2019 Sustainability Report

Task Force on Climate Related Financial Disclosures

At Swire Pacific, we communicate our approach to climate change mitigation, adaptation and resilience in accordance with our Climate Change Policy.

In 2018, we started to align our disclosures with those recommended by the TCFD of the Financial Stability Board. There are four categories: governance, strategy, risk management and metrics and targets. We aim to ensure information consistency and utility for users.


  • The Board oversees the management of risk, including sustainability risk. We use an enterprise risk management system. The Audit Committee identifies, analyses and reviews risks. We have corporate risk registers, in which climate change has been identified as an emerging risk.
  • The Group Head of Sustainable Development reports annually to the Board on our sustainability risks and performance.
  • The Chairman, divisional chief executives and the Finance Director meet twice a year to consider SwireTHRIVE and sustainability risks, opportunities and targets. These meetings provide direction and oversight to the Swire Group Sustainability Committee (SGSC), which comprises divisional sustainability heads and is chaired by an executive director of Swire Pacific. The SGSC meets three times a year. In accordance with its terms of reference, it has the following responsibilities related to climate change:
    • To oversee, amend and implement SwireTHRIVE (including in relation to carbon and climate resilience) and sustainability policies
    • To report on sustainability to the Group Risk Management Committee (including about emissions and energy use)
    • To report to the Audit Committee on compliance with sustainability policies and on the Group’s sustainability work (including in relation to climate change)
    • To review legislative, regulatory and other public sustainability developments and to report them to relevant committees of the Board
  • We have adopted a Climate Change Policy to guide our management approach and strategy on climate change mitigation, adaptation and resilience.
  • Greenhouse gas emissions, climate resilience and the management of waste and water resources are the sustainability issues most material to our business. SwireTHRIVE focuses on these issues.


  • Climate change carries risks for our business. Flooding, extreme weather events and increasing temperatures can adversely affect our assets, operations, employees and suppliers. There are also regulatory, market and reputational risks.
  • Climate Change appears on the Group Risk Register and was highlighted in the Risk Management section of the Group’s Annual Report. It also was highlighted as a key sustainability risk to the Group in a separate stakeholder engagement risk identification exercise.
  • Climate change is an opportunity to develop low carbon and climate-resilient businesses. Demand exists for climate resilient products and services. By addressing climate change the costs of extreme weather conditions, such as maintenance and insurance premiums, can be mitigated. Climate change stimulates business innovation and experimentation and facilitates the transition to a lower carbon economy.
  • To make our businesses more resilient to climate change:
    • Swire Properties’ new buildings are energy efficient, low users of carbon and certified as green. In 2019, 97% of all existing buildings were certified green buildings and over 95% of 2019 gross rental income was from certified green buildings.
    • In 2019, Swire Properties introduced UrbanLab in Mainland China. UrbanLab focuses on innovative technology solutions relevant to the real estate sector.
    • Cathay Pacific is a member of the Roundtable on Sustainable Biomaterials and of the Sustainable Aviation Fuel Users Group Asia. It has a minority stake in Fulcrum BioEnergy Inc., which converts municipal solid waste into sustainable aviation fuel.
    • Swire Coca-Cola uses independent third parties to assess water risk for each of its bottling plants, so as to form source vulnerability assessments. The findings are integrated into source water protection plans and are regularly reviewed.
    • Swire Pacific Offshore wants to decarbonise by using marine versions of alternative fuels. With Nanyang Technological University, it is researching the viability of hydrogen fuel cell technology
  • We are starting a study intended to identify the key risks and opportunities posed by climate change to our assets and business operations.
  • As part of SwireTHRIVE, we have targets for the reduction of our carbon use. Swire Properties has developed a science-based target for carbon reduction.
  • With Tsinghua University’s Joint Research Centre for Building Energy Efficiency and Sustainability, we have developed and tested methods to increase energy efficiency and improve environmental performance in our businesses. The collaboration began with Swire Properties and now includes Swire Coca-Cola. It generates substantial energy savings.
  • In 2018, Swire Properties issued a 10-year US$500 million green bond. The proceeds are intended to fund projects relating to renewable energy, energy efficiency and climate change adaptation. The environmental impact of the green projects funded by the bond proceeds have been described in Swire Properties’ second Green Bond Report.
  • In July 2019, Swire Properties secured its first sustainability-linked loan, with the interest rate being linked to ESG performance.

Risk management

  • In accordance with TCFD recommendations, we are assessing how vulnerable our businesses are to flood, heat stress, water stress and extreme weather events. The findings will be incorporated into our ERM process.
  • We will start to identify the physical risks posed by climate change to our key assets and business operations, under two climate change scenarios (RCP 4.5 and 8.5).
  • Swire Properties is conducting asset-level modelling of acute and chronic physical risks associated with the four Representative Concentration Pathways (RCP 2.6, 4.5, 6 and 8.5) used by the Intergovernmental Panel on Climate Change.

    Global climate models are being used in order to evaluate the exposure of specific assets and operations in 2025, 2030, 2050 and 2100. The vulnerability of individual assets and business and operating areas to flooding, heat stress, water stress and extreme wind is being assessed.

    The climate related effects of government policies and regulatory, technological and market trends are being considered, with a view to identifying their financial impact.

    Swire Properties will use their findings to develop a plan to mitigate risks and build resilience which will be incorporated into their Enterprise Risk Management system.
  • Our business continuity plans cover extreme weather events. Swire Properties has specific crisis response plans for its buildings.
  • Through the ISO 14001 Environmental Management System and ISO 50001 Energy Management System, we manage our daily operational risks related to climate change, carbon and energy management.
  • We support the efforts of the Hong Kong Business Environment Council to promote awareness of climate change in the business community.
  • Swire Properties consider sustainability development criteria, including climate adaptation and resilience, energy efficiency and carbon emissions, when assessing acquisitions.

Metrics and Targets

  • Since 2006, we have been measuring and reporting our energy consumption and our Scope 1 and 2 carbon emissions from our operations in accordance with global standards, including the GHG Protocol.
  • Our aviation and property businesses have had reduction targets for a number of years:
    • Cathay Pacific has set a target to improve its fuel efficiency by an average of 2% per annum by 2020 and to achieve carbon neutral growth thereafter. This exceeds the 1.5% agreed industry target.
      • In 2019, Cathay Pacific increased fuel efficiency by 2%, as measured by tonnes of CO2 per available tonne kilometre
    • Swire Properties has set targets to reduce (i) the annual energy consumption of its Hong Kong and Mainland China properties by 64 million kWh and 23 million kWh respectively and (ii) the carbon intensity of its Hong Kong and Mainland China properties by 27% and 21% respectively, in each case by 2020 and by reference to relevant baselines.
    • In 2019, Swire Properties' science based target was approved by the SBTi.
      • Reduce Scope 1 and 2 GHG emissions by 35% per sqm by 2025 and by 52% per sqm by 2030 (compared to the baseline year of 2018)
      • Reduce Scope 3 GHG emissions from downstream leased assets by 28% per sqm by 2030 (compared to the baseline year of 2018)
      • Reduce Scope 3 GHG emissions from capital goods by 25% per sqm by 2030 (compared to the baseline years of 2016-2018)
  • Swire Coca-Cola has developed a science-based target for the reduction of its carbon emissions in accordance with SBTi criteria:
    • The SBT is for a 30% reduction in absolute Scope 1, 2 and 3 emissions by 2030 (compared to the baseline year of 2018)
    • They will be submitting this target to the SBTi later in 2020 for approval
  • In 2017, our operating companies set targets to reduce carbon intensity by 8-10% by 2020, in each case by reference to a 2015 frozen efficiency baseline (from which performance is projected with the assumption of no improvement in current efficiencies). In 2019, the Group outperformed this target by 1.83%.
  • We report on progress towards these targets in our annual sustainability reports.

    To help us meet our targets we encourage the use of renewable energy in our operations. 16.2 million kWh of electricity was generated from renewable energy sources at Swire Properties, Swire Coca-Cola and HAECO Xiamen in 2019. The Swire Pacific Sustainable Development Fund is available to support suitable renewables projects.
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