SUSTAINABILITY GOVERNANCE FRAMEWORK

SUSTAINABLE DEVELOPMENT GOVERNANCE

To strengthen its governance capabilities in sustainability, the Company officially established the Sustainability Committee (formerly known as the Environmental, Social, and Governance Committee, or “ESG Committee”) in March 2022. The Committee is led by the Chair of the Board and comprises two executive directors and four independent non-executive directors, ensuring the independence and professionalism of decision-making. Building on this foundation, the Company has continuously optimised its sustainable governance structure, forming a management framework consisting of the “Board - Sustainability Committee - Sustainability Leadership Group - Sustainability Executive Group”. Among these, the Board, as the highest decision-making body, comprehensively supervises the implementation of the sustainability strategy; the Sustainability Committee is responsible for specific guidance and oversight; the Sustainability Leadership Group promotes the deep integration of sustainability principles with business operations; and the Sustainability Executive Group, composed of headquarters functional departments and subsidiary business units, ensures the effective implementation of all sustainability initiatives. This systematic governance structure not only enhances the standardisation and execution of sustainable development management but also provides a solid organisational guarantee for the Company to achieve its sustainable development goals.

Yuexiu Property’s Sustainability Governance Framework

The Board of Directors

Remuneration
Committee

Nomination
Committee

Audit
Committee

Sustainability
Committee

Sustainability
Leadership Group

Sustainability
Executive Group

Climate Change
Response Working Group

Green Office
Working Group

Dual Carbon
Working Group

Sustainable Supply
Chain Working Group

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SUSTAINABLE DEVELOPMENT PHILOSOPHY

Based on comprehensive discussions and decisions by the Board and the Sustainability Committee, Yuexiu Property strictly follows the Plan-Do-Check-Act (P-D-C-A) cyclical management process as its core management philosophy for sustainable development. This concept not only provides clear principles and guidance for the Company’s sustainable development management efforts but also ensures continuous progress on the path of sustainable development through a spiral ascending work model.

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Plan

Global Policies

Follow and adhere to the United Nations Sustainable Development Goals
Observe the ISSB’s IFRS S1 and IFRS S2, as well as any upcoming relevant standards
Respond to the Paris Agreement reached in the UN Climate Change Conference in Paris, France (COP21) and the Baku Climate Unity Pact as the outcome of the UN Climate Change Conference in Baku, Azerbaijan (COP29)

National Policies

Adhere to the national “carbon peak and carbon neutrality” goals
Comply with the Action Plan for Carbon Dioxide Peaking before 2030, the Guiding Opinions on Accelerating the Establishment and Improvement of a Green and Low-Carbon Circular Development Economic System and the Measures for the Administration of Legal Disclosure of Enterprise Environmental Information
Follow the Measures for the Supervision and Administration of Energy Conservation and Ecological Environment Protection of Central Enterprises

Based on domestic and international policies, Yuexiu Property has established a comprehensive sustainable development management system. For more details, please click the link to visit the official website:

Climate Change Policy, Meteorological Disaster Emergency Response Plan, Sustainable Water Resources Policy, Circular Economy Promotion Policy, Biodiversity Policy, Green Finance Policy, Environmental Policy, Energy Policy, Sustainable Building Policy, Health and Safety Policy, Occupational Health Management Rules, Production Safety Management Approach, Employee Rights Protection Policy, Diversity and Inclusion Policy, Human Rights Policy, Board Diversity Policy, Respect in the Workplace Policy, Supplier Code of Conduct, Sustainable Procurement Policy, Customer Relationship Management Approach, Detailed Provisions on Customer Complaint Management, Whistleblowing Policy, Comprehensive Risk Management Approach, Compliance Management Approach, Anti-Corruption and Anti-Bribery Policy and Tax Compliance Policy

Based on the established institutional framework, Yuexiu Property has developed specific plans for sustainable development management in the Company’s development process to ensure that effective implementation of policies internally.

Act

Philosophy

Yuexiu Property periodically adjusts its sustainable development philosophy based on the current P-D-C-A cycle, benchmarking against best practice management models domestically and internationally to enrich its sustainable development philosophy.

Structure

In 2024, a new committee member was added to the Sustainability Committee to enhance the Company’s sustainable development management capabilities. Plans are underway to form additional specialised working groups under the Sustainability Executive Group, focusing on various sustainable development-related topics, such as a TNFD Working Group;
A Climate Change Response Working Group, a Green Office Working Group, a Dual Carbon Working Group and a Sustainable Supply Chain Working Group have been established, enhancing our organisational experience in sustainable development management.

Strategies

In accordance with the 17 Sustainable Development Goals set by the United Nations, Yuexiu Property regularly reviews its sustainable development performance and continuously align itself with these goals;
We benchmark ourselves against best practices from leading peers, regularly assess our sustainable development strategic objectives and adjust as necessary.

Policies

We continuously benchmark ourselves against international best practices and industry standards to formulate more systematic ESG policies, in order to improve our sustainability management system.

Management

Based on the areas of improvement identified during the Check phase, we analyse the gaps against international and domestic standards, and continuously optimise future sustainable development management actions to achieve better sustainable development performance;
We continuously analyse and evaluate the feasibility of future goals, while ensuring the successful achievement of sustainable development goals for the “14th Five-Year Plan” period, to explore the intensity and depth of goals for the “15th Five-Year Plan” period;
We summarise the strengths and weaknesses of annual sustainable development information disclosure efforts, clarifying how disclosure contributes to enhancing sustainable development performance.

Do

Conduct daily sustainable development management according to the established plans and measures;
Utilise the sustainable development management system for digital statistics of daily data, perform regular analysis, and report performance progress to the Board-level Sustainability Committee and the Management. The Sustainability Committee and Management review the related data periodically;
Provide sustainable development-related training for internal personnel to continuously enhance the sustainable development management capabilities at Yuexiu Property.

Check

Regularly review the alignment of Yuexiu Property’s sustainable development strategy with latest developments, trends and requirements;
Review the Company’s management policies at least every three years, and promptly revise and update them in response to changes in external conditions;
Conduct periodic reviews and inspections of internal sustainable development management systems, making revisions as necessary
Regularly assess sustainability performance to ensure sufficient progress towards the established targets;
Integrate sustainable development risks into the overall risk management system, utilising risk assessment tools such as risk matrices, scenario analysis, and stress testing to identify and evaluate the likelihood and impact of sustainable development risks across the entire value chain, considering both potential financial and non-financial impacts.