30 Environmental, Social and Governance Report 2022 PILLAR 2: PROPERTY PORTFOLIO For each of these focus areas, we set out the environmental targets and goals aligned with our commitments to enhance asset operations and achieve a sustainable future. The table below illustrates the goals that we strive to attain by 2025. Focus Areas 2025 Targets & Goals Status Sustainable & Efficient Operations 50% increase in solar power generation capacity or the equivalent of 52 MW We are installing close to 100 MW1 of rooftop solar power capacity across our assets globally as an enlarged Group. 20% reduction in energy consumption intensity During the reporting period, several assets were selected to undergo asset enhancement initiatives to improve energy efficiency. In addition, we are on track to develop a decarbonisation strategy across the enlarged Group to achieve further reduction measures in the long-term as part of the transition to net zero. Sustainable Building Certifications 50% of our portfolio to obtain sustainable building certifications and ratings 39%2 of the Group’s portfolio of completed directly managed assets were awarded sustainable building certifications and ratings, representing approximately 10.6 million sqm in GFA. This included ESR’s standalone portfolio, which was approximately 36% certified. Climate Change Resilience Alignment with recommendations from the Task Force on Climate-related Financial Disclosures (TCFD) The Group adopted the principles under the TCFD Framework and incorporated these recommendations into our reporting framework. The framework seeks to assess and disclose the financial impact of climate-related risks and opportunities on our business. Flexible & Adaptable Properties Design, construction and maintenance approaches to reduce material degradation ESR focuses on accessibility and adaptability as key aspects in the design and development of assets. The Group Sustainable Procurement Policy guides our approach in developing and managing assets aligned with industry best practices in sustainable design and green construction. This includes adapting our procurement guidelines to maximise local procurement and use low-carbon materials that are highly recyclable, renewable or durable. In Japan, the ESR Yokohama Sachiura Distribution Centre 2 is strategically located near Tokyo International Airport boasting a panoramic ocean view of Mount Fuji, and is within close proximity to a wide range of third-party logistics (3PLs) importers, exporters and manufacturers. The accessibility of this asset provides a competitive advantage which is an attractive proposition for customers. Strategic Locations Building and expanding modern logistics facilities in key locations 1 Across the enlarged Group as at December 2022, comprising completed projects of 85 MW in 2022 and planned projects of 15 MW within first half of 2023. The completed solar panels of 85 MW includes approximately 54 MW for ESR standalone portfolio of entities. 2 Based on the GFA of certified completed directly managed assets (approx. 10.6 million sqm), divided by total GFA of completed directly managed assets (approx. 27.3 million sqm). Property Portfolio
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