Sustainability Reports 2022/23

Sun Hung Kai Properties Limited Sustainability Report 2022/23 55 Value Created for Supply Chain Our Reporting Approach Message from the Sustainability Steering Committee Our Business Our Approach to Sustainability Value Created for People Value Created for Community Appendices Value Created for the Environment Value Created for Customers Embedding Sustainability into Procurement Decisions We work with a diverse supplier base to procure building materials, building services equipment and office equipment for our property businesses, and food for our hotel business. During the reporting year, we collaborated with 8,385 suppliers, spending more than HK$9.94 billion. Multiple sourcing fosters fair competition and reduces the risk of supply chain disruption that can arise from overreliance on a single supplier. During the reporting year, less than 30% of our total purchases came from our five largest suppliers. Strategies and Management Supporting SHKP’s Building Homes with Heart principle, our transparent and resilient supply chain aligns with the SDGs in its fundamental principles. We work with our business partners to promote ethical and sustainable practices and create value for the community. Our suppliers 1 , contractors 1 and subcontractors are governed by our Supplier Code of Conduct which sets out our expectations in areas, such as legal compliance, governance, business ethics, environmental protection, health and safety, human rights, equal opportunities as well as labour practices. This year, we updated our Supplier Code of Conduct to enhance our management and strategy in business ethics, environmental protection, occupational health and safety, and labour practices. Our Sustainable Building Policy and green procurement policy ensure sustainability is considered when selecting suppliers and sourcing building materials, equipment and office products. Suppliers, contractors and subcontractors must comply with all relevant environmental and social laws and regulations, including the Waste Disposal Ordinance, the Employment Ordinance, and the Occupational Safety and Health Ordinance. Our supply chain partners – including suppliers, contractors, subcontractors, joint ventures and other service providers – are encouraged to comply with the business ethics and quality requirements set out in our updated Environmental Policy , our Health and Safety Policy and our new Cybersecurity Policy . We encourage suppliers and subcontractors to adopt the principles of the United Nations Global Compact and the Universal Declaration of Human Rights. We have zero tolerance for child and forced labour in the supply chain, and actively promote an inclusive, discrimination-free work environment for all. Our comprehensive supply chain management mechanism ensures that new and existing suppliers perform to our standards and comply with our requirements. With a vertically integrated approach, we standardize the selection and retention of suppliers, regular assessment of their performance, risk management along the supply chain and the development of evaluation systems. We emphasize compliance, labour management and human rights by evaluating suppliers’ ability to offer reasonable compensation and a safe working environment. Our tender documents require all business partners, suppliers and contractors to strictly comply with laws and regulations on labour rights. We engage with our suppliers and contractors via daily communication as well as regular assessments and meetings. Hong Yip regularly updates and disseminates information via their vendor portal. This year, Sanfield hosted a symposium, which provided a platform for our project management team, architects, engineers, suppliers and subcontractors to express their views and share their valuable experiences. 1 Our suppliers and contractors provide cleaning, security, laundry, landscaping, construction activities and E&M services, etc. In accordance with our green procurement policy, we consider environmental and social factors when making procurement decisions. We prioritize suppliers and contractors who share our environmental commitments, such as those who adhere to ISO 14001 Environmental Management Systems, comply with the BEAM Plus scheme, practise green procurement, and integrate occupational health and safety and other sustainable measures in their operations. Our offices also procure supplies from sustainable sources, including certified paper. This nurtures sustainability throughout the supply chain. Hong Yip rewards vendors with bonus scores if, during assessments, they can provide certificates for quality, environmental, energy, and occupational health and safety areas. We participate in the Charter on Preferential Appointment of OSH Star Enterprise, which gives preference to providers that have effective safety management systems and pass the Occupational Safety and Health Council’s stringent safety audits of repair, maintenance, alteration and addition works. Suppliers who participate in the Environment and Ecology Bureau’s Energy Saving Charter and 4T Charter are particularly welcome. Hong Yip also participates in the Green Council’s Sustainable Procurement Charter to develop, document and implement sustainable procurement. Head Office Construction Hotels Property Management Total Suppliers (Hong Kong) 210 320 4,468 3,345 8,343 Suppliers (non-Hong Kong) 0 6 29 7 42