4 Governance and Risk Management

Vitens' corporate governance framework is based on the company’s Articles of Association, the provisions of the Dutch Civil Code, the Dutch Corporate Governance Code (the Code), and the other applicable laws and regulations to which Vitens is bound.

As a water company, we are closely linked to society and feel a deep responsibility for the society in which we work. The Dutch Drinking Water Act guides us in carrying out our primary task: supplying sufficient drinking water of good quality. The Dutch Human Environment and Transport Inspectorate (ILT) monitors Vitens' compliance with this law on behalf of the Dutch Ministry of Infrastructure and Water Management. Vitens is in ongoing dialogue with the Human Environment and Transport Inspectorate (ILT) regarding its challenges in complying with the Drinking Water Act.

In addition, environmental legislation, data-protection requirements, and the promotion of diversity in leadership roles are important legal frameworks for us.

As a major organisation with a significant societal role in the Netherlands, Vitens places strong emphasis on maintaining a robust governance structure. Vitens therefore applies the principles of the Code voluntarily wherever possible in its corporate governance.

The Code is available on the website of the Corporate Governance Code Monitoring Committee. The Code contains principles and best-practice provisions for Dutch listed companies. Vitens’ shares are not publicly listed, and the company is therefore not legally required to apply the Code. Any deviations from the Code are explained below, in line with the ‘comply or explain’ principle:

• The provisions associated with principle 3.4, ‘Accountability for implementing the remuneration policy’, apply onlywhere the Standards for Remuneration Act contains no such provision, given that the Act applies to Vitens.
• We are not yet in a position to issue a statement on risk management and therefore unable to comply with principle 1.4, ‘Accountability for the implementation of risk management’. The risk management and control system is yet to be developed. We cannot yet say when this will be in place, but we will be working towards it in the coming years.

Vitens is organised in accordance with the 'Three Lines Model'. The model assumes that the first line is responsible for risk management and regulatory compliance, by embedding these effectively in processes with clear lines of responsibility. The second line, which includes the Internal Control & Improvement Department, supports, advises, and monitors whether the first line is actually fulfilling the responsibilities. Furthermore, risks are explicitly and demonstrably weighed up during the decision-making process, partly on the basis of advice from senior management. The third line (Internal Audit) independently verifies whether the risk-management and internal-control system is functioning effectively. Vitens designed to ensure that the organisation learns from incidents. This is how we continuously improve risk management.

Code of conduct

The code of conduct forms the basis for how we treat each other. It gives employees clear guidance in making the right choices when it comes to issues such as integrity, safety, dealing with customers, with each other and the environment. The code of conduct was last updated in 2024. Everyone within Vitens is responsible for complying with the code of conduct.

Social security

Vitens wants to be and remain a socially safe organisation. An organisation where people feel able to address one another, speak honestly, and interact with respect. When a Vitens employee finds themselves in a socially unsafe situation, the advice is to first try to resolve the incident within the team or with a colleague. This contributes to a more positive working environment and stronger professional relationships. We therefore always push for a discussion with those directly affected. If this conversation does not provide a solution, the employee can submit a personal or anonymous report to the Central Reporting Point for Social Safety. This is the place to report matters such as inappropriate conduct, integrity issues or (suspected) wrongdoing. All reports are treated confidentially.

For inappropriate behaviour (in the broadest sense of the term) and for (suspected) wrongdoing, the Socially Unsafe Situations Procedure and the Whistleblower Policy apply.

Confidential adviser

In the event of a dilemma concerning social safety or a suspicion of wrongdoing, employees of Vitens may seek support from one of the confidential advisers. Vitens has five internal confidential advisors and one external confidential advisor.

Fraud

Fraudulent acts can be committed both internally and externally. Vitens is taking targeted measures to minimise the risk of fraud, with a focus on promoting social safety. In doing so, the organisation strives for a working environment in which employees exhibit intrinsically desirable behaviour and act in the best interests of the organisation.

In addition, Vitens implements control measures designed to directly or indirectly influence both desired and undesired behaviour. In order to proactively respond to potential threats, Vitens conducts regular analyses of the main fraud risks. Internal control is carefully designed, with the fraud prevention process forming a continuous cycle within our organisation. The risk manager monitors both internal control measures and potential risks.

Socially Responsible Contracting and Procurement (SRCP)

Vitens has adopted and implemented a policy in the area of Socially Responsible Procurement (SRP). This policy supports our ambition to make our collaboration with market partners more sustainable. The guiding principle of the policy is to select the most sustainable market players for our contracts. In doing so, we look not only at their own business operations, but also at how they carry out their assignments for Vitens. Our SRP policy covers sustainability in the broadest sense and focuses on six key themes: environment, climate, circularity, International Social Conditions (supply-chain responsibility), diversity and inclusion, and social return.

Diversity and Inclusion Policy

Vitens places great importance on diversity and inclusion within the organisation. We see a diverse workforce and an inclusive organisational culture as essential conditions for achieving our strategic objectives and creating sustainable value. Diversity and inclusion contribute to innovation, better performance and being an attractive employer.

Vitens has signed the Social and Economic Council (SER) Diversity Charter. In doing so, Vitens commits to promoting an inclusive organisational culture and equal opportunities for all employees, regardless of gender, age, work ability, ethnic or cultural background, or LGBTQI+ identity. The charter means that Vitens sets concrete goals, including maintaining a balanced gender representation across the organisation and taking active measures to prevent exclusion and discrimination. Progress will be monitored and reported.

In making appointments, the Supervisory Board aims for a balanced gender ratio in both the Executive Board and the Supervisory Board: a target of at least 30% women and at least 30% men. In 2025, the gender ratio on the Executive Board was 50%–50% (at the time of a two‑member board) and 60%–40% on the Supervisory Board. The target percentage was therefore achieved.