Basis of Presentation

The Integrated Annual Report of the Enel Group, consisting of the Report on Operations inspired by integrated thinking and the consolidated financial statements prepared in accordance with the IFRS/IAS international accounting standards, represents the “core” document of the Enel Group’s integrated corporate reporting system, based on the transparency, effectiveness and accountability of information.
The objective of the Enel’s Integrated Annual Report is to describe its strategic thinking and to present its results and the medium- and long-term outlook for an Integrated Businesses model that in recent years has fostered the creation of value in the context of the energy transition.
The Enel Group has drawn inspiration from the “Core & More” reporting approach, designing its own corporate reporting system at the service of stakeholders in a connected, logical and structured manner and developing its own concept for presenting economic, social, environmental and governance information, in accordance with specific regulations, recommendations and international best practices.
This “Core Report” seeks to provide a holistic view of the Group, its business model and the related medium/longterm value creation process, including the qualitative and quantitative financial and sustainability information considered most relevant on the basis of a materiality assessment that also considers the expectations of stakeholders.
The “More Reports”, on the other hand, include more detailed and additional information, partly in compliance with specific regulations, than that provided in the Core Report while being cross referenced to the latter.

As an expression of integrated thinking, the Integrated Annual Report seeks to represent the capacity of the business model to create value for stakeholders in the short, medium and long term, ensuring the connectivity of the information it contains.
The Group maintains ongoing relationships with stakeholders in order to understand and meet their reporting needs, taking account of the importance of the impact of the Group’s business model for all interests involved. The financial and sustainability information presented within the various documents of the corporate reporting system are selected based on their materiality determined on the basis of specific frameworks, methodologies and assessments.
The following represent the key principles underpinning the preparation of the Report on Operations, with the basis of preparation of the consolidated financial statements being discussed in the section “Form and content of the consolidated financial statements”.
The Report on Operations includes financial and sustainability information selected on the basis of a materiality analysis that takes account of stakeholder information requirements, including Enel’s contribution to achieving the United Nations Sustainable Development Goals (SDGs) (i.e. “Affordable and Clean Energy“ (SDG 7), “Industry, Innovation and Infrastructure“ (SDG 9), “Sustainable Cities and Communities“ (SDG 11) and “Climate Action“ (SDG 13)) and on the activities implemented to contribute to their achievement in order to meet the expectations of the main stakeholders in the Integrated Annual Report.
The Enel Group also performs a double materiality analysis, details on which are available in the Sustainability Report. In addition to the concept of materiality, the qualitative and quantitative financial and sustainability information reported in the Report on Operations have been prepared and presented in such a way as to ensure their completeness, accuracy, neutrality and comprehensibility.
The information contained in the Report on Operations is also consistent with the previous year.
Accordingly, the Group applies the same methodologies from year to year, unless otherwise specified, in compliance with international best practices for integrated reporting and sustainability reporting.
For the purposes of preparing sustainability information, especially quantitative information, the Group mainly applies the provisions of the Global Reporting Initiative (GRI) standards, in line with the Sustainability Report, and the “Aspects” of the GRI supplement dedicated to the Electric Utilities sector (“Electric Utilities Sector Disclosures”). Consideration was also given to the indicators proposed in the white paper “Toward Common Metrics and Consistent Reporting of Sustainable Value Creation” of the World Economic Forum (WEF), the details of which are highlighted in the section on the WEF and in the “Group Performance” chapter of this report.

Taking account of the results of the priority matrix and the significant climate impacts on the Group’s value creation process, each chapter (Governance, Group Strategy & Risk Management, Group Performance and Outlook) includes information relating to climate change as proposed by the Task Force on Climate-related Financial Disclosures (TCFD) ⁽⁵⁾ which published specific recommendations in June 2017 that were adopted by the Group in its voluntary reporting on the financial impacts of climate risks.
The Group also took account of the recommendations issued by the IASB in November 2019 “IFRS Standards and climate-related disclosures” and November 2020 “Effects of climate-related matters on financial statements”, as updated in July 2023 with the issue of the educational material “Effects of climate-related matters on financial statements”. These recommendations emphasize that climate-related risk must be considered in management’s assumptions used in the exercise of its judgment in measuring items in the financial statements.

In order to ensure the connectivity of information and to communicate the way in which the progress achieved in sustainability contributes to enhancing current and future financial performance, clear and consistent relationships between key financial and sustainability information have been identified and presented in the Report on Operations for each of the four sections indicated above.
In addition, Enel’s Integrated Annual Report has been published in the “Investors” section of the Enel website (www. enel.com).

⁽⁵⁾ In 2023, the Financial Stability Board announced that the work of the TCFD was completed with the issue of international sustainability reporting standards IFRS S1 and IFRS S2, which were published at the end of June 2023 by the International Sustainability Standards Board (ISSB).

In order to provide an integrated representation of the Group and represent the connectivity of information, the Enel Group has prepared a matrix delineating the relationships between the governance, Group strategy and risk management, Group performance and the outlook for each business line.

Cross-sections to all Businesses