MENU PLACES PEOPLE PARTNERS PEPERRFOFORRMMAANNCCEE PERFORMANCE ((ENENVVIIRROONNMENMENTT)) (ECONOMIC) Performance (Environment) Policies 2022 Progress Profile of Environmental Impacts Climate Change Energy Resource and Circularity Water Biodiversity Occupant Wellbeing Building/Asset Investments Some of these resilience measures will also be incorporated into the planning and design stages of new developments to ensure our assets will continue to be resilient under different future climate scenarios. With the announcement of the Company’s HKD100 billion investment plan for new projects in the Chinese Mainland and Hong Kong, it is of the utmost importance to expand our climate risk assessment work to cover new project sites. This will allow us to critically evaluate the potential climate exposure of these developments and take early strategic action to incorporate climate resilience into the projects’ design and planning stages. After the release of the Sixth Assessment Report (AR6) by IPCC in 2022, we immediately began to update our climate models to incorporate the latest available climate science. We will also perform relevant deep-dive hazard modelling for selected projects, such as urban drainage modelling, riverine flood modelling and coastal hydrodynamic modelling, using outputs from climate models. The results will be analysed to generate climate-related parameters and design concepts for projects in order to help design teams communicate and channel climate-related considerations into their designs. Assessment of Transition Risks and Opportunities This is a comprehensive review of global, national and local government policies, including Hong Kong’s Climate Action Plan 2050, released in 2021, as well as regulatory, market and technological trends based on different climate scenarios involved in the global transition to a low-carbon economy. We identified a number of risk and opportunity drivers that may have a financial impact on our business under three different climate scenarios: the “Net Zero Scenario” (1.5°C); the “Paris Consistent Scenario” (2°C); and the “Hot House World Scenario” (3°C). The drivers include tightened building energy codes and guidelines, increased market demand for green and energy-efficient properties and climate-resilient properties. SUSTAINABLE DEVELOPMENT REPORT 2022 187