CDL’s Climate Transition Plan

CDL Group’s Climate Transition Plan sets out our strategic ambition to integrate sustainability into our business model and value chain. The plan comprises the five elements: Foundations, Governance, Engagement Strategy, Implementation Strategy, Metrics and Targets, and details the Group’s efforts towards a net-zero, 1.5°C pathway and restoration of natural ecosystems. It is also aligned with Glasgow Financial Alliance for Net Zero (GFANZ) and the Transition Plan Taskforce’s (TPT) frameworks.

Foundations and Strategic Ambition

For three decades, we have remained committed to and guided by our ethos of ‘Conserving as We Construct’ established in 1995. It has guided our management to pioneer climate action towards mitigating climate risks, meeting rising investor expectations and harnessing new growth opportunities by capacity building and capital mobilisation. Our goal is to create long-term value for our business, stakeholders and the environment.

Assumptions and disclaimers: Our Climate Transition Plan and its content featured in this report may include statements with respect to future events, trends, plans, expectations, or objectives relating to the Group’s business, financial condition, results of operations, performance and strategy. This is in regard to climate objectives and other goals set forth herein. This forward-looking content is produced based on current circumstances both at a global and local level, such as alignment with Singapore’s Green Plan 2030 and BCA’s Green Mark Certification Scheme and currently available information, including but not limited to the current actions, policies and plans undertaken by governments and other stakeholders, and may be subject to change.

CDL’s Implementation Strategy
CDL Group’s transition plan is underpinned by strong governance and concrete action involving our ecosystem of stakeholders. Our implementation strategy strives towards deriving financial impact that leads to the achievement of targets set for sustained action towards a net-zero future. We are guided by clear goals and targets and supported by robust data collected across our value chain. Implementation is categorised across six main categories: Green Buildings and Energy Efficiency, Internal Carbon Pricing, Renewable Energy, Carbon Offsets, Scope 3 Emissions and Supply Chain, and Physical Risk and Nature-Positive Action.

To ensure accuracy and reliability of our performance and progress towards our targets, we carry out annual external assurance and verification of our emissions data in accordance with global standards such as GHG Protocol and ISO 14064. Going forward, we are also exploring enhanced data management systems to build more robust data consolidation, analytics and accuracy.

Green Buildings and Energy Efficiency
CDL Group has numerous award-winning green buildings with best-in-class energy management (ISO 50001), including a portfolio of 129 BCA Green Mark Certifications for our developments, making us one of Singapore’s leading developers with the most BCA Green Mark Platinum awards since 2005. In 2024, we achieved five BCA Green Mark Platinum SLE awards for City House, Palais Renaissance, The Orie, Norwood Grand and Union Square Residences. We also attained one Green Mark Platinum award for City Serviced Offices at Republic Plaza, 9th floor and two Green Mark Gold Plus awards for City Serviced Offices located in South Beach and Republic Plaza, 58th floor. Our key subsidiary, M&C, is greening our hotels in Asia, Europe, US, Middle East and New Zealand, and plans are underway to reduce energy usage. As at end 2024, 17 UK-based hotels have also achieved Green Tourism eco-labels by the Global Sustainable Tourism Council. To attain improved energy efficiency, the Group has deployed measures such as upgrading chiller plants, introducing motion sensors and installing energy-efficient lighting across our developments. We have also incorporated climate-resilient designs and piloted solutions such as more advanced AHUs with an electronically commutated (EC) fan, chiller plant optimisation and micro-climate control to reduce heat gain and improve energy efficiency.

Internal Carbon Pricing, Renewable Energy and Carbon Offsets
Increasing renewable energy use is integral. In 2024, the Company installed solar panels on five of our commercial assets in Singapore to maximise solar harvesting, as we continue to strive to deploy photovoltaic panels at our assets and participate in the renewable energy certificate (REC) marketplace to reduce hard-to-abate, residual emissions. Carbon pricing plays an important role by pricing in the external cost of carbon to quantify and manage the true costs of carbon emissions during decision-making processes. CDL Group completed an ICP pilot study on Republic Plaza in 2024. In 2025, CDL will explore meaningful opportunities to test and validate the use of ICP to drive awareness of the cost of carbon and allow us to better weigh environmental impact together with financial considerations as part of decision-making processes. Given the renewable energy constraints in Singapore and recent developments in carbon markets as part of Article 6 negotiations at COP29 in Baku, the Group is also reviewing our renewable energy and carbon offset strategies. This includes considering deployment of renewable energy assets to better manage the financial impact of decarbonisation and to generate opportunities.

Scope 3 Emissions and Supply Chain
Beyond Scope 1 and 2 emissions, the Group has set SBTi targets to reduce our Scope 3 emissions. In 2023, we completed a Whole Life Carbon Assessment (WLCA) in Singapore to understand and reduce the carbon footprint across different stages of our life cycle. We are now in the process of developing sustainable material specifications in our development projects. In 2024, we also embarked on our CDL SME Supplier Decarbonisation Queen Bee Programme to engage our suppliers and help them build capacity to report and manage their carbon emissions. Over the years, we have also reached out to tenants under our Green Lease Programme, and more recently, our City Green Tenant Bonus (CGTB) Programme, to raise sustainability awareness and promote green practices. Since 2014, we have encouraged our tenants to adopt energy conservation measures and continue to maintain a 100% participation rate for green leases.

Physical Risk and Nature-Positive Action
To provide a better assessment of transition and physical risks affecting our buildings, we are on track to completing our 4th climate change scenario analysis in alignment with TCFD recommendations, to better understand the financial implications of climate change. Our 4th climate change scenario analysis is in alignment with IPCC’s 1.5°C, SSP 1.9 and SSP 8.5 pathways, over time horizons up to the year 2050. Due to the intricate interconnections between climate and nature, in 2024, the Group also adopted the TNFD Recommendations to drive nature-positivity alongside climate action.

Engagement Strategy
CDL Group is committed to engaging and influencing our ecosystem of stakeholders, including our Board, senior management, staff, investors, banks, regulators, builders, suppliers, customers and the wider community, to adopt more sustainable and innovative practices. We conduct an annual materiality assessment to provide an inside-out and outside-in perspective of our financial and sustainability impacts on our stakeholders and our business. Climate transition and physical risks feature in the highly critical category year-on-year and reflect the importance of climate issues to our organisation.

The annual Hong Leong and CDL Group Sustainability Forum, organised since 2014, has kept the Group’s directors and senior representatives abreast of the latest trends and best practices through sharing from distinguished experts in the industry and academia. We also actively build a green culture amongst employees, and enhance green skills through sustainability-related training and monthly e-newsletters.

Leveraging our sphere of influence amongst stakeholders, we also engage the wider sustainability ecosystem, key policymakers and real estate sector to empower them, and lead change towards the Singapore Green Plan 2030 and global climate goals. As at 31 December 2024, the SSA has hosted over 1,200 sustainability-related training programmes and advocacy events, attracting over 43,100 attendees. To drive innovation in the industry, CDL also pursues research with Institutes of Higher Learning to explore reduction of embodied carbon, electrification of local fleets with EV chargers, carbon capture and Building-Integrated Photovoltaics (BIPV).

Metrics and Targets
In line with Singapore’s net-zero emissions goal by 2050, the Group has made the following commitments to the WorldGBC Net Zero Carbon Commitment for new developments and 13 Singapore assets:

  1. To achieve net-zero carbon with whole life carbon approach for wholly-owned and directly managed buildings in Singapore by 2030.
  2. To achieve maximum reduction of embodied carbon in new developments, compensating for any remaining residual operational and upfront embodied emissions via offsetting for new developments by 2030 and for all buildings to be net-zero carbon by 2050.

We have also raised ambitions to reduce Scope 1 and 2 carbon emissions intensity by 63% and reduce Scope 3 GHG emissions intensity from purchased goods and services by 41% and from investments by 58.8% by 2030, from a baseline year of 2016, as validated by the SBTi.

As part of performance and emissions tracking under our Future Value 2030 Sustainability Blueprint, in 2024, the Group attained a 25% reduction in Scope 1 and 2 operational carbon emissions for assets under direct management and operational control from 2016 levels, and 38% reduction in Scope 3 embodied carbon in new developments compared with a 2016 baseline. We have also achieved Scope 3 investment intensity reductions of 52.1%. Going forward, we are planning to review and update our SBTi targets in line with the latest developments.

Governance
The Group takes a whole-institution approach in the integration of our transition plan into our overall business strategy and operations, vertically across all levels and horizontally across business units. Our Board and leadership, comprising senior management, are committed to strategically integrating climate transition elements across key aspects of our business. In 2015, we published the CDL Climate Change Policy to guide all stakeholders in the transition to a low-carbon future. In 2023, we also updated our biodiversity policy, which includes no deforestation commitments in line with safeguarding forests as natural carbon sinks. Since 2016, our BSC oversees our sustainability strategy and is apprised of initiatives to address climate-related risks and opportunities, including target setting, tracking and reporting, as well as CDL Group’s transition plan. More information on our sustainability governance structure can be found on page 17 of the CDL ISR 2025. Climate-related risks and opportunities are fully integrated into the Group’s strategic risk management framework. More information can be found in pages 33-43 of the Risk Management section of the CDL Annual Report 2024.

In October 2023, the Group also set up the Net-Zero Committee to identify decarbonisation strategies and opportunities, as well as to set, strengthen, review, and align our business units’ net-zero key performance indicators. Collaboration and action will be essential in charting a more sustainable trajectory towards a 1.5°C future.

Looking ahead, the Transition Plan Taskforce’s principles of “Ambition, Action and Accountability” will guide us to transform our business and operations towards a low-carbon, sustainable and nature-positive model.