SHKP 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 No risk Low risk Medium risk High risk 30 Sun Hung Kai Properties Limited | Sustainability Report 2024/25 Typhoon Rainfall Flood Extreme Heat River Flood RCP 2.6 RCP 8.5 RCP 2.6 RCP 8.5 RCP 2.6 RCP 8.5 RCP 2.6 RCP 8.5 Location 2030 2050 2030 2050 2030 2050 2030 2050 2030 2050 2030 2050 2030 2050 2030 2050 Hong Kong Shanghai Transition risk To evaluate transition risks associated with the shift to a low-carbon economy, we focused on two of the Group’s core businesses, property (retail and office) and hotel and serviced apartments, across Hong Kong and Shanghai. A mixed-method approach was adopted, integrating both quantitative scenario analysis and qualitative insights under two different climate futures, to ensure relevance and contextual accuracy. Quantitative assessments were conducted using scenario data from authoritative sources, such as the IPCC, IEA and NGFS. These data projections were used to examine transition risks under different climate policies and market futures, covering both 2030 and 2050 horizons. To complement the quantitative analysis, we performed a qualitative review of local policy trends and regulatory developments in Hong Kong and Shanghai, recognizing that global scenario data can sometimes lack regional specificity. Subsequently, we conducted workshops and internal surveys with relevant departments and business units to gather practical insights on operational resilience and transition risk exposure across the value chain. This comprehensive assessment covered 21 risk parameters for the property sector (retail and office) and 15 for the hotel and serviced apartment sector, including policy, economic and market factors. By assessing the likelihood and severity of transition risk exposures across our selected operations and their value chains, we identify the transition risks that are significant to the Group. Similar to the physical risk assessment, the transition risk analysis also involves inherent uncertainties – stemming not only from climate modelling assumptions, but also from evolving regulatory environments and expert judgments influenced by market sentiment. The findings from this process are summarized in the following table, detailing the identified transition risks, their potential business and financial impacts, and our corresponding response strategies. Risk Type Acute Physical Risks (Short/Medium Term) Chronic Physical Risks (Medium/Long Term) Description Typhoon Rainfall Flood / River Flood Extreme Heat Potential Impact Higher property damage losses More typhoon-induced business interruptions Greater threats to human health and safety, and to the environment More business interruptions due to flood damage to facilities and equipment More supply chain disruption from flooding and transport issues More building and equipment damage from high temperatures and power outages Increased occupational health risks (discomfort, exhaustion and heat- related illnesses) Reduced productivity owing to extended construction time Potential Financial Impact Increased operating costs for asset repairs, inventory replacement, supply chain disruption and suspended construction Increased property insurance premiums Decreased asset value Decreased revenue owing to business disruption Increased operating costs for increased cooling demands Increased expenses owing to impacts on employees’ health Example of Our Strategy Implement the Sustainable Supply Chain Management Guideline to assess and manage environmental and social risks across our supply chain Integrate climate-adaptive and sustainability-focused elements into the new and existing buildings Equip frontline teams with operational handbooks and emergency support mechanisms to enhance preparedness for extreme weather scenarios During such events, an emergency support centre will be activated to ensure operational continuity