At PRIME, we strive to ensure that our business operations are characterised by sustainable practices. We are committed to delivering sustainable value to our stakeholders, and to achieve this goal, we believe that high standards of corporate governance and responsible management of our environmental and social impacts are necessary.
To facilitate the integration of sustainable practices into PRIME's business operations, sustainability is a collaborative responsibility that is shared across all functions. The management team takes charge of developing and improving PRIME's sustainability strategy, whereas the property managers are responsible for executing, monitoring, and implementing the policies and practices.
The Board of Directors ultimately takes ownership of PRIME's sustainability strategy, providing guidance on the strategic direction of PRIME and ensuring that Management discharges its responsibilities. This ensures that the vision of sustainability is seamlessly integrated into the highest level of decisionmaking at PRIME, and its significance is effectively communicated throughout the entire value chain. The Board of Directors undertakes a crucial role in directing the discussion on material topics, and guiding management on areas of focus.
The Audit and Risk Committee ("ARC") is responsible for supervising PRIME's sustainability blueprint, covering material topics, initiatives, strategies, and objectives. The ARC - which works with the Management team to establish and assess sustainability targets and review management policies and practices - is also responsible for reporting on the progress made towards sustainability objectives and strategies to the Board. After the Board reviews and approves them, the Management team maintains frequent communication with PRIME's stakeholders to gain a comprehensive understanding of the ESG topics that are significant and material to both PRIME and its stakeholders. While the Management team is responsible for developing and refining PRIME's sustainability strategy, the property managers play a crucial role in implementing, executing, and monitoring sustainability practices and policies, and progress made will be reported to the Board during Board meetings.
The primary avenue of visibility for the ARC into sustainability risks will be through the Climate Risk Register, which was recently approved by the Board in February 2023. The register will be reviewed quarterly by the ARC to enable the necessary oversight over Management of identified climate-specific risks. The register will be populated through upcoming climate risk assessments and scenario analysis led by our property manager. As this is the first year of formalising the management of sustainability risks, description of longer-term targets will be disclosed in subsequent years' reports.
Lincoln Property Company - A Strategic Resource
During FY2022, PRIME announced the consolidation of property management for all 14 of its properties to Lincoln Property Company ("LPC"). The consolidation exemplifies PRIME's dedication to place a more concentrated emphasis on ESG and technology solutions across our portfolio, which are fundamental to PRIME's operating agenda.
LPC as the Property Manager strives to provide tenants with healthy and efficient properties throughout PRIME's portfolio, while also promoting the implementation of best-in-class, holistic ESG and technology practices that offer measurable, datadriven solutions. During FY2022, LPC led an initiative to conduct an ESG diagnostics exercise for each of PRIME's properties, which resulted in a summary of ESG Budget Recommendations for the upcoming fiscal year 2023.
As a result, PRIME has created a comprehensive 2023 ESG Budget Plan, which outlines operating initiatives on both a portfolio-wide and property-by-property basis, tenant engagement and community outreach initiatives, as well as capital initiatives on an asset-byasset basis. To ensure the successful implementation of these initiatives and the achievement of our targets, the Management, along with LPC and our asset management teams, will continuously monitor their execution throughout 2023.
Stakeholder Engagement and Materiality
Intending to achieve our commitment to sustainable economic growth and long-term value for our stakeholders, PRIME recognises the fundamental role of effective communication and engagement with its stakeholders. To this end, PRIME has established a foundation for the integration of sustainability into our business strategy and operations. This includes the implementation of measures that ensure that PRIME's activities align with its sustainability objectives.
Going forward, PRIME will continue to build strong and meaningful long-term relationships with its stakeholders while driving ESG value creation. A significant part of this effort will involve gathering valuable stakeholder feedback through consistent two-way communication on materiality concerns, to further enhance PRIME's sustainability approach.
For more information, please refer to page 93-95 of PRIME's 2022 Annual Report.