Circular economy

ESRS 2 SBM-3

The high demand for raw materials in construction along with the waste volumes generated through demolition make the building industry one of the most resource-intensive sectors of the economy. Due to the finite availability of resources, the linear economic system – consisting of raw material extraction, use and disposal – is increasingly reaching its limits.

The construction of buildings requires large quantities of non-renewable building materials such as sand, stone, asphalt and concrete. At the same time, a growing demand for renewable raw materials – above all timber – can also be observed. Large quantities of waste are generated at the end of the life cycle of the structures we build. This waste is often not returned to the economic cycle at an equivalent level of value but is instead recycled or reused at a lower quality. In the worst case, these raw materials are removed entirely from the economic cycle through waste incineration or landfill disposal. A problem with landfill sites is that they cease to be available as inhabitable or cultivable land. Hazardous waste poses an additional risk to people and the environment and involves higher disposal costs. These considerations show that the material negative impacts and risks extend across the entire value chain – from in-house building material producers and/or external suppliers through to waste disposal companies.

These developments also offer opportunities, however. The reuse and recovery of raw materials not only reduces costs in procurement and disposal but also opens up new business areas, for example through the production and use of sustainable building materials and the refurbishment of existing structures. An extensive in-house building materials network enables a high degree of vertical integration within the Group. This allows STRABAG to mitigate risks arising from resource scarcity, to meet customer requirements and to minimise disposal costs. When developing strategies and business models, STRABAG aligns itself with the 9R framework of the circular economy: rethink, reduce, reuse, repair, refurbish, remanufacture, repurpose, recycle and recover.

The circular economy model is firmly anchored as one of six key strategic topics in our Strategy 2030. We aim to expand our expertise in the procurement and handling of building materials as well as in deconstruction and recycling as a way to continuously increase our resource efficiency. Within the key topic of circular economy, the following additional topics are addressed at Group level through prioritised action areas: value stream management competence; reconstruction, conversion and refurbishment; and building materials production / sustainable building materials.

Policies

ESRS E5-1

This strategic framework gives rise to a number of principles and objectives that are set out in our overarching Sustainability Policy and in our Environmental and Energy Policy. These principles and strategic objectives represent commitments and obligations that will guide the future direction of STRABAG’s business activities.

The Environmental and Energy Policy specifies the objective of the circular economy as follows:

• Circular planning: We offer the design of circular buildings using reused components, secondary raw materials and renewable resources, taking into account resource efficiency, dismantlability and flexibility. We promote circular construction through proactive proposals to our clients. Upon request, we identify potential improvements through building-specific life-cycle assessments and demonstrate to our clients the ecological added value of different construction variants.
• Circular building materials: We produce and use building materials made from secondary raw materials and renewable resources, as well as materials with a high potential for reuse and recycling. In addition, we continuously work on technical solutions to increase the recycled content in our products.

• Deconstruction: We focus on selective demolition and non-destructive deconstruction in order to recover and reuse valuable materials and components.
• Zero-waste construction site: We are working to reduce waste on our construction sites through a high degree of prefabrication, take-back logistics and other actions.
• Reconstruction, conversion and refurbishment: We offer solutions for the recording, assessment, repair, modernisation, redesign or extension of existing buildings.
• Value stream management: We are improving the cross-site recording and management of value streams in order to ensure the highest possible level of material recovery and to reduce waste. We also offer our clients comprehensive material and waste management concepts, including for the handling of hazardous waste.

The Environmental and Energy Policy applies across the entire Group and affects both STRABAG and our upstream and downstream supply chain. The policy has been signed by the Management Board of STRABAG SE; responsibility for its implementation lies with the CEO.

Actions and projects

ESRS E5-2

STRABAG is pursuing a range of actions and projects to establish the circular economy as a key strategic topic in the Group’s sustainable transformation. As these actions form part of the overarching transformation of the Group and therefore involve lasting changes to day-to-day operations and regular processes, it is not possible to say exactly which financial resources are allocated specifically to which of the initiative listed below. The total budget for research and development at STRABAG SE can be found in the present Management Report (Financial Performance).

Reconstruction, conversion and refurbishment

Extending the useful life of structures for as long as possible – through refurbishment or modernisation – is the resource-efficient alternative to demolition and new builds. Reconstruction, conversion and refurbishment are therefore part of a functioning circular economy and can minimise raw material consumption and waste volumes.

As a key action area within Strategy 2030, STRABAG is specifically expanding its activities in reconstruction, conversion and refurbishment under the BESTAND BEYOND brand, among other things by adapting processes, strengthening internal working groups and raising public awareness.

New processes for recording existing building structures have been established and integrated in the central divisions Zentrale Technik (the Group’s technical competence centre) and TPA (the STRABAG entity for quality assurance and innovation). These include in particular the digitalisation of existing buildings using stationary and mobile 3D laser scans and the subsequent creation of BIM models (Building Information Modelling). In addition, a practical guide has been developed for building construction projects to support the development of circular economy concepts as part of deconstruction planning.

To further embed the topic within the Group, a five-day training programme for employees was developed and successfully tested in 2025. Two training series per year are planned from 2026 onwards. The training content includes the provision of specialist knowledge as well as proactive client communication in order to address requirements related to reconstruction, conversion and refurbishment at an early stage in project planning. Internal networking and cross-departmental knowledge exchange were strengthened through regular exchange formats. Workshops also analysed uncertainties and challenges from the client perspective in order to respond more effectively to specific requirements. In this way, reconstruction, conversion and refurbishment are being further established within STRABAG’s business model.

We are also actively positioning ourselves on the topic of reconstruction, conversion and refurbishment and raising awareness of its advantages and possibilities at specialist events and trade fairs as well as through guest contributions in relevant publications.

Sustainable building materials

The different renewable raw materials and their applications are presented at the Reallabor Sustainable Construction in Vienna. The real-world laboratory serves as a location for investigating renewable and circular building materials under real conditions. STRABAG and its partners examine how materials can be used multiple times, recycled and processed in a resource-efficient manner. The laboratory provides a platform for collaboration between research, industry and business. It is used to test the practical applicability and scalability of circular solutions and provides space for workshops, events and meetings. The real-world laboratory opened in May 2025 and is planned to run for two years.

Actions to optimise value stream management

A robust data basis on current raw material consumption and waste volumes enables us to leverage optimisation potential in order to keep the value streams at STRABAG in continuous circulation.

We are working to obtain information on the fate of our waste within the downstream supply chain and are continuing to develop a digital platform for tracking waste volumes. To this end, we surveyed the requirements with respect to potential software solutions among our operational entities in Austria and Germany. In the 2025 financial year, a concept was developed on this basis for the target process of data collection as well as for the structure and functionality of the software. As this is a multi-year long-term development, no project end date can currently be specified.

Until the tool is deployed across the Group, waste volumes are derived from STRABAG’s accounting system. For this purpose, a standardised methodology for tracking waste volumes was developed in the 2023 financial year and introduced across the Group in January 2024. The aim of the system is to help improve our data basis so we can more effectively steer our recyclable material flows. To continuously improve our data basis, an extended control system with additional responsible parties was developed in 2025. This system is to be tested and rolled out in 2026. As this too is a multi-year long-term development, no project end date can currently be specified.

At the same time, several KPIs for value stream management capability have been defined. These include, for example, the share of recycled materials in the building materials we produce ourselves and the proportion of recyclable materials from our construction sites that are processed at STRABAG’s own value stream management facilities. The necessary recording systems and analyses are currently being developed. In the future, the KPIs will be displayed in a central dashboard and will contribute to expanding material cycles within STRABAG.

As a third component, the network of STRABAG-owned value stream management facilities is to be further expanded, for example in the form of recycling and storage sites. In the future, this will enable more materials to be processed at our own facilities and a greater share of recyclable materials to be kept within the Group’s circular material flows.

Targets

ESRS E5-3

There are no measurable time-bound outcome-oriented targets related to resource use and circular economy at this time. These are currently being developed and will be established once a sufficient data basis is available. The measurability of strategies and actions will only be possible after these targets have been defined.

STRABAG is working to further develop its IT infrastructure and to capture the data basis for the production and use of raw materials along the value chain. This will enable us to set quantifiable targets and to measure progress in the future. For this purpose, a data governance framework is currently being established in line with the Group-wide data strategy. During the reporting year, roles and responsibilities for various data domains were further specified and published internally in a catalogue. In addition to establishing the governance structure, work continued on further developing data storage and data provision. This includes connecting additional data sources to the central data platform and standardising the processes for retrieving and processing data from the source systems.

When defining targets, consideration must be given to the fact that both the use of building materials and the generation of waste in the construction industry depend on the specific project. Achieving a transition in resource use therefore requires a new mindset among our clients as well. One of our key tasks is therefore to convince clients of the benefits of circular construction by offering them sustainable solutions that are also economically attractive.

In addition, construction products used within the EU must meet requirements relating to safety-critical functions (mechanical stability, compatibility of different materials, etc.) and comply with pollutant and emission limits. For this reason, there are restrictions at national and regional level on the use of secondary raw materials in construction products, for example in the form of maximum permissible amounts. At present, several EU countries are working on legal frameworks to allow recyclable materials to exit waste legislation in order to promote their use as secondary raw materials.

Metrics

Resource inflows

ESRS E5-4

STRABAG operates its own extraction sites for raw materials as well as production facilities for building materials. These include stone/gravel, asphalt and concrete. The vast majority of the cement used is sourced externally. Bitumen, steel and timber are procured exclusively from external suppliers. Due to this differing structure, various methodological approaches and assumptions are applied when collecting data on resource inflows and the share of secondary raw materials.

STRABAG’s main activity consists of construction projects in the fields of transportation infrastructure, building construction and civil engineering. The following building materials are essential for the construction of these structures: stone, gravel, concrete, cement, asphalt, bitumen, steel and timber. In addition to purchasing these materials, STRABAG also produces large quantities of stone, gravel, concrete and asphalt itself. Cement for the production of concrete and bitumen for asphalt production are therefore key materials from our upstream supply chain. We also use water at various stages of our in-house building materials production, for example as a main component of concrete. Critical raw materials play only a minor role at STRABAG and are found only as components of purchased construction products.

In addition to its core construction business, STRABAG also offers further services, including waste management. This includes the recovery and disposal of waste from both our own activities and from our clients. The waste accepted at our sites corresponds in type to our own waste. STRABAG operates its own recycling plants and landfills and also builds and operates landfill sites for clients. Waste from third parties assigned to the waste management business segment is reported separately as resource inflow in this report.

We require a wide range of construction machinery and equipment to build our structures, including cranes, roller-compactors, excavators and wheel loaders. Packaging plays a relatively minor role in STRABAG’s resource consumption, as our most important materials are not delivered in conventional packaging but are delivered in substantial quantities as dry bulk or in mixtures directly by heavy goods vehicles. Weight and packaging are therefore not included in our parameters.

We report the six material flows with the largest volumes that were used to manufacture our products and provide our services. Timber was selected as the most important biological building material. Together, these materials account for approximately 72% of the costs of all building materials. The data for asphalt, bitumen, cement, concrete, steel and timber include only those materials that were purchased externally, not those that were produced in-house. The reported purchase volumes are used, among other things, in our building materials production (bitumen and stone/gravel in asphalt, cement and stone/gravel in concrete). Quantities from our own building materials production are therefore not included in the metrics in order to avoid double counting. The reported quantity of stone and gravel, in addition to materials purchased externally, also includes those extracted from the earth at our own quarries and gravel operations as well as recycled aggregates used in our asphalt and concrete mixing plants. To determine the portion from our own extraction activities, it was assumed that sales volumes correspond to extraction volumes. We also assume that inventory levels from extraction can be neglected, as these quantities remain approximately constant.

The quantities for stone/gravel, asphalt, concrete and timber are calculated on the basis of euro values and average prices. The euro values are taken from STRABAG’s accounting system. For the average price of timber, data from ZÜBLIN Timber’s purchasing department were used. For the average prices of stone/gravel, asphalt and concrete, we used data from our own production of these building materials. One exception is the amount of recycled aggregates as a percentage of the total quantity of stone/gravel. These data are not euro-based; instead, the volumes are recorded directly at the production facilities.

The quantities for bitumen, cement and structural steel are taken from STRABAG’s accounting system. For these building materials, country-specific average prices are calculated on the basis of volumes and costs. A price range is defined based on the average price. Entries within this price range are included in the calculation of the metrics using their recorded volumes. Quantity entries outside the price range are included in the calculation using their respective average price and cost value. This results in a total volume per building material and country for the calculation of the metrics.

Materials used

Timber is the most important biological building material used in the manufacture of STRABAG’s products and the provision of its services. Despite the significantly smaller quantities of timber used compared with other building materials, we therefore report the percentage of sustainably sourced timber in the total weight of materials used. For the calculation, we use volume data derived from average prices.

To determine the amount of timber purchased from sustainable sources, we assume that this corresponds to the percentage of PEFC- or FSC-certified forest areas in the countries from which our timber is procured. No information can be provided on how the procured timber is handled at the end of its useful life nor can we make any statements as to whether the cascade principle is applied. Based on information on the handling of waste wood provided by the German Federal Environment Agency, it can be assumed that most of the timber is incinerated at the end of its useful life.

Percentage of biological materials

The reported figures include the weights and percentages of reused or recycled secondary components, products or materials within the largest material flows by volume, as well as timber as the most important biological building material. Information on the percentage of secondary raw materials for cement and bitumen cannot be provided, as these are used as binding agents in the building materials concrete and asphalt. Current recycling processes allow only the recycling of the building materials themselves and do not permit separation into their original constituent materials.

The percentages of secondary raw materials in the building materials procured are based on the percentages of secondary raw materials in building materials produced in-house (stone/gravel, asphalt and concrete). These data are recorded throughout the year in the ERP systems of the production facilities. It is assumed that externally purchased building materials contain the same percentages of secondary raw materials as those produced by STRABAG itself. The percentages of secondary raw materials in steel and timber are based on information from the literature.

Secondary raw materials

Waste management

The tables below report the waste generated within the waste management business. The collection of these waste streams follows the same methodology as that used for our own waste.

Waste accepted from external sources

Waste accepted from external sources sent for recovery

Waste accepted from external sources sent for disposal

Resource outflows

ESRS E5-5

Structures are increasingly being designed and built according to circular economy principles. The application of circular economy methods, however, is project-dependent and is significantly influenced by our clients’ requirements. In the production of our own building materials, we are constantly working to make the process more circular. Our central division TPA, together with our production facilities, is developing and testing building materials with higher percentages of secondary raw materials. The addition of so-called rejuvenators is intended to restore the original properties of bitumen from reclaimed asphalt as a way of preparing reclaimed asphalt for use in new asphalt mixtures. The development of alternative binders is also intended to contribute to the increased use of renewable raw materials in construction and to enable building materials to be reused or recovered more effectively in the future.

In the case of building materials, the durability and reparability of our products depend on their specific application within a structure. Every structure is unique and can consist of thousands of different components. At present, no sector-specific evaluation framework exists Information on durability, reparability or the recyclable percentages is therefore difficult to compare and offers only limited informative value.

The situation is different when it comes to the recyclable percentages of our products. The most important building materials produced in-house by STRABAG (stone/gravel, asphalt and concrete) are all 100% recyclable. In practice, however, this recycling rate cannot always be achieved due to legal restrictions and applicable standards. As the above-mentioned research and development activities in building materials progress, the construction industry will be able to make a significant contribution to the transition to a circular economy.

The waste streams reported are those that are recovered or disposed of by external waste management companies. The data are recorded throughout the year as part of STRABAG’s accounting processes. For each waste fraction, country-specific average prices are calculated on the basis of volumes and costs. A price range is defined based on the average price. Quantity entries within this price range are included in the calculation of the metrics using their recorded volumes. Quantity entries outside the price range are included in the calculation using their respective average price and cost value. This results in a total volume per waste fraction and country for the calculation of the metrics.

Each waste fraction is assigned to one of the following categories: preparation for reuse, recycling, or other recovery operations for recovered waste, and incineration or landfill for disposed waste. The allocation to these categories is based on the experience of waste management experts at STRABAG as well as on commonly used information from industry associations in the construction sector.

In doing so, we deliberately distinguish preparation for reuse and recycling from other recovery operations. For the circular economy to succeed in the long term, it is important that raw materials and materials are processed in such a way that they retain their original material quality for as long as possible or can be used in other high-quality applications. This objective can only be achieved if a clear distinction is made between high-quality recovery processes (preparation for reuse, recycling) and lower-value recovery (downcycling, backfilling, etc.). We therefore advocate defining a clear distinction within the relevant legal frameworks and making it mandatory for waste management companies to disclose the final destination of waste to their clients.

We assume that our waste is not disposed of by any other means and that each waste fraction is 100% recovered or disposed of through one of the methods described above.

Waste generated

Recovered waste

Disposed waste

Non-recycled waste

STRABAG’s relevant waste streams consist of construction and demolition waste. The most important waste fractions generated in the course of our business activities are excavated material (soil, stones, dredged material and track ballast), concrete demolition waste, construction rubble (a mixture of concrete, bricks, tiles and ceramics), reclaimed asphalt, bituminous mixtures and mixed construction waste (wood, glass, plastics, metals, insulation and plaster). Radioactive waste arises only in exceptional cases in connection with our construction activities, for example during the decommissioning of nuclear power plants. We will therefore report on this only in those years in which we carry out relevant construction projects.

Sources – Circular Economy

Deutsches Umweltbundesamt [German Federal Environment Agency]. (2019). Altholz [Waste Wood]. Retrieved 18 February 2026.