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Materiality analysis

Engaging with our stakeholders and understanding what is in their hearts and minds is important to us in our day to day business.

By understanding our stakeholders, we are able to make choices that have a sustainable benefit. Determining what is material to our stakeholders and focussing on our material impacts is important as it enables us to address these topics internally as well as report to our stakeholders on this externally.

The process starts with interacting with our stakeholders and having a common understanding of the road forward, so we can determine the right policies can be made and proper actions to be taken. Every year, we analyse what our stakeholders consider to be important and where we have a significant impact from a social, economic and environmental point of view. Last year we performed a survey to make sure this understanding is current. This year, in addition to the information gleaned from our regular stakeholder engagements, we updated our understanding based on a document review and media analysis. The outcome of this update has been validated internally by key senior decision makers. We aim to perform a survey again in 2019.

This analysis shows that the topics most material to our stakeholders remain unchanged from last year. These are; engaging with local communities; securing supply for our markets; societal financial impact and the North West European (NWE) electricity market are still key material topics as they were last year. Also safety in our working environment and investments in our grid (onshore and offshore) to realise the energy transition are still important topics. We have renamed the topic related to our investments 'Sustainable Grid Infrastructure'. This is a better reflection of our challenges related to the way we can make smarter use of our assets and in what way we can invest in our infrastructure to facilitate the energy transition.

Topics such as financing and financial performance remain evenly material, which seems logical considering our role and responsibility in the energy transition and the trade-off we as TenneT have between our regulatory task and leading the way to a more sustainable energy grid. The topics of security and cyber-security have become more material in this year's analysis. In the previous year, only copper theft was included, but we have broadened and renamed this topic to include (cyber) security to better reflect our task of providing a safe and secure grid infrastructure in a better way.

Our policies, decision-making and our reporting are not limited by the topics that are both material to our stakeholders and can be significantly impacted by us. We also consider other topics in this report, including those deemed less significant or material enough to be of importance to act upon and to disclose them in this report or on our corporate website

We also report on how we contribute to the United Nations Sustainable Development Goals. With our core business activities we clearly contribute to SDG7 and SDG9, and in the execution of these activities we realise we have an impact on other SDGs. In the previous year, we asked our stakeholders to identify the SDGs where they felt TenneT could make most impact. In 2018, we have used this as an input for our CSR ambition plan 2025. And we have linked our ambitions and our contribution to specific SDGs. The relevant SDGs are shown below and we have included these in the table on the next page, where we have disclosed the connection between the SDGs, our materiality analysis, performance metrics and chapters in our report.