Swire Properties Green Bond Framework serves as the documented Environmental Method Statement for this application. It states the SPL s method to

Transcription

1 Swire Properties Green Bond Framework serves as the documented Environmental Method Statement for this application. It states the SPL s method to achieve the intended positive environmental effect of the specified Green Bond.

2 THE INFORMATION CONTAINED HEREIN IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE AN INVITATION OR OFFER TO ACQUIRE, PURCHASE OR SUBSCRIBE FOR SECURITIES. Swire Properties Green Bond Framework Founded in Hong Kong in 1972, Swire Properties Limited ( Swire Properties ) is listed on The Stock Exchange of Hong Kong Limited and is one of the Hong Kong s leading property developers and investors. Swire Properties engages in property investment, that is the design, development, leasing and management of commercial, retail and some residential properties; property trading, that is the development and construction of properties, principally residential apartments, for sale; and investments in and operation of hotels. Swire Properties vision is to be the leading sustainable development ( SD ) performer in the real estate industry globally by In support of this vision, we have developed a SD 2030 Strategy that is organised around five pillars. At the heart of our holistic strategy is the creative transformation of Places into vibrant, high quality sustainable communities. This is achieved through proactive investment in our People and long-term, mutually beneficial relationships with our Partners. Importantly, we are committed to delivering a positive contribution to our communities through sound Environmental Performance, while ensuring we deliver sustainable Economic Performance combined with good corporate governance and high ethical standards. Our Green Bond(s) will reinforce our commitment to our SD 2030 Strategy, which includes designing, constructing and managing high quality developments that contribute positively to the communities in which they are located. While we take great care to develop high quality buildings, as part of our SD 2030 Strategy we also seek to continually improve our environmental performance. We focus beyond the direct impact of our buildings and seek to reduce climate impact and optimise resource efficiency. Framework Overview For the purpose of issuing Green Bond(s), Swire Properties has developed the following framework, which addresses the four key pillars of the 2017 Green Bond Principles ( 2017 GBP ): 1. Use of proceeds; 2. Process for project evaluation and selection; 3. Management of proceeds; and 4. Reporting. 1. Use of Proceeds The net proceeds of the Green Bond(s) will be used to fund or refinance, in whole or in part, new or existing eligible green projects at Swire Properties real estate assets or properties that meet one or more of the following categories of eligibility as recognised in the 2017 GBP ( Eligible Green Projects ): RESTRICTED

3 i. Projects relating to Renewable Energy, such as solar and waste-to-energy projects; ii. Projects relating to Energy Efficiency, such as adoption of smart technologies and/or systems for optimizing energy management in our new and existing developments. In addition, the net proceeds may also be used to upgrade the existing equipment (for example, lighting or chillers) in such developments to higher efficiency models to achieve at least a 10% improvement in energy efficiency; iii. Projects relating to Sustainable Water and Wastewater Management, including grey water treatment systems and water conservation installations; iv. Projects relating to Climate Change Adaptation, such as projects for the design, construction, maintenance and upgrades of buildings / assets for adapting to more frequent and extreme weather events caused by climate change (for example, projects for the upgrade of flood defence or storm water management systems); and v. Projects relating to Green Buildings that have received within the last two years, or that receive during the tenor of the Green Bond(s), a third-party-verified green building certification such as LEED (Gold / Platinum), BEAM Plus (Gold / Platinum) or other equivalent green building certifications. Such projects may include the development or redevelopment of such Green Buildings, and/or renovations and/or tenant improvements relating to the environmental performance of such buildings. Such Green Building projects may also include improving the wellbeing of occupiers with a view to achieving the WELL Building Standard (Silver / Gold / Platinum) certification for such buildings. Please refer to Appendix 1 for details on the LEED, BEAM Plus and WELL Building Standard certifications. 2. Process for Project Evaluation and Selection The Eligible Green Projects are identified and selected via a process that involves participants from various functional areas. Representatives from Swire Properties technical services and sustainability department and treasury department will form a working group to review and select Eligible Green Projects according to the criteria outlined above. The working group will identify and manage potentially material environmental and social risks associated with the Eligible Green Projects, if applicable. The shortlisted projects will be presented to the Sustainable Development Steering Committee or the Executive Committee of Swire Properties for approval. 3. Management of Proceeds The net proceeds from each Green Bond issued will be managed by Swire Properties treasury team. Swire Properties will keep an internal record, containing information including: i. Green Bond details including principal amount, maturity date, coupon, etc.; ii. List of Eligible Green Projects and brief description of the projects; and iii. The amount of net proceeds allocated to the projects. Pending allocation, the net proceeds from the Green Bond(s) issued may be invested in cash or cash equivalents, or used to repay existing borrowings under general credit facilities of Swire Properties group. RESTRICTED

4 4. Reporting Swire Properties will provide information on the allocation of the net proceeds of its Green Bond(s) on Swire Properties website and in Swire Properties Sustainable Development Reports. Such information will be provided on an annual basis until all the net proceeds have been allocated. The information will contain at least the following details: i. A list of Eligible Green Projects funded through Swire Properties Green Bond(s), including amounts allocated; and ii. Remaining balance of unallocated proceeds. The allocation of the net proceeds will be reviewed by an independent accountant. In addition, where feasible, Swire Properties will provide qualitative and (if reasonably practicable) quantitative environmental performance indicators of the Eligible Green Projects funded. Such performance indicators include: i. Energy consumption reduction (kwh); ii. Carbon emission reduction (tonnes of CO 2 e); iii. Water consumption reduction (m 3 ); and iv. Amount of waste diverted from landfills (tonnes). RESTRICTED

5 Appendix 1 (External Certifications) Leadership in Energy and Environmental Design TM ( LEED ) LEED is a voluntary, third party building certification process developed by the U.S. Green Building Council. LEED certification provides independent verification of a building or neighborhood s green features, allowing for the design, construction, operations and maintenance of resource-efficient, highperforming, healthy, cost-effective buildings. LEED works for all buildings at all phases of development, from new construction to existing buildings, as well as all building sectors, from homes to hospitals to corporate headquarters. For more information, please visit Building Environmental Assessment Method (BEAM) Plus ( BEAM Plus ) Recognised and certified by the Hong Kong Green Building Council, BEAM Plus offers a comprehensive set of performance criteria for a wide range of sustainability issues relating to the planning, design, construction, commissioning, management, operation and maintenance of a building. By providing a fair and objective assessment of a building s overall performance throughout its life cycle, BEAM Plus enables organisations and companies of all sizes to demonstrate their commitment to sustainable development. For more information, please visit WELL Building Standard TM ( WELL ) WELL is a performance-based system for measuring, certifying, and monitoring features of the built environment that impact the health and wellness of the people who live, work, and learn in the buildings. WELL focuses on seven categories of building performance: air, water, nourishment, light, fitness, comfort, and mind. It is administered by the International WELL Building Institute and third party certified by Green Business Certification Inc. For more information, please visit RESTRICTED

6 Supplementary information: HKQAA obtained below information in assessment stage which served as supplementary information of the 5 eligible types of project activities listed in above Environmental Method Statement. Item 1: Use of Renewable Energy, such as solar and waste-to-energy projects Primary Category: Green Track 6 Renewable Energy Red Track Please specific the project technology and justification Secondary Category: Major related environmental dimensions 1 Significant / major environmental and social impact constituted by this type of project activities 6.2 Solar Photovoltaic (PV) Power Generation; and 6.7 Other New Energy Application Boost Renewable Energy Solar Energy In Swire Properties Limited Sustainable Development report 2016 (SPL SD report 2016), building roof solar PV panels are installed on several SPL premises to replace grid power. Further application study of a combined green roof and solar PV system will be taken. Waste-to-heat Energy In SPL SD report 2016, a small scale biodiesel tri-generation and adsorption system will be installed in One Taikoo Place to supply combined heating, cooling and power generation. Used cooking oil generated by tenants will be converted into biodiesel to help power this system. SPL is committed to identify and manage potentially material environmental and social risks associated with the eligible green projects. All SPL s Hong Kong portfolio have been certified ISO Environmental Management Systems (EMS) and ISO50001 Energy Management System (EnMS), and that can assure the compliance with environmental and energy performance under internal audit and 3 rd party independent audit regularly. SDG s Target(s) and Indicator(s) 2 SDG7: Affordable and clean energy Target 7.1: By 2030, ensure universal access to affordable, reliable and modern energy services Target 7.2 By 2030, increase substantially the share of renewable energy in the global energy mix Item s Objectives and Targets SPL SD report 2016 specified that as part of SPL s SD 2030 Strategy, the application of renewable energy will be enhanced, and a 2020 KPI has been established that SPL will formulate a strategy to increase the use of renewable energy where possible, by on-site generation, purchase from renewable sources and other methods.

7 Item 2: Energy Efficiency Improvement Primary Category: Green Track 1 Energy Conservation and Efficiency Red Track Please specific the project technology and justification Secondary Category: Major related environmental dimensions 1 Significant / major environmental and social impact constituted by this type of project activities 1.2 Sustainable Building; 1.4 Energy Management Center Increase Resource Efficiency As specified in the framework that the net proceeds would fund the new and existing developments to adopt smart technologies and/or systems for optimizing energy management. The net proceeds may also be used to upgrade the existing equipment, e.g. lighting or chillers, in such developments to higher efficiency models. As stated in SPL SD report 2016, a variety of technologies and strategies has been in place to reduce energy consumption in SPL s portfolios. Examples include a lift upgraded in One Pacific Place with VVVF motor drives (estimated energy saving 31,000kWh/annual) and upgraded the down-lighting in the pedestrian areas of Pacific Place mall with LED (estimated energy saving 53,000kWh/annual). All SPL s Hong Kong portfolio have been certified ISO Environmental Management Systems (EMS) and ISO Energy Management System (EnMS), and that can assure the compliance with environmental and energy performance under internal audit and 3 rd party independent audit regularly. SDG s Target(s) and Indicator(s) 2 SDG12: Sustainable consumption and production: Target 12.2: By 2030, achieve the sustainable management and efficient use of natural resources Item s Objectives and Targets Any upgrade of the existing equipment (for example, lighting or chillers) to higher efficiency models would achieve at least a 10% improvement in energy efficiency. SPL SD report 2016 specified that under their SD 2030 Strategy, SPL aims to achieve reduction of annual energy consumption by 64 million and 23 million kwh/year by 2020 for Hong Kong and Mainland China portfolio respectively.

8 Item 3: Sustainable Water and Wastewater Management Installation Primary Category: Green Track 4 Sustainable Water Red Track Please specific the project technology and justification Secondary Category: Major related environmental dimensions 1 Significant / major environmental and social impact constituted by this type of project activities 4.1 Water Saving and Unconventional Water Use Increase Resource Efficiency This type of project activities would align with the principle activities of SPL. It mainly focuses on water conservation including grey water management. SPL SD report 2016 also revealed that a wide range of water conservation initiatives have been implemented. These initiatives include automatic taps, automotive flush water basins and urinals. A case study in 2016: A grey water treatment system was installed at Lincoln House, Taikoo Place to collect wastewater from tenants pantries for treatment in a centralised mini-treatment plant located in the building. The resulting grey water is used for irrigation and car park cleaning (approximately reducing monthly consumption by 17%). All SPL s Hong Kong portfolio have been certified ISO Environmental Management Systems (EMS), and that can assure the compliance with environmental and energy performance under internal audit and 3 rd party independent audit regularly. SDG s Target(s) and Indicator(s) 2 Item s Objectives and Targets SDG12: Sustainable consumption and production: Target 12.2: By 2030, achieve the sustainable management and efficient use of natural resources SPL SD report 2016 specified that the company manages water across their portfolios with a view to reducing water consumption and increasing efficiency and under SPL s SD 2030 Strategy, the company will strengthen their overall water management, and by 2020, SPL will establish water management policy and complete water risk assessment for Mainland China Portfolios.

9 Item 4: Climate Change Adaptation Primary Category: Green Track 8 Climate Change Adaptation Red Track Please specific the project technology detail and justification Secondary Category: Major related environmental dimensions 1 Significant / major environmental and social impact constituted by this type of project activities 8.1 Emergency Prevention and Control of Disaster Live & Prosper Sustainably; and Combat Climate Change This type of project activities is related to climate change adaptation initiatives which will be formulated with the completion of the climate risk assessments for all SPL s portfolios. This type of project activities will include design, construction, maintenance and upgrades of buildings / assets for adapting to more frequent and extreme weather events caused by climate change (for example, projects for the upgrade of flood defence or storm water management systems). All SPL s Hong Kong portfolio have been certified ISO Environmental Management Systems (EMS) and ISO Energy Management System (EnMS), and that can assure the compliance with environmental and energy performance under internal audit and 3 rd party independent audit regularly. SDG s Target(s) and Indicator(s) 2 SDG11: Sustainable cities and communities Target 11.b: By 2020, substantially increase the number of cities and human settlements adopting and implementing integrated policies and plans towards inclusion, resource efficiency, mitigation and adaptation to climate change, resilience to disasters, and develop and implement, in line with the Sendai Framework for Disaster Risk Reduction , holistic disaster risk management at all levels SDG13: Climate Action Target 13.1: Strengthen resilience and adaptive capacity to climate-related hazards and natural disasters in all countries Item s Objectives and Targets SPL SD report 2016 specified that under the SD 2030 Strategy, by 2020, SPL will complete a climate risk assessments for all their portfolios. A resilience enhancement plan and corresponding actions to mitigate the identified climate risks will be produced from the assessments.

10 Item 5: Green Buildings Certification Primary Category: Green Track 1: Energy Conservation and Efficiency Red Track Please specific the project technology and justification Secondary Category: Major related environmental dimensions 1 Significant / major environmental and social impact constituted by this type of project activities SDG s Target(s) and Indicator(s) Sustainable Building Live & Prosper Sustainably Combat Climate Change SPL supports building rating schemes that measure the environmental impacts of buildings and provide benchmarks and objective standards against which SPL can measure its performance. Building rating schemes involve a third-party-verified green building certification such as LEED (Gold / Platinum), BEAM Plus (Gold / Platinum) or other equivalent green building certifications. Such projects may include the development or redevelopment of such Green Buildings, and/or renovations and/or tenant improvements relating to the environmental performance of such buildings. Green Building projects may also include improving the wellbeing of occupiers with a view to achieving the WELL Building Standard (Silver / Gold / Platinum) certification for such buildings. The working group will identify and manage potentially material environmental and social risks associated with the Eligible Green Projects, if applicable. SDG11: Sustainable cities and communities Target 11.b: By 2020, substantially increase the number of cities and human settlements adopting and implementing integrated policies and plans towards inclusion, resource efficiency, mitigation and adaptation to climate change, resilience to disasters, and develop and implement, in line with the Sendai Framework for Disaster Risk Reduction , holistic disaster risk management at all levels SDG13: Climate Action Target 13.1: Strengthen resilience and adaptive capacity to climate-related hazards and natural disasters in all countries Item s Objectives and Targets SPL SD report 2016 specified that under their SD 2030 Strategy, SPL is targeting to achieve the highest environmental building assessment ratings for all of their projects currently under development by Remarks: Reference Author Number 1 United Nations Environmental Programme (UNEP) Title Sustainable Development Goals: United Nations Environment Programme: Annual Report Sustainable_Development_Goals_-_UNEP_annual_report_ UNEP-AR SustainableDevelopmentGoals.pdf.pdf?sequence=3&isAllowed=y 2 UNEP About the Sustainable Development Goals on UNEP