SHKP Sustainability Report 2024/25

10 Sun Hung Kai Properties Limited | Sustainability Report 2024/25 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 We adopt a vigorous approach to risk management and conduct regular assessments to evaluate company-specific risk exposure. These assessments consider the likelihood and magnitude of identified risks, including operational risks, ESG risks and interest rate risks. The Audit and Risk Management Committee assists the Board in establishing and upholding a robust risk management and internal control system. This involves a well-defined process or framework to determine our appetite for these risks and their potential consequences, along with the mitigation measures we have implemented for at least two key risks. Our risk exposure is reviewed at least twice a year, or more frequently if necessary, and internal audits of our risk management process were conducted in the past two years to ensure effectiveness. Furthermore, our management is responsible for addressing ESG-related risks, including those related to compliance, climate change, employment practices, cybersecurity and supply chain. Managing ESG Risks and Opportunities in Our Operations Strategic initiatives are implemented to maintain a robust risk culture. We integrate risk considerations into product and service development, and provide focused training regarding risk management practices for new hires and existing staff. Key risk management metrics have been established across various departments to guide our business operations. Furthermore, general staff and management can access self-learning resources on the intranet, covering ESG topics, such as climate management, sustainable supply chain management, and enterprise risk management to enhance their knowledge on the relevant aspects. In bolstering our resilience against ESG risks, the Group has integrated ESG risks into our enterprise risk management approach. Below is an overview of our significant ESG risks and opportunities, potential financial implications and examples of our strategies. Climate Change and Energy Oversight and Responsibilities The Board, via the Executive Committee and SSC, oversees the Group’s climate strategy, plan and environmental performance improvement The SSC oversees the execution of the Group’s environmental management strategy, monitors environmental performance and targets, and evaluates the Group’s climate-related risks and opportunities The Energy Optimization Committee (EOC) monitors the buildings’ performance to improve the GHG emissions and energy reduction Potential Risks and Opportunities Increase maintenance costs and revenue loss from extreme weather disruptions, along with higher litigation risks and financial risks from regulatory non-compliance Increase energy efficiency and operating cost savings, along with higher revenue from growing sales and rentals due to rising demand for climate-resilient and sustainable properties Our Strategies and Action Plans Participate in the Carbon Neutrality Partnership and implement our decarbonization strategy Incorporate climate-resilient building features with smart building management systems and develop adaptation plans Implement retrofitting measures, maximize on-site renewable energy generation and procurement of renewable energy certificates Research and pilot green building development and low-carbon construction materials Metrics and Targets Reduce scope 1 and 2 GHG emissions intensity by 35% and electricity consumption intensity by 13% for EOC-monitored buildings by FY2029/30 from FY2019/20 baseline Increase the number of green building certificates and solar panels installation at managed properties Our Performance in FY2024/25 Reduced scope 1 and 2 GHG emissions intensity by ~ 35.6% and electricity consumption intensity by ~ 14.3% for EOC-monitored buildings Earned ~ 150 green-building-related certificates and installed ~ 20,000 solar panels in Hong Kong, including Hong Kong’s first privately funded solar farm built on South East New Territories Landfill Relevant Material Topics Climate Change Mitigation and Adaptation Energy Relevant SDGs