In addition, the Company engages its BSC members on ESG-focused events such as the annual Hong LeongCDL Group Sustainability Forum since 2014, and the CSO communicates the latest global and local ESG trends and practices via emails. The CDL Sustainability Quarterly Report posted online on www.cdlsustainability.com offers regular updates on the Group’s sustainability initiatives and interim EHS performance to the BSC, Sustainability Committee and external audience. For more details on the BSC’s roles and responsibilities for climate-related risks and opportunities, please refer to CDL’s Annual Report 2023, page 37 . To achieve effective integration of sustainability throughout the company, the CSO chairs the Sustainability Committee, which comprises members across all departments and operational units. In 2021, the Company stepped up on strengthening the links between its ESG performance with the Management Executive Committee (ExCo) members’ remuneration. 20% of the ExCo members’ remuneration is linked to ESG targets, with a respective weightage of 5% each for Environmental and Governance targets and 10% for Social targets. With Heads of Departments (HODs) reporting to the respective ExCo members, the ESG Key Performance Indicators are cascaded down to every level in the organisation. HODs are held accountable for their ESG performances, which are then captured in their annual performance appraisals that correspond with their remuneration and promotions. 2023 IN REVIEW – ZERO IN ON NATURE Zero in on Nature in CDL’s Sustainability Strategy In September 2023, the Taskforce on Naturerelated Financial Disclosures (TNFD) released its final Recommendations, guiding corporates to act on evolving nature-related risks and opportunities. Having embraced the Task Force on Climate-related Financial Disclosures (TCFD) in 2017, adopting TNFD is a natural progression for the Company. As one of the pioneering Singapore companies amongst 320 companies in the world to voluntarily report according to the TNFD Recommendations, the Company aims to effectively assess, disclose and manage its naturerelated risks and opportunities, and provide consistent and comparable reporting to all its stakeholders. SUSTAINABILITY GOVERNANCE STRUCTURE Nature and biodiversity conservation have been part of the Company’s longstanding commitment to minimising and mitigating the impact of its developments on natural habitats, as well as protecting biodiversity. Since 2010, the Company has made it a standard practice to conduct a Biodiversity Impact Assessment (BIA) at greenfield sites located within or adjacent to natural habitats before construction. In 2020, the Group launched a dedicated Biodiversity Policy, and aligned it with Singapore’s “City in Nature” vision in 2021. With increasing global focus on loss of biodiversity as a key business risk, and potential impacts brought on by property development and management activities, “Biodiversity Conservation” has been added to the Group’s list of top material ESG issues since 2021. The Company is honoured that its CSO Ms Esther An has been newly appointed as a member of the WEF's Global Commission on Nature-Positive Cities set up in September 2023. The company is fully supportive of her role in raising awareness of the importance of healthy ecosystems for a resilient built environment through her sharing of Singapore and the Company's experience. ACCELERATING TOWARDS THE GLOBAL RACE TO ZERO To tackle the climate emergency, the Company is well placed to accelerate climate action and create positive ESG and business impact. Building upon its corporate ethos of “Conserving as We Construct”, established in 1995, the Company’s Economic, Environmental, Social and Governance (EESG) strategy continues to guide its value creation model to achieve its three deliverables with positive impact: “Decarbonisation”, “Digitalisation & Innovation” and “Disclosure & Communication”. Decarbonisation – Expanding Scope and Managing Performance In 2021, the Company became Southeast Asia’s first real estate conglomerate to sign the World Green Building Council’s (WorldGBC) Net Zero Carbon Buildings Commitment – a global pledge to achieve net-zero operational carbon by 2030. This was expanded to include maximum embodied * The Sustainability Board Statement contains a full year’s data from 1 January to 31 December 2023 and focuses primarily on sustainability related Group data and information. “Group” refers to Singapore operations (including Tower Club and Le Grove, City Serviced Offices and CBM), and hotels owned and managed, and managed by M&C, and M&C New Zealand, unless otherwise stated. The “Company” refers to CDL’s operations in this Report that cover corporate office, managed buildings and construction sites in Singapore, and exclude hotel properties, unless otherwise stated. SUSTAINABILITY BOARD STATEMENT 2023, the hottest year on record, bore witness to an increased frequency and severity of climate and naturerelated catastrophes around the world. The World Economic Forum’s (WEF) Global Risks Report 2024 reported that “extreme weather events” is the top global risk for humanity over the next 10 years. Similarly, “biodiversity loss and ecosystem collapse” is perceived as one of the fastest deteriorating global risks. With only 15% of the targets for the United Nations (UN) Sustainable Development Goals' (SDGs) on track and many going in reverse, there is much to be done.1 Sustainability is undoubtedly a mainstream business priority now. According to Bloomberg, about 90% of investors anticipated more benefits from a focus on Environmental, Social and Governance (ESG) issues. This has helped them to make more informed decisions. CDL’s corporate ethos, “Conserving as We Construct”, established since 1995, has steered the Company in the right direction to effectively navigate through climate and business risks today. For nearly three decades, the Group has been committed to a balanced triple bottom line that integrates ESG considerations into its business for long-term value creation. The Group has continually tracked its ESG performance to ensure business growth and profitability, while mitigating impact on planet and people. The Company’s value-creation model is based on a two-pillar framework comprising ‘impact’ on planet and people, and ‘value’ focusing on connecting ESG to financial and investment materiality. Its sustainability initiatives continue to be anchored on four strategic pillars – Integration, Innovation, Investment, and Impact to achieve three key deliverables – "Decarbonisation", "Digitalisation & Innovation", and "Disclosure & Communication" that are aligned with global best practices and standards. As the world races to zero, the Group will continue to accelerate innovative and impactful climate action through collaborations with the public, private and people sectors. The Group will remain dedicated to ESG integration and focus on capturing growth opportunities, while mitigating ESG risks and creating value for all stakeholders. To address the rising global concern about degradation to nature and biodiversity loss, CDL’s Integrated Sustainability Report (ISR) 2024 is titled “Zero in on Nature”. The Report proactively articulates the Group’s ESG strategy and actions in embracing nature to enhance value and impact in the communities it operates in and charting its path towards a net-zero and nature-positive future. MAINTAINING SUSTAINABILITY LEADERSHIP & STRONG GOVERNANCE Continued Recognition by Global Sustainability Rankings and Awards As a testament to its longstanding commitment to sustainable development and alignment of its deliverables with global best practices, the Company continues to lead in established global sustainability ratings and rankings: • Global 100 Most Sustainable Corporations in the World by Corporate Knights: Ranked 22nd in 2024 and maintained ranking as the world’s most sustainable real estate management and development company for the sixth consecutive year as well as the only Singapore company listed for 15 consecutive years • CDP: The only company in Southeast Asia and Hong Kong to remain on the CDP A List for six consecutive years; only Singapore company to score double 'A's for climate change (since 2018) and water security (since 2019). Top 2% amongst CDP Participants for Supplier Engagement on Climate Change • MSCI ESG Ratings: Maintained ‘AAA’ leader rating since 2010 • Sustainalytics: ESG Regional Top Rated and Industry Top Rated in 2024 • GRESB: 4th in Asia’s Diversified – Office/Retail/Listed Sector in 2023 (Standing Investments); GRESB 5-Star Rating • S&P Global’s Sustainability Yearbook 2024 • Bloomberg Gender-Equality Index: The only Singapore real estate company listed since 2018 • The Edge Singapore Billion Dollar Club: Conferred the inaugural Best ESG Risk Ratings award • The Asset Triple A Sustainable Finance Awards 2024: Conferred Best Sustainability-Linked Loan – Real Estate Since 2012, the Company’s Corporate Social ResponsibilityCorporate Governance (CSR-CG) Committee was established to implement an integrated governance structure, ensuring commitment across hierarchical levels and functions for coordinating ESG efforts. The CSR-CG Committee was renamed the Board Sustainability Committee (BSC) in 2016. The Chief Sustainability Officer (CSO) reports directly to the BSC, comprising three independent directors, and CDL’s Executive Director and Group CEO. The BSC has direct advisory supervision of the Group’s sustainability strategy and targets, including that of its major subsidiaries, Millennium & Copthorne (M&C) Hotels Limited and CBM Pte Ltd. The BSC also oversees the Group’s sustainability strategy and is apprised of initiatives to address climate and sustainability-related risks and opportunities, sustainable investment plans, as well as sustainability reporting on material ESG issues, work plans, performance targets setting, tracking and reporting. Two meetings are held annually, or more frequently as and when necessary, for the management to update BSC on the Group’s sustainability plans and performance reviews. 1 Asia and the Pacific SDG Progress Report 2024, February 2024. SUSTAINABILITY 77 76 SUSTAINABILITY ANNUAL REPORT 2023 CITY DEVELOPMENTS LIMITED
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