8 July, 2024 | JUL AUG 2024

Delivering change: the importance of green initiatives in gambling

Christoph Neubauer, Head of Group CR & ESG at Novomatic, sheds light on the increasing importance of Environmental, Social & Governance (ESG) in the gaming sector and reveals measures the supplier is already implementing

Tell us a little about yourself, your role and experience within ESG?

I have been in this position at Novomatic for almost three years now. Before that, I worked in the financial sector for over 10 years. I have been involved in environmental, social and governance issues for many years and have been following the development of this area for a long time. From this, it has become clear to me that significant changes have taken place.

 

How do you measure your ESG indicators to ensure continuous improvement? A topic like this is not as tangible as, for example, a financial report.

We have an annual report that contains a report on ESG that is voluntarily audited. This report is prepared annually together with the financial report. As of September 2023, we no longer have any listed bonds and are not required to publish the report on our website, but we continue to prepare internally. We  have also implemented numerous initiatives both at our headquarters, as well as at our subsidiaries. These measures cover a broad spectrum, from player protection to human rights and employee interests. Our annual reporting serves as a common basis in which we document all figures and quantitative measures.

This allows us to continuously track our progress, and successes and highlight them.

 

How has the importance of ESG developed for gaming companies?

From a core business perspective, ESG has become increasingly important. In the past, the industry often relied on attractive images and promising texts, but without implementing significant changes. We have left that behind us. At Novomatic, player protection and the safety of the players are fundamental to our core business, so we have created a comprehensive ESG framework around these priorities, encompassing environmental, social and governance guidelines.

This framework is also essential for securing and maintaining our licences.

Operating in any market requires a solid foundation and ESG issues are of huge importance today. On top of this, penalties for non-compliance have increased dramatically, underlining the importance of maintaining these standards.

 

How can smaller companies put ESG initiatives in place, compared to bigger organisations (like Novomatic) who have greater resources to allocate?

I would say being small is not always a disadvantage. If you are a smaller company, focus on the opportunities you have. With fewer employees and a smaller number of operating companies, you often have the opportunity to implement projects and measures more quickly. I always compare a large oil tanker with a speedboat, but of course you can’t apply this directly to projects and processes, but neither one is always at an advantage or disadvantage.

 

How has the release of your Novovision™ Casino Management System gone for the company so far?

Excellent, we have some 30,000 EGMs worldwide currently running on the system and the numbers are constantly growing. At the core of the Novovision™ access solution is a biometric registration process, which means you produce a template from the customer’s fingerprint or facial scan. Once the initial identification, blacklist checks and registration of the customer are completed, they can enter the premises fast and easy with a quick fingerprint or facial scan, where their unique and untransferable biometric characteristics are checked against the template in the database. So you know exactly who is coming, who is leaving and who is joining the game. It’s a very strong tool to facilitate player protection and responsible gaming, by ensuring your guest is an adult and not a minor, and that they are legally permitted to take part in gaming.

 

You’ve already touched on this in that last answer but, on a wider scale, what role does biometrics play at Novomatic?

For us, it’s very important to know who our customers are. Are they above a specific age? Are they above 18 years or above 20 years old in the respective legislations? It’s very important to ensure that our customers are above the legal age for taking part in the gaming offers in our operations. Biometrics guarantee the unique identification of customers, fast, easy and discreet – and are much more reliable than a traditional player’s card. Novovision™ is a powerful tool, which goes far beyond biometrically supported access solutions – it is a fully fledged casino management system that fulfils GDPR compliance, KYC compliance and AML regulations and it’s also audit-proof. So, with Novovision™, you can prove your results to auditors and all other relevant entities in the right way.

 

How did you react to the new CSRD (corporate sustainability reporting directive) for EU companies from 2025?

The CSRD and EU legislation represent major challenges. We are already preparing for implementation for the fiscal year 2025. Not an easy task, because there are several hundred data points, hundreds of topics and subtopics, disclosure requirements and so on. And this runs through the entire Novomatic Group. It’s a huge amount of work, but we’re managing it step by step and I’m sure we will be successful across the group.

 

With all the departments you have mentioned, is it difficult to streamline the implementation of new directives across all your teams?

It becomes more difficult the larger the organisation becomes, because you may already have information in a different organisation, but we have to transfer that to the new framework and build it from scratch.

 

Can you tell us all about your latest photovoltaic installations in Austria?

It represents a very important topic and we are increasingly focusing on green energy in the future. We have already installed photovoltaic systems in a number of smaller markets and subsidiaries in our core markets. This year, we will be commissioning the largest rooftop photovoltaic system in Lower Austria, with around 5,000 photovoltaic panels on around 20,000 square metres at our headquarters in Gumpoldskirchen. We have over 2,000 megawatt hours of peak power here. The new system will enable us to save hugely on CO2 emissions, over 1,100 tons per year. As we are not only an operator but also a manufacturer, we have our largest production facility in Austria, where our headquarters are located, and we want to use the green energy generated by our plant for production.

 

You mentioned earlier that, in the past, there were plenty of pretty pictures and words without too much action. For any company looking to step up their ESG strategy, how would you advise on the best way to actually make change, rather than just making it look like change?

I would say that the most important progress has already been the new regulations. They really focus on transparency. With the new requirements, every major market player has to be transparent on key settings and issues. I believe we will be seeing significant progress in these areas coming out of this as well.

 

Are there any final messages you’d like to conclude with?

Looking at the ESG sector, I would say we are facing major changes and the challenges they bring. But, in my opinion, you can only improve from challenges. By recognising weaknesses, you can use these challenges as a turbo to emerge bigger and stronger. I am happy to be working in this field and all of us can play a part in contributing to this important area.