. Key figures based on equity, interest-bearing liabilities and net interest-bearing liabilities are presented only as at 31
December 2025, as the information for earlier periods prepared on a carve-out basis does not reflect the capital and financing
structure of Lassila & Tikanoja.
Annual Report 2025
Key figures
65
Reconciliation of alternative performance
measures
The company discloses certain other widely used performance measures that
can for the most part be derived from the income statement and balance sheet.
The formulas for these performance measures are provided in the section
Calculation of key figures. In the company’s view, these measures clarify the
result of operations and financial position based on the income statement and
balance sheet.
EBITDA and Adjusted EBITDA to operating profit
MEUR
1-12/2025
Carve-out
1-12/2024
Carve-out
Operating profit 34.2 40.5
+ Depreciation, amortisation and impairment 45.5 43.4
EBITDA 79.8 83.8
Items affecting comparability:
- Expenses arising from business restructurings 4.8 0.8
- Items related to the acquisition of business activities -0.6 1.3
- Other items 0.3 -
4.5 2.2
Adjusted EBITDA 84.3 86.0
Adjusted EBITA to operating profit
MEUR
1-12/2025
Carve-out
1-12/2024
Carve-out
Operating profit 34.2 40.5
+ Amortisation of purchase price allocations to
intangible assets from acquisitions 1.9 1.8
Items affecting comparability:
- Expenses arising from business restructurings 4.8 0.8
- Items related to the acquisition of business activities -0.6 1.3
- Other items 0.3 -
Items affecting comparability total
1
4.5 2.2
Adjusted EBITA 40.6 44.4
1
In 2025, the items affecting comparability include expenses relating to the demerger
totalling EUR 4.7 million.
Return on capital employed, % (ROCE)
MEUR
1-12/2025
Carve-out
1-12/2024
Carve-out
Capital employed, average at the end of the reporting
period and the end of the comparison period
340.9 318.9
Operating profit 34.2 40.5
+ Financial income 0.2 0.1
+ Share of result of joint ventures 1.9 3.2
Return on capital employed (MEUR) 36.3 43.7
Return on capital employed, % 10.6 13.7
Return on equity, % (ROE)
MEUR
1-12/2025
Carve-out
Result for the period (rolling 12 months) 25.7
Equity (average at the end of the reporting period and
the end of the comparison period) 212.5
Return on equity, % (ROE) 12.1
Net interest-bearing liabilities
1
MEUR
31 Dec
2025
31 Dec
2024
Carve-out
Borrowings 125.0 0.3
Lease liabilities 48.6 45.2
Non-current interest-bearing liabilities 173.6 45.5
Lease liabilities 13.8 11.7
Cash pool liabilities to related parties - 11.6
Borrowings 0.2 0.5
Current interest-bearing liabilities 13.9 23.8
Total interest-bearing liabilities 187.6 69.4
Cash pool receivables from related barties - 0.1
cash and cash equivalents 37.4 1.9
Net interest-bearing liabilities 150.2 67.4
1
In connection with the demerger, loans and cash and cash equivalents were transferred
from Luotea (formerly Lassila & Tikanoja) to Lassila & Tikanoja. Further information is
provided in Note 4.1 Financial assets and liabilities in the notes to the consolidated financial
statements.
Gearing, %
31 Dec
2025
Net interest-bearing liabilities, MEUR 150.2
Equity, MEUR 172.8
Gearing, % 86.9
Gross capital expenditure reconciliation
MEUR
1-12/2025
Carve-out
1-12/2024
Carve-out
Intangible assets of acquired businesses 11.5 1.5
Property, plant and equipment of acquired businesses 1.0 0.4
Other additions to intangible assets 2.4 9.3
Other additions to property, plant and equipment 21.2 28.7
-3.4 -4.2
Acquisition of heavy rental equipment included in
right-of-use assets
9.1 0.5
Gross capital expenditure 41.7 36.1
1
The structural additions related to environmental provisions and the equipment additions
related to presses and balers leased from the financing company, as well as equipment
additions arising from the redemption of heavy metal rental equipment.
Net debt / Adjusted EBITDA (rolling 12 months)
MEUR
1-12/2025
Carve-out
Net interest-bearing liabilities 150.2
Adjusted EBITDA (rolling 12 months) 84.3
Net debt / Adjusted EBITDA (rolling 12 months) 1.8x
Equity ratio, %
MEUR
31 Dec
2025
Equity 172.8
Statement of financial position total 509.7
Advances received -16.1
Total 493.7
Equity ratio, % 35.0
Annual Report 2025
Key figures
66
Definitions and reasons for the use of key figures
Key figure Definition Reason for the use
Earnings per share (EUR)
Result for the period attributable to the equity
holders of the parent company / adjusted average
basic number of shares
Diluted earnings per share
(EUR)
Result for the period attributable to the equity
holders of the parent company / adjusted average
diluted number of shares
Equity per share (EUR)
Equity attributable to the equity holders of the parent
company / adjusted basic number of shares at the
balance sheet date
Dividend per share
Dividend for the financial year / Adjusted basic
number of shares at the balance sheet date
Payout ratio, % Dividend per share / earnings per share x 100
Effective dividend yield, %
Dividend per share / closing price of the financial
period
P/E Ratio
Closing price of the financial period / earnings per
share
Net cash flow from operating
activities after investments
per share, EUR
Net cash flow from operating activities after
investments per share, EUR / adjusted average basic
number of shares
Net cash flow from operating
activities after investments
provides information on Lassila
& Tikanoja’s ability to generate
cash from its operations after
investments to service debt or
pay dividends.
Market capitalization
Adjusted basic number of shares at the balance
sheet date x closing price of the financial period
Key figures per share
Key figure Definition Reason for the use
Operating profit
Operating profit as presented in the income
statement
Operating profit reflects the result generated
by Lassila & Tikanoja’s business operations ex-
cluding financing, shares of the result of asso-
ciated companies and joint ventures and taxes.
EBITDA
Operating profit excluding depreciation,
amortisation and impairment
Management uses EBITDA to monitor the prof-
itability excluding non-cash capital expenses
of Lassila & Tikanoja’s core business opera-
tions.
EBITDA margin, % EBITDA as a percentage of net sales
Management uses EBITDA to monitor the prof-
itability excluding non-cash capital expenses
of Lassila & Tikanoja’s core business opera-
tions.
Items affecting
comparability
Substantial costs arising from business
restructurings or acquisitions, gains and losses
from divestments and costs arising from the
discontinuation of businesses as well as other
material items outside ordinary course of
business
Items that are not directly related to Lassila
& Tikanoja’s ordinary course of business are
reported separately in order to assess the per-
formance and comparability between reporting
periods of its core business operations.
Adjusted EBITDA
EBITDA adjusted for items affecting
comparability
Adjusted EBITDA, adjusted EBITA and related
margins are presented in addition to operating
profit and EBITDA to reflect underlying busi-
ness performance and to enhance comparabil-
ity from period to period. Management believes
that these adjusted performance measures
provide meaningful supplemental information
by excluding items outside the ordinary course
of business, which reduce comparability be-
tween periods.
Key figures on financial performace
Annual Report 2025
Key figures
67
Key figure Definition Reason for the use
Adjusted EBITDA
margin, %
Adjusted EBITDA as a percentage of net sales
Adjusted EBITA measures profitability exclud-
ing acquisition-related amortisation and im-
pairment, reflecting underlying business per-
formance and enhancing comparability
between periods.
Adjusted EBITA
Operating profit excluding amortisation
and impairments of acquisition-related
intangible assets, adjusted for items affecting
comparability
Adjusted EBITA measures profitability
excluding acquisition-related amortisation and
impairment, reflecting underlying business
performance and enhancing comparability
between periods.
Adjusted EBITA
margin, %
Adjusted EBITA as a percentage of net sales
Adjusted EBITA measures profitability exclud-
ing acquisition-related amortisation and im-
pairment, reflecting underlying business per-
formance and enhancing comparability
between periods.
This measure is one of Lassila & Tikanoja’s
mid-term financial targets.
Net cash flow from
operating activities
after investments
Net cash flow from operating activities
according to the combined cash flow
statement, less net cash flow from investing
activities as presented in the cash flow
statement
Net cash flow from operating activities after
investments provides information on Lassila
& Tikanoja’s ability to generate cash from its
operations after investments to service debt or
pay dividends.
Interest-bearing
liabilities
Borrowings + lease liabilities + cash pool
liabilites to related parties
Component of capital employed, return on cap-
ital employed and net interest-bearing liabili-
ties.
Capital employed Equity + interest-bearing liabilities
Capital employed reflects the total investment
in Lassila & Tikanoja’s business operations and
it is used to calculate return on capital em-
ployed.
Return on capital
employed, % (ROCE)
(Operating profit + financial income + share of
the result of joint ventures, rolling 12 months) /
(equity + interest-bearing liabilities ((average of
the end of the reporting period and at the end
of the comparison period))
Return on capital employed is a profitability
metric that Lassila & Tikanoja uses to measure
how efficiently it uses invested capital to gen-
erate profits.
Key figure Definition Reason for the use
Gross capital
expenditure
Investments in intangible assets, acquisitions
of heavy rental equipment included in right-
of- use assets, and investments in property,
plant and equipment, excluding additions
to constructions related to environmental
provisions, excluding additions of equipment
related to compactors and balers leased
from finance companies, as well as
respective assets acquired through business
combinations
Gross capital expenditure indicate investments
in operational, rental and strategic projects
aimed at maintaining service production ca-
pacity and supporting growth of business op-
erations.
Return on equity, %
(ROE)
Result for the period (rolling 12 months) /
equity (average at end of the reporting period
and the end of the comparison period)
This metric measures Lassila & Tikanoja’s rela-
tive profitability, i.e. return on equity.
Net interest-bearing
liabilities
Interest-bearing liabilities - cash pool
receivables from related parties - cash and
cash equivalents
Net interest-bearing liabilities is a liquidity
measure used by management to monitor Las-
sila & Tikanoja’s ability to pay its debts in the
short-term.
Net debt / Adjusted
EBITDA
Net interest-bearing liabilities / adjusted
EBITDA (rolling 12 months)
This measure is an indicator of Lassila & Tikan-
oja’s indebtedness in relation to its operational
financial performance.
This measure is one of Lassila & Tikanoja’s
mid-term financial targets.
Gearing, % Net interest-bearing liabilities / Equity
This measure is an indicator of Lassila & Tikan-
oja’s indebtedness by comparing equity invest-
ed by shareholders to interest-bearing liabili-
ties borrowed from financiers.
Equity ratio, %
Equity / (statement of financial position total -
advances received)
This measure indicates the relative proportion
of equity used to finance Lassila & Tikanoja’s
assets, which helps to monitor the indebted-
ness of Lassila & Tikanoja.
Average number of
employees in full-time
equivalents (FTEs)
Average number of full-time equivalent
employees during the reporting period
Average number of employees in full-time
equivalents (FTE) provides information about
the overall staff size of Lassila & Tikanoja and
FTE reflects the total number of working hours
of all employees. Management believes that
this provided information can be useful when
analysing workforce costs, productivity or
staffing needs.
Number of employees
at the end of the
period
Number of employees at the end of the review
period, total full-time and part-time employees
Financial statements
Annual Report 2025
68
Combined income statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .69
Combined statement of comprehensive income . . . . . . . . . . . . . . . . .69
Consolidated statement of financial position . . . . . . . . . . . . . . . . . . . .70
Combined statement of cash flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Consolidated statement of changes in equity . . . . . . . . . . . . . . . . . . . 72
Notes to the consolidated financial statements . . . . . . . . . . . . . . . . . 73
Financial statements of the parent company . . . . . . . . . . . . . . . . . . .108
Proposal by the Board of Directors for the distribution
of the profit and the Auditor’s Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114
1
Financial result
1.1 Segment reporting . . . . . . . . . . . . . . . . . . . . . . . . . 78
1.2 Revenue from contracts with customers . . . 79
1.3 Employee benefit expenses . . . . . . . . . . . . . . . . 81
1.4 Materials and services and other operating
income and expenses . . . . . . . . . . . . . . . . . . . . . . 81
1.5 Share-based payments . . . . . . . . . . . . . . . . . . . . .82
1.6 Expenses related to leases . . . . . . . . . . . . . . . . .83
1.7 Depreciation, amortisation and impairment 83
1.8 Financial income and expenses . . . . . . . . . . . . .84
1.9 Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .84
2
Operational assets and liabilities
2.1 Trade and other receivables . . . . . . . . . . . . . . . . 87
2.2 Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
2.3 Trade and other current payables . . . . . . . . . . .88
2.4 Other non-current liabilities . . . . . . . . . . . . . . . .88
2.5 Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .88
3
Intangible and tangible assets and other
non-current assets
3.1 Goodwill and other intangible assets . . . . . . . 91
3.2 Goodwill impairment testing . . . . . . . . . . . . . . . .92
3.3 Property, plant and equipment . . . . . . . . . . . . . . .92
3.4 Right-of-use assets and lease liabilities . . . .94
3.5 Other non-current assets . . . . . . . . . . . . . . . . . .95
4
Financial risks and capital structure
4.1 Financial assets and liabilities . . . . . . . . . . . . . . 97
4.2 Financial risk management . . . . . . . . . . . . . . . . .99
4.3 Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
4.4 Earnings per share and dividend per share 102
4.5 Commitments and contingent liabilities . . . 102
5
Consolidation and other notes
5.1 Consolidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . .104
5.2 Group companies . . . . . . . . . . . . . . . . . . . . . . . . . 104
5.3 Business acquisitions . . . . . . . . . . . . . . . . . . . . .105
5.4 Related-party transactions . . . . . . . . . . . . . . . . 106
5.5 Auditing costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . .106
5.6 Events after the balance sheet date . . . . . . . 107
Financial statements
68
Financial statements
Annual Report 2025
69
Primary financial statements of the Group
| Combined income statement | |||
| 2025 | 2024 | ||
| 1 January - 31 December MEUR | Carve-out | Carve-out | Note |
Net sales | 1.2 | ||
Other operating income | 1.4 | ||
Materials and services | - | - | 1.4 |
Employee benefit expenses | - | - | 1.3 |
Other operating expenses | - | - | 1.4 |
Depreciation, amortisation and impairment | - | - | 1.7 |
Operating profit | |||
Financial income | |||
Financial expenses | - | - | |
Exchange rate differences (net) | - | ||
Financial income and expenses | - | - | 1.8 |
Share of the result of joint ventures | |||
Result before taxes | |||
Income taxes | - | - | 1.9 |
Result for the period | |||
| Attributable to: | |||
Equity holders of the parent company | |||
Earnings per share for result attributable to the equity holders of the parent company, EUR: | |||
| 4.4 | ||
| 4.4 | ||
1 The comparative period is calculated based on the number of shares at the date of the demerger 31 December 2025. |
| Combined statement | |||
| of comprehensive income | |||
| 2025 | 2024 | ||
| 1 January - 31 December MEUR | Carve-out | Carve-out | Note |
Result for the period | |||
| Other comprehensive income, net of tax | |||
| Items that may be reclassified to profit or loss | |||
Currency translation differences | - | 4.3 | |
Other comprehensive income, total | - | ||
Total comprehensive income, after tax | |||
| Attributable to: | |||
Equity holders of the parent company |
Financial statements
Annual Report 2025
70
Primary financial statements of the Group
Combined statement of financial position
| 2024 | |||
31 December MEUR | 2025 | Carve-out | Note |
| ASSETS | |||
| Non-current assets | |||
Goodwill | 3.1 | ||
Other intangible assets | 3.1 | ||
Total intangible assets | |||
Right-of-use assets | 3.4 | ||
Other property, plant and equipment | 3.3 | ||
Total property, plant and equipment | |||
Shares in joint ventures | 3.5 | ||
Other shares and holdings | 3.5 | ||
Other non-current receivables | 3.5 | ||
Total other non-current assets | |||
Total non-current assets | |||
| Current assets | |||
Inventories | 2.2 | ||
Trade receivables | 2.1, 4.1 | ||
Contract assets | 1.2, 2.1 | ||
Income tax receivables | 2.1 | ||
Cash-pool receivables from related parties | 4.1, 5.4 | ||
Other current receivables | 2.1, 4.1 | ||
Cash and cash equivalents | 4.1 | ||
Total current assets | |||
TOTAL ASSETS |
| 2024 | |||
31 December MEUR | 2025 | Carve-out | Note |
| EQUITY AND LIABILITIES | |||
| Equity | |||
| Equity attributable to the equity holders of the parent company | |||
Share capital | |||
Currency translation differences | - | - | |
Invested unrestricted equity reserve | |||
Invested equity | |||
Retained earnings | |||
Total Equity | 4.3 | ||
| Liabilities | |||
Deferred tax liabilities | 1.9 | ||
Pension liabilities | 1.3 | ||
Provisions | 2.5 | ||
Borrowings | 4.1 | ||
Lease liabilities | 3.4, 4.1 | ||
Other liabilities | 2.4 | ||
Total non-current liabilities | |||
Borrowings | 4.1 | ||
Cash-pool liabilities to related parties | 4.1, 5.4 | ||
Lease liabilities | 3.4, 4.1 | ||
Trade and other payables | 2.3, 4.1 | ||
Income tax liabilities | 2.3 | ||
Provisions | 2.5 | ||
Total current liabilities | |||
Total liabilities | |||
TOTAL EQUITY AND LIABILITIES |
Financial statements
Annual Report 2025
71
Primary financial statements of the Group
Combined statement of cash flows
| 2025 | 2024 | ||
| 1 January - 31 December MEUR | Carve-out | Carve-out | Note |
| Cash flows from operating activities | |||
Result for the period | |||
| Adjustments | |||
Income taxes | 1.9 | ||
Depreciation, amortisation and impairment | 1.7 | ||
Financial income and expenses | 1.8 | ||
Gains and losses on sale of tangible and intangible assets | - | - | |
Share of result of joint ventures | - | - | 3.5 |
Provisions | - | - | 2.5 |
Other adjustments | - | ||
| Net cash generated from operating activities before change in working | |||
capital | |||
| Change in working capital | |||
Change in trade and other receivables | - | ||
Change in inventories | - | - | |
Change in trade and other payables | - | ||
Change in working capital | - | ||
Interest and other financial expenses paid | - | - | |
Interest and other financial income received | |||
Income taxes paid | - | - | |
Net cash from operating activities |
| 2025 | 2024 | ||
| 1 January - 31 December MEUR | Carve-out | Carve-out | Note |
| Cash flows from investing activities | |||
Acquisitions of subsidiaries and businesses, net of cash acquired | - | - | 5.3 |
Purchases of intangible assets and property, plant and equipment | - | - | |
Proceeds from sale of intangible assets and property, plant and equipment | |||
Dividends received from joint venture | |||
Dividends received from other non-current investments | |||
Net cash from investing activities | - | - | |
Net cash from operating and investing activities | |||
| Cash flows from financing activities | |||
Cash pool financing with the former Lassila & Tikanoja | - | 4.1 | |
Equity financing with the former Lassila & Tikanoja, net | - | ||
Repayments of long-term borrowings | - | - | 4.1 |
Repayments of lease liabilities | - | - | |
Net cash from financing activities | - | - | |
Net change in cash and cash equivalents | - | ||
Cash and cash equivalents at the beginning of the period | |||
Effect of changes in foreign exchange rates | - | - | |
Cash and cash equivalents at the end of the period | 4.1 |
Financial statements
Annual Report 2025
72
Primary financial statements of the Group
| Consolidated statement of changes in equity | |||||||
| Currency | Invested | ||||||
| Invested equity and | translation | unrestricted equity | |||||
| MEUR | retained earnings | Share capital | differences | reserve | Retained earnings | Total equity | Note |
Invested equity on 1 January 2024 | - | ||||||
Result for the period | |||||||
Translation difference | - | - | |||||
Total comprehensive income | - | ||||||
Share-based benefits | 1.5 | ||||||
| Equity transactions with the former Lassila & Tikanoja | |||||||
Group | - | - | |||||
Invested equity on 31 December 2024 | - | ||||||
Invested equity on 1 January 2025 | - | ||||||
Result for the period | |||||||
Translation difference | |||||||
Total comprehensive income | |||||||
Share-based benefits | 1.5 | ||||||
| Equity transactions with the former Lassila & Tikanoja | |||||||
Group | |||||||
Demerger | - | - | |||||
Equity on 31 December 2025 | - | ||||||
In the demerger, and in accordance with the Demerger Plan, Luotea’s (the former Lassila & Tikanoja) financing arrangements transferred to Lassila & Tikanoja comprised EUR 75 million unsecured notes, term loans totalling EUR 35 million and EUR 15 million, as well as the related accrued interest liabilities. These items have not been included in the company’s comparative period carve-out financial information. As a result, at the demerger date of 31 December 2025, the company’s | |||||||
| equity decreased and the amount of liabilities increased. | |||||||
| For more information on equity please refer to Note 4.3 Equity. |
Financial statements Notes to the consolidated financial statements
Annual Report 2025
73
Notes to the consolidated financial statements
Financial statements Notes to the consolidated financial statements
Annual Report 2025
74
Financial statements Notes to the consolidated financial statements
Annual Report 2025
75
Financial statements Notes to the consolidated financial statements
Annual Report 2025
76
Financial statements Notes to the consolidated financial statements
Annual Report 2025
7777
1 Financial result
1.1 Segment reporting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
1.2 Revenue from contracts with customers . . . . . . . . . . . . . . . . . . . 79
1.3 Employee benefit expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
1.4 Materials and services and other operating income and
expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
1.5 Share-based payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
1.6 Expenses related to leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
1.7 Depreciation, amortisation and impairments . . . . . . . . . . . . . . . 83
1.8 Financial income and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . .84
1.9 Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .84
Financial statements Notes to the consolidated financial statements
Annual Report 2025
78
1.1 Segment reporting
2025, MEUR
Circular
Economy
Business
Unallocated
items and
eliminations
Lassila &
Tikanoja
External net sales 426.6 426.6
Inter-division net sales 0.1 -0.1 -
Net sales 426.7 -0.1 426.6
Materials and services -126.2 - -126.2
Employee benefit
expenses -135.1 -6.8 -141.9
Other operating
expenses -83.4 1.2 -82.2
Operating profit 40.4 -6.2 34.2
Items affecting
comparability
1
-0.2 4.7
Adjusted EBITA 42.1 -1.5
Financial income and
expenses -4.6
Share of the result of
joint ventures 1.9
Result before taxes 31.6
Income taxes -5.8
Result for the period 25.7
Capital employed 351.0 9.4
Gross capital expenditure 40.3 1.4
Depreciation,
amortisation and
impairments 45.1 0.5 45.5
2024, MEUR
Circular
Economy
Business
Unallocated
items and
eliminations
Lassila &
Tikanoja
External net sales 423.9 423.9
Inter-division net sales 0.1 -0.1 -
Net sales 424.0 -0.1 423.9
Materials and services -123.6 - -123.6
Employee benefit
expenses -135.3 -5.1 -140.3
Other operating
expenses -82.9 4.1 -78.8
Operating profit 41.2 -0.8 40.5
Items affecting
comparability
1
1.6 0.6
Adjusted EBITA 44.7 -0.2
Financial income and
expenses -4.7
Share of the result of
joint ventures 3.2
Result before taxes 38.9
Income taxes -7.4
Result for the period 31.5
Capital employed 299.7 21.7
Gross capital expenditure 35.9 0.3
Depreciation,
amortisation and
impairments 43.1 0.3 -43.4
1
Items affecting comparability mainly include expenses related to business acquisitions,
including changes in the fair value of the deferred consideration related to the acquisition
of Sand & Vattenbläst i Tyringe AB (“SVB”), as well as expenses related to business
restructurings. In 2025, the items affecting comparability include expenses relating to the
demerger totalling EUR 4.7 million. Further information on the valuation of the deferred
consideration related to SVB is presented in Note 4.1 Financial assets and liabilities.
Financial statements Notes to the consolidated financial statements
Annual Report 2025
79
Information on the geographical areas
MEUR
2025
Carve-out
2024
Carve-out
Net sales
Finland 395.7 393.3
Sweden 21.6 21.2
Other countries 9.4 9.4
Total 426.6 423.9
Assets
Finland 494.4 441.1
Sweden 15.4 11.9
Total 509.7 453.0
Gross capital expenditure
Finland 38.4 31.9
Sweden 3.3 4.2
Financial statements Notes to the consolidated financial statements
Annual Report 2025
80
Financial statements Notes to the consolidated financial statements
Annual Report 2025
81
Financial statements Notes to the consolidated financial statements
Annual Report 2025
82
Financial statements Notes to the consolidated financial statements
Annual Report 2025
83
Financial statements Notes to the consolidated financial statements
Annual Report 2025
84
1.8 Financial income and expenses
MEUR
2025
Carve-out
2024
Carve-out
Financial income
Interest income on loans and other receivables 0.1 0.1
Interest income from related parties 0.1 0.1
Dividend income 0.0 0.0
Foreign exchange gains 0.1 -
Total financial income 0.3 0.1
Financial income and expenses -4.6 -4.7
Financial statements Notes to the consolidated financial statements
Annual Report 2025
85
Financial statements Notes to the consolidated financial statements
Annual Report 2025
86
2 Operational assets and liabilities
2.1 Trade and other receivables . . . . . . . . . . . . 87
2.2 Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
2.3 Trade and other current payables . . . . . .88
2.4 Other non-current liabilities . . . . . . . . . . . .88
2.5 Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . .88
Financial statements Notes to the consolidated financial statements
Annual Report 2025
87
2.1 Trade receivables and other
receivables
2.2 Inventories
MEUR 2025
2024
Carve-out
Raw materials and consumables 4.7 4.2
Finished goods 0.7 1.2
Other inventories 4.5 3.8
Total 9.9 9.2
The carrying value of the inventories was written down to the net realisable value,
and the expense of EUR 0.1 million (0.0) is included in Materials and services in
the income statement.
Financial statements Notes to the consolidated financial statements
Annual Report 2025
88
2.5 Provisions
MEUR
2025
2024
Carve-out
Non-current provisions 6.3 6.3
Current provisions 0.3 0.6
Total 6.6 6.9
Financial statements Notes to the consolidated financial statements
Annual Report 2025
89
Obligations covered by the environmental provisions
The Group has leased site that it uses as landfill from the city of Kotka. In Varkaus
the Group uses a site for intermediate storing, processing and final disposal
of contaminated soil. At the expiry of the leases or at the discontinuation of
operations, the Group is responsible for site restoration comprising landscaping
and post-closure environmental monitoring called for in the terms and conditions
of environmental permits.
The Munaistenmetsä landfill site in Uusikaupunki serves as a final disposal area
for municipal waste, contaminated soil and industrial by-products.
The material recycling centre in the landfill area in Oulu receives, processes
and recovers various types of waste and side streams, such as industrial waste,
contaminated soil, construction and demolition waste as well as municipal waste.
The landfill area in Pori receives and processes gypsum, construction and
demolition waste as well as contaminated soil and other smaller items. The
new environmental permit became legally valid in December 2025. The new
environmental permit covers the applied-for new reception and processing
operations for both non-hazardous and hazardous waste. Construction of the
hazardous waste operations will commence in spring 2026.
Other provisions
Other provisions consist mainly of provisions for restructuring as well as
restoration provisions for leased premises.
MEUR
Environmental
provisions
Other
provisions Total
Provisions at 1 Jan 2025
6.3 0.6 6.9
Additions 0.5 0.2 0.7
Used during the year -0.4 -0.5 -0.8
Effect of discounting -0.1 - -0.1
Provisions at 31 Dec 2025 6.3 0.3 6.6
MEUR
Environmental
provisions
Other
provisions Total
Provisions at 1 Jan 2024 7.2 0.1 7.2
Additions 0.6 0.6 1.2
Used during the year -0.4 -0.1 -0.5
Effect of discounting -1.0 - -1.0
Provisions at 31 Dec 2024 6.3 0.6 6.9
Financial statements Notes to the consolidated financial statements
Annual Report 2025
9090
3 Intangible and tangible assets
and other non-current assets
3.1 Goodwill and other intangible assets . . . . . . . . . . . . . . . . .91
3.2 Goodwill impairment testing . . . . . . . . . . . . . . . . . . . . . . . . 92
3.3 Property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . 92
3.4 Right-of-use assets and lease liabilities . . . . . . . . . . . . . 94
3.5 Other non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
Financial statements Notes to the consolidated financial statements
Annual Report 2025
91
3.1 Goodwill and other intangible assets
2025, MEUR Goodwill
Items acquired
through business
combinations
Intangible
rights
Other
intangible
assets
Prepayments and
construction in
progress Total
Acquisition cost, 1 Jan 118.8 38.9 1.0 15.8 20.7 195.2
Additions - - 0.0 0.1 2.2 2.4
Business acquisitions 6.4 5.1 - - - 11.5
Disposals - - -0.0 -0.9 - -1.0
Transfers between items - - - 21.1 -21.1 -
Exchange differences 0.5 0.2 0.0 - - 0.7
Acquisition cost, 31 Dec 125.7 44.2 1.1 36.2 1.7 208.8
Accumulated amortisation, 1 Jan -29.6 -0.3 -11.4 -41.3
Accumulated amortisation on disposals and
transfers - 0.0 1.3 1.3
Amortisation charge -1.9 -0.1 -2.9 -4.9
Exchange differences -0.1 -0.0 - -0.1
Accumulated amortisation, 31 Dec - -31.6 -0.3 -13.1 - -45.0
Carrying amount at 31 Dec 125.7 12.6 0.7 23.1 1.7 163.8
Other intangible assets consist primarily of software and software licences.
Contractual commitments related to intangible assets totalled EUR 0.1 million (0.1).
2024, MEUR Goodwill
Items acquired
through business
combinations
Intangible
rights
Other
intangible
assets
Prepayments and
construction in
progress Total
Acquisition cost, 1 Jan 118.2 38.3 1.0 13.5 13.9 184.9
Additions - - 0.0 0.1 9.1 9.3
Disposals 0.8 0.7 - - - 1.5
Impairments - - -0.0 -0.1 - -0.1
Transfers between items - - - 2.3 -2.3 -
Exchange differences -0.3 -0.1 -0.0 - - -0.3
Acquisition cost, 31 Dec 118.8 38.9 1.0 15.8 20.7 195.2
Accumulated amortisation, 1 Jan -27.8 -0.2 -10.0 -38.1
Accumulated amortisation on disposals and
transfers - 0.0 0.1 0.1
Amortisation charge -1.8 -0.1 -1.5 -3.4
Exchange differences 0.0 0.0 - 0.0
Accumulated amortisation, 31 Dec - -29.6 -0.3 -11.4 - -41.3
Carrying amount at 31 Dec 118.8 9.3 0.8 4.4 20.7 153.9
Financial statements Notes to the consolidated financial statements
Annual Report 2025
92
3.2 Goodwill impairment testing
.
Sensitivity analyses of impairment testing
In connection with the impairment testing, a sensitivity analysis of the cash-
generating unit was performed, during which the key calculation assumptions
were tested. The key assumptions used in the testing were discount rate and
EBITDA per cent used in calculation of the terminal value. The EBITDA per cent
was based on the historical development of the cash-generating unit. In the
sensitivity analysis, a key assumption was tested by changing the threshold
values to a value at which the value-in-use would equal the carrying amount.
Based on the sensitivity analysis, no reasonably possible change in key
assumptions would result in the carrying amount of the cash-generating unit
exceeding its value in use.
3.3 Property, plant and equipment
Financial statements Notes to the consolidated financial statements
Annual Report 2025
93
Climate Transition Plan
Lassila & Tikanojalla has a transition plan in place to reduce emissions. The
primary focus of the measures concerning the Group’s own emissions is on
reducing emissions generated during transportation. Key actions include
transitioning to low-emission vehicles and investing in the use of renewable
fuels. The transition will be implemented in connection with investments in fleet,
and investments in low-emission vehicles are not expected to have a material
impact on the financial statements. Existing vehicles will be used until the end of
their useful life, and the transition plan does not require changes to depreciation
periods. So far, the transition plan does not significantly affect investment levels
for heavy-duty vehicles.
2025, MEUR Land
Buildings and
structures
Machinery
and
equipment
Other tangible
assets
Prepayments
and
construction
in progress Total
Acquisition cost, 1 Jan 7.6 131.7 331.9 0.2 8.0 479.5
Additions 0.0 1.1 8.5 0.0 11.5 21.2
Business acquisitions - - 1.0 0.0 - 1.0
Disposals - -0.9 -12.6 0.8 - -12.7
Transfers between items - 3.7 3.4 - -7.1 -
Exchange differences - 0.0 0.5 0.0 0.0 0.6
Acquisition cost, 31 Dec 7.6 135.7 332.8 1.1 12.5 489.6
Accumulated depreciation, 1 Jan -96.5 -227.7 -0.1 -324.3
Accumulated depreciation on disposals and transfers 0.6 12.5 -0.8 12.4
Depreciation for the period -5.7 -20.9 -0.0 -26.7
Exchange differences -0.0 -0.2 -0.0 -0.2
Accumulated depreciation, 31 Dec - -101.6 -236.3 -0.9 - -338.8
Carrying amount at 31 Dec 7.6 34.1 96.5 0.2 12.5 150.9
The carrying amount of buildings and structures include capitalised costs related to the environmental provisions. The carrying amount of machinery and equipment includes
compactors and balers sold through an external financing company. Due to the repurchase obligation the leased equipment is treated as tangible assets. The carrying
amount of the equipment was EUR 11.6 million (12.0) at the end balance sheet date. Contractual commitments related to property, plant and equipment totalled EUR 9.0
million (8.6).
2024, MEUR Land
Buildings and
structures
Machinery
and
equipment
Other tangible
assets
Prepayments
and
construction
in progress Total
Acquisition cost, 1 Jan 7.6 125.2 321.4 0.2 16.0 470.3
Additions 0.0 0.7 9.5 0.0 18.5 28.7
Business acquisitions - - 0.3 0.0 - 0.4
Disposals - -3.6 -16.0 - -0.1 -19.7
Transfers between items - 9.5 16.9 - -26.4 -
Exchange differences - -0.0 -0.2 -0.0 -0.0 -0.2
Acquisition cost, 31 Dec 7.6 131.7 331.9 0.2 8.0 479.5
Accumulated depreciation, 1 Jan -94.0 -223.2 -0.1 -317.2
Accumulated depreciation on disposals and transfers 2.6 15.8 - 18.4
Depreciation for the period -5.1 -20.3 -0.0 -25.5
Exchange differences 0.0 0.0 0.0 0.0
Accumulated depreciation, 31 Dec - -96.5 -227.7 -0.1 - -324.3
Carrying amount at 31 Dec 7.6 35.3 104.2 0.1 8.0 155.3
Financial statements Notes to the consolidated financial statements
Annual Report 2025
94
3.4 Right-of-use assets and lease
liabilities
2025, MEUR Land Buildings
Machinery
and
equipment Total
Acquisition cost, 1 Jan 11.0 36.8 50.5 98.3
Additions 1.0 10.8 9.7 21.4
Business acquisitions 0.0 0.9 0.0 1.0
Disposals -0.4 -5.5 -11.0 -16.9
Exchange differences - 0.1 0.0 0.2
Acquisition cost, 31 Dec 11.7 43.0 49.2 103.9
Accumulated depreciation, 1
Jan -2.6 -14.7 -26.2 -43.5
Accumulated depreciation
on disposals and transfers 0.1 4.2 9.4 13.7
Depreciation for the period -0.9 -6.4 -6.6 -14.0
Exchange differences - -0.1 -0.0 -0.1
Accumulated depreciation,
31 Dec -3.4 -17.0 -23.4 -43.8
Carrying amount at 31 Dec 8.2 26.1 25.8 60.1
2024, MEUR Land Buildings
Machinery
and
equipment Total
Acquisition cost, 1 Jan 12.5 29.7 62.9 105.1
Additions 0.3 11.0 1.1 12.4
Business acquisitions - 0.1 0.0 0.1
Disposals -1.8 -4.0 -13.5 -19.3
Exchange differences - -0.1 -0.0 -0.1
Acquisition cost, 31 Dec 11.0 36.8 50.5 98.3
Accumulated depreciation, 1
Jan -2.0 -11.7 -30.6 -44.4
Accumulated depreciation
on disposals and transfers 0.4 3.1 11.9 15.4
Depreciation for the period -1.0 -6.0 -7.5 -14.5
Exchange differences - 0.0 0.0 0.0
Accumulated depreciation,
31 Dec -2.6 -14.7 -26.2 -43.5
Carrying amount at 31 Dec 8.4 22.1 24.3 54.8
On the balance sheet date, no new lease agreements are known which will
become valid in the coming financial years that would have a significant impact
on the amount of debt resulting from a right-of-use asset or a lease agreement.
Lease liabilities and their maturity have been presented in Notes 4.1 Financial
assets and liabilities and 4.2 Financial risk management.
For more information about the expenses related to leases, please refer to Note
1.6 Expenses related to leases.
Financial statements Notes to the consolidated financial statements
Annual Report 2025
95
Financial statements Notes to the consolidated financial statements
Annual Report 2025
96
4 Financial risks and
capital structure
4.1 Financial assets and liabilities . . . . . . . . . . . . . .97
4.2 Financial risk management . . . . . . . . . . . . . . . . 99
4.3 Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .102
4.4 Earnings per share and dividend per share .102
4.5 Commitments and contingent liabilities . . . .102
Financial statements Notes to the consolidated financial statements
Annual Report 2025
97
4.1 Financial assets and liabilities
Financial statements Notes to the consolidated financial statements
Annual Report 2025
98
Financial statements Notes to the consolidated financial statements
Annual Report 2025
99
4.2 Financial risk management
Lassila & Tikanoja’s financial risks are managed centrally by the Group’s
finance function, which is led by the Group’s CFO. The principles for financial
risk management are defined in the treasury policy approved by the Board of
Directors of Lassila & Tikanoja Plc. The purpose of financial risk management is to
mitigate significant financial risks and strive to reduce the unfavourable effects of
fluctuations in the financial market and other risk factors on the Group’s result.
Financial statements Notes to the consolidated financial statements
Annual Report 2025
100
Financial statements Notes to the consolidated financial statements
Annual Report 2025
101
Financial statements Notes to the consolidated financial statements
Annual Report 2025
102
4.4 Earnings per share and dividend per
share
MEUR 2025 2024
Result attributable to equity holders of the company,
MEUR 25.7 31.5
Adjusted weighted average number of ordinary shares
Earnings per share, EUR 0.67 0.83
Dilutive effect of the share-based incentive programme,
million shares 0.1 0.1
Adjusted average number of shares during the period,
Earnings per share, diluted, EUR 0.67 0.82
¹ The number of shares at the date of the demerger 31 December 2025 also for the
comparative period.
Capital management
The objective of the Group’s capital management is to secure the continuity of
operations and maintain an optimal capital structure to enable investments, taking
the cost of capital into account. The capital includes equity and liabilities less
advances received. The development of the capital structure is monitored quarterly
using the equity ratio and gearing.
Financial statements Notes to the consolidated financial statements
Annual Report 2025
103
5 Consolidation
and other notes
5.1 Consolidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
5.2 Group companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
5.3 Business acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
5.4 Related-party transactions . . . . . . . . . . . . . . . . . . . . . . . . . . 106
5.5 Auditing costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106
5.6 Events after the balance sheet date . . . . . . . . . . . . . . . . . . .107
Financial statements Notes to the consolidated financial statements
Annual Report 2025
104
Financial statements Notes to the consolidated financial statements
Annual Report 2025
105
5.3 Business acquisitions
Business acquisitions 2025
On June 2, 2025, Lassila & Tikanoja Plc’s subsidiary L&T Ympäristöpalvelut Oy
acquired the pallet business of Stena Recycling Oy. The annual net sales of the
business have been approximately EUR 10 million. The acquisition strengthens
Lassila & Tikanoja’s service offering and supports the growth of its circular
economy business in line with L&T’s growth strategy. As a result of the business
acquisition, Lassila & Tikanoja’s pallet business will employ just over 30 people
across four locations. In the fair value measurement, intangible assets based on
customer relationships amounting to EUR 3.7 million and goodwill amounting to
EUR 3.4 million were identified. Goodwill is primarily based on a broader service
network, a stronger service offering, and future development prospects. The
goodwill is tax-deductible.
On 1 December 2025, Lassila & Tikanoja Plc’s subsidiary L&T Teollisuuspalvelut
Oy acquired the entire share capital of Viemärihuolto Reinikka Oy. In the fair value
measurement, intangible assets based on customer relationships amounting to
EUR 0.9 million and goodwill amounting to EUR 1.4 million were identified. The
goodwill is primarily based on a broader service network, a strengthened service
offering and future growth prospects.
On 1 December 2025, Lassila & Tikanoja Plc’s Swedish subsidiary Sand
& Vattenbläst i Tyringe AB (SVB) acquired the entire share capital of
RecondConcept i Ånge AB, a company providing process-cleaning services in
Sweden. In the fair value measurement, intangible assets based on customer
relationships amounting to EUR 0.4 million and goodwill amounting to EUR 1.6
million were identified. The goodwill is primarily based on a strengthened service
offering and future growth prospects. In connection with the transaction, Lassila
& Tikanoja recognised a EUR 1.1 million contingent consideration (earn-out) within
non-current liabilities. The contingent consideration is measured at fair value,
which is based on the development of RecondConcept i Ånge AB’s EBITDA in
2026 and 2027.
In the reporting period, the business acquisitions had a EUR 7.1 million impact
on Lassila & Tikanoja’s net sales and EUR 0.3 million on operating profit. If the
acquisitions had been completed on 1 January 2025, Lassila & Tikanoja’s net
sales would have been approximately EUR 434.6 million and operating profit
approximately EUR 35.1 million. In the reporting period, transaction costs totalling
EUR 0.3 million (in 2024: 0.3) related to the acquisitions were recognised in other
operating expenses.
Business acquisitions 2024
On 1 February 2024, Lassila & Tikanoja acquired all of the shares of PF
Industriservice AB, a company that provides process cleaning services in
Sweden. Through the acquisition, Lassila & Tikanoja’s process cleaning
services business expanded to the Gävleborg area in Sweden. In the fair value
measurement, intangible assets based on customer relationships with a value of
EUR 0.7 million, as well as goodwill with a value of EUR 0.8 million were identified.
The goodwill is mainly based on the regional position of the acquired business
and its future development prospects.
On 1 July 2024, Lassila & Tikanoja’s subsidiary L&T Ympäristöpalvelut Oy
acquired the rest 60 per cent of the shares of Suomen Keräystuote Oy. Previously
Suomen Keräystuote Oy was an associated company, of which Lassila &
Tikanoja’s ownership was 40 per cent. The transaction did not have a significant
impact on Lassila & Tikanoja’s figures.
In 2024, business acquisitions had a EUR 2.6 million impact on Lassila &
Tikanoja’s net sales for the financial period and EUR 0.2 million on operating
profit. If the acquisitions in 2024 had been completed on 1 January 2024, Lassila
& Tikanoja’s net sales would have been approximately EUR 424.0 million and
operating profit approximately EUR 40.5 million. In 2024, expenses totalling EUR
0.1 million related to the acquisitions were recognised in the income statement.
Business acquisitions, fair value total,
MEUR 2025 2024
Intangible assets 5.1 0.7
Property, plant and equipment 1.0 0.4
Right-of-use assets 1.0 0.1
Inventories 0.5 -
Receivables 0.6 0.2
Cash and cash equivalents 0.8 0.5
Total assets 9.0 1.9
Lease liabilities 0.9 0.1
Other liabilities 1.1 0.2
Deferred tax liabilities 0.3 0.2
Total liabilities 2.3 0.6
Net assets acquired 6.7 1.2
Total consideration 13.0 2.1
Goodwill 6.4 0.8
Impact on cash flow
Total consideration -13.0 -2.1
Contingent consideration 1.1 -
Consideration paid in cash -11.9 -2.1
Cash and cash equivalents of the acquired company 0.8 0.5
Total impact on cash flow -11.1 -1.6
The acquisition calculations for 2025 are preliminary. The fair value of net assets
acquired from the acquisitions completed in December will be finalised during
the first half of 2026. The figures for such acquired businesses, that are not
material to the Group when considered separately, are stated in aggregate.
Financial statements Notes to the consolidated financial statements
Annual Report 2025
106
cash pool receivables and liabilities. Trade and other receivables as well as trade
and other payables consist of items arising from ordinary business operations.
Transactions with the joint venture
The Group’s business transactions with Laania Oy are presented in the following
table. The former Lassila & Tikanoja has also provided guarantees for Laania’s
financing arrangements. These guarantees have been allocated to the New
Lassila & Tikanoja in the carve-out financial information. In the final quarter of
2025, the guarantees for Laania’s financing arrangements provided by the former
Lassila & Tikanoja were released. In 2025, Laania paid dividends totalling EUR 1.6
million (1.8) to Lassila & Tikanoja.
MEUR 2025 2024
Net sales 2.7 3.1
Purchases of materials and services -0.8 -0.9
Trade and other receivables 0.0 0.0
5.5 Auditing costs
MEUR
2025
Carve-out
2024
Carve-out
Auditing 0.2 0.1
Other assignments in accordance with the auditing
act 0.0 0.0
Tax consulting services 0.0 0.0
Other services 0.0 0.1
Total 0.2 0.2
Non-audit services provided by the statutory auditor, PricewaterhouseCoopers
Oy, and allocated to Lassila & Tikanoja’s carve-out financial information amounted
to a total of EUR 44 thousand in the financial year 2025 (EUR 133 thousand in
the financial year 2024).
Financial statements Notes to the consolidated financial statements
Annual Report 2025
107
5.6 Events after the balance sheet date
The company announced the composition of Lassila & Tikanoja Plc’s Nomination
Board on 29 January 2026. Lassila & Tikanoja Plc’s three largest shareholders,
who are entitled to appoint a representative to Lassila & Tikanoja Plc’s
Shareholders’ Nomination Board are the first groups of shareholders (Evald and
Hilda Nissi Foundation and Bergholm Heikki), the second group of shareholders
(Chemec Oy, CH-Polymers Oy, Maijala Eeva, Maijala Investment Oy, Maijala
Juhani, Maijala Juuso, Maijala Miikka, Maijala Mikko, Maijala Roope and Maijala
Tuula) and Nordea Funds Ltd (through 11 funds managed by it).
The following persons have been appointed as their representatives in Lassila
& Tikanoja’s Nomination Board: Juhani Lassila, Miikka Maijala and Josefin
Degerholm. The Chairman of Lassila & Tikanoja Plc’s Board of Directors, Jukka
Leinonen, acts as the fourth member of the Nomination Board. The Chairman of
the Nomination Board is Juhani Lassila.
Lassila & Tikanoja Plc received a notification from Protector Forsikring ASA
on 30 January 2026, according to which its shareholding in Lassila & Tikanoja
decreased below 5 per cent on 29 January 2026.
Lassila & Tikanoja Plc announced on 16 February 2026, that a member of
Lassila & Tikanoja Plc’s Group Executive Board, Hilppa Rautpalo (Senior Vice
President, Legal, HR and EHSQ), has announced her decision to leave the
company to take up a new position outside the organization by August 2026 at
the latest.
Lassila & Tikanoja announced on 26 February 2026 Lassila & Tikanoja’s
Shareholders’ Nomination Board proposals for the 2026 Annual General Meeting.
The Shareholders’ Nomination Board proposes the Board of Directors to
have five (5) members. The Nomination Board proposes that all of the current
members, Tuija Kalpala, Teemu Kangas-Kärki, Sakari Lassila, Jukka Leinonen and
Anna-Maria Tuominen-Reini be re-elected to the Board of Directors. In addition,
the Nomination Board proposes that Jukka Leinonen be re-elected as Chairman
of the Board of Directors and Sakari Lassila as Vice Chairman.
The Shareholders’ Nomination Board proposes that the remuneration of the
members of the Board of Directors be as follows:
• chairman, EUR 70,000 per year (2025: EUR 70,000);
• vice chairman, EUR 47,000 per year (2025: EUR 47,000);
• members, EUR 35,000 per year (2025: EUR 35,000);
However, if a member of the Board of Directors were to serve as the chairman
of the Audit Committee or the Personnel and Sustainability Committee, and not
simultaneously serve as the chairman or vice chairman of the Board of Directors,
their annual remuneration will be EUR 47,000.
Lassila & Tikanoja announced on 27 February 2026 that the Company will
launch a share repurchase programme for share-based incentive schemes
and remuneration of the Board of Directors. The Board of Directors of Lassila
& Tikanoja Plc has decided to exercise the authorisation granted by the
Extraordinary General Meeting held on 4 December 2025 to repurchase the
Company’s own shares. The repurchase of shares will commence at the earliest
on 2 March 2026 and end at the latest on 28 April 2026. The maximum number
of shares to be repurchased is 150,000, representing approximately 0.39 per cent
of all shares in Lassila & Tikanoja Plc.
Lassila & Tikanoja announced on 27 February 2026 that the company’s Board
of Directors has decided to establish a new long-term share-based incentive
scheme for the Group’s key employees. The aim of the new scheme is to align
the objectives of the Company, shareholders and key employees to increase
the value of the Company in the long term, to strengthen the commitment of
key employees to the Company and to offer them a competitive reward plan
that is based on earning and accumulating the Company’s shares as well as on
appreciation of the share price.
The Performance Share Plan 2026–2030 comprises three (3) three-year (3)
performance periods, covering the calendar years 2026–2028, 2027–2029
and 2028–2030. In the plan, a participant has the opportunity to earn Lassila &
Tikanoja Plc shares based on the achievement of performance criteria. The Board
of Directors decides on the performance criteria of the plan and the performance
levels to be set for each performance criterion at the beginning of a performance
period. The potential rewards based on the plan will be paid after the end of each
performance period. During the performance period 2026–2028, the earning of
rewards is based on the following performance criteria:
• Return on capital employed (ROCE) (30 %) during the period 2026–2028;
• Revenue growth (30 %) during the period 2026–2028;
• Total shareholder return (rTSR) (30 %) during the period 2026–2028;
• Reduction of the carbon footprint (ESG) (10 %) during the period 2026–2028.
The rewards to be paid based on the performance period 2026–2028
correspond to the value of approximately 218,677 Lassila & Tikanoja Plc shares in
maximum total, also including the portion to be paid in cash. The target group of
the Performance Share Plan during the performance period 2026–2028 consists
of approximately 25 key employees, including the Group’s President and CEO and
the Group Executive Board.
Lassila & Tikanoja Plc announced on 19 March 2026, that Eero Hautaniemi,
who has served as President and CEO of Lassila & Tikanoja Plc since 2019, has
informed the company of his wish to step down from his position no later than 30
June 2027. The Board of Directors of the company has initiated the recruitment
process for a new President and CEO.
Financial statements of the parent company
Financial statements
Annual Report 2025
108
Financial statements of
the parent company
Income statement . . . . . . . . . . . . . . . . . . . . . . . .109
Balance sheet . . . . . . . . . . . . . . . . . . . . . . . . . . .109
Cash flow statement . . . . . . . . . . . . . . . . . . . . . 110
Accounting policies . . . . . . . . . . . . . . . . . . . . . . 110
Notes to the financial statements . . . . . . . . . 111
Financial statements of the parent company
Financial statements
Annual Report 2025
109
Income statement
of the parent
company
EUR thousand 2025 Note
Other operating expenses -4,242.0 3
Operating result -4,242.0
Result before appropriations and taxes -4,242.0
Appropriations 4
Group contribution 24,700.0
24,700.0
Income taxes -4,091.6 5
Result for the period 16,366.4
Balance sheet of the parent company
EUR thousand 2025 Note
ASSETS
Non-current assets
Intangible assets 6
Other intangible assets 1,260.9
Advance payments and construction in progress 1,048.5
2,309.4
Tangible assets 7
Machinery and equipment 90.9
Other tangible assets 39.7
Advance payments and construction in progress 172.9
303.4
Investments 8
Shares in group companies 89,075.3
Shares in joint venture 9,946.8
Other shares and holdings 100.0
99,122.1
Total non-current assets 101,734.8
Current assets
Non-current receivables
Receivables from group companies 4,204.6 9
Prepaid expenses and accrued income 165.7
Deferred tax assets 6.6 10
4,376.9
Current receivables
Receivables from group companies 74,700.0 9
Other receivables 1,081.7
Prepaid expenses and accrued income 648.0 9
76,429.7
Cash and cash equivalents 18,465.2
Total current assets 99,271.7
Total assets 201,006.6
EUR thousand 2025 Note
SHAREHOLDERS' EQUITY AND LIABILITIES
Shareholders' equity 11
Share capital 80.0
Invested non-restricted equity reserve 18,966.5
Retained earnings 6,983.3
Profit for the period 16,366.4
42,396.2
Accumulated appropriations
Depreciation difference 137.7
Obligatory provisions 12
Current 9.7
9.7
Liabilities 13
Non-current
Loans from credit intitutions 50,000.0
Unsecured notes 75,000.0
125,000.0
Current
Trade payables 164.7
Liabilities to group companies 18,623.2
Other liabilities 6,932.9
Accrued expenses and deferred income 7,742.1
33,463.0
Total liabilities 158,463.0
Total shareholders' equity and liabilities 201,006.6
Financial statements of the parent company
Financial statements
Annual Report 2025
110
Cash flow
statement of the
parent company
EUR thousand 2025
Operating activities
Profit (+)/ loss (-) before appropriations and taxes -4,242.0
Cash flow before change in working capital -4,242.0
Change in working capital
Increase/decrease in current non-interest-bearing
receivables -1,081.7
Increase/decrease in current non-interest-bearing liabilities 5,323.8
Change in working capital 4,242.0
Cash flow from operating activities -
Cash flow from investing activities -
Cash flow from financing activities -
Change in cash and cash equivalents -
Cash and cash equivalents at the beginning of the period -
Cash and cash equivalents transferred in the demerger 18,465.2
Cash and cash equivalents at the end of the period 18,465.2
Cash and cash equivalents at 31 December
Cash and cash equivalents 18,465.2
Accounting
policies of the
parent company
Basis of preparation
Lassila & Tikanoja Plc was established through the partial demerger of Luotea Plc
(formerly Lassila & Tikanoja plc), with the effective date of the demerger being 31
December 2025. Accordingly, the Company’s first financial period comprises one
day. Lassila & Tikanoja Plc is the parent company of the Lassila & Tikanoja Group
and is domiciled in Helsinki. The Company provides administrative services to
the group companies, which have been centralised to be produced by the parent
company.
The financial statements of Lassila & Tikanoja Plc have been prepared in
accordance with the Finnish Accounting Act (FAS). The financial statements
are presented in euros, and the items included therein have been measured at
historical cost. The opening balances of the balance sheet were transferred at
their carrying amounts from the demerging company on the effective date of the
demerger, 31 December 2025.
When appropriate, the financial statements of Lassila & Tikanoja Plc comply
with the Group’s accounting policies based on IFRS. The accounting policies of
the consolidated financial statements are presented in the notes to the
consolidated financial statements. The accounting policies of Lassila & Tikanoja
Plc described in the following chapters differ from the accounting policies of the
consolidated financial statements.
Subsidiary shares
Subsidiary shares in the balance sheet are measured at historical cost less
impairment losses. The carrying amounts of the subsidiary shares are assessed
as part of the Group’s impairment testing, where cash flow forecasts based on
value-in-use calculations are prepared for the Group’s cash-generating units.
In the impairment testing of subsidiary shares, the cash flows are further
allocated to subsidiaries’ recoverable amounts. An impairment loss is
recognised, if the carrying amount of the subsidiary shares and the amount of
net loan receivables from the subsidiary exceed the recoverable amount of the
corresponding assets.
Shares in joint venture and other shares and holdings
Shares in joint venture and other shares and holdings are recognised in the
balance sheet at historical cost, less any impairment losses recognised.
Loans from credit institutions and unsecured notes
Loans are recognised in the balance sheet at their original acquisition cost. Issue
costs related to the loans and other costs directly attributable to the raising of
financing are capitalised as prepaid expenses and amortised on a straight-line
basis over the term of the loan. Interest on loans is recognised as an expense in
the financial period to which it relates.
Leases
The lease payments of the lease contracts are expensed over the rental period,
and they are included in other operating expenses. Assets leased and related
liabilities are not recognised in the parent company’s balance sheet.
Share-based incentives
Share-based incentives settled in shares are recognised, at the date of
settlement, as a transfer from the reserve for treasury shares within equity to
retained earnings. Cash-settled share-based incentives are recognised as an
expense in personnel expenses in the income statement and as a liability until
they are paid.
Research and development expenditure
Research and development expenditure is recognised as an expense.
Obligatory provisions
Obligatory provisions in the balance sheet are based on legal or contractual
obligations towards third parties, that have not been realised, are related to the
past or current financial period and at the balance sheet date it is certain or
probable, that the obligation will be realised, but the exact amount and timing are
uncertain and the corresponding income from the obligation is neither certain
nor probable. The changes in obligatory provisions are included in the income
statement.
Financial statements of the parent company
Financial statements
Annual Report 2025
111
Notes to the financial statements of the parent company
1. Personnel and administrative bodies
2025
Average number of personnel
Salaried employees 63
Total 63
Management salaries, remuneration and pension benefits are described
in Note 5.4 Related party transactions to the consolidated financial
statements.
No loans were granted to the related parties of the group companies.
2. Auditor’s fees
EUR thousand 2025
Auditing 52.5
Total 52.5
3. Liiketoiminnan muut kulut
EUR thousand 2025
Other operating expenses
Expenses related to the demerger 4,242.0
Total 4,242.0
4. Appropriations
Tuhat euroa 2025
Group contribution
Group contribution received 24,700.0
Total group contributions 24,700.0
Total appropriations 24,700.0
5. Income taxes
EUR thousand 2025
Income taxes on operations for the financial year 4,091.6
Total 4,091.6
6. Intangible assets
2025
EUR thousand
Intangible
rights
Other intangible
assets
Prepayments and
construction in progress Total
Transfers from the partial demerger 38.1 2,421.1 1,048.5 3,507.7
Acquisition cost, 31 Dec 38.1 2,421.1 1,048.5 3,507.7
Transfers from the partial demerger -38,1 -1 160,2 -1 198,3
Accumulated amortisation, 31 Dec -38.1 -1,160.2 -1,198.3
Total carrying amount - 1,260.9 1,048.5 2,309.4
Other intangible assets includes several ICT projects.
Financial statements of the parent company
Financial statements
Annual Report 2025
112
8. Investments
2025
EUR thousand
Shares in Group
companies
Shares in joint
ventures
Other shares and
holdings Total
Transfers from the partial demerger 89,075.3 9,946.8 100.0 99,122.1
Acquisition cost, 31 Dec 89,075.3 9,946.8 100.0 99,122.1
Total carrying amount 89,075.3 9,946.8 100.0 99,122.1
Holding of shares and votes, %
Subsidiaries
L&T Teollisuuspalvelut Oy, Helsinki 100.0
L&T Ympäristöpalvelut Oy, Helsinki 100.0
Sand&VattenBläst i Tyringe AB, Hässleholm, Ruotsi 70.0
Joint Ventures
Laania Oy, Helsinki
55.0
7. Tangible assets
2025
EUR thousand
Machinery and
equipment
Other tangible
assets
Advance
payments and
construction in
progress Total
Transfers from the partial demerger 127.0 39.7 172.9 339.5
Acquisition cost, 31 Dec 127.0 39.7 172.9 339.5
Transfers from the partial demerger -36.1 -36.1
Accumulated depreciation, 31 Dec -36.1 -36.1
Total carrying amount 90.9 39.7 172.9 303.4
9. Long-term and short-term receivables
EUR thousand 2025
Long term receivables from Group Companies
4,204.6
Accrued expenses and deferred income
Unsecured notes, accruals 165.7
Short-term receivables From Group Companies
50,000.0
Group contribution receivable 24,700.0
Total 74,700.0
Prepaid expenses and accrued income
Licences 502.7
Other 127.3
Total 648.0
¹ Lassila & Tikanoja Plc granted an unsecured shareholder loan totalling SEK 45,5
million to its subsidiary Sand & Vattenbläst i Tyringe Ab (70% ownership). The interest
on the shareholder loan is linked to the 12 month Euribor and is reviewed annually on 1
January. The loan agreement may not be assigned to a third party without the consent
of the parties. The shareholder loan has no fixed maturity and is repayable on demand
together with accrued interest.
² The Company has a EUR 30 million loan receivable from L&T Ympäristöpalvelut Oy
and a EUR 20 million loan receivable from L&T Teollisuuspalvelut Oy. The loans are
unsecured and bear interest linked to the 6-month Euribor. The loans mature on 30
June 2026.
10. Deferred tax assets
EUR thousand 2025
Obligatory provisions 1.9
Impairment of non-current assets 4.6
Total 6.6
Financial statements of the parent company
Financial statements
Annual Report 2025
113
11. Shareholders’ equity
EUR thousand 2025
Restricted equity
Transferred in the partial demerger 31 Dec 80.0
Restricted equity, total 80.0
Non-restricted equity
Transferred in the partial demerger 31 Dec 18,966.5
Invested non-restricted equity reserve 31 Dec 18,966.5
Transferred in the partial demerger 31 Dec 6,983.3
Retained earnings at 31 Dec 6,983.3
Profit for the period 16,366.4
Non-restricted equity total 42,316.2
Shareholders' equity at 31 Dec 42,396.2
Distributable funds
Retained earnings 6,983.3
Profit for the period 16,366.4
Invested non-restricted equity reserve 18,966.5
Total distributable funds 42,316.2
13. Liabilities
Repayments of non-current liabilities in coming years
EUR thousand 2025
Loans from credit institutions 50,000.0
Unsecured notes 75,000.0
Total 125,000.0
EUR thousand 2025
Short term liabilities to Group Companies
Cash pool liabilities 18,465.2
Accrued expenses and deferred income 158.1
Total 18,623.2
Short term liabilities to others
Trade payables 164.7
6,932.9
Accrued expenses and deferred income 7,742.1
Total 14,839.7
Accrued expenses and deferred income
Personnel expenses 1,912.1
Interest expenses 1,738.4
Taxes 4,091.6
Other expenses 0.0
Total 7,742.1
Liabilities to Luotea Plc related to the partial demerger.
The long-term loans mature in 2028. Their terms are described in more
detail in Note 4.2 Financial risk management to the consolidated financial
statements.
14. Contingent liabilities
EUR thousand 2025
Lease liabilities
Maturity within 1 year 708.6
Maturity in subsequent years 1,847.2
Total 2,555.8
Guarantees for group companies 33,948.8
Other bank guarantees 105.3
10,945.9 thousand remains unused. The portion of the guarantee limits currently in use
is presented above.
According to the shareholders’ agreement, the Company is committed to
acquire the remaining 30 per cent share of Sand & Vattenbläst i Tyringe AB.
The remaining 30 per cent share will be acquired during the first half of
2026. The estimated value of the commitment at the end of the reporting
period totalled EUR 6,198.1 thousand.
12. Obligatory provisions
EUR thousand 2025
Restructuring provisions 9.7
Total 9.7
Annual Report 2025
114
Financial statements Proposal by the Board of Directors
The Auditor’s Note
We have today submitted our report on the audit conducted by us.
Helsinki on 2 April 2026
PricewaterhouseCoopers Oy
Samuli Perälä
APA
According to the financial statements, Lassila & Tikanoja Plc’s unrestricted
equity amounts to EUR 42,316,205.58 with the result for the period representing
EUR 16,366,364.95 of this total. There were no substantial changes in the financial
position of the company after the end of the period, and the solvency test referred to
in Chapter 13, Section 2 of the Companies Act does not affect the amount
of distributable profits.
The Board of Directors proposes to the Annual General Meeting to be held on 28
April 2026 that a dividend of EUR 0.42 per share be paid for the financial year 2025.
The Board of Directors proposes that the dividend be paid in two instalments.
The first dividend instalment of EUR 0.21 per share will be paid to shareholders who
on the record date of the first dividend instalment, 30 April 2026, are registered in
the Company’s shareholders’ register held by Euroclear Finland Oy. The Board of
Directors proposes that the dividend be paid on 8 May 2026.
The record date and payment date of the second dividend instalment shall be
resolved by the Board of Directors in its meeting preliminarily scheduled for 18
September 2026. The record date of the second dividend instalment would then be
on or about 22 September 2026, and the payment date of the second instalment on
or about 1 October 2026.
On the day the proposal for the distribution of profit was made, the number of shares
entitling to dividend was 38,076,012. Accordingly, the total amount of the dividend
would be EUR 15,991,925.04, and the remaining distributable funds would amount to
EUR 26,324,280.54.
Statements of the Board of Directors and signatures to the Report of the Board of Directors and the Financial Statements
for the year 2025
The financial statements have been prepared in accordance with applicable accounting regulations and provide a true and fair view of the assets, liabilities, financial
position, and results of operations of both the company and the entities included in the consolidated financial statements. The report by the board of directors includes a fair
review of the development and performance of the business of the company and the entities included in the consolidated financial statements, along with a description of
the principal risks and uncertainties and other relevant information. The sustainability report included in the report by the board of directors has been prepared in
accordance with the requirements set forth in Chapter 7 of the accounting act as well as the article 8 of the taxonomy regulation.
Helsinki on 30 March 2026
Jukka Leinonen Sakari Lassila Teemu Kangas-Kärki
Tuija Kalpala Anna-Maria Tuominen-Reini
Eero Hautaniemi
President and CEO
Auditor’s Report
Annual Report 2025
115
To the Annual General Meeting of Lassila & Tikanoja Plc
Report on the Audit of the Financial Statements
Opinion
In our opinion
• the consolidated financial statements give a true and fair view of the group’s
financial position, financial performance and cash flows in accordance with
IFRS Accounting Standards as adopted by the EU
• the financial statements give a true and fair view of the parent company’s
financial performance and financial position in accordance with the laws and
regulations governing the preparation of financial statements in Finland and
comply with statutory requirements.
Our opinion is consistent with the additional report to the Audit Committee.
What we have audited
We have audited the financial statements of Lassila & Tikanoja Oyj (business
identity code 3555336-9) for the financial year 31 December 2025 to 31
December 2025. The financial statements comprise:
• the consolidated balance sheet as of 31 December 2025, combined income
statement, combined statement of comprehensive income, statement of
changes in equity, combined statement of cash flows and notes , which
include material accounting policy information and other explanatory
information for the period 1 January 2025 to 31 December 2025
• the parent company’s balance sheet, income statement, cash flow statement
and notes for the period 31 December 2025 to 31 December 2025.
Basis for Opinion
We conducted our audit in accordance with good auditing practice in Finland. Our
responsibilities under good auditing practice are further described in the Auditor’s
Responsibilities for the Audit of the Financial Statements section of our report.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Independence
We are independent of the parent company and of the group companies in
accordance with the ethical requirements that are applicable in Finland and are
relevant to our audit, and we have fulfilled our other ethical responsibilities in
accordance with these requirements.
To the best of our knowledge and belief, the non-audit services that we have
provided to the parent company and group companies are in accordance with
the applicable law and regulations in Finland and we have not provided non-audit
services that are prohibited under Article 5(1) of Regulation (EU) No 537/2014.
The non-audit services that we have provided are disclosed in Note 5.5. to the
Financial Statements.
Emphasis of matter
We draw attention to the section “Basis of preparation of the consolidated
financial statements” in the notes to the Lassila & Tikanoja Group consolidated
financial statements, which describes that the financial figures of the
consolidated statement of financial position as of December 31, 2025, are
presented based on actual figures as of December 31, 2025, and on a carve-out
basis for other financial information and comparative periods. Our opinion is not
modified with respect to this matter.
Our Audit Approach
Overview
Materiality
Audit Scope
Key Audit
matters
• Overall group materiality:
€ 3 600 000
• The group audit scope included the most
significant group companies and covered a
sufficient share of group’s revenues, assets,
and liabilities.
• Revenue recognition
• Valuation of goodwill
• Valuation of shares in group companies and
receivables from group companies in the
parent company financial statements
As part of designing our audit, we determined materiality and assessed the risks
of material misstatement in the financial statements. In particular, we considered
where management made subjective judgements; for example, in respect
of significant accounting estimates that involved making assumptions and
considering future events that are inherently uncertain.
Materiality
The scope of our audit was influenced by our application of materiality. An audit
is designed to obtain reasonable assurance whether the financial statements are
free from material misstatement. Misstatements may arise due to fraud or error.
They are considered material if individually or in aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of
the financial statements.
Based on our professional judgement, we determined certain quantitative
thresholds for materiality, including the overall group materiality for the
consolidated financial statements as set out in the table below. These, together
with qualitative considerations, helped us to determine the scope of our audit and
the nature, timing and extent of our audit procedures and to evaluate the effect of
misstatements on the financial statements as a whole.
Overall group materiality € 3 600 000
How we determined it
We used net sales as benchmark to determine
overall group materiality
Rationale for the
materiality benchmark
applied
We chose net sales as the benchmark because,
in our view, it is the appropriate benchmark that
users of the financial statements regularly use to
evaluate the group's performance.
How we tailored our group audit scope
We tailored the scope of our audit, taking into account the structure of the
Lassila & Tikanoja Group, the accounting processes and controls, and the industry
in which the group operates.
The Group has one reportable segments: Circular Economy business, its main
markets being Finland and Sweden. We have scoped our audit to obtain sufficient
audit coverage of Lassila & Tikanoja Group’s consolidated financial statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were
of most significance in our audit of the financial statements of the current
period. These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
As in all of our audits, we also addressed the risk of management override of
internal controls, including among other matters consideration of whether there
was evidence of bias that represented a risk of material misstatement due to
fraud.
Auditor’s Report (Translation of the Finnish Original)
Auditor’s Report
Annual Report 2025
116
Responsibilities of the Board of Directors and the
Managing Director for the Financial Statements
The Board of Directors and the Managing Director are responsible for the
preparation of consolidated financial statements that give a true and fair view
in accordance with IFRS Accounting Standards as adopted by the EU, and of
financial statements that give a true and fair view in accordance with the laws
and regulations governing the preparation of financial statements in Finland and
comply with statutory requirements. The Board of Directors and the Managing
Director are also responsible for such internal control as they determine is
necessary to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directors and the Managing
Director are responsible for assessing the parent company’s and the group’s
ability to continue as a going concern, disclosing, as applicable, matters relating
to going concern and using the going concern basis of accounting. The financial
statements are prepared using the going concern basis of accounting unless
there is an intention to liquidate the parent company or the group or to cease
operations, or there is no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial
Statements
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due
to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with good auditing practice will always detect
a material misstatement when it exists. Misstatements can arise from fraud or
error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.
As part of an audit in accordance with good auditing practice, we exercise
professional judgment and maintain professional skepticism throughout the audit.
We also:
• Identify and assess the risks of material misstatement of the financial
statements, whether due to fraud or error, design and perform audit
procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for
one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to
design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the parent
company’s or the group’s internal control.
• Evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures made by
management.
Key audit matter in the audit of the group How our audit addressed the key audit matter
Revenue recognition
Refer to Note 1.1 and 1.2 in the consolidated financial statements
The Group’s total net sales amounted to EUR 427 million. Revenue from contracts
with customers is generated from multiple revenue streams as described in Note
1.2. Revenue recognition principles vary depending on the nature of the revenue
stream.
Revenue recognition is considered a key audit matter due to the significance of
revenue to the financial statements and due to management judgment involved
in selecting the appropriate revenue recognition method for the different revenue
streams.
Our audit procedures included, for example, the following:
• We obtained an understanding of the company’s revenue recognition policies
and compared these to the respective IFRS standards
• We obtained an understanding of the internal controls that the company uses
to assess the completeness, accuracy, and timing of revenues
• We tested revenue transactions on a sample basis
• We tested, on a sample basis, revenue related balance sheet items such as
contract assets and liabilities.
Valuation of goodwill
Refer to Note 3.1 and 3.2 in the consolidated financial statements
As of 31.12.2025, Goodwill in the consolidated balance sheet amounted to
EUR 126 million. Goodwill is not amortised, but is tested at least annually for
impairment. Goodwill impairment testing has been prepared based on value-
in-use calculations in which future cash flows are discounted to current value.
Value-in-use calculations include significant management judgment in respect of
profitability levels, long-term growth rates and discount rates.
The valuation of goodwill is considered a key audit matter due to its significance
as well as due to the management judgment involved in the impairment testing.
Our audit procedures included, for example, the following:
• We obtained an understanding of the methodology and assumptions used in
the goodwill impairment testing
• We tested the mathematical accuracy of the calculations
• We assessed the reasonableness of the estimated future profitability levels and
their consistency with the budgets and forecasts made by the management in
connection with the strategy process
• We assessed the reasonableness of the discount rates, long-term growth rates
and certain other assumptions by e.g., comparing the inputs to observable
market data
• We assessed management’s sensitivity analysis to ascertain the extent of
change in key assumptions that either individually or collectively could result in
an impairment of goodwill
• We assessed the adequacy of the disclosures.
Key audit matter in the audit of the parent company How our audit addressed the key audit matter
Valuation of shares in group companies and receivables from group companies
in the parent company financial statements
Refer to the accounting policies of the parent company and Note 8 and 9.
The investments in shares in group companies amounted to EUR 89 million and
non-current and current receivables from group companies to EUR 79 million.
The valuation of shares in group companies and receivables from group
companies is assessed annually and tested for impairment when necessary.
Impairment testing is performed using the discounted cash flow model.
Valuation of shares in group companies and receivables from group companies
is considered a key audit matter in the audit of the parent company due to
the significance of these investments to the financial statements and due to
management judgment involved in the impairment testing of these investments.
Our audit procedures included, for example, the following:
• We assessed the reasonableness of the management estimates by e.g.
checking their consistency with the approved budgets and forecasts
• We assessed the methodology used in determining the discount rates and
long-term growth rates by e.g., comparing the inputs to observable market data.
There are no significant risks of material misstatement referred to in Article 10(2c) of Regulation (EU) No 537/2014 with respect to the consolidated financial statements
or the parent company financial statements.
Auditor’s Report
Annual Report 2025
117
• Conclude on the appropriateness of the Board of Directors’ and the
Managing Director’s use of the going concern basis of accounting and
based on the audit evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast significant doubt on the
parent company’s or the group’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention
in our auditor’s report to the related disclosures in the financial statements
or, if such disclosures are inadequate, to modify our opinion. Our conclusions
are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the parent company
or the group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial
statements, including the disclosures, and whether the financial statements
represent the underlying transactions and events so that the financial
statements give a true and fair view.
• Plan and perform the group audit to obtain sufficient appropriate audit
evidence regarding the financial information of the entities or business units
within the group as a basis for forming an opinion on the group financial
statements. We are responsible for the direction, supervision and review of
the audit work performed for purposes of the group audit. We remain solely
responsible for our audit opinion.
We communicate with those charged with governance regarding, among other
matters, the planned scope and timing of the audit and significant audit findings,
including any significant deficiencies in internal control that we identify during
our audit.
We also provide those charged with governance with a statement that we
have complied with relevant ethical requirements regarding independence, and
communicate with them all relationships and other matters that may reasonably
be thought to bear on our independence, and where applicable, related
safeguards.
From the matters communicated with those charged with governance, we
determine those matters that were of most significance in the audit of the
financial statements of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or
regulation precludes public disclosure about the matter or when, in extremely
rare circumstances, we determine that a matter should not be communicated in
our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
Other Reporting Requirements
Appointment
We have acted as the auditor appointed by the extraordinary general meeting
since 31 December 2025.
Other Information
The Board of Directors and the Managing Director are responsible for the other
information. The other information comprises the report of the Board of Directors
and the information included in the Annual Report but does not include the
financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information.
In connection with our audit of the financial statements, our responsibility
is to read the other information and, in doing so, consider whether the other
information is materially inconsistent with the financial statements or our
knowledge obtained in the audit, or otherwise appears to be materially
misstated. With respect to the report of the Board of Directors, our responsibility
also includes considering whether the report of the Board of Directors has
been prepared in compliance with the applicable provisions, excluding the
sustainability report information on which there are provisions in Chapter 7 of the
Accounting Act and in the sustainability reporting standards.
In our opinion, the information in the report of the Board of Directors is
consistent with the information in the financial statements and the report of
the Board of Directors has been prepared in compliance with the applicable
provisions. Our opinion does not cover the sustainability report information
on which there are provisions in Chapter 7 of the Accounting Act and in the
sustainability reporting standards.
If, based on the work we have performed, we conclude that there is a material
misstatement of the other information, we are required to report that fact. We
have nothing to report in this regard.
Other opinions
We support the adoption of the financial statements. The proposal by the Board
of Directors regarding the treatment of distributable funds is in compliance
with the Limited Liability Companies Act. We support that the members of the
Board of Directors of the parent company and the President and CEO should be
discharged from liability for the financial period audited by us.
Helsinki 2 April 2026
PricewaterhouseCoopers Oy
Authorised Public Accountants
Samuli Perälä
Authorised Public Accountant (KHT)
Annual Report 2025
118
Independent Assurance Report
Assurance Report on the Sustainability Report
To the Annual General Meeting of Lassila & Tikanoja Plc
We have performed a limited assurance engagement on the group sustainability
report of Lassila & Tikanoja Plc (business identity code 3555336-9) that is
referred to in Chapter 7 of the Accounting Act and that is included in the report of
the Board of Directors for the reporting period ended 31.12.2025.
Opinion
Based on the procedures we have performed and the evidence we have obtained,
nothing has come to our attention that causes us to believe that the group
sustainability report does not comply, in all material respects, with
1. the requirements laid down in Chapter 7 of the Accounting Act and the sustai-
nability reporting standards (ESRS), and
2. the requirements laid down in Article 8 of the Regulation (EU) 2020/852 of the
European Parliament and of the Council on the establishment of a framework
to facilitate sustainable investment, and amending Regulation (EU) 2019/2088
(EU Taxonomy).
Point 1 above also contains the process in which Lassila & Tikanoja Plc has
identified the information for reporting in accordance with the sustainability
reporting standards (double materiality assessment).
Our opinion does not cover the tagging of the group sustainability report
with digital XBRL sustainability tags in accordance with Chapter 7, Section
22, Subsection 1(2), of the Accounting Act, because sustainability reporting
companies have not had the possibility to comply with that requirement in the
absence of requirements for the tagging of sustainability information in the ESEF
regulation or other European Union legislation.
Basis for Opinion
We performed the assurance of the group sustainability report as a limited
assurance engagement in compliance with good assurance practice in Finland
and with the International Standard on Assurance Engagements (ISAE) 3000
(Revised) Assurance Engagements Other than Audits or Reviews of Historical
Financial Information.
Our responsibilities under this standard are further described in the
Responsibilities of the Authorised Group Sustainability Auditor section of
our report. We believe that the evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Other Matter
We draw attention to the fact that the group sustainability report of Lassila
& Tikanoja Plc that is referred to in Chapter 7 of the Accounting Act has been
prepared and assurance has been provided for it for the first time for the
reporting period ended 31.12.2025. Our opinion does not cover the comparative
information that has been presented in the group sustainability report. Our
opinion is not modified in respect of this matter.
Authorised Group Sustainability Auditor’s Independence
and Quality Management
We are independent of the parent company and of the group companies
in accordance with the ethical requirements that are applicable in Finland
and are relevant to our engagement, and we have fulfilled our other ethical
responsibilities in accordance with these requirements.
The authorised group sustainability auditor applies International Standard
on Quality Management ISQM 1, which requires the authorised sustainability
audit firm to design, implement and operate a system of quality management
including policies or procedures regarding compliance with ethical requirements,
professional standards and applicable legal and regulatory requirements.
Responsibilities of the Board of Directors and the
Managing Director
The Board of Directors and the Managing Director of Lassila & Tikanoja Plc are
responsible for:
• the group sustainability report and for its preparation and presentation
in accordance with the provisions of Chapter 7 of the Accounting Act,
including the process that has been defined in the sustainability reporting
standards and in which the information for reporting in accordance with the
sustainability reporting standards has been identified,
• the compliance of the group sustainability report with the requirements
laid down in Article 8 of the Regulation (EU) 2020/852 of the European
Parliament and of the Council on the establishment of a framework to
facilitate sustainable investment, and amending Regulation (EU) 2019/2088,
and for
• such internal control as the Board of Directors and the Managing Director
determine is necessary to enable the preparation of a group sustainability
report that is free from material misstatement, whether due to fraud or error.
Inherent Limitations in the Preparation of a Sustainability
Report
In reporting forward-looking information in accordance with ESRS, management
of the Company is required to prepare the forward-looking information on the
basis of assumptions that have been disclosed in the sustainability report about
events that may occur in the future and possible future actions by the Group.
Actual outcomes are likely to be different since anticipated events frequently do
not occur as expected.
Responsibilities of the Authorised Group Sustainability
Auditor
Our responsibility is to perform an assurance engagement to obtain limited
assurance about whether the group sustainability report is free from material
misstatement, whether due to fraud or error, and to issue a limited assurance
report that includes our opinion. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the decisions of users taken on the basis of the group
sustainability report.
Compliance with the International Standard on Assurance Engagements (ISAE)
3000 (Revised) requires that we exercise professional judgment and maintain
professional skepticism throughout the engagement. We also:
• Identify and assess the risks of material misstatement of the group
sustainability report, whether due to fraud or error, and obtain an
understanding of internal control relevant to the engagement in order to
design assurance procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the
parent company’s or the group’s internal control.
• Design and perform assurance procedures responsive to those risks to
obtain evidence that is sufficient and appropriate to provide a basis for
our opinion. The risk of not detecting a material misstatement resulting
from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control.
Description of the Procedures That Have Been Performed
The procedures performed in a limited assurance engagement vary in nature
and timing from, and are less in extent than for, a reasonable assurance
engagement. The nature, timing and extent of assurance procedures selected
depend on professional judgment, including the assessment of risks of
Annual Report 2025
119
Independent Assurance Report
material misstatement, whether due to fraud or error. Consequently, the level of
assurance obtained in a limited assurance engagement is substantially lower
than the assurance that would have been obtained had a reasonable assurance
engagement been performed.
Our procedures included for example the following:
• We interviewed the company’s management and the individuals responsible
for collecting and reporting the information contained in the group
sustainability report at different levels of the organization to gain an
understanding of the sustainability reporting process and the related internal
controls and information systems.
• We familiarised ourselves with the background documentation and records
prepared by the company where applicable, and assessed whether they
support the information contained in the group sustainability report.
• We assessed the company’s double materiality assessment process in
relation to the requirements of the ESRS standards, as well as whether the
information provided about the assessment process complies with the ESRS
standards.
• We assessed whether the sustainability information contained in the group
sustainability report complies with the ESRS standards.
• Regarding the EU taxonomy information, we gained an understanding of the
process by which the company has identified the group’s taxonomy-eligible
and taxonomy-aligned economic activities, and we assessed the compliance
of the information provided with the regulations.
Helsinki on 2 April, 2026
PricewaterhouseCoopers Oy
Authorised Sustainability Auditors
Samuli Perälä
Authorised Sustainability Auditor
Annual Report 2025
ESEF Assurance Report
138
To the Management of Lassila & Tikanoja Plc
We have performed a reasonable assurance engagement on the financial
statements 636700EBB0SA4501AT18-2025-12-31-0-fi.zip of Lassila & Tikanoja
Plc (business identity code 3555336-9) that have been prepared in accordance
with the Commission’s regulatory technical standard for the financial year 31
December 2025 to 31 December 2025.
Responsibilities of the Board of Directors and the
Managing Director
The Board of Directors and the Managing Director are responsible for the
preparation of the company’s report of the Board of Directors and financial
statements (the ESEF financial statements) in such a way that they comply
with the requirements of the Commission’s regulatory technical standard. This
responsibility includes:
• preparing the ESEF financial statements in XHTML format in accordance with
Article 3 of the Commission’s regulatory technical standard
• tagging the primary financial statements, notes and company’s identification
data in the consolidated financial statements that are included in the ESEF
financial statements with iXBRL tags in accordance with Article 4 of the
Commission’s regulatory technical standard and
• ensuring the consistency between the ESEF financial statements and the
audited financial statements.
The Board of Directors and the Managing Director are also responsible for such
internal control as they determine is necessary to enable the preparation of ESEF
financial statements in accordance with the requirements of the Commission’s
regulatory technical standard.
Auditor’s independence and quality management
We are independent of the company in accordance with the ethical requirements
that are applicable in Finland and are relevant to the engagement we have
performed, and we have fulfilled our other ethical responsibilities in accordance
with these requirements.
The auditor applies International Standard on Quality Management (ISQM) 1,
which requires the firm to design, implement and operate a system of quality
management including policies or procedures regarding compliance with ethical
requirements, professional standards and applicable legal and regulatory
requirements.
Auditor’s responsibilities
Our responsibility is to, in accordance with Chapter 7, Section 8 of the Securities
Markets Act, provide assurance on the financial statements that have been
prepared in accordance with the Commission’s regulatory technical standard.
We express an opinion on whether the consolidated financial statements that
are included in the ESEF financial statements have been tagged, in all material
respects, in accordance with the requirements of Article 4 of the Commission’s
regulatory technical standard.
Our responsibility is to indicate in our opinion to what extent the assurance has
been provided. We conducted a reasonable assurance engagement in accordance
with International Standard on Assurance Engagements (ISAE) 3000 (Revised).
The engagement includes procedures to obtain evidence on:
• whether the primary financial statements in the consolidated financial
statements that are included in the ESEF financial statements have been
tagged, in all material respects, with iXBRL tags in accordance with the
requirements of Article 4 of the Commission’s regulatory technical standard
and
• whether the notes and company’s identification data in the consolidated
financial statements that are included in the ESEF financial statements have
been tagged, in all material respects, with iXBRL tags in accordance with the
requirements of Article 4 of the Commission’s regulatory technical standard
and
• whether there is consistency between the ESEF financial statements and
the audited financial statements.
The nature, timing and extent of the selected procedures depend on the auditor’s
judgment. This includes an assessment of the risk of a material deviation due to
fraud or error from the requirements of the Commission’s regulatory technical
standard.
We believe that the evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Independent auditor’s report on the ESEF financial statements
of Lassila & Tikanoja Plc (Translation of the Finnish Original)
Opinion
Our opinion pursuant to Chapter 7, Section 8 of the Securities Markets Act is
that the primary financial statements, notes and company’s identification data
in the consolidated financial statements that are included in the ESEF financial
statements of Lassila & Tikanoja Plc 636700EBB0SA4501AT18-2025-12-31-0-fi.
zip for the financial year 31 December 2025 to 31 December 2025 have been
tagged, in all material respects, in accordance with the requirements of the
Commission’s regulatory technical standard.
Our opinion on the audit of the consolidated financial statements of Lassila &
Tikanoja Plc for the financial year 31 December 2025 to 31 December 2025 has
been expressed in our auditor’s report dated 2 April 2026. With this report we do
not express an opinion on the audit of the consolidated financial statements nor
express another assurance conclusion.
Helsinki, on the date of the electronic signature
PricewaterhouseCoopers Oy
Authorised Public Accountants
Samuli Perälä
Authorised Public Accountant (KHT)
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