Engaging Our Stakeholders and Assessing Double Materiality

The Group is committed to reducing energy consumption through implementation of various energy efficiency measures, including chiller replacement and adopting energy efficiency technologies in our buildings. Enhancing energy efficiency contributes to carbon reduction and mitigates climate change, accelerating the transition towards a low-carbon economy. These actions not only minimise our environmental impact and conserve resources, but also safeguard ecosystems and promote long-term economic health.

Rising awareness on climate change in recent years has led to increasing demand for energy efficiency measures to reduce GHG emission. Buildings with energy- efficient features can attract environmentally conscious tenants, comply with energy efficiency regulations, and reduce operational costs over the life cycle of a property. These features could increase property value for our portfolio, contributing to long-term profitability.

The Group regularly engages with our tenants and customers, who play a key role in our success. By understanding their needs and concerns, the Group can improve the quality of our products and services, which leads to improved tenant and customer experience. Through addressing our tenants’ and customers’ demand for sustainable product and services, the Group not only satisfies our tenants and customers but also creates positive environmental and social impact.

With the shifting needs and preferences of our tenants and customers, the Group actively engages with them to understand their expectations. Through addressing their needs, the Group could increase tenant and customer loyalty and satisfaction, and potentially increase recurring revenue for the Group through increased occupancy and demand for buildings. In addition, higher stakeholder participation for the Group’s initiatives could lower cost spent on customer acquisition.

By integrating advanced sustainable features in our new projects, including natural ventilation, Building Information Modelling (“BIM”), Modular Integrated Construction (“MiC”), smart IoT systems, and Multi-trade Integrated Mechanical, Electrical, and Plumbing (“MiMEP”), our projects minimise construction waste, lower carbon emissions, reduce noise pollution and contribute to safer working environment. Furthermore, the improved energy and resource efficiency and smart designs of sustainable buildings both minimises our environmental footprint and improves our residents’ wellbeing, contributing to green economy and fostering a more resilient community.

Sustainable buildings often attract higher market demand from sustainability conscious users and buyers, creating business opportunities and ensuring long- term occupancy and growth. Furthermore, sustainable buildings could reduce operational costs from enhanced energy and water efficiency over the life cycle of a property. Sustainable building certifications help the Group to adhere to evolving building regulations and minimise compliance risks.

By prioritising waste reduction, recycling, and proper disposal through initiatives such as the REACT Campaign, the Group can minimise landfill use, reduce greenhouse gas emissions, and protect ecosystems from harmful contaminants. These efforts safeguard public health, promote a cleaner environment for all and help to alleviate pressure towards landfills in Hong Kong and contributing to a circular economy.

The Group expects higher operational costs due to stricter regulations on waste management. New construction methods could help us reduce waste and cost at the same time. For example, MiMEP and MiC methods can lead to reduced manpower requirements and shorter construction durations, potentially lowering operational expenses.

The Executive Committee maintained high standard of corporate governance and oversight, enabling integration of risk and opportunity into strategic decision-making process. By proactively managing risks related to environment, society, and compliance, the Group is committed to environmental and social responsibility. This approach creates positive impact on the environment and community, strengthening positive relationship with various stakeholders. Strong governance also enables sustainable growth for both the Group and the stakeholders it serves.

Effective risk management is essential for the Group’s sustainable development. It allows the Group to promptly identify, assess, and mitigate a wide range of risks, including operational risk, regulatory risk and market risk. Robust risk management strategies also allow the Group to reduce potential economic loss, safeguard its assets, improve financial return and increase long-term profitability.