2018 Sustainability Report


Merin Swire

Chairman’s statement

“Sustainable development is a strategic imperative for our businesses and integral to our overall approach to building long-term value for our shareholders.”

Swire Pacific’s commitment to sustainability helps to build the foundation for its growth and to provide opportunities for innovation and improved efficiency. Sustainable development is a strategic imperative for our businesses and integral to our overall approach to building long-term value for our shareholders.

We must continue to evolve our sustainability policies with regard to the environment, our people and our communities. We will continue to embed the policies, systems and standards in line with global best practice and trends. This includes climate related risks, which is why this year’s report includes material responding to the Taskforce for Climate Related Financial Disclosures (TCFD).

Sustainability is not just the responsibility of specialists. Everyone has a role to play. We are scaling up the provision of training and tools for our people accordingly.

I am very proud of the work our staff, our customers and others with whom we interact have achieved in 2018. We are making good progress, but I know we can achieve much more. We must become more focused on those areas of our business with the greatest environmental and social impact.

Sustainability requires us to think beyond the short term. Doing so will help us to build the resilience necessary to create value for our shareholders for the long term.

Merlin Swire

Mark Watson

Head of Sustainable Development Statement

“A strong sustainability performance boosts reputation, improves efficiency, mitigates risk and attracts and retains talent.”

Sustainable development is key to the creation of long-term value for our businesses and to ensuring that we can continue investing in our future.

In 2018, we made good progress in reducing our impact on the environment and addressing climate change. This is reflected in our inclusion in the Hang Seng, MSCI, FTSE4GOOD and DJSI Asia Pacific indices, with Swire Properties being the only Hong Kong and Mainland China based company included in the DJSI World Index.

At the end of 2018, 92% of Swire Properties’ existing buildings were certified green buildings, with 75% achieving the highest ratings. In our aviation division (which produces the bulk of our carbon emissions), Cathay Pacific is investing in more fuel-efficient Airbus A350 aircraft. Our aviation and marine divisions have made carbon reduction commitments through the International Civil Aviation Organisation (ICAO) and the International Maritime Organisation (IMO) respectively. We intend to set more ambitious carbon emission targets for 2030, including, in the case of Swire Properties, science-based targets, that is, targets in line with the scale of reductions required to keep global temperature increase below 2°C above pre-industrial temperatures.

In January 2018, Swire Properties issued its first green bond. This was the first such bond to receive green finance certification from the Hong Kong Quality Assurance Association. The bond raised US$500 million for green projects – building development, energy efficiency, renewable energy, wastewater management and climate change adaptation. In September 2018, Swire Properties completed its HK$15 billion One Taikoo Place office tower, which obtained platinum-level green certifications (BEAM Plus, LEED and WELL). It is one of the world’s most green triple Grade-A office towers, setting a new benchmark for sustainable construction.

In a period of significant expansion, the beverages division used less water to produce one litre of finished product. In Hong Kong, the division has negotiated the formation of a PET and HDPE plastics1 recycling joint venture. Alongside its continuous efforts with the #DrinkWithoutWaste initiative, this will enable Hong Kong to reduce the amount of plastic waste sent to landfill.

SwireTHRIVE, our sustainable development strategy, helps our businesses to mitigate operational risk and to build long-term resilience through environmental best practice and innovation. In 2019, we will review our progress against our original goals and intend to set carbon, water and waste targets for 2030. We will expand SwireTHRIVE to cover more risks that could threaten the long-term viability of our business and to deal with social and economic aspects of sustainability. We also want to respond to increasing external sustainability risks and regulations.

Decarbonising technologically-constrained industries such as aviation and shipping is challenging. But we aim to contribute by investing in technology and supporting innovation. Fulcrum Bioenergy (in which we have an equity interest) is developing waste-based sustainable biofuels for aviation. Swire Pacific Offshore is examining the potential of fuel cell technology in the marine sector.

A strong sustainability performance boosts reputation, improves efficiency, mitigates risk and attracts and retains talent. We will do more to integrate sustainability into our enterprise risk management. I am confident in what we can achieve, and in our ability to create value for our businesses through sustainability. Swire Pacific is well placed to share technologies and expertise across our businesses, creating value in the long term.

Dr. Mark Watson
Head of Sustainable Development

1 PET is an abbreviation for Polyethylene terephthalate. HDPE is an abbreviation for High-density polyethylene