ESG report of WEDOS

Opening statement

WEDOS Internet, a.s. is a leader in the web hosting and server services market. Since the beginning of our operations, we have emphasized environmentally friendly operations, social responsibility, fairness towards employees, and transparent company management. We believe that we can only ensure sustainable growth in accordance with the principles of sustainability and ethics. We see ESG (Environmental, Social, Governance) aspects as a natural part of our business and will continue to strengthen and develop them.

Material topic and key risks and opportunities

As a data center operator, we face high energy consumption and the need for effective cooling. This poses a risk of increasing our carbon footprint if we do not implement environmentally friendly and innovative technologies. On the other hand, we also see this as an opportunity—thanks to unique oil cooling, free cooling, and waste heat utilization technologies, we can significantly reduce energy consumption and environmental impact. On the social side, diversity, a safe and inclusive work environment, and fair conditions for employees are key for us. In terms of management, we focus on a transparent and ethical approach, compliance with legal regulations, and strengthening the trust of shareholders and the public.

Environmental aspects (E)

Energy consumption and renewable resources

• In 2023, we consumed 1,790 MWh of electricity, with 100% of this volume covered by renewable energy sources.
• However, since 2024, we have not had access to detailed information from the supplier, which may affect our ability to report the exact share of renewable energy sources.

Number of servers and capacity growth

• We originally had 1,900 servers, added over 1,000 servers last year, and currently operate more than 4,000 servers.
• We plan to add another 1,000 servers next year, which we already have in stock. This growth means higher absolute energy consumption, but also greater potential for more efficient use of green cooling technologies and a reduction in the relative carbon footprint per unit of computing capacity.

Cooling technology and energy savings

1. DC1 ("Bunker") and free cooling: Free cooling in DC1 saves us approximately 1,300 MWh per year compared to conventional cooling methods. We use the residual heat to heat the building, with the excess warm air replacing conventional heating. The PUE of DC1 is around 1.17.
2. DC2 ("Podskalí") and oil cooling: DC2 uses oil cooling for all servers, which is unique worldwide. At the current stage, when relatively few servers are installed in DC2, the savings amount to approximately 35 MWh per year. Once DC2 is fully occupied, we expect savings of over 1,050 GWh per year compared to traditional cooling.

The current PUE DC2 is 1.03, but thanks to the server fans being turned off, values around 0.75 can be effectively achieved.

• Oil cooling is more than 43% more economical than air cooling. In addition, we use mineral oil, which is not harmful to the environment.
• Thanks to oil cooling in DC2, waste heat is used to heat domestic water, the building, the parking lot, and the municipal swimming pool. This contributes to further savings – together, we save approximately 107 MWh of electricity for heating each year, and in 2025 we plan to supply the swimming pool with over 77 MWh of energy, increasing this amount by tens of percent annually in the following years.

Noise and air conditioning optimization

• In 2023, we optimized the air conditioning system in DC1.
• We have reduced the acoustic noise level at neighboring residential buildings by 5 decibels and plan to reduce it by another 2 decibels in 2025. This will minimize the impact on the surrounding environment and improve the quality of life for residents in the neighborhood.

Waste management and biodiversity protection

• We produce less than 1 ton of mixed waste per year and less than 5 tons of recycled waste per year.
• We support recycling in data centers – containers for sorting paper, plastic, and electronic waste are available.
• We comply with all environmental regulations. We monitor all impacts of our operations to minimize our environmental footprint.

Social responsibility (S)

Working conditions, diversity, and inclusion

• WEDOS has more than 60 employees.
• Women make up 25% of our workforce. In 2024, we hired several female employees on a part-time basis after their maternity leave. This model has proven successful, and we are considering expanding it further.
• In 2024, we opened a new branch, which caused some resentment among our three branches. We are aware of this and are working to improve mutual relations and internal communication.

Work safety, training, and employee development

• We pay attention to occupational health and safety, and all employees are properly trained.
• We comply with ISO standards and have introduced a fire watch.
• We support training and enable participation in external educational courses.
• Regular internal English courses with native speakers and professional training in IT, business, and marketing increase employee qualifications and motivation.

Social impact (CSR activities)

• Every year, we donate over CZK 1 million to charitable and non-profit projects such as Bazalka, Arpida, and the Early Care Society.
• We support sports at the local, national, and international levels (HC Motor České Budějovice, SK Dynamo České Budějovice, FC Zbrojovka Brno, the local WEDOS league, Pelimatkat Cup 2024, and the sports complex in Hluboká nad Vltavou).
• Support for cultural and social activities (long-term partnership with Hluboká Zoo, charity American car meet in Tábor, sponsorship of high school graduation balls).
• WEDOS community: We run a community forum called Help, a knowledge base with tutorials, organize excursions for schools and interested parties, professional internships for students, WEDOS Tour (meetings with customers), AjťákoBraní (recruitment conference), and Open House.
• Customer satisfaction scores 4.6 out of 5 on Google in long-term ratings.

Corporate governance (G)

Structure, transparency, and ethics

• A few years ago, we transitioned to a project-oriented organizational structure that clearly defines roles and increases efficiency.
• Automating services from the outset allows you to focus on developing and improving your offering.
• We adhere to ethical principles, ensure equal opportunities, and have zero tolerance for discrimination.
• We protect our customers' data in accordance with GDPR, ISO standards (ISO 27001, 27017, 27018) and offer WEDOS Global Protection cyber protection.

Compliance with legal regulations and anti-corruption measures

• We fully comply with legal requirements in the areas of environmental protection, data protection, labor law, and other standards.
• We value transparency and fair treatment of customers, suppliers, and partners.

Shareholder relations

• We hold regular general meetings, and shareholders are informed about key decisions and financial results.
• In 2024, a dividend similar to that paid in 2021 was paid (CZK 43.47 per share at the time, CZK 36.94 after tax), which corresponds to approximately 36% of the net annual return relative to the purchase price of the share.
• Shareholders are entitled to a 20% discount when renewing hosting services.
• In 2025, we plan to introduce an employee stock plan (30% of shares) to strengthen the loyalty of current and future employees.

Our plans for the future

Certification and future plans

• We are ISO 9001, 14001, 27001, 27017, and 27018 certified.
• In 2025, we plan to expand our certifications to include DORA.

Goals and strategies for the future

• Increase the share of renewable energy sources to 100% by 2025 and keep energy consumption as low as possible, even with a growing number of servers.
• Fully occupy DC2 and achieve savings of over 1050 GWh per year thanks to oil cooling.
• Add approximately 1,000 more servers with regard to effective cooling and minimizing environmental impact.
• Introduce an employee stock plan, improve relations between branches, and promote diversity.
• Maintain and expand charitable and sponsorship activities, support sports, culture, and education.
• Further reduction in noise from cooling equipment – by 2 dB in 2025.

Impact assessment

Thanks to freecooling and oil cooling technologies, we are reducing the relative carbon footprint per unit of computing capacity. Although absolute consumption is increasing, we are significantly more efficient in terms of performance. Social activities strengthen the company's reputation, contribute to employee and customer satisfaction, and promote regional development. Transparent management, adherence to ethical principles, and communication with shareholders strengthen our position as a trusted partner in the long term.

Conclusion

WEDOS continues to fulfill its commitment to ESG and sustainability. Innovative green technologies, efficient resource management, support for employees, communities, sports, and culture, while adhering to ethical and legal standards, all contribute to sustainable growth and stability. We look forward to our future steps in the area of ESG bringing even better results for our company, our customers, our surroundings, and society as a whole.