ESR Group ESG Report 2022 EN

60 Environmental, Social and Governance Report 2022 PILLAR 3: CORPORATE PERFORMANCE Supply Chain Management ESR incorporates ESG considerations as part of our supply chain management on areas relating to sustainable procurement, operational resilience and sustainability performance of suppliers. We work closely with a wide range of suppliers, including contractors, vendors, consultants, service providers, architects and designers in the development and management of our asset portfolios. Suppliers are assessed based on a set of criteria including track record, financial strength, and their commitment towards high standards of quality, environmental management and safety. We work with our contractors to integrate the relevant ESG considerations into our value chain. Impact assessments are conducted prior to construction covering the effects on the environment and compliance with applicable laws and regulations. Suppliers are also required to adhere to our Supplier Code of Conduct, setting out the standards relating to regulatory compliance, business conduct, labour practices, environmental protection, sustainable procurement, health and safety training and awareness amongst other areas. After every completed engagement, ESR evaluates the performance of suppliers to provide them with feedback for improvement. Suppliers that do not meet or breach the requirements are penalised or terminated based on the contractual terms. By following our stringent procurement processes and Supplier Code of Conduct, we aim to encourage our suppliers to adopt sustainable practices. Refer to additional information on Counterparty Risk Management on page 54 & 55 which sets out mechanism on due diligence on selection of suppliers.

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