Ørsted is recognised as a leader in responsible tax practices and tax transparency. This supports our ambition to help build green energy in a way that gives back to society.
Why are responsible tax practices important?
Tax contributions are a key part of the positive social and economic impact we can make as a business. They help the local economies in which we operate to deliver valuable public services, such as healthcare, education, and transport, and build the infrastructure that allows businesses to thrive.
By being a responsible taxpayer and engaging with policymakers to support robust tax regulations, we support well-functioning societies, institutions, and regulations that are conducive to both people and business.
What are we doing?
- We aim to comply not only with the letter of the law, but also the underlying policy intent behind it to ensure that we pay the right amount of tax, at the right time, in the countries where we operate.
- We engage with stakeholders and cooperate with local market authorities to support effective tax systems, honouring our commitment to be a responsible taxpayer.
- We’re transparent in our tax reporting and voluntarily report in line with the GRI 207 standard, which includes disclosing country-specific tax payment and deferred tax information in our annual report.
How are we doing?
We consistently meet our ongoing target of a Group effective tax rate of 19 %. This refers to the rate at which our taxable ordinary profits for the year are subject to tax. It demonstrates that we pay tax at a rate that’s sustainable and that we don’t engage in aggressive tax planning.
A Group effective tax rate on ordinary business (profit and tax adjusted for one-off items) (%)
Latest updates from 2022
- We obtained the Fair Tax Mark, becoming the first Danish multinational company to secure accreditation to the global gold standard of responsible tax conduct.
- We continued to develop our reporting of tax practices in our annual report. Our integration of ESG disclosures in the 2021 annual report won us the Special Recognition Award by PwC Denmark.
- To continuously strengthen our tax compliance efforts, we established a team dedicated to developing automated reporting and declaration tax solutions, thereby ensuring we comply with the evolving reporting requirements from tax authorities globally.
- We’re a signatory to the B Team Responsible Tax Principles as part of our commitment to responsible tax practices, and we continued to liaise on an ongoing basis with our peers in the B Team to continuously evolve our approach.
- We engaged with various politicians, policymakers, and other stakeholders, including the OECD, with a view to ensuring that energy policy is better integrated with tax policy. As part of these efforts, we’ve also engaged in constructive dialogues on energy price caps and similar mechanisms. We fully support such initiatives, but equally argue that they should be implemented in a balanced manner, ensuring that only excess revenues are targeted.
- We’ve made a submission to the UK Treasury in response to the public consultation on the proposed changes to the UK capital allowance regime, arguing that effective tax relief is critical for the green transformation.
What’s next?
We’ll maintain our focus on transparency and accountability across our tax payments and reporting to fully satisfy increasing compliance and reporting requirements.
Key information
Partnerships
We engage in partnerships with a view to encouraging progressive tax regulation, staying up to date on policy developments, and engaging with peers on responsible practices:
- The Danish Confederation of Enterprises’ Tax Panel, with a view to influencing tax regulations and staying up to date on tax policy developments.
- The Tax Dialogue, with a view to staying updated on tax policy developments.
- The B-Team, to engage with peers on responsible tax principles and tax governance matters.
- The Fair Tax Mark, where we’ve been accredited for our responsible tax practices.
International frameworks
- OECD BEPS and Pillar I and Pillar II
- EU directives, e.g. ATAD, DAC6, and CbCR
- Applicable local and international tax legislation
Governance
Accountability lies with our Chief Financial Officer. Our Board of Directors reviews and approves the tax policy annually.
Policies
This programme contributes towards the following Sustainable Development Goals:
