Sustainability Reports 2022/23

Governance Strategy Risk management Metrics and targets Risk Type Description Potential Impact Potential Financial Impact Example of Our Strategy Transition Risks & Opportunities Technology (short/medium/long term) Growing trend of adopting energy-efficient and low-carbon technology • More drive to invest in energy-efficient and low-carbon technologies • Increased capital expenditure on low-carbon product investment • Decreased operating costs owing to energy savings • Increased cost of training for new technology • Apply smart and green building technologies • Conduct energy and carbon audits, and implement energy- efficient retrofits for lifts, chillers, lighting systems, etc. • Adopt smart building management systems, energy optimization systems and other innovative solutions • Increase on-site renewable energy such as solar energy • Purchase RECs where applicable • Collaborate with companies and universities to develop green technologies Rising adoption of renewable energy • Increased adoption of renewable energy sources such as on-site solar panels Policy and Legal (short/medium/long term) Stricter building regulations • Increased need for employee knowledge of green building requirements • Increased litigation risks for non- compliance with green building policies • Increased capital expenditure on low-carbon product investment • Increased capital investment for building retrofitting to meet building regulations • Increased training costs for policy and regulation • Increased fines owing to non-compliance • Incorporate sustainable features and low-carbon materials in building design • Fulfil green building commitments stipulated in the Sustainable Building Policy • Monitor progress and strive towards targets for GHG emissions, electricity consumption, water use and construction waste diversion • Evaluate carbon pricing mechanisms and explore pathways to carbon neutrality Emerging regulations on carbon pricing • Increased business uncertainty, arising from changing regulations and global trends • Increased pressure to invest in low- carbon technologies and materials • Increased capital expenditure on low-carbon technologies and materials • Increased expenditure on carbon price Reputation and Market (short/medium/long term) Rising market demand for green buildings • Influenced the business direction by prioritizing investment in green buildings • Increased need to train staff in green building practices to answer buyer inquiries • Increased capital expenditure on low-carbon products • Increased revenue from growing sales and growing green building rentals • Maintain and expand our green-certified building portfolio • Manage our environmental performance – and mitigate risks relating to climate change, energy and carbon emissions – in daily operations with ISO 14001 and ISO 50001 management systems • Collaborate with companies and universities to develop green technologies • Promote green finance by integrating sustainability targets into financing mechanisms Rising consumer preference for sustainable living • Reduced competitiveness if consumer demands are unmet • Increased drive to develop green buildings and sustainable services • Increased revenue from the expanding green market Sun Hung Kai Properties Limited Sustainability Report 2022/23 28 Our Reporting Approach Message from the Sustainability Steering Committee Our Business Our Approach to Sustainability Value Created for the Environment Value Created for People Value Created for Customers Value Created for Supply Chain Value Created for Community Appendices