Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance
• Socio-economic development
• Enterprise and supplier development

Environmental Achievements

• General decrease in electricity consumption across most units
• Achieved zero fatalities group-wide
• Maintained our Level 1 B-BBEE for the third year in a row
• 7 495 585 WASTE kg (2018: 6 863 382)
• 4 510 042 WATER CONSUMPTION kl (2018: 4 515 725)
• 231 403 213 ENERGY CONSUMPTION kWh (2018: 249 911 965)

Social Achievements

• Implemented 25 SED projects that incorporated either environmental or health and safety or both aspects
• Launched our first internal online sustainability e-learning programme for employees
• R56.7 million invested in E&SD, which benefited various beneficiaries from within our local communities
• Supported 15 beneficiaries through formal business development support in line with the requirements of our E&SD programme
• Sun International exceeded its 45% target for preferential procurement spend; the revised 2020 goal is to reach and maintain 60% spend
• MVG sign ups grew by 5.2%
• Achieved a customer satisfaction target rating of 80% at most properties
• 56.1% female representation across our South African operations (95.3% of whom are black females) and 51.9% for the group
• Achieved 93.2% black employment in our South African operations
• Zero fatalities group-wide

Governance Achievements

• Further progress was made in integrating and aligning Latam’s and the rest of Africa’s governance frameworks with our South African operations
• Maintained its B-BBEE Level 1 rating for the third consecutive year
• At year end the board achieved 57% black representation, exceeding its 50% target but narrowly missing its female target of 30%, with an actual 29% female representation

Climate Goals & Targets

Environmental Challenges

• Uncertainty around the coronavirus impact on operations
• Social unrest in Chile
• Sun City’s operational challenges
• Tough revenue growth in the current economic climate
• Weak economic conditions
• Erosion of market share due to Electronic Bingo Terminal (EBTs) and Limited Pay-out Machines (LPMs) in catchment areas
• Increase in gaming taxes and levies
• Non-renewal or significant cost of SCJ licences renewal
• Increased demands from stakeholders (communities and local suppliers)
• Loss of GrandWest Casino licence exclusivity
• Ongoing changes in licence conditions
• Civil protests and riots
• Illegal gambling

Mitigation Strategies

• Revised central office operating model will yield positive strategic outcomes – reducing debt, supporting operational excellence and encouraging a renewed focus on the customer
• Continued to reduce group debt levels
• Implemented a simplified central-office and group-operational structure, with a renewed focus on our customer segments
• Ongoing property refurbishments
• Investing in quality assets when opportunities present as well as deal with loss making units
• Driving operational efficiencies, optimisation and quality of earnings as well as accelerating our balance sheet de-gearing
• Geographic and alternative gaming diversification
• Improving efficiencies
• Prudently managing debt levels
• Continuous refurbishments of properties to attract and retain customers
• Strong cash flows
• Submitted comments on the proposed South African legislation
• Lobbying and engaging with CASA, the gaming boards, trade unions and other companies who have similar concerns regarding this legislation
• Working in conjunction with the gaming industry in Latam to monitor proposed legislation and impact on Sun Dreams
• Rolling out alternative non-tobacco products at certain South African operations
• Increasing smoking decks at our Latam operations
• Monitoring CASA’s progress in challenging the increase on grounds of a procedural and fairness basis
• Lobbying and challenging proposed gaming tax legislation
• The gaming industry in Peru has launched a legal challenge against this proposed tax and Sun Dreams is obtaining legal advice on this proposed law
• Ongoing focus on improving operational and resource efficiencies as well as cost containment across the group
• Reducing group debt levels as well as refinancing and hedging debt
• Focusing on customer service and value offerings
• Focusing on repairs and maintenance while optimising capital expenditure
• Improving investor relationships through regular and proactive engagement
• Restructuring the central office in South Africa
• A formal community engagement management plan is in place including stakeholder engagement forums as well as a dedicated SED and community engagement specialist, to improve community dialogue and to identify community needs
• Ongoing communication with interested stakeholder groupings
• Focusing on local B-BBEE procurement, enterprise development and SED within communities surrounding group operations
• Monitoring SCJ casino law changes with the regulators and legislative bodies
• Motivating for SCJ licence extensions
• Limiting capital expenditure until renewal certainty
• Collaborating with the Chilean casino association to modify casino law and recover the group’s investment
• Negotiating licence conditions with various gambling boards
• Proactively improving relationships with gambling boards
• Maintaining or improving current B-BBEE levels in South Africa
• Continuing to invest in local and affected communities
• Continuing to review and challenge the proposed legislation
• Ongoing lobbying with government to discuss and consider proposal for exclusivity
• Extensive engagement with media, local municipalities and other interested stakeholders informing them of the risks of relocation in respect of revenue declines and potential job losses
• Providing authorities with intelligence around illegal gaming and casino outlets
• Lobbying gaming boards for support from law enforcement agencies
• Proactive employee engagement to determine matters of concern they face in their communities
• Ensuring business contingency plans including insurance as well as access to properties and loss of customer attraction and retention

Supply Chain Management

Responsible Procurement

• Supplier code of conduct
• B-BBEE compliant suppliers

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: IIRC framework, JSE Limited Listings Requirements, South African Companies Act, 71 of 2008, International Financial Reporting Standards (IFRS), GRI Standards, King IV™, United Nations Sustainable Development Goals (SDGs)

Certifications: ISO 14001:2015, ISO 45001:2018

Third-party Assurance: PricewaterhouseCoopers Inc. and IBIS ESG Assurance

UN Sustainable Development Goals

• Goal 4
• Goal 6
• Goal 8
• Goal 3
• Goal 5
• Goal 12

These SDGs align with the group’s strategy. Progress against these SDGs will be regularly monitored by relevant board and management governance committees and reported on internally and externally.

Awards & Recognition

• Award from the Community of Human Resources Officers under the category ‘Celebrating Excellence in Human Resources’

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• 10 of 14 properties implemented water metering in 2021
• Boardwalk achieved 97% diversion of waste from landfill through recycling and waste beneficiation
• Carnival City, Flamingo, and Central Office achieved 2021 milestone recycling targets
• Eliminated the use of palm oil by 2021 and plastic straws by 2022 (partial achievement)

Social Achievements

• Launched the SunStars employee recognition and reward program
• Implemented a new gaming floor management program and updated the learning catalogue to include more online programs
• Invested R14 million in Socio-Economic Development (SED) and R13.1 million in Corporate Social Investment (CSI)
• Achieved 8.6% employee turnover rate in South Africa (lowest in several years)

Governance Achievements

• Established anti-corruption training for all employees (implied)
• Implemented a new privacy policy and information office operating mandate
• Exceeded black and female diversity targets on the board

Climate Goals & Targets

Environmental Challenges

• Covid-19 pandemic impacts on operations and revenue
• Weak economic conditions in South Africa
• Political and civil unrest
• Increased gaming taxes and levies
• Smoking legislation
• Recovery of the hospitality and tourism industry
• Increased demands from stakeholders
• Erosion of market share due to other forms of gambling
• Loss of GrandWest casino licence exclusivity
• Cyber threats and information security
• Data limitations or exclusions in waste data

Mitigation Strategies

• Implemented Covid-19 protocols, vaccination strategy, and cost containment measures
• Focused on improving customer experience, operational efficiencies, and cost containment
• Strengthened balance sheet and improved liquidity position
• Reviewed security arrangements and business interruption plans
• Reviewed SASRIA insurance cover and engaged with security companies
• Submitted comments on the proposed Tobacco Bill and engaged with CASA
• Integrated into the Global Hotel Alliance and focused on domestic leisure revenues
• Implemented a formal community engagement management plan
• Continued to support local B-BBEE procurement and enterprise development
• Engaged with a financial institution to block bank accounts of persons participating in illegal gambling
• Participated in the National Illegal Gambling Enforcement Forum
• Leveraged developments in the online sports betting business
• Proactively engaged with the Western Cape Premier and national government
• Established a security training and awareness communication strategy
• Enhanced remote working security protocols and security monitoring tools
• Developed a zero-waste-to-landfill (ZWTL) self-assessment toolkit

Supply Chain Management

Responsible Procurement

• Preferential procurement from B-BBEE compliant suppliers
• Supplier registration database and online tender notice board
• Supplier code of conduct

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards, King IV™, UN Sustainable Development Goals (SDGs), TCFD (implied)

Third-party Assurance: Integrated Reporting and Assurance Services (IRAS)

UN Sustainable Development Goals

• SDG 2 (Zero Hunger)
• SDG 3 (Good Health and Well-being)
• SDG 4 (Quality Education)
• SDG 6 (Clean Water and Sanitation)
• SDG 12 (Responsible Consumption and Production)

Initiatives align with these SDGs through various programs and projects.

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Boardwalk completed installation of a reverse osmosis plant, pending water use license approval, to supply potable water to hotel and casino.
• Improved 2022 recycling rate to 68% vs 2021 rate of 58%.

Social Achievements

• Invested R27.6 million in Socio-Economic Development (SED) and R5.3 million in CSI in-kind donations.
• Launched Sun Stars reward and recognition program.
• No fatalities reported for the year.
• 93.9% black employee representation in South African operations.

Governance Achievements

• Concluded a R2.4 billion sustainability-linked loan, the first in the South African hospitality sector.
• IRAS rated Sun International the best ESG reporting company in the travel and leisure industry.

Climate Goals & Targets

Environmental Challenges

• Weak economic conditions.
• Utility supply and efficiencies (loadshedding).
• Political and civil unrest.
• Cyber threats and information security.
• Increased community needs due to Covid-19.
• Slow pace of LPM industry rollout.
• Increased employee turnover due to emigration and economic pressures.
• Limited tendering and procurement opportunities for black women-owned businesses.
• Maintaining B-BBEE levels.
• Data limitations and inconsistencies in waste data from suppliers.

Mitigation Strategies

• Sustainability linked loan to promote key sustainability performance targets.
• Investing in green energy solutions and alternative water sources.
• Preferential procurement, SED, and CSI programs.
• Employee development, health and wellness programs, and competitive remuneration.
• Developing a zero-waste-to-landfill (ZWTL) self-assessment toolkit.
• Implementing water metering across properties.
• Succession and talent management programs.
• Reviewing procurement processes and inviting black women-owned businesses to stakeholder engagement sessions.
• Implementing a new B-BBEE system to improve information accuracy and monitoring.
• Engaging with suppliers to improve data accuracy and consistency.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Code of conduct; supplier sustainability requirements; preferential procurement for B-BBEE compliant SMMEs.

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather

Transition Risks

• Regulatory changes, market shifts

Opportunities

• Development of energy-efficient products and services; renewable energy projects.

Reporting Standards

Frameworks Used: GRI Standards, JSE Sustainability Disclosure Guidance, TCFD (aiming to report according to TCFD)

Certifications: Null

Third-party Assurance: IBIS Consulting

UN Sustainable Development Goals

• SDG 2
• SDG 3
• SDG 4
• SDG 6
• SDG 7
• SDG 8
• SDG 12
• SDG 13

Initiatives align with SDGs through education, health and wellness, water conservation, renewable energy, decent work, responsible consumption and production, and climate action.

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Sun International Sustainability Excellence award (Boardwalk)

Environmental Metrics

ESG Focus Areas

• Broad-Based Black Economic Empowerment (BBBEE)
• Water usage reduction
• Waste recycling rates
• Carbon emissions reduction (Scope 1 and Scope 2)
• Renewable energy generation

Environmental Achievements

• 18% reduction in carbon emissions against a 2017 baseline
• 12% reduction in water withdrawals against a 2019 baseline
• 16% reduction in electricity consumption against a 2019 baseline
• 1% transition of total electricity to renewable energy (Sun City project online in August 2023)

Social Achievements

• Sun Stars employee reward and recognition program
• Significant progress in addressing equal pay for work of equal value
• No permanent employees paid below a living wage
• Concluded the first sustainability-linked loan for the hospitality industry in South Africa

Governance Achievements

• Reviewed and amended short-term and long-term incentive plans
• Improved Remuneration Policy based on shareholder feedback
• Independent evaluation of the Remuneration Committee
• Maintained Level 1 BBBEE contributor rating

Climate Goals & Targets

Environmental Challenges

• Negative impact of the South African economy on consumer spending
• Supply chain disruptions
• Loadshedding
• High inflation
• Addressing potential discriminatory pay practices

Mitigation Strategies

• Implementing variable pay structures
• Addressing equal pay for work of equal value
• Focusing on a living wage
• Addressing pay gap disparities
• Implementing ESG KPIs in senior management STIs
• Sustainability-linked loan

Supply Chain Management

Responsible Procurement

• Increasing procurement spend with businesses which are at least 30% or more Black Woman Owned

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: King IV™

Awards & Recognition

• Finalist for the Best Remuneration Report for 2023 (The South African Reward Association)