Environmental Capital

CapitaLand is committed to minimising its environmental impact as a real estate owner, developer and manager. It believes that lowering the environmental footprint of its buildings through innovation creates value for its stakeholders.

It incorporates environmental sustainability in its life cycle management, in all stages of a project, from feasibility, design, procurement, construction, operation to redevelopment. Monitoring environmental impacts is integral to its business operations, as efficient use of environmental resources such as energy and water contributes to the operational efficiency and long-term sustainability of the company.

The following elements are CapitaLand’s material environmental aspects of business functions including investment, property development, property management as well as corporate office management.

FRAMEWORK*
Material Issues, Context and Business Case	Climate Change and Energy Water Waste Biodiversity Global Greenhouse gas (GHG) emissions at unsustainable level Rising demands for energy, compounded by finite resources Water scarcity, accessibility and security Waste generation at unsustainable rates; Land scarcity for waste disposal Cost pressure from resource scarcity Interdependence between ecosystems and the wellbeing of the community
	The efficient use of environmental resources such as energy and water contributes to the operational efficiency and long-term sustainability of the company, mitigates risks such as compliance and climate change, and presents new opportunities in differentiating the company in the markets that it has a presence in.
Policy and Objectives	Identify opportunities in managing its property portfolio to deliver long-term benefits Identify and respond to climate change risks Reduce energy consumption and encourage renewable energy sources Reduce water consumption, encourage use of treated/recycled water and rainwater harvesting Manage waste through construction efficiency and encourage recycling Manage biodiversity to contribute positively to the natural environment Engage stakeholders to play their part
Accountability	CEOs are Environment, Health and Safety (EHS) Champions ISO 14001 certified Environmental Management System (EMS) ensures accountability to relevant managers and all staff Setting of key performance indicators (KPIs), linked to remuneration for all staff; track performance via an Environmental Tracking System (ETS)
Method/ Action Plan	Environmental Management System (EMS) Legal compliance Identification of aspect and management of impact Sustainable Building Guidelines - including Environmental Impact Assessment (EIA) and stakeholder consultation Appointment of ISO 14001 certified main contractors or conduct EMS legal compliance on-site Green Operations – EMS SOPs KPIs Green rating target for new buildings and major refurbishments Green existing property portfolio Eco-efficiency targets: Improve performance through tracking of energy and water usage, waste generation and carbon emissions Stakeholder engagement
Stakeholder Engagement	Be part of national making policy Collaborate with NGOs Require and indicate preference for ISO 14001 main contractors/vendors Share CapitaLand EHS policy with suppliers and service providers Share and encourage end users, including tenants, shoppers, residents and the general community, to adopt environmentally sustainable habits

Mitigating Climate Change Risks and Identifying Opportunities

Climate change risks and opportunities are identified and mitigated through CapitaLand’s Enterprise Risk Management (ERM) framework and the externally certified ISO14001 Environmental Management System. CapitaLand is positioned to face such challenges as it has in place a target to achieve green certification of existing properties by 2030. It is also ISO 14001 certified for its Environmental Management System in 15 countries. CapitaLand is taking steps to integrate the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD¹) in its reporting.

Top Management Commitment and Staff Involvement

CapitaLand’s EHS Committee maintains the Group’s EHS Management System. Each Strategic Business Unit (SBU) also has its own EHS Committee to drive initiatives in countries where they operate with support from various departments. The CapitaLand EHS Committee doubles up as the CapitaLand Environment Sustainability Working Team and supports the work of CapitaLand’s Sustainability Steering Committee. Please refer to Introduction Chapter for details of the Sustainability Management Structure.

All staff are involved in reducing CapitaLand’s environmental footprint. They are encouraged to be forthcoming and to report all incidences of environmental-related issues and complaints, and incidences of non-compliances and non-conformities.

Key Performance Indicators (KPIs) Tied to Remuneration

To measure its performance, CapitaLand has incorporated KPIs, most of which are linked to remuneration for its staff including top management.

2017 Key Performance Indicators

	Targets	Performance
Environmental Management System (EMS)	ISO 14001 certification for its EMS in all markets with investment properties Risk management of environmental aspects and impacts	Retained ISO 14001 certification in 15 countries covering all markets with investment properties Having an annually audited EMS provides assurance to top management and external investors on the company’s compliance and alignment to best practices
Supply Chain Management	All main contractors appointed to be ISO 14001 certified or, to comply fully with local environmental laws and regulations, annually audited by an independent accredited assessor	Three main contractors appointed in 2017, two are ISO 14001 certified, and one is in the process of getting certified. In the interim, it will comply fully with local OHS laws and regulations and the site will be audited by an independent accredited assessor
Resource Consumption Management	All new development projects to meet minimum green rating target set Singapore – Green Mark GoldPLUS award Overseas – certification by a green rating system administered by a national government ministry/agency or a WGBC recognised Green Building Council; one level higher than certification for iconic projects2	Achieved 5 LEED, 15 Green Mark, 1 Green Building Evaluation Label3 Total of 163 green ratings achieved for its new development projects and existing buildings – 122 Green Mark, 22 LEED, 10 Green Building Evaluation Label, 2 Green Star, 2 CASBEE, 2 BREEAM, 1 DGNB, 1 GBI4 and 1 LEED (India) Estimated energy and water reduction exceeding S$ 31 million (over 150,000 MWh/year and 1.3 million m3/year) from these projects5, while estimated carbon emission reduction is about 87 million kgCO2e/year Five projects under development designed to harvest renewable energy on-site
	All existing buildings to achieve a minimum green rating Singapore – by 2020 Overseas – by 2030	93% of CapitaLand’s existing buildings in Singapore (by m2) has at least a Green Mark Gold rating 48% of CapitaLand’s existing buildings overseas (by m2) has achieved a green rating
Operational Efficiency	0.5% energy reduction and 0.5% water reduction per m2(vs. 2016 for like-for-like set of properties) Reduce carbon emissions intensity by 23% by 2020, and 30% by 2030 Reduce energy intensity by 20% by 2020, and 25% by 2030 Reduce water intensity by 20% by 2020, and 30% by 2030 (using 2008 as the base year)	4.3% and 0.7% reduction in energy and water consumption per m2 (vs. 2016) Reduced 5.2% carbon emissions intensity (vs. 2016) Achieved 29.4% carbon emissions reduction, 23.4% energy reduction and 24.1% water reduction per m2 (using 2008 as the base year) Achieved cost avoidance in excess of S$140 million6 from utilities savings since 2009 for its operational properties Energy and water saving initiatives implemented in 2017 may lead to an estimated reduction of 14,000 MWh (8.7 million kgC2Oe) and 360,000 m3 of potable water per year.
Stakeholder Engagement	Organise environmental outreach activities to encourage a environmental mindset among staff and stakeholders	Over 280 CapitaLand properties participated in WWF Earth Hour, pledging to go beyond the hour with year-long sustainable initiatives