Sustainable Finance and Responsible Investment

We understand that prosperity extends beyond financial gains, encompassing the well-being of our communities and the health of our planet. This understanding shapes our approach to investment as we are guided by a set of the ESG Investment Guidelines (“the Investment Guidelines”) to ensure that our portfolio aligns with our values and contributes to a more sustainable future. Moreover, investing in sustainability helps us build a more resilient and enduring portfolio, which will generate maximum value in the long run and face minimumrisks compared to a traditional portfolio.

To maintain a responsible investment strategy, we strive to uphold an average MSCI ESG Rating of BBB or higher for our investment portfolio. We carefully consider the ESG rating of companies during our analysis, ensuring that ESG performance is evaluated alongside financial metrics. We also prioritise the purchase of sustainable bonds whenever available from the same issuer. Furthermore, we thoroughly review the ESG reports of asset management companies for our fund investments as well as any ESG-relevant credentials held by asset managers during selection process. We strive to identify and support companies with strong ESG practices.

In order to pursue sustainable investment, we have excluded sectors that conflict with our values. These include:

Tobacco

Casinos & Gaming

Weapons & Military Equipment

With the Investment Guidelines, we aim to create a sustainable portfolio that generates positive financial returns while making a meaningful impact on society and the environment.

The Group’s commitment to sustainable development extends to the acquisition of new buildings. We have been actively incorporating ESG principles into our technical due diligence process to ensure the buildings we acquire achieve a high sustainability standard and will create positive value for People, Prosperity and Planet. During the process, building safety and deleterious materials, such as asbestos, concrete (HAC, Chlorides and Woodwool) and lead (in water pipes or paint), used in the construction of the building will be scrutinised.

In addition, we will conduct throughout an examination of environmental hazards faced by the building (e.g., flood, fire, health and safety and land contamination risks) as well as any relevant Energy Performance Certificate (“EPC”). We will also screen out any buildings that are not rated, at the minimum, the second-highest level in a green building standard (e.g., WELL).

During the Reporting Period, we made two strategic property acquisitions in London, UK - Kaleidoscope and One New Street Square. In addition to being a strategic investment in overseas property, these acquisitions showcase our strong commitment to fostering a sustainable built environment on a global scale. The Kaleidoscope building has been rated “Excellent” under the Building Research Establishment Environmental Assessment Method (“BREEAM”), while One New Street Square is a BREEAM “Outstanding” and WELL “Gold” building. The sustainability of these buildings is attributed to a range of sustainable elements. For instance, Kaleidoscope has water and energy-efficient management systems, as well as a robust digital infrastructure. Meanwhile, One New Street Square was designed with nature in mind and is surrounded by trees and an extensive vertical garden. These buildings provide a green and healthy environment for users to experience sustainability.