Chairman’s Foreword

Dear reader,

I am delighted to present our Integrated Report 2021, which not only sets out our results but also gives information about our strategy and governance as well as the risks and opportunities we have faced and overcome.

The report contains our proposal to provide innovative development solutions, adapting to the imminent wave of change, based on the company's vision and regenerative purpose, while striving to lead the sustainable transformation.

THE MAJOR CHALLENGES OF THE CENTURY

We could say that the great transformations that will take place in this century have materialised in these first two decades. The pandemic was a wake-up call that tested our capacity for adaptation and resilience in the face of the unforeseen. The war in Europe has revealed the interdependencies and divergences that exist in a world of apparently globalized values.

The seriousness of climate change has been proven scientifically; the time for debate is over, and the cost of doing nothing far outweighs the cost of acting. According to the World Meteorological Organization, there is a 50 % probability that the target limit of a 1.5ºC average temperature increase may be exceeded in the next five years.

These shocks have led us to perceive the future as uncertain and have called society's values into question, at a time when the stakes are high and decisions are urgent. In the face of the prevailing volatility, I believe it's important to rely on certainties: on the shared vision that the 2030 Agenda represents, on science and technology, and on the role of business as a driver of a new reality.

BUSINESS AS UNUSUAL

Twenty-five years ago, we defined our raison d'être as a company: to design different — we call them "unusual" — solutions that challenge the conventional approach for developing basic infrastructures in order to increase their positive impact on the planet and society. This has been our guide and, as a company and as a group of people, we believe that ACCIONA has played an important role during this time in the sustainable transformation of key sectors of the economy, such as energy, water, and, more recently, urban transport and housing.

We have been pioneers in some areas, such as renewable power generation, power purchase agreements, electricity storage, blockchain applications and hybridation. We have a lengthy list of patents in the infrastructure field, pioneering proprietary construction techniques, and a track record of working on some of the world's most iconic infrastructures. In the water business, we invested heavily in reverse osmosis desalination when the need for a less energy-intensive technology to address water scarcity was not as obvious as it is today.

This commitment is clear in the company's conviction and the coherence of its sustainability strategy, with the result that 93 % of its activities in 2021 were eligible and aligned with the EU Taxonomy; we are also leaders in the main ESG indices for the sectors in which we operate.

The main event in 2021 was the initial public offering of ACCIONA Energía, our most outstanding business project. This successful transaction ensures that the company has the funds to attain its ambitious growth targets: to expand from 11.2 GW of installed capacity to 20 GW in 2025.

Despite the turbulence, ACCIONA's financial results in 2021 could be described as positive. We attained €8,104 million in revenue, 31 % more than the previous year, and performance was generally good in all our businesses.

Barring the potential impact of geopolitical tensions, the outlook for 2022 is also good. We project double-digit growth in EBITDA, driven mainly by the Energy business. We will also continue to move forward with major projects that will enable cities to become leading players in the sustainable transformation, focusing on decarbonised transportation, water and an increasingly circular economy.

Government recovery strategies and investment plans in our main markets (Europe, Australia, the United States and Canada) show a firm commitment to investing in renewable energy and infrastructure as a means of driving economic recovery, promoting local industry and moving firmly towards energy transition and independence. The ongoing global drive to sustainability is expected to create more than 200 million jobs and directly transform 20 % of GDP, which is still heavily exposed to fossil fuels.

MOVING FORWARD INEXORABLY

Having decided on the path, we are at a point where we need to accelerate. In the coming years, we need to diversify risks by redesigning supply chains to be more resilient. This is an opportunity to reindustrialise countries, particularly in Europe, with technology playing an increasingly decisive role.

We consider that, as a society, we must focus on certainties and avoid discouragement and the temptation to seek short-term solutions. The ability to stand firm in our convictions in these times of uncertainty means that, as a society, in the coming decades we will be able to reap the benefits of the opportunities that present themselves as challenges today.

It is frustrating to see how decisions driven by fear prevented us, for example, from becoming a world power in sectors that, ten years later, have proven to be critical for Spain and for Europe.

And it is necessary to prepare the new generations — and the current ones — for the impending change. The transition to a decarbonised economy brings challenges in knowledge and skills that may prove deeper than those posed by the digital transformation. There is an urgent need to train professionals who can understand and drive this new environment.