CHAIRMAN'S STATEMENT

In this decade of urgent action, CDL will continue to raise the bar for ESG integration and set new benchmarks for a greener, more inclusive world.

Dear Stakeholders,

2021 has been a year of recalibration. It saw us navigate the winds of change towards a “new normal” and accelerate towards a net zero world. In a year characterised by global economic, climate and social disruptions, the world has shifted its focus towards recovery and resilience.

The harsh reality is that climate change has not ceased during the COVID-19 pandemic and has continued to threaten humanity and our living environment. Extreme weather has already destroyed homes, businesses, and lives causing trillions of dollars in damages. Despite these, discussions at COP26 were heartening. Countries have agreed to review their plans to align with the Paris Agreement target of limiting global warming up to 1.5ºC compared to pre-industrial levels. The global climate summit also saw the unprecedented commitments to net zero goals and the pledging of trillions of dollars required to fund the transition towards a more sustainable future in the private sector. CDL is proud to be one of the companies which has committed to a zero-carbon future, through our World Green Building Council (WorldGBC) Net Zero Carbon Buildings Commitment made in February 2021.

As the world continues to adapt to the disruptions caused by COVID-19, transformation is key for corporates to transition towards a greener future. At CDL, sustainability has been integral to our business strategy for the past two decades. With the support of multiple stakeholders, we have achieved great progress. However, the deep urgency of climate change is imminent, and we must continue to do more.

Maintaining Operational Resilience

Amidst global uncertainties and challenges, CDL remains convicted to integrating Economic, Environmental, Social and Governance factors into our core business. This has enabled us to pre-empt and mitigate enterprise risk, contributing to the long-term success of our company.

Due to the prolonged impact of COVID-19, the road to recovery remains uneven. However, the accelerated vaccine deployment across the world and the gradual easing of border restrictions serves as light at the end of the tunnel. Despite these challenges, the Group has returned to profitability for 2H 2021 and FY2021. With hotel operations showing significant improvement, the hospitality sector’s rebound is imminent. The property development segment contributed almost half of the Group’s total revenue, propelled by strong performing Singapore projects such as Whistler Grand, Amber Park, The Tapestry and Irwell Hill Residences, as well as overseas projects, including Shenzhen Longgang Tusincere Tech Park, and contribution from New Zealand land sales.

With the tightened social and workplace measures over the past two years, our global tenants remain significantly impacted. Since the beginning of the pandemic in 2020, we have provided over $40 million in property tax and rental rebates, operational and marketing support to our tenants to help them navigate through these challenging times. Millennium & Copthorne Hotels Limited (M&C), our hospitality arm, also rolled out support programmes to frontline healthcare workers and displaced guests.

In spite of the global pandemic and the resurgence of infections, the Group will continue to forge ahead with resilience and agility, accelerating our creation of innovative and green solutions. Our strong focus on capital recycling and our prudent corporate strategy continue to put us in good stead to emerge stronger.

Building Climate Resilience

While the world races towards its net zero goals, Singapore has been steadfast in its commitment. In her national statement at COP26, Minister for Sustainability and the Environment, Ms Grace Fu, highlighted the Singapore Green Plan 2030 as a nationwide movement to fight climate change, emphasising Singapore’s resolve to contribute to international climate action. In February 2022, the government cemented these commitments, announcing that Singapore would raise its ambition to achieve net zero emissions by or around 2050. There are also plans in the pipeline to progressively increase carbon tax from 2024 to 2030, to help achieve these goals.

Singapore further demonstrated this commitment by strengthening the regulatory requirements for reporting disclosures. In August 2021, the Singapore Exchange Regulation proposed a roadmap for climate-related disclosures to be mandated for listed companies in Singapore, and for greater efforts to enhance board diversity. This is amid “urgent demand for such information from lenders, investors, and other key stakeholders”, demonstrating clear stakeholder demand for relevant, comparable, and consistent disclosures from companies.

With COVID-19 being a “wake-up call” for decision makers to prioritise a more sustainable approach to investment, ESG has now become a competitive advantage for companies. Leading asset managers BlackRock1 and Morgan Stanley2 have published data that sustainable funds have outperformed their non-ESG peers, and Bloomberg reported that ESG assets may hit US$53 trillion by 2025, which is more than a third of projected global AUM.3

Our Leadership Commitment to a Net Zero Future

It is our long-standing belief that sustainability is a journey, and one that we are proud to have begun since 1995. At this critical juncture in history, we recognise that corporates play a crucial role in helping the world achieve its net zero goals.

CDL’s recognition in multiple ESG indices and awards is a testament to the dedication of our management team and staff. In 2021, we are honoured to remain listed on 13 global ratings, rankings and indices. We have maintained double ‘A’s in the 2021 CDP Global A List for corporate climate action and water security and are the only company in Southeast Asia and Hong Kong to score ‘A’ for corporate climate action for four consecutive years.

With our management’s unwavering support and tireless dedication in driving corporate sustainability, we have ranked 5th on the Corporate Knights 2022 Global 100 Most Sustainable Corporations in the World and emerged as the top real estate management and development company globally. This marks our best performance since 2010.

Pressing Onward

As the saying goes, the only constant in life is change. While the pandemic has brought disruptions and challenges, we have chosen to turn these into opportunities for innovation and collaboration. Decarbonisation and creating positive impact that is aligned with the UN SDGs will remain a key focus for our business.

With effect from 1 January 2022, Mr Philip Yeo has stepped down as a Board Sustainability Committee (BSC) member. On behalf of the Board, we thank him for his stewardship and strategic guidance in contributing to CDL’s sustainability leadership. Effective on the same date, we also welcomed two new BSC members – Mrs Wong Ai Ai and Mr Chong Yoon Chou, who will help raise our climate governance.

The Board continues to support management’s unwavering commitment to green buildings and setting ambitious targets and strategies under the CDL Future Value 2030 Sustainability Blueprint, with a desire to move the needle in the race to net zero. In this decade of urgent action, CDL will continue to raise the bar for ESG integration and set new benchmarks for a greener, more sustainable world.

Kwek Leng Beng
Executive Chairman

1 Sustainable investing is the future. iShares by BlackRock.
2 Sustainable investing during coronavirus. Morgan Stanley, 24 February 2021.
3 ESG assets may hit US$53 trillion by 2025, a third of global AUM. Bloomberg Professional Services, 23 February 2021.