STRATEGIC MANAGEMENT OF MATERIAL ESG ISSUES

Materiality Assessment

Materiality is any factor that can have a present or future impact on CDL’s value creation, and hence our business performance over time. Balancing internal and external viewpoints is therefore critical in defining and managing ESG issues that are of significant relevance to our business and stakeholders.

Since 2014, we have engaged our stakeholders through materiality assessments to prioritise and respond to issues that arise from the dynamicity of our working environment.

In 2019, we undertook our third comprehensive biennial materiality study. Conducted by an independent external consultant, it helped us to identify key issues that impact our ability to create value for our stakeholders.

We first conducted an extensive horizon scanning exercise to determine the list of material risks and opportunities. Next, over 600 online surveys were sent out to key stakeholders and face-to-face interviews were conducted with strategic stakeholders to gain insights. Besides prioritising CDL’s material ESG issues according to their needs, our stakeholders provided different perspectives on how they viewed CDL’s ESG performance. At the validation workshop with CDL’s Senior Management, the material issues were assessed based on the following.

• Disruptive capacity (potential impact on CDL’s business);
• Proximity (period¹ over which the material issue will likely have an effect); and
• Adaptive capacity (CDL’s current preparedness to manage each material topic)

Overall, the 2019 list of material issues is broadly similar to the results of the 2017 materiality study, with sustainable finance and waste management emerging as new material issues. The study also highlighted several material issues with notable increase in concern by internal and external stakeholders. This feedback will help us to evaluate and improve on our sustainability practices and disclosure to align with our stakeholders’ expectations.