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Sustainability

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 well-being of our communities. The material environmental, social and governance (ESG) factors have been identified and encapsulated in the CapitaLand 2030 Sustainability Master Plan, which was launched in 2020, and will be reviewed by the Board of the Manager of CLMT 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 Manager'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. The Manager's business plans are translated to both quantitative and qualitative performance targets, including sustainable corporate practices and are cascaded throughout the organisation.


SUSTAINABILITY APPROACH

  • Our Commitment
  • Push Boundaries of Change
  • Board, Top Management and Staff Commitment and Involvement
  • Materiality
  • Prioritisation of ESG Material Issues

Our Commitment

OUR COMMITMENT

As an externally managed real estate investment trust, CLMT is managed by CapitaLand Malaysia REIT Management Sdn. Bhd. (CMRM or the Manager), a wholly-owned subsidiary of CapitaLand Investment Limited, which is part of the CapitaLand (CL or CL Group). Meanwhile, CLMT’s properties are managed by Knight Frank roperty Management Sdn. Bhd. and Zaharin Nexcap Property Consultants Sdn. Bhd. (collectively known as Property Managers) that oversees the daily property operations. The Manager and Property Managers are responsible for the property operations across CLMT’s portfolio. The Manager of CLMT are part of the CL Group and our sustainability strategy is aligned to that of CapitaLand. Since starting on its sustainability journey, CLMT has built on CapitaLand’s firm foundation to strengthen its portfolio and sustainability practices to be resilient to the challenges faced by the retail real estate sector. As we progress, we endeavour to make a meaningful and positive impact in the communities we operate in as we create value for our Unitholders.

CLMT is committed to improving the economic and social well-being of its stakeholders through management of human capital, asset, portfolio and property operations. The Manager and Property Managers firmly uphold CapitaLand’s credo of ‘Building People. Building Communities.’, and abide by CapitaLand’s sustainability framework, policies, guidelines, as well as ethics and code of business conduct.

We uphold high standards of corporate governance and transparency to safeguard shareholders’ interests. We have in place an adequate and effective Enterprise Risk Management Framework to enhance business resilience and agility. CapitaLand’s proactive approach towards environmental, health and safety (EHS) management, which incorporates universal design into its developments, ensures that its properties are sustainable and future-proof. Policies and guidelines are put in place to ensure the efficient use of energy, water and other resources.

CapitaLand’s integrated human capital strategy aims to recruit, develop and motivate employees to drive growth. Community development is an important component of its commitment to sustainability. It focuses on providing support to enhance the lives of underprivileged children and vulnerable elderly, through corporate philanthropy and employee volunteerism.

With the launch of CapitaLand’s 2030 Sustainability Master Plan in 2020, CapitaLand elevated its commitment to global sustainability in the built environment given its presence in more than 250 cities and over 30 countries. The Master Plan focuses on three key pillars to drive CapitaLand’s sustainability efforts in the ESG pillars, enabling CL Group to create a larger positive impact for the environment and society.

The three key pillars are:

BUILD

Building portfolio resilience and resource efficiency

ENABLE

Enabling thriving and future-adaptive communities

ACCELERATE

Accelerating sustainability innovation and collaboration

There are five identified pathways to achieve our sustainability objectives:

1

Integrate sustainability in CapitaLand’s real estate life cycle:

From the earliest stage of its 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 its business operations.

2

Strengthen innovation and collaboration to drive sustainability:

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.

3

Leverage sustainability trends and data analytics:

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 its operating properties and development projects.

4

Monitor and report progress to ensure transparency:

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.

5

Increase engagement and communication with key stakeholders:

It is key to build awareness among CL Group’s employees, investors, customers and communities, and collectively effect transformational change to achieve CapitaLand’s 2030 targets.

Push Boundaries of Change

PUSH BOUNDARIES OF CHANGE

To push the boundaries of change, CapitaLand will transit to a low-carbon business that is aligned with climate science. In November 2020, CapitaLand had its carbon emissions reduction targets approved by the Science Based Targets initiative (SBTi) for a ‘well-below 2°C scenario. The targets are in line with the goals of the Paris Agreement to keep global temperature rise well below 2°C in this century. CapitaLand is also developing a new metric, Return on Sustainability, in addition to the regular financial return to measure CL Group’s ESG impact.

CapitaLand has also launched the inaugural CapitaLand Sustainability X Challenge (CSXC), an innovation challenge to enable CapitaLand to accelerate its sustainability efforts and meet its 2030 targets. The CSXC covers seven challenge statements and reflect the key themes and goals in CapitaLand’s 2030 Sustainability Master Plan.

CapitaLand aims to be a leader in sustainable finance and secure S$6 billion through sustainable finance by 2030. Proceeds and interest rate savings from CapitaLand’s efforts in sustainable finance can also be used to drive more sustainability initiatives and innovations within the company.

As part of the CapitaLand Group, CLMT is committed to working towards long term and annual targets under CapitaLand’s 2030 Sustainability Master Plan Framework. CLMT is aligned with CapitaLand’s long term targets:

Reduce carbon
emissions intensity
by 78% by 2030

Reduce energy
intensity by 35% by
2030

Reduce water
intensity by 45% by
2030

(Using 2008 as base year)

CLMT keeps track of its performance to ensure its properties are on track to meet CL Group’s targets.

Board, Top Management and Staff Commitment and Involvement

BOARD, TOP MANAGEMENT AND STAFF COMMITMENT AND INVOLVEMENT

CapitaLand Investment (CLI) Group-wide sustainability management comes under the purview of CapitaLand Sustainability Council (SC) which comprises two Independent Board members and four executive committee members that report to the CLI Board. CapitaLand’s Management Council consisting of the Group Chief Executive Officer (CEO), all Presidents and/or CEOs of business units and key management officers of the Corporate Office provide strategic management of ESG implementation across the Group. The SC is supported by the Group Sustainability Office and various work teams to drive continued progress and improvement in the areas of ESG. It was chaired by one of CLI Board’s independent directors and member of its Executive Resource and Compensation Committee and Risk Committee. The work teams comprise representatives from CapitaLand business units and corporate functions. This governance is cascaded from the Group level to CLMT level through the operations of CapitaLand’s EHS Committee.

The Manager’s properties are overseen by representatives in the Environmental, Health and Safety (EHS) Committee to drive initiatives within its properties. The Board of the Manager is updated regularly through the Executive Committee and Audit Committee on matters relating to sustainability risks and business malpractice incidents. The Board of the Manager 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.

Materiality

MATERIALITY

CLMT 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.

We identify and review material issues that are most relevant and significant to us and our stakeholders. These are prioritised based on the likelihood and potential impact of issues affecting business continuity and development.

For external stakeholders, priority is given to issues important to the society and applicable to CLMT. More information on stakeholder engagement is available in the Social and Relationship Capital, Human Capital and Environmental Capital chapters of the CapitaLand Global Sustainability Report 2021.

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.

Prioritisation of ESG Material Issues

PRIORITISATION OF ESG MATERIAL ISSUES

Pillars of 2030
Sustainability Master Plan
Material ESG Factors/Indication
Critical Moderate and Emerging
BUILD
Portfolio Resilience and Resource Efficiency
  • Climate change and carbon reduction
  • Energy efficiency
  • Water management
  • Waste management
  • Biodiversity
ENABLE
Thriving and Future-Adaptive Communities
  • Occupational Health & Safety
  • Human capital
  • Stakeholder engagement
  • Supply chain management
  • Diversity (Board and staff)
  • Human rights
ACCELERATE
Sustainability Innovation and Collaboration
  • Products and services (incl customer health and safety)
Anchored by strong Governance and Sustainable Financial Performance
  • Compliance
  • Business ethics

For more information on CLMT’s initiatives, please click here