At CapitaLand Malaysia Trust (CLMT), sustainability is at the core of everything we do. We are committed to growing in a responsible manner, delivering long term economic value, and contributing to the environmental and social wellbeing of our communities. CLMT's material environmental, social and governance (ESG) factors are aligned with CapitaLand 2030 Sustainability Master Plan, which was launched in 2020, and will be reviewed by the Board of Directors together with Management every two years.
The CapitaLand 2030 Sustainability Master Plan steers our efforts on a common course to maximise impact through building a resilient and resource efficient real estate portfolio, enabling thriving and future-adaptive communities, and accelerating sustainability innovation and collaboration. Ambitious ESG targets have been set which include carbon emissions reduction targets validated by the Science Based Targets initiative (SBTi).
The Board of the Manager of CLMT is responsible for overseeing the CLMT's sustainability efforts and takes ESG factors into consideration in determining its strategic direction and priorities. The Board also approves the executive compensation framework based on the principle of linking pay to performance. CLMT's business plans are translated to both quantitative and qualitative performance targets, including sustainable corporate practices and are cascaded throughout the organisation.
As an externally managed real estate investment trust, CLMT is managed by CapitaLand Malaysia REIT Management Sdn. Bhd. (CMRM or the Manager), which is a wholly owned subsidiary of Singapore-listed CapitaLand Investment Limited (CLI or Sponsor), a leading global real estate investment manager with a strong Asia foothold.
CLMT's properties are managed by Knight Frank Property Management Sdn. Bhd. and Zaharin Nexcap Property Consultants Sdn. Bhd. (collectively known as Property Managers) that are responsible for the daily property operations. The CapitaLand team behind the Manager and Property Managers responsible for property and portfolio operations are identified as employees of CLMT.
As a CLI-sponsored REIT, CLMT is aligned with CapitaLand's 2030 Sustainability Master Plan unveiled in 2020 to elevate he Group's commitment to global sustainability in the built environment. The Sustainability Master Plan drives CapitaLand's sustainability efforts in the environment, social and governance (ESG) pillars, enabling the Group to create a larger positive impact for the environment and society.
CapitaLand's 2030 Sustainability Master Plan is regularly reviewed where necessary to complement the Group's business strategy and align with climate science. The first scheduled review in 2022 is in progress and the outcome will be published before end May 2023.
Five pathways were identified to achieve CapitaLand Group's sustainability objectives, and CapitaLand will adapt its strategies as technologies evolve and new scientific data become available:
From the earliest stage of the investment process, to design, procurement, construction, operations and redevelopment or divestment, sustainability targets will be embedded in policies, processes, best practices, and key performance indicators of CapitaLand's business operations.
CapitaLand will continue to source globally for new ideas and technologies to meet its sustainability ambitions and work with like-minded partners to create shared values.
This allows CapitaLand to track critical performance and progress in water usage, waste management, energy consumption, carbon emission, and health and safety. These measurements along with social indicators are key to driving performance improvement across our operating properties and development projects.
As CapitaLand tracks its sustainability progress, it will continue to validate its performance by external assurance and align its Global Sustainability Report to international standards.
It is key to building awareness among CapitaLand's employees, investors, customers and communities, and collectively effecting transformational change to achieve CapitaLand's 2030 targets.
The Sponsor's Board recognises the importance of sustainability as a business imperative and ensures that sustainability considerations are factored into CLI's strategy development.
On a regular basis, CLI Board is updated through the Strategy and Sustainability Committee on the sustainability management performance of the Group, key material issues identified by stakeholders, and the planned follow-up measures. Additionally, through the Risk Committee and Audit Committee, the CLI Board is typically updated at least once a year and at ad hoc Board meetings on matters related to sustainability risks, and relevant performance metrics, including carbon emissions performance, progress on achieving the reduction targets, green certification, human capital development, as well as stakeholders' expectations on climate change and/or other social matters. They are also informed of any work-related safety incidents, business malpractice incidents and environmental incidents, which may include climate related damages or disruptions.
The Strategy and Sustainability Committee (SSC), a Board Committee chaired by Lead Independent Director Mr Anthony Lim, is responsible for overseeing CLI's sustainability strategies and goals, including providing guidance to Management and monitoring progress against achieving the goals of sustainability initiatives. The SSC typically meets twice a year, with additional meetings convened as necessary.
The sustainability work teams comprise representatives from CLI business units and corporate functions. Each business unit also has its own Environmental, Health and Safety (EHS) Committee to drive initiatives in countries where it operates with support from various departments. This governance is cascaded from CLI level to CLMT level through the operations of CapitaLand's EHS Committee.
The Manager's properties are overseen by representatives in the EHS Committee to drive initiatives within its properties. CMRM's Board is updated regularly through the Executive Committee and Audit Committee on matters relating to sustainability risks and business malpractice incidents. CMRM's Board is also updated on the sustainability management performance of CLMT, key material issues identified by stakeholders and the planned follow-up measures. The Manager works closely with the Property Managers in carrying out strategies and relevant activities, abiding by CapitaLand's sustainability framework and policies.
As a CLI-sponsored REIT, CLMT's sustainability strategy is aligned to that of the Sponsor. CLMT is committed to working towards long term and annual targets under CapitaLand's 2030 Sustainability Master Plan Framework. To strengthen its sustainability stewardship, the Manager has formalised a sustainability department effective January 2023, which is then supported by various Heads of Department of the Manager, and the Heads of Department of the operations and technical teams of CLI. Through the Sustainability department, CMRM's Board is updated regularly on matters relating to sustainability management performance of CLMT, key material issues identified by stakeholders and the planned follow-up measures.
To measure its performance, CLMT has incorporated ESG key performance targets/indicators, most of which are linked to remuneration for the Manager's staff, including top management. The performance on these performance targets have financial and non-financial consequences.
CMRM's Board embraces diversity and has a Fit and Proper Policy which provides for the Board to comprise talented and dedicated Directors with a wide mix of expertise, experience, perspectives, skills and backgrounds, with due consideration given to diversity including but not limited to, business or professional experience, age and gender, ethnicity and culture, geographical backgrounds and nationalities. With respect to female representation, the Nominating and Remuneration Committee (NRC) notes the Malaysian Code on Corporate Governance 2021 target of women making up 30% of the boards of Bursa Malaysia-listed companies by 2030. In its annual review of the Board's composition, the NRC expressly considers and includes a commentary to the Board about diversity in the composition of the Board. The Board aims to achieve at least 30% female representation in the composition of the Board and senior management positions over the next one to two years when reviewing the nominations for the appointment and re-appointment of Directors for a new term. The formalisation of the appointment of woman candidate as Director(s) of the Manager will be the NRC's and Board's focused priority in year 2023 and 2024.
As CLMT is a CLI-sponsored REIT, CapitaLand's ESG material issues have been deemed material and applicable to CLMT's business and operations. CapitaLand has a regular review, assessment and feedback process in relation to ESG topics. Key to this is an annual Group-wide Risk and Control Self-Assessment exercise which entails the identification, assessment and documentation of material risks and corresponding internal controls. These material risks include fraud and corruption, environmental (e.g. climate change), health and safety, and human capital risks which are ESG-relevant.
Guided by CapitaLand's 2030 Sustainability Master Plan to elevate the Group's commitment to global sustainability, CLMT, as a CLI-sponsored REIT, identifies and reviews material issues that are most relevant and significant to us and our stakeholders. These ESG material issues are assessed and prioritised based on the likelihood and potential impact of issues affecting the business continuity of CLMT. For external stakeholders, priority is given to issues important to the community and applicable to CLMT.
The Manager and Property Managers engage stakeholders through various programmes and channels to identify and assess material ESG issues which significantly impact business operations and stakeholders. The Group-wide Risk and Control Self-Assessment exercise provides the framework for the identification, assessment and documentation of material risks and corresponding internal controls. These are prioritised based on the likelihood and potential impact of issues affecting business continuity and development. For more information on stakeholder engagement, please refer to the Social and Relationship Capital chapter of this report and the upcoming CapitaLand Investment Global Sustainability Report 2022.
|Pillars of 2030
Sustainability Master Plan
|Material ESG Factors/Indication|
|Critical||Moderate and Emerging|
As a CLI-sponsored REIT, CLMT is aligned with CapitaLand's science-based targets set out in CapitaLand's 2030 Sustainability Master Plan as we transit to a low-carbon business. CapitaLand's carbon emissions intensity reduction target is computed from the approved science-based target to better track day-to-day operational efficiency. As part of the CapitaLand Group, CLMT is committed to working towards the long term and annual targets under CapitaLand's 2030 Sustainability Master Plan Framework1:
CLMT is aligned with CapitaLand's commitment to minimise its environmental impact and contribute towards desired positive outcomes for the benefit of stakeholders. CLMT is committed to environmental sustainability and value creation as a real estate owner. By leveraging technologies and analytics in optimising the usage of energy, water and waste management across our properties, we believe the efficient use and management of environmental resources such as energy, water and waste contributes to higher efficiency and sustainability of CLMT's portfolio.
For more information on CLMT's initiatives, please click here
Click here for CapitaLand Investment Limited's Global Sustainability Report 2022.