cowi tax policy

COWI is a multinational enterprise which provides consulting services within engineering, economics, architecture and environmental science.

COWI is a Danish based group founded in 1930 in Copenhagen, Denmark. The holding company of the group is COWI Holding A/S which is owned by the COWI Foundation. The COWI Foundation holds 87 % of the shares in COWI Holding A/S. COWI Holding A/S as well as current and former employees hold the remaining 13 % of the shares.

COWI is headquartered in Denmark and has 8,000 employees in offices across the world. At any given moment, COWI is involved in more than 10,000 projects worldwide.

Tax Governance

The Board of Directors has the overall responsibility for the Group Tax approach, including tax policy and its implementation in the organisation. The established Audit Committee in COWI Group oversees and monitors the tax reporting and related work. COWI's Tax Policy is reviewed by the Executive Board and the Audit Committee and approved by the Board of Directors once a year and is applicable for all COWI entities. The Chair of the Audit Committee, Anne Harris has been appointed as responsible within the Board of Directors.

The Group CFO is a member of the Executive Board and oversees the group finance function. Tax compliance and tax risk management lie within the area of responsibility of the Group CFO.

COWI Group's tax function is part of the group finance function. The tax team prepares and maintains COWI's Tax Policy and is responsible for the day to day handling of all corporate tax matters. The tax team is based in Denmark and assists the entire group with clarifying tax and VAT issues in connection with international projects, Danish and international corporate tax forecasting and compliance issues. 

Our Approach to Tax

Taxes form a natural part of the cost base in COWI. Like any other costs, taxes and their implications are examined and assessed in consideration of our business activities and strategy. We are committed to ensure compliance with local and international tax laws and regulations acknowledging that a responsible approach to tax is necessary to sustain our business in the countries where we operate.

COWI's Tax Policy is based on compliance and integrity. This means that in COWI we are committed to comply with local tax laws and international regulations when calculating taxes due. COWI refrains from using so-called “tax-havens” in order to avoid taxes on activities which take place elsewhere. As of 31. December 2023, there is one registration in the COWI Group located in a tax haven (a permanent establishment in Panama). The permanent establishment originates from a bridge project in Panama, which is now finished. The permanent establishment is currently in the process of deregistration.

Our approach to tax is also described in the ESG-Chapter (page 52) in our Annual report for 2023.

Our Approach to and Management of Tax Risks

COWI's approach to risk management is defined by our desire to protect the assets and reputation of our business. In line with this approach, we seek to minimise or eliminate tax risks where possible, which means that we do not initiate any artificial or aggressive transactions for tax optimisation purposes. To underpin this approach, we manage our tax matters in a tax governance framework with communication lines that ensure that relevant stakeholders, including the Executive Board and Board of Directors, are involved when making significant business decisions with a tax impact.

In order to mitigate the related risks and meet the challenges of multi jurisdictional tax operations of COWI Group Companies efficiently and in a timely, responsible and compliant way, COWI Group's tax team is working closely with managers and finance functions throughout the organisation in dedicated global internal tax networks.

Given the size and complexity of our business and activities, the COWI Group is exposed to a variety of tax risks. We aim to manage these risks through:

• Employment of a qualified in-house COWI tax team. The team is based in Denmark. It undertakes regular training and knowledge pooling and knowledge sharing through dedicated global internal tax networks.
• Engagements with external tax advisors on solving complex tax matters where profound local knowledge of tax compliance requirements is required.
• Regular control and auditing. The COWI tax team and the finance functions in all COWI entities perform their activities in a reporting and control framework, which is documented and reviewed regularly by internal controllers and external auditors according to legislative requirements.

Our Relationship with Tax Authorities and other stakeholders

COWI seeks to maintain a good working relationship and to keep an open and transparent dialogue with tax authorities throughout the world. We cooperate with tax authorities and respond in a straightforward and timely manner to any enquiries. In case of misunderstandings or disagreements regarding fact or law, we seek to work with the tax authorities to resolve any such issues. COWI also engages with governments, business organisations (e.g. Dansk Industri) and other business groups with tax specialist from other large Danish companies on proposed changes to tax legislation where appropriate, either directly or via representative bodies. Such dialogue will always be based on mutual respect, professionalism, and trust.

UN's Sustainable Development Goals

COWI is committed to universal sustainability principles and UN's Sustainable Development Goals (SDG). In particular SDG #11 'Sustainable cities and communities' expresses COWI's vision and integrates and encompasses almost all the services provided by COWI along with SDG # 6, 7, 9 and 13. COWI is a worldwide tax payer and a responsible approach to tax plays a vital role in COWI. This commitment to timely pay all taxes due is supporting SDG # 16.6. in developing effective, accountable and transparent institutions at all levels.

Tax Exemptions and Tax Incentives

We do pursue projects financed by multinational aid organisations in the form of grants and donor funded projects benefitting from tax exemptions, if this is permitted and authorised by law.

As a company we also pursue a responsible use of tax incentives in jurisdictions where such incentives are governed in accordance with applicable laws. Through our strategy FUTURE-NOW our ambition is to accelerate growth based on the green transition.

In regard to our strategy we have used the following tax incentives:

R&D

Many countries offer various tax incentives in order to increase total investment in research and development. COWI is a leading engineering company, and these incentives support our strategy. In Denmark, Norway, UK & Canada we are making use of these incentives.

Increased tax deprecation base for “new green” assets

The Danish government has also increased depreciation basis to 116 % on new “green” machinery and equipment acquired from 2020 until November 2022. As a part of FUTURE-NOW COWI have a goal of reaching a net zero footprint. As an example COWIs supervision cars have gone from fossil fuel-powered cars to electric cars, which is a part of what has been included in “green” assets to our 116 % operating equipment balance.