Climate Change Data

Sonae Sierra SGPS, S.A.

Climate Impact & Sustainability Data (2019, 2023)

Reporting Period: 2019

Environmental Metrics

Total Carbon Emissions:20,560 tCO2e (2019)
Scope 1 Emissions:9,377 tCO2e (2019)
Scope 2 Emissions:11,183 tCO2e (2019)
Scope 3 Emissions:478,860 tCO2e (2019)
Renewable Energy Share:79% (2019)
Waste Generated:26,046.45 tons (2019)
Carbon Intensity:19.1 kgCO2e/sq.m GLA (2019)

ESG Focus Areas

  • Climate Change
  • Circular Economy
  • Workforce Diversity and Wellbeing

Environmental Achievements

  • Avoided over €15.1 million in costs in 2020 from eco-efficiency improvements in energy, water and waste introduced since 2002.
  • Consistently improved environmental performance since 2005, with an 84% cumulative reduction in carbon intensity.

Social Achievements

  • Formation of the Sierra Academy, a training platform.
  • Development of several initiatives to improve employee wellbeing and promote resilience as part of ‘Project Be Well’.

Governance Achievements

  • Established a Sustainability-Linked Financing Framework aligned with ICMA SLBP 2020 and LMA SLLP 2021 principles.

Climate Goals & Targets

Long-term Goals:
  • Carbon neutrality by 2040.
  • Adapting operations to a Circular Economy.
Medium-term Goals:
  • Increase Waste Recycling Rate to a minimum of 78% by 2025.
Short-term Goals:
  • Reduce GHG (Scope 1 + 2) Emissions intensity to a maximum of 16.8 kgCO2e / sq. m GLA by 2025 (minimum 12% reduction vs. 2019 Baseline).

Environmental Challenges

  • Partners in investment properties needing to share the decarbonization vision.
  • Financial constraints from events like the COVID-19 pandemic.
  • Sharp increase in green electricity price.
  • Proper waste management requiring intensive human resources and depending on people's behavior.
  • Dependence on local disposal systems for recyclable and organic waste.
Mitigation Strategies
  • Renovation Strategy of buildings portfolio (€34 million investment) including new lighting, heating/cooling systems, and increased insulation.
  • Investment in photovoltaic panels for renewable energy.
  • Continued green electricity procurement (aiming for 96% in 2025).
  • Intensive human resource allocation for waste management.
  • Measures to improve waste segregation and increase awareness/training.

Supply Chain Management

Responsible Procurement
  • Green electricity procurement.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: ICMA Sustainability-Linked Bond Principles 2020, LMA Sustainability-Linked Loan Principles 2021

Third-party Assurance: KPMG Advisory - Consultores de Gestão, SA (Second Party Opinion); Deloitte (limited assurance for 2019 data)

UN Sustainable Development Goals

  • SDG 13: Climate Action
  • SDG 12: Responsible Consumption and Production

Sonae Sierra's activity is designed to meet the UN Sustainable Development Goals, focusing on those where they can deliver greater impact.

Awards & Recognition

  • More than 200 industry awards and several distinctions.

Reporting Period: 2023

Environmental Metrics

Total Carbon Emissions:77,112 tCO2e (EQS) (Scope 3)
Scope 1 Emissions:3,843 tCO2e (EQS)
Scope 2 Emissions:5,934 tCO2e (EQS)
Scope 3 Emissions:77,112 tCO2e (EQS)
Renewable Energy Share:92% (electricity)
Total Energy Consumption:489,155 GJ
Water Consumption:908 Megalitres
Waste Generated:23,381 tonnes
Carbon Intensity:12.2 kgCO2e/sq.m GLA (market-based approach)

ESG Focus Areas

  • Sustainable Buildings
  • Responsible Investment
  • Management of Service Client Sustainability Profile
  • Climate Change Resilience
  • Circular Economy
  • Responsible Procurement
  • Management of Tenant/Occupier Sustainability
  • Impact on Local Communities
  • Human Capital Management
  • Employee Health, Safety & Well-being
  • Business Ethics, Transparency and Anti-Corruption

Environmental Achievements

  • Reduced electricity consumption by 68% since 2002
  • Reduced water consumption by 41% since 2003
  • Reduced GHG emissions intensity (Scope 1 and 2) by 88% since 2005 (market-based approach)
  • Increased waste recycling rate by 48 percentage points since 2002 (to 67%)
  • Reduced waste landfill rate by 41 percentage points since 2007 (to 14%)
  • Science-based targets approved by the SBTi for 2030 emission reductions

Social Achievements

  • Launched Big > In program for young talent, welcoming 12 new trainees in 2023
  • Implemented Rise High Rise Higher leadership training program
  • Launched Flex Work program, with 68% of employees satisfied or very satisfied
  • Opened new Maia offices designed to foster collaboration and well-being
  • Supported 164 charitable organizations, contributing €728,056

Governance Achievements

  • Investment Management division recognized as Best Investment Manager in Iberia
  • Sierra Prime and Iberia Coop achieved 5-star GRESB ratings
  • 100% of renewed tenant/occupier leasing contracts included updated ESG clauses
  • Internal Audit activities covered 53% of core business processes identified as having corruption risks, with no instances of corruption identified

Climate Goals & Targets

Long-term Goals:
  • Achieve carbon neutrality by 2040
Medium-term Goals:
  • Reduce scope 1 and 2 GHG emissions per square metre by 73% by 2030
  • Reduce scope 3 GHG emissions from purchased goods and services by 55% per square meter developed by 2030
  • Reduce all other absolute scope 3 GHG emissions by 46.2% by 2030
  • Achieve 25% water reuse/recycling in assets with high climate-related risks by 2030
  • Achieve 80% waste recycling rate by 2030
  • Achieve 2 litres per visit water consumption by 2030
  • Increase percentage of women in leadership positions to 50% by 2030
  • Achieve 94% top talent retention rate by 2030
Short-term Goals:
  • Achieve 2024 targets for energy, water, waste, and emissions reductions

Environmental Challenges

  • Climate change (physical and transition risks)
  • Cyber attacks
  • Development project challenges (profitability, licensing, execution)
  • Financing challenges
  • Client portfolio growth and renewal
  • Cost of living crisis
  • Digital transformation
  • Breach of financial covenants
  • Inflation
  • Interest rate fluctuation
  • Key people retention
  • Political, legal and regulatory risks
Mitigation Strategies
  • Environmental Management System, TCFD-aligned assessments, insurance policies, climate risk assessments, decarbonisation roadmaps
  • Cybersecurity Governance Model, training, monitoring services, protection technologies
  • Internal database, market research, risk-sharing with partners, Investment Proposals (IP) approval process
  • Strong relationships with financing partners, liquidity monitoring, risk assessment for refinancing deals
  • Dedicated commercial functions, CRM system, market expansion strategies
  • Tenant support, customer retention initiatives
  • Transformation Programme, digitalisation projects, omnichannel offers
  • Policy for acceptable LTV and LTC levels, interest rate risk management policy
  • CPI-based leasing agreements, CAPEX plan adjustments, energy-saving measures
  • Interest rate hedging, risk management policy
  • Career development opportunities, employee satisfaction surveys, Flex Work program, employer branding initiatives
  • Legal team monitoring, compliance procedures, industry organisation memberships

Supply Chain Management

Responsible Procurement
  • Responsible Procurement Policy, prioritising sustainable materials and ethical suppliers

Climate-Related Risks & Opportunities

Physical Risks
  • Heavy precipitation
  • Water stress
  • Heat stress
Transition Risks
  • Building renovation due to EPC obsolescence
  • Carbon pricing
  • Electrical mobility adaptation
Opportunities
  • Energy consumption reduction, photovoltaic installations

Reporting Standards

Frameworks Used: GRI Standards, Construction and Real Estate Sector Disclosures (CRESD), IIRC Framework on Integrated Reporting, Six Capitals reporting framework, TCFD recommendations

Certifications: ISO 14001, ISO 45001, BREEAM, LEED, WELL

Third-party Assurance: Deloitte & Associados, SROC, S.A.

UN Sustainable Development Goals

  • Goal 7 (Affordable and clean energy)
  • Goal 9 (Industry, innovation, and infrastructure)
  • Goal 11 (Sustainable cities and communities)
  • Goal 13 (Climate action)
  • Goal 8 (Decent work and economic growth)
  • Goal 3 (Good health and well-being)

Initiatives contributing to these goals are detailed throughout the report

Sustainable Products & Innovation

  • Bright 2.0 energy efficiency program
  • Dive 2.0 water benchmarking program

Awards & Recognition

  • Best Investment Manager in Iberia (Euromoney Real Estate Awards)
  • Multiple ECSP awards
  • MAPIC awards
  • 5-star GRESB ratings for Sierra Prime and Iberia Coop