MENU PLACES PEOPLE PARTNERS PERFORMANCE PERFORMANCE (ENVIRONMENT) (ECONOMIC) Governance Strategy Risk Management Metrics and Targets We have identified short- and medium-term measures for individual buildings that will mitigate risks and building resilience across our portfolios. These include upgrading flood-protection measures and alert systems, chiller efficiency improvements, glass façade inspections and smart monitoring systems. Some of these resilience measures will also be incorporated into the planning and design stages of new developments. We believe that by doing this, we can ensure our assets will continue to be resilient under other future climate scenarios. Transition Risks and Opportunities Regarding the global transition to a low-carbon economy, in accordance with the TCFD’s recommendations, Swire Properties has developed three distinct and plausible climate change scenarios in order to stress test the resilience of its business and strategy to varying future operating environments. The scenarios used by Swire Properties have been informed by several publicly available climate scenarios from recognised authorities including the International Energy Agency (“IEA”), the Network for Greening the Financial System (“NGFS”) and the Intergovernmental Panel on Climate Change (“IPCC”) who developed the Shared Socio-Economic Pathways (“SSPs”). The scenarios incorporate global and local government policies, environmental, economic, social and technology indicators and market trends. The scenarios are not intended to be predictions of the future; rather, they seek to stress-test Swire Properties’ business against several plausible future states. The scenarios look at two time horizons (2030 and 2050) and include both global and region-specific (Hong Kong and the Chinese Mainland) indicators. Climate Scenario Analysis 1.5°C – Net-Zero World 2°C – Paris Consistent 3°C – Hot House World Scenario Scenario Scenario • RCP 1.9 • RCP 2.6 • RCP 6.0 • IEA Net-Zero by 2050 • IEA SDS • IEA Stated Policies Scenarios • NGFS Net-Zero 2050 • NGFS Below 2°C (STEPS) • SSP1 – Sustainability • Shared Socio-Economic • NGFS Current Policies Pathway – Sustainability • Shared Socio-Economic Pathway – Fossil-fuelled development SUSTAINABLE DEVELOPMENT REPORT 2022 232