EU Taxonomy Disclosure
The EU Taxonomy
To reach the goal of EU Green Deal and EU´s climate and energy objectives for 2030, EU Taxonomy Regulation was published to establish a classification scheme for economic activities based on their environmental sustainability. It sets six environmental objectives and requires all companies falling within the scope of the Non-Financial Reporting Directive to report certain indicators detailing the extent to which their activities are sustainable according to these objectives and criteria.
Bittium’s Approach to Taxonomy Alignment and Taxonomy Eligibility
Bittium has determined the taxonomy-eligible economic activities and aligned activities by the following process:
- Identifying economic activities and processes across the business of the Bittium as per NACE classification (Classification according to the Statistical Classification of Economic Activities in the European Community).
- Evaluating whether the identified economic activities are suitable to the economic activity descriptions included in the Annex I and II of the Climate Delegated Act. When suitable, such activities are determined as taxonomy-eligible activities.
- Assessing whether the identified eligible activities meet the substantial contribution criteria, “Do No Significant Harm´ (DNSH) criteria and determining compliance with minimum safeguards.
Bittium has identified the following economic activities in its business operations as taxonomy-eligible:
- Environmental objective 1 (Climate change mitigation): category 8.1 Data processing, server space rental and related activities,
- Environmental objective 2 (Climate change adaptation): category 8.1 Data processing, server space rental and related activities, and
- Environmental objective 4 (Circular economy): category 1.2 Manufacture of electrical and electronic equipment, category 4.1. Provision of IT/OT data-driven solutions, and category 5.2 Sale of spare parts.
Bittium solutions that offer data processing services and server space rental services are carefully checked based on the description of category 8.1 of environmental objective 1 (climate change mitigation). Bittium interpreted the matter strictly and stated that solutions using Bittium’s own data center fit this description and are therefore taxonomy-eligible. The company was unable to confirm with sufficient evidence the extent to which the current operation meets the requirements defined in the criteria for sufficient contribution. For this reason, the company decided that its operations are taxonomy-eligible, but not taxonomy-aligned.
In addition to the design and development of own products related to programming, Bittium offers versatile IT expertise and services. Such activities include, for example, software development, development of connectivity solutions, research, and consulting services. In 2022, Bittium defined these activities as taxonomy-eligible activities according to environmental objective 2 (climate change adaptation) in category 8.2 Software, consulting and related activities and reported the related key figures accordingly. In 2023, the EU Commission issued the EU Commission note C/2023/305 on eligibility/alignment-related reporting, which includes special instructions for reporting the net sales of businesses falling under the category 8.2. According to this instruction, Bittium’s taxonomy report for 2023 does not include net sales accumulated from the activities related to category 8.2.
Bittium manufactures several of its own electrical and electronic devices for measuring biosignals and remote monitoring as well as for the defense and security markets. These functions include Bittium’s own electrical and electronic devices, design, development, production, and maintenance of accessories, as well as the maintenance of device software, in addition to the maintenance of the device structure. These business activities are aligned with the description of Environmental objective 4 (Circular economy) category 1.2 Manufacture of electrical and electronic equipment, and therefore are taxonomy-eligible. Bittium was unable to confirm with sufficient evidence that any of these activities meet the requirements defined in the criteria for substantial contribution. Therefore, the company chose a conservative interpretation and decided that the functions in question are not taxonomy-aligned.
Bittium offers various software products and solutions related to information technology. Such functions are checked based on description of Environmental objective 4 (Circular economy) category 4.1. Provision of IT/OT data-driven solutions. Activities in which the following are manufactured, developed, installed, put into use, maintained or repaired, or expert services are provided, including technical consulting on the design or monitoring of the following are defined as taxonomy-eligible. Among Bittium’s activities, production and delivery of its own software products and solutions related to information technology, maintenance, implementation services for software products in the customer’s environments, customer training related to implementation, support services and expert services have been defined as taxonomy-eligible. Bittium cannot confirm with sufficient evidence that any of these activities meet the requirements defined in the criteria for substantial contribution. Therefore, the company chose a conservative interpretation and decided that the activities in question are not taxonomy-aligned.
As part of product sales, Bittium offers repair services, which include the sale of spare parts for certain products. The separately identifiable spare part sales in question have been defined as taxonomy-eligible based on the description of Environmental objective 4 (Circular Economy) category 5.2 Sale of spareparts. Bittium chose a conservative interpretation and decided that repair services that include component exchanges but are not identified as spare part sales do not qualify as taxonomy-aligned activities. The company was unable to establish with sufficient evidence that any of these activities meet the requirements defined in the criteria for substantial contribution. Therefore, the company chose a conservative interpretation and decided that the activities in question are not taxonomy-
aligned.
Accounting Policy for Financial KPIs
Bittium did not identify taxonomy-aligned activities, so the taxonomy-aligned net sales, capital expenditure, and operating expenditure is 0%.
Net Sales
- Bittium has calculated the net sales (note 2 of the Financial Statements) in accordance with the delegated act on the provision of information. The criteria correspond to the principles regarding the preparation of financial statements of the IFRS 15 standard.
- With regards to environmental objective 1 (climate change mitigation) category 8.1 Data processing, server space rental and related activities, Bittium has found eligible net sales, and it is reported in the table on the next pages. Solutions using Bittium’s own data center fit this description.
- Regarding the environmental objective 4 (Circular Economy) category 1.2 Manufacture of electrical and electronic equipment, Bittium has found eligible net sales, and it is reported in the tableon the next pages. Bittium’s sales of electronic equipment in both the Defense & Security and Medical business segments fit this description.
- Regarding the environmental goal 4 (Circular economy) category 4.1 Provision of IT/OT data-driven solutions, Bittium has found eligible net sales, and the data is reported in the table on the next pages . Bittium’s information technology sector’s own software product license sales and maintenance-related net sales in both the Defense & Security and Medical business segments fit this description.
Capital Expenditure
- In this taxonomy report, the costs incurred from the acquisition of tangible and intangible assets and right-of-use assets are counted as capital expenditures (note 11 of the financial statements).
- Bittium has calculated the capital expenditure in accordance with the delegated act on the provision of information. At the same time, it has defined the absolute capital expenditures used in taxonomy reporting as gross investments.
- According to Bittium, capital expenditures allocated to its taxonomy-eligible net sales, such as investments in measurement devices and manufacturing equipment, can be classified as taxonomy-eligible capital expenditures.
- According to the guidelines of the EU Taxonomy Regulation, Bittium’s capital expenditure was EUR 9.36 million in 2023.
- Bittium’s taxonomy-eligible capital expenditures were EUR 0.28 million in 2023.
Operating Expenditure
- In this taxonomy report, direct expenses related to research and development, product delivery and facility maintenance, which have not been capitalized by the company, are counted as operating expenditures.
- Bittium has calculated the operating expenses in accordance with the delegated act on the provision of information and determined that the operating expenses allocated to the taxonomy-eligible net sales can be classified as taxonomy-eligible operating expenses.
- According to the guidelines of the EU Taxonomy Regulation, Bittium’s operating expenses were EUR 73.45 million in 2023.
- Bittium’s taxonomy-eligible operating expenses were EUR 43.29 million in 2023.
Bittium will continue to develop the taxonomy evaluation and reporting practice in 2024. Bittium aims to increase the share of sustainable business practices. As the field of application of the reporting practices expands and the practices become clearer, the company expects that the proportion of its taxonomy-eligible and taxonomy-aligned activities will increase in the future.
Sales revenue
| Substantial Contribution Criteria | DNSH Criteria | ||||||||||||||||||
| Economic activities | Codes | Absolute turnover | Proportion of turnover | 1. Climate change mitigation | 2. Climate change adaptation | 3. Water and marine resources | 4. Circular economy | 5. Pollution | 6. Biodiversity and ecosystems | 1. Climate change mitigation | 2. Climate change adaptation | 3. Water and marine resources | 4. Circular economy | 5. Pollution | 6. Biodiversity and ecosystems | Minimum Safeguards | Proportion of Taxonomy aligned (A.1.) or eligible (A.2.) turnover | Category Enabling activities | Category Transitional activities |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| M€ | % | Y;N; N/EL |
Y;N; N/EL |
Y;N; N/EL |
Y;N; N/EL |
Y;N; N/EL |
Y;N; N/EL |
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) | |||||||||||||||||||
| Not found | NA | 0,00 | 0,00 | NA | NA | NA | NA | NA | NA | NA | NA | NA | NA | NA | NA | NA | NA | NA | NA |
| Turnover of environmentally sustainable activities (taxonomy-aligned) (A.1) | 0,00 | 0,00 | 0% | ||||||||||||||||
| of which enabling | 0,00 | 0,00 | % | % | % | % | % | % | % | ||||||||||
| of which transitional | 0,00 | 0,00 | % | % | |||||||||||||||
| A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) | |||||||||||||||||||
| EL;N/ EL(f) |
EL;N/ EL(f) |
EL;N/ EL(f) |
EL;N/ EL(f) |
EL;N/ EL(f) |
EL;N/ EL(f) |
||||||||||||||
| Data processing, hosting and related activities | CCM 8.1 |
0,23 | 0% | EL | 0% | ||||||||||||||
| Manufacture of electrical and electronic equipment | CE 1.2 | 36,38 | 48% | EL | 0% | ||||||||||||||
| Provision of IT/OT data-driven solutions | CE 4.1 | 11,75 | 16% | EL | 0% | ||||||||||||||
| Sale of spare parts | CE 5.2 | 0,34 | 0% | EL | 0% | ||||||||||||||
| Turnover of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) | 48,70 | 65% | 0.3% | 29% | 0% | 71% | 0% | 0% | 0% | ||||||||||
| Total(A1 + A2) | 48,70 | 65% | 0.3% | 29% | 0% | 71% | 0% | 0% | 30% | ||||||||||
| B. TAXONOMY-NON-ELIGIBLE ACTIVITIES | |||||||||||||||||||
| Turnover of Taxonomy-non-eligible activities | 26,55 | 35% | |||||||||||||||||
| Total(A + B) | 75,25 | 100% | |||||||||||||||||
Capital expenditure
| Substantial Contribution Criteria | DNSH Criteria | ||||||||||||||||||
| Economic activities | Codes | Absolute turnover | Proportion of turnover | 1. Climate change mitigation | 2. Climate change adaptation | 3. Water and marine resources | 4. Circular economy | 5. Pollution | 6. Biodiversity and ecosystems | 1. Climate change mitigation | 2. Climate change adaptation | 3. Water and marine resources | 4. Circular economy | 5. Pollution | 6. Biodiversity and ecosystems | Minimum Safeguards | Proportion of Taxonomy aligned (A.1.) or eligible (A.2.) turnover | Category Enabling activities | Category Transitional activities |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| M€ | % | Y;N; N/EL |
Y;N; N/EL |
Y;N; N/EL |
Y;N; N/EL |
Y;N; N/EL |
Y;N; N/EL |
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) | |||||||||||||||||||
| NA | 0,00 | 0,00 | 0 | 0 | 0 | 0 | 0 | 0 | NA | NA | NA | NA | NA | NA | NA | NA | NA | NA | |
| CapEx of environmentally sustainable activities (taxonomy-aligned) (A.1) | 0,00 | 0,00 | 0% | ||||||||||||||||
| of which enabling | 0,00 | 0,00 | % | % | % | % | % | % | 0% | ||||||||||
| of which transitional | 0,00 | 0,00 | % | 0% | |||||||||||||||
| A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) | |||||||||||||||||||
| EL;N/ EL(f) |
EL;N/ EL(f) |
EL;N/ EL(f) |
EL;N/ EL(f) |
EL;N/ EL(f) |
EL;N/ EL(f) |
||||||||||||||
| Computer programming, consultancy and related activities | CCA 8.2 |
0,03 | 0% | EL | 2% | ||||||||||||||
| Manufacture of electrical and electronic equipment | CE 1.2 | 0,25 | 3% | EL | 0% | ||||||||||||||
| CapEx of Taxonomy- eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) | 0,28 | 3% | 0% | 11% | 0% | 89% | 0% | 0% | 2% | ||||||||||
| Total(A1 + A2) | 0,28 | 3% | 0% | 11% | 0% | 89% | 0% | 0% | 2% | ||||||||||
| B. TAXONOMY-NON ELIGIBLE ACTIVITIES | |||||||||||||||||||
| CapEx of Taxonomy-non-eligible activities | 9,08 | 97% | |||||||||||||||||
| Total(A + B) | 9,36 | 100% | |||||||||||||||||
Operational expenditure
| Substantial Contribution Criteria | DNSH Criteria | ||||||||||||||||||
| Economic activities | Codes | Absolute turnover | Proportion of turnover | 1. Climate change mitigation | 2. Climate change adaptation | 3. Water and marine resources | 4. Circular economy | 5. Pollution | 6. Biodiversity and ecosystems | 1. Climate change mitigation | 2. Climate change adaptation | 3. Water and marine resources | 4. Circular economy | 5. Pollution | 6. Biodiversity and ecosystems | Minimum Safeguards | Proportion of Taxonomy aligned (A.1.) or eligible (A.2.) turnover | Category Enabling activities | Category Transitional activities |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| M€ | % | Y;N; N/EL |
Y;N; N/EL |
Y;N; N/EL |
Y;N; N/EL |
Y;N; N/EL |
Y;N; N/EL |
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) | |||||||||||||||||||
| Not found | 0,00 | 0,00 | 0 | 0 | 0 | 0 | 0 | 0 | NA | NA | NA | NA | NA | NA | NA | NA | NA | NA | |
| CapEx of environmentally sustainable activities (taxonomy-aligned) (A.1) | 0,00 | 0,00 | 0% | ||||||||||||||||
| of which enabling | 0,00 | 0,00 | % | % | % | % | % | % | 0% | ||||||||||
| of which transitional | 0,00 | 0,00 | % | 0% | |||||||||||||||
| A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) | |||||||||||||||||||
| EL;N/ EL(f) |
EL;N/ EL(f) |
EL;N/ EL(f) |
EL;N/ EL(f) |
EL;N/ EL(f) |
EL;N/ EL(f) |
||||||||||||||
| Computer programming, consultancy and related activities | CCA 8.2 |
10,47 | 14% | EL | 30% | ||||||||||||||
| Manufacture of electrical and electronic equipment | CE 1.2 | 24,60 | 33% | EL | 0% | ||||||||||||||
| Provision of IT/OT data-driven solutions | CE 4.1 | 8,23 | 11% | EL | 0% | ||||||||||||||
| OpEx of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) | 43,29 | 59% | 0% | 24% | 0% | 75% | 0% | 0% | 30% | ||||||||||
| Total(A1 + A2) | 43,29 | 59% | 0% | 24% | 0% | 75% | 0% | 0% | 30% | ||||||||||
| B. TAXONOMY-NON ELIGIBLE ACTIVITIES | |||||||||||||||||||
| OpEx of Taxonomy-non-eligible activities | 30,16 | 41% | |||||||||||||||||
| Total (A + B) | 73,45 | 100% | |||||||||||||||||