Message from the Board of Management

Dear reader,

As we reflect on the past year, it is clear that the world has faced a multitude of challenges, from the ongoing COVID-19 pandemic to rising geopolitical tensions and environmental crises. We experienced a war in Ukraine, increasingly strained relations between the United States and China, disruption in supply chains, an ongoing energy crisis, inflation, and an intensifying shortage of skilled workers in many parts of the world. Despite these difficulties, TÜV SÜD remains committed to creating a better tomorrow through innovation and sustainability.

Our theme for this year’s annual report is “ONE TOMORROW,” a testament to our belief that optimism and proactive action are essential during tough times. We understand that the challenges we face are complex and daunting, but we are determined to do our part to help create a better future.

At TÜV SÜD, we have been protecting people, the environment, and property from technical risks for nearly 160 years. Our technology-agnostic mindset allows us to offer innovative solutions across a wide range of industries and markets. What we do, matters: the trust we create is part of the very foundation of technical innovation, which helps solve today’s and tomorrow’s challenges.

Digital transformation, and key technologies around artificial intelligence (AI) and cybersecurity are key elements of our strategy. We are actively working on developing quality standards and solutions for the certification of AI and we use AI ourselves; for example, when we inspect façades or when we check whether documents are complete. In the area of cybersecurity, we ensure that the conditions for protecting data, processes, systems, and facilities are met. We help businesses and society make their digital transformations both successful and safe.

Sustainability is also a core element of our Strategy 2025+. We aim to become the most sustainable company in our industry, and we want to provide comprehensive support to our customers in this field. For example, in 2022 we expanded our service offering around hydrogen. “Green” hydrogen can play an important role as a medium of storage for sustainably generated energy. It can help reduce the use of fossil fuels and in some areas, it can completely replace them. This means fewer greenhouse gas emissions — an important step in the battle against climate change.

Here are some examples of what we can do for our customers regarding hydrogen. We can check whether power plants are ready for the use of hydrogen and certify them in a three-stage process. We call this program “H2readiness.” We also test materials and components, to find out how well they function in environments with hydrogen. We do this in two state-of-the-art labs in Germany: in Frankfurt and in Garching near Munich. Additionally, we are helping railway operators transition to alternative drive systems and new infrastructure.

In 2022, we also worked on becoming more sustainable ourselves, in all areas of our business. We reduced our greenhouse gas emissions and further optimized our standards of good corporate governance. We revised our Code of Conduct to renew our commitment to impartiality, integrity and legality, and to solidify our responsibility for human rights, labor and social standards, environmental protection, and to taking greater responsibility for our supply chain. We also value diversity within our company and are committed to fostering it, especially at the leadership level. We strive to treat one another with respect, and we have zero tolerance for discrimination. With many of these efforts, we actively support the United Nations’ Sustainable Development Goals.

Our efforts have not gone unnoticed. In the fall of 2022, we received a Platinum rating in the EcoVadis sustainability rating, placing us in the top one percent of participating companies in our industry worldwide.

We also made efforts to provide tangible help when and where it was needed most, including humanitarian aid for refugees from Ukraine and supporting vital aid activities after the recent severe earthquakes through our joint venture company in Türkiye, TÜVTÜRK.

What made all of this possible was our sustainable business model and our ongoing investments in the future of our business portfolio – 154 million euros last year alone. Investments include new testing capacity for electrical appliances in the United Kingdom, lab capacity for testing food in India, and new capacity for testing medical devices, both in India and in the USA.

Whether a business model is stable and resilient becomes apparent during times of crisis – and ours is passing this test. A broad portfolio helps us balance out fluctuations. In 2022, our sales reached almost 2.9 billion euros. Unfortunately, rising costs for energy, IT, and testing equipment affected our EBIT, which came out at 195 million euros. In terms of earnings, the previous year, 2021, had been our strongest on record. Our 2022 earnings are slightly lower. Yet, taking into account the challenging market environment, we are satisfied with the result.

We would like to extend our sincere gratitude to all employees and managers at TÜV SÜD for their hard work and dedication, without which our successes would not have been possible. Together, we will continue to embrace the spirit of “ONE TOMORROW,” supporting our customers and making our future safer and more sustainable.

Munich, March 30, 2023
The Board of Management of TÜV SÜD AG

Dr. Johannes Bussmann
Ishan Palit
Prof. Dr. Matthias J. Rapp