CITY DEVELOPMENTS LIMITED ANNUAL REPORT 2021 CORPORATE GOVERNANCE 54 55 or interviews. Through interviews with selected management staff, regulators, industry and sustainabi l ity experts, tenants and suppliers, the Company obtained additional insights into working towards its net zero carbon commitment and strategically addressing risks and opportunities for its businesses, while continuing to deliver long-term value for its stakeholders. The preliminary material issues were validated by the Company’s Senior Management and approved by the BSC thereafter. Wi th the fas t-chang i ng bus i ness landscape and externalities, themateriality assessment is critical to help the Company to sharpen its sustainability strategy and focus resources on areas that are deemed most material to its business. On a quarterly basis, CDL publ ishes an online Sustainability Report on its microsite at www.cdlsustainability.com. This voluntary initiative that started in July 2017 updates stakeholders of CDL’s progress towards key goals and targets set under its Future Value 2030 Sustainability Blueprint, and sets benchmarks for the transparency and timeliness of ESG disclosures to investors and stakeholders. The BSC assists the Board in the review and consideration of the Company’s sustainabi l i ty issues and approach to sustainabi l ity reporting. The BSC compr ises four Di rectors, wi th the Group CEO in the chair and three other IDs. The BSC’s terms of reference sets out, inter alia, the objectives, roles and responsibilities of the BSC. It also includes the BSC’s purview over matters relating to the Company’s ESG strategy, ESG targets, the sustainability reporting framework and also the Company’s policies, practices and performance on its material ESG factors wh i ch are s i gn i f i cant and contribute to the Company’s performance, business activities, and/or reputation as a global corporate citizen. The annual ISR is dedicated to reporting on CDL’s sustainabi l i ty efforts and CORPORATE GOVERNANCE performance that address the social and environmental impacts pertinent to the Company’s stakeholders and business. Over the years, CDL’s robust sustainability reporting has evolved into a unique blended model using the Global Reporting Initiative (“GRI”) Standards as its core since 2008. To address the diverse expectations of stakeholders, CDL embraced CDP since 2010, Global Real Estate Sustainability Benchmark since 2013, the Value Reporting Foundation’s Integrated Reporting Framework since 2015, Sustainable Development Goals (“SDG”) Reporting since 2016, Task Force on Cl imate-related Financial Disclosures (“TCFD”) framework since 2017 and Sustainabi l ity Accounting Standards Board (“SASB”) Standards for Real Estate Sector since 2020. CDL’s ISRs are available on both its corporate website and the dedicated sustainability microsite. To enhance data credibility and instill confidence in readers, external assurance of its report started since 2009. ISR 2022’s external audit has been further elevated in its scope against the GRI Standards, SASB Standards, as well as the TCFD and Climate Disclosure Standards Board (“CDSB”) frameworks. Further information on the Company’s approach to stakeholder engagement and its materiality assessment can be found on pages 65 to 78 of the AR. CORPORATE VALUES AND CONDUCT OF BUSINESS The Boa rd and Managemen t a re commi tted to conduct ing business with integrity and consistent with high standards of business ethics, and in compliance with all applicable laws and regulatory requirements. The Company has in place an internal code of business and ethical conduct crystallising the Company’s business pr inciples and practices with respect to matters which may have ethical implications. The code, which provides a communicable and understandable framework for employees to observe the Company’s principles such as honesty, integrity, responsibility and accountability at all levels of the organisation and in the conduct of the Company’s business in their relationships with customers, suppliers and amongst employees, is available on the Company’s intranet and is easily accessible by all employees. The code provides guidance on issues such as: • conflicts of interest and the appropriate disclosures to be made; • t he Company ’ s s t ance aga i ns t corruption and bribery; • compliance with applicable laws and regulations including those relating to the protection of the environment and the conservation of energy and natural resources; • compliance with the Company’s policies and procedures, including those on internal controls and accounting; • safeguarding and proper use of the Company’s assets, confidential information and intellectual property rights, including the respect of the intellectual property rights of third parties; and • competition and fair dealing in the conduct of the Company’s business, in its relationships with customers, suppliers, competitors and towards its employees. In line with the Board’s commitment to maintain high ethical standards which are integral to its corporate identity and business, the Company has the following three key corporate policies in place: (i) Anti-Corruption Policy & Guidelines which sets out the responsibilities of the Group companies and of each employee in observing and upholding CDL’s ‘zero-tolerance’ position against all forms of corruption, bribery and extortion and provides information and guidance to employees on how to engage its stakeholders, including the channel of communication through which shareholders and investors may pose queries and through which the Company may respond. The IR Policy outlines the principles and framework in which the Company communicates and engages with investors, analysts and other IR stakeholders to provide balanced, clear and pertinent information. To provide investors with a better understanding of the Group’s business and growth drivers, regular updates on the Group’s strategies, operations and financial performance are available across multiple platforms. Further information on the Company’s investor relations policy and activities can be found on pages 63 and 64 of the AR. Principle 13: Engagement with Stakeholders Sustainability Since 2014, the Company star ted conducting materiality assessments annually, which is facilitated by a third party, to determine the key economic, environmental, social and governance (“EESG”) issues that are important to the Company’s stakeholders. These issues are foundational to the Company’s annual sustainability reporting. Corresponding EESG targets , metr i cs , ini t iat ives , and progress are rev iewed by the Management team, reported to the BSC and the Board for approval, before they are published annually in the Company’s Integrated Sustainability Report (“ISR”). Due to COVID-19, the Company conducted mo re comp rehens i ve ma t e r i a l i t y assessments both in 2020 and 2021, to be in closer al ignment wi th the shifting priorities and expectations of its stakeholders. The process started with an extensive macro scanning exercise to determine the list of material risks and opportunities relevant to CDL’s stakeholders and bu s i ne s s f o r s u s t a i ne d g r owt h . Engagement with internal and external stakeholders, including the BSC, was then conducted through online surveys to recognise, address, resolve, avoid and prevent instances of corruption, bribery and extortion which may arise in the course of their work. (ii) Fraud Pol icy & Guidel ines which provides guidance on actions which may constitute fraudulent conduct and highlights the importance of the implementation, maintenance and compliance with the internal controls framework of the Group and its policies and procedures. (iii) Competition Pol icy & Guidel ines which states the Company’s policy to compete fairly and ethically in the conduct of business in all its markets and provides direction and guidance to employees in their relationships and communications with competitors and customers. These pol icies are avai lable on the Company’s corporate website, intranet and have also been disseminated to officers and employees of the Group’s key subsidiaries. These policies have been translated into Mandarin and Thai for dissemination to employees of the Group in China and Thailand. The Company ’ s po l i c y on how i t manages and protects personal data in accordance with the applicable regulatory requirements are set out in the CDL Personal Data Policy. The Company has also set out the f o l l owi ng sus t a i nab i l i t y po l i c i es which are available on the Company’s corporate website: • Environmental, Health & Safety (EHS) Policy Established in 2003, the EHS Policy sets the strategic direction for al l departments and employees towards creating a “Safe & Green” corporate culture by adher ing to regulatory compliance, reducing environmental impact, and ensuring a safe, fair and inclusive workplace. • Human Rights Policy Sets out the Company’s commitment in upholding fundamental principles of human and workplace rights in places where the Company operates. Beyond compliance to the local government’s policies and regulations in protecting human rights, CDL is committed to respecting human rights in all aspects of its stakeholder engagement such as equitable employment practices, non-di scr iminat ion, wel fare and f a i r c ompen s a t i on , a s we l l a s workplace health and safety within its developments. • Climate Change Policy In l ine wi th CDL’s susta inab i l i ty strategy and commitment to its ethos of “Conserving as We Construct” since 1995, the Company is dedicated to climate action and achieving low carbon operations. CDL became the first real estate conglomerate in Southeast Asia to sign the World Green Building Council’s (“WorldGBC”) Net Zero Carbon Buildings Commitment in February 2021. This is a global pledge to achieve net zero operational carbon by 2030, covering new and existing whollyowned assets under CDL’s di rect management and operational control. In November 2021, during COP26, CDL extended its pledge towards a net zero whole life carbon emissions approach. Through this expanded commitment, the Company pledged to achieve maximum reduction of embodied carbon in new developments, compensating for any remaining residual operational and upfront embodied emissions via offsetting for new developments by 2030 and advocating for all buildings to be net zero carbon by 2050. In 2018, CDL was the first real estate company in Singapore to set Science Based Targets initiative (“SBTi”)-validated carbon reduction targets based on a 2°Cwarmer scenario with 2007 baseline year. CDL renewed its SBTi-validated targets in December 2021 by aligning with a more stringent 1.5°C warmer scenario and 2016 baseline year.
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