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Charter Hall Group

PRI reporting framework 2019

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Pre-investment (selection)

PR 04. Incorporating ESG issues when selecting investments

04.1. Indicate if your organisation typically incorporates ESG issues when selecting property investments.

04.2. Provide a description of your organisation's approach to incorporating ESG issues in property investment selection.

Charter Hall's property investment selection process undertakes a due diligence process which outlines and considers ESG issues. This process identifies and considers the sustainability credentials of the property, as well as opportunities to enhance the credentials of the property. The process also involves specialist consultants to identify and consider other ESG factors such as:

  • Geographic location - access to markets, transportation and infrastructure, accessibility for building occupants, suppliers and customers, location of major physical features such as water courses and natural hazards.
  • Market and economic development trends
  • Environmental issues (including contamination, flooding and other climate related risks, materials assessment, indoor environmental quality, water efficiency, energy efficiency/supply).  All our buildings are reviewed for flood risk (1 in 100 flood event), as well as the condition and age of HVAC to ensure that tenant comfort is maintained during extended days of extreme heat.
  • Climate change risk analysis - assessing relevant climate risks (extreme storm, bushfire, extreme heat and sea level rise) and determine if the building is capable of withstanding potential climate change impact, depending on its location.
  • Building performance (environmental ratings such as NABERS, Green Star, WELL etc which inform GHG emissions),
  • Services and building operations - such as water and energy supply and efficiencies, waste management,
  • Workplace health and safety compliance
  • Hazardous material compliance
  • Building structure, materials and hazardous materials inspections identify compliance with industry codes and certifications.
  • Planning and compliance factors in relation to Federal, State and Local Government regulations such as the Disability Discrimination Act (DDA).
  • Building ratings against the Property Council of Australia Guide to Office Building Quality.

All due diligence considerations are undertaken in accordance with the Charter Hall Corporate Governance policies, which are publicly disclosed on our website https://www.charterhall.com.au/About-Us/Corporate-Governance/

Investment selection analysis includes financial risks of tenant and sector.

04.3. Indicate which E, S and/or G issues are typically considered by your organisation in the property investment selection process, and list up to three examples per issue.

Environmental example 1, description

          Information and analysis on Climate change related risks, energy efficiency/supply and water efficiency are sought for new acquisitions.  Climate change risk analysis includes assessing relevant climate risks (extreme storm, bushfire, extreme heat and sea level rise) and determine if the building is capable of withstanding potential climate change impact, depending on its location.  Energy and water efficiency analysis considers building performance (environmental ratings such as NABERS, Green Star, WELL etc which inform GHG emissions),
        

Environmental example 2, description

          Energy efficiency ratings/certification (such as NABERS), energy audits, visibility of consumption through sub-metering and/or analytics systems, consideration of age of plant and equipment, energy efficiency attributes of energy intensive systems such as HVAC and lighting systems.
Energy supply considerations are also sought for new acquisitions.
        

Environmental example 3, description

          Contaminated land assessments are sought for new acquisitions.
        

Social example 1, description [OPTIONAL]

          Location and transportation considerations for tenants are considered in property acquisitions, which determines the desirability of the building for current and future occupants in terms of ease of access to various forms of transport, accessibility for their operations as well as for our tenant's customers.
        

Social example 2, description [OPTIONAL]

          Health, Safety and Wellbeing considerations are identified in our due diligence procedures for building acquisitions, including hazardous material assessment, fire and OHS compliance, to ensure health and wellbeing of occupants and reduced risk for Charter Hall.
        

Social example 3, description [OPTIONAL]

          Charter Hall requires due diligence reports prepared on building safety compliance and material compliance.
        

Governance example 1, description

          Charter Hall due diligence considerations review all relevant regulatory and legislative requirements associated with the asset and governance.
        

Governance example 2, description

          Charter Hall due diligence considerations review Governance issues such as legal, property management, zoning and planning, building environmental ratings and certifications.
        

Governance example 3, description

          Charter Hall due diligence is undertaken in accordance with our Corporate Governance policies including the Charter Hall Anti-Bribery, Fraud and Corruption Risk Management Policy, which is publicly disclosed on our website https://www.charterhall.com.au/About-Us/Corporate-Governance/
        

04.4. Additional information. [Optional]


PR 05. Types of ESG information considered in investment selection (Private)


PR 06. ESG issues impact in selection process

06.1. Indicate if ESG issues impacted your property investment selection process during the reporting year.

06.2. Indicate how ESG issues impacted your property investment deal structuring processes during the reporting year.

06.3. Additional information.

Charter Hall partners with many investment groups who identify ESG requirements associated with their investment, which align with their corporate ESG approach. 

Investors in our funds have reviewed fund ESG ratings and influenced the fund's approach to asset selection (such as seeking assets with high green star or NABERS ratings or seeking higher GRESB ratings).

All large Charter Hall developments seek a Green Star Design and As Built ratings, which are identified to attract tenants to commit to longer term lease agreements.

 


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