Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Custodianship
• Community Engagement
• Safety
• Responsible Investment

Environmental Achievements

• Achieved Three Green Stars in the 2020 GRESB benchmarking (FIBRA Macquarie)
• Reduced emissions intensity from 0.27 tCO2-e to 0.19 tCO2-e per tonne of production (Viridis Ag)
• EDC became the Philippines’ leading 100% renewable energy provider
• Port of Newcastle secured $A515 million in sustainability-linked loans

Social Achievements

• Launched a dedicated investor portal
• Provided D&I strategy oversight training to MAM’s asset Board Directors
• TDC’s ‘Parents in the Digital World’ initiative combating cyber bullying
• TDC’s ‘WiFive’ initiative helping students strengthen digital awareness
• EDC actively supporting agroforestry and enterprise development
• Stride Climate Investments improved employee and community safety

Governance Achievements

• Integrated D&I considerations into due diligence processes for prospective investments
• Established a Safety Alignment Framework (SAF)
• ESG considerations embedded throughout investment decision-making and asset management
• 100% of MAM staff have mandatory D&I objectives

Climate Goals & Targets

Environmental Challenges

• Climate change impacts (extreme weather events)
• Resource scarcity
• Rapid urbanization
• Social inequality
• Cyberbullying and online safety for children
• Coal reliance of Port of Newcastle
• Crop residue burning impacting solar power generation (Stride)
• Road safety issues (Stride)

Mitigation Strategies

• Implementing net zero business plans by 2022 for portfolio companies
• Investing in resilient infrastructure (EDC)
• Diversification strategies (Port of Newcastle)
• Collaboration with local farmers (Stride)
• Implementing geohazard early warning systems (EDC)
• Improved weather forecasting and modelling (EDC)
• Developing partnerships to foster digital inclusion (TDC)
• Implementing CVO technology (Endeavour Energy)

Supply Chain Management

Responsible Procurement

• Modern slavery assessments for suppliers (Port of Newcastle)

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events
• Earthquakes
• Typhoons

Transition Risks

• Shifting energy markets
• Regulatory changes

Opportunities

• Investment in renewable energy
• Development of resilient infrastructure

Reporting Standards

Frameworks Used: GRI, GRESB, SASB, TCFD, UN SDGs

Certifications: LEED

UN Sustainable Development Goals

• Goal 7 (Affordable and Clean Energy)
• Goal 13 (Climate Action)
• Goal 9 (Industry, Innovation and Infrastructure)
• Goal 2 (Zero Hunger)
• Goal 11 (Sustainable Cities and Communities)

Investments in renewable energy, sustainable infrastructure, and responsible agriculture contribute to these goals.

Awards & Recognition

• Three Green Stars (GRESB)

Environmental Metrics

ESG Focus Areas

• Not disclosed

Environmental Achievements

• Not disclosed

Social Achievements

• Not disclosed

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Not disclosed

Mitigation Strategies

• Not disclosed

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: GRI Standards 2018: Core option

Certifications: Null

Third-party Assurance: Independent limited assurance report

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Climate Change
• Deforestation
• Gender Diversity
• Executive Remuneration
• Board Governance

Environmental Achievements

• 84% of the Global Equity Compounders portfolio and 87% of the International Equity Compounders portfolio consisted of GHG targets validated by the SBTi or a similar industry standard by the end of 2023.

Social Achievements

• For global portfolios, the percentage of companies with 30% or more women directors increased to 87% from 83% in 2022. For international portfolios, it increased to 81% from 78% in 2022.
• Majority of global and international companies incorporated ESG metrics in their incentive plans.

Governance Achievements

• The team informed the boards of 19 companies of the rationale for voting against management on issues such as board gender diversity, remuneration, capital increase, board independence, overcommitment of board members, and political expenditure.

Climate Goals & Targets

Environmental Challenges

• Substantial emissions gap remains to align with 1.5°C warming.
• Only 1% of companies are likely on track to be compliant with incoming EU legislation on deforestation.
• Lack of board gender diversity.
• Scant details on ESG metrics used in executive remuneration.

Mitigation Strategies

• Engaging with portfolio companies to motivate improvements in deforestation practices, including disclosure, certification, traceability, policies, targets, and KPIs.
• Engaging with portfolio companies to increase the percentage of women directors to a minimum of 30%.
• Voting against management proposals where insufficient representation of women directors is observed.
• Collecting data on ESG-linked remuneration in executive incentive plans.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Environmental and social risk management
• Climate change
• Environmental and social financing
• Sustainability in our own business operations
• Client and customer experience
• People and workplace
• Business conduct and ethics
• Community

Environmental Achievements

• Sourced the equivalent of 100% of our global electricity consumption from renewable sources in FY2023
• Energy intensity per capita reduced by 57% from FY2014 (14% reduction from FY2022)
• Invested, committed or arranged $A2.2 billion in green energy assets in FY2023
• 97 GW of green energy assets in development or construction as at 31 March 2023
• 14 GW of green energy assets in operation as at 31 March 2023
• Reduced FY2023 electricity use by 37% from the FY2014 baseline
• 72% of Macquarie people occupied a sustainably-rated office at the end of FY2023
• Average recycling rate of 51% in FY2023 across major Sydney offices and London headquarters
• Diverted 78% of construction and demolition waste from landfill in the year
• Achieved a 77% paper use reduction from our FY2019 baseline in FY2023

Social Achievements

• 1,094 reviews completed under the Environmental and Social Risk (ESR) Policy in FY2023
• Macquarie Asset Management (MAM) became a signatory to the UK Stewardship Code 2020 in September 2022
• 11,800 attendances at tailored training, workshops and leadership sessions
• Over $A52m contributed by Macquarie employees and the Foundation in FY2023
• Macquarie’s Lost Time Injury Frequency Rate (LTIFR) in the year ended 31 March 2023 was 0.1
• 98% of our people completed global online WHS training
• Refreshed three-year Global Diversity, Equity and Inclusion (DEI) Strategy launched
• Launched an ‘Introduction to DEI’ eLearning module
• 24% of BFS complaints were resolved within the same business day and 61% within five business days in FY2023
• For the third year running BFS external complaints with the Australian Financial Complaints Authority were lowest in the sector relative to loan and deposit funds under management

Governance Achievements

• 61 disclosures received and managed by the Integrity Office in FY2023
• 62.5% of MGL Board directors are women
• 30.0% of Macquarie’s Executive Committee members are women
• Established a greenwashing working group in FY2023

Climate Goals & Targets

Environmental Challenges

• Rising temperatures, pollution, biodiversity loss, extreme weather events and social challenges
• Rising costs of living and international food and energy security concerns
• The talent market remains tight for certain skillsets
• Increasing instances of data breaches across the world, and high-profile ransomware attacks
• Greenwashing as a regulatory, litigation and reputational risk

Mitigation Strategies

• Implementation of the ESR and WHS policies
• Developing and implementing Macquarie-wide and business-specific policies
• Providing advice on environmental and social risks and opportunities and facilitating training
• Building the capability of our people to support vulnerable and disadvantaged customers
• Initiated a proactive scams campaign
• Established a greenwashing working group to coordinate training and guidance efforts and review controls around greenwashing risk

Supply Chain Management

Responsible Procurement

• New sustainable procurement framework
• Supplier Governance Policy

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events

Transition Risks

• Regulatory changes, market shifts
• Greenwashing

Opportunities

• Investment in climate mitigation and adaptation solutions
• Supporting clients and portfolio companies to achieve their decarbonisation ambitions
• Reducing emissions of our own business operations
• Aligning financing activity with the global goal of net zero emissions by 2050

Reporting Standards

Frameworks Used: GRI Standards, SASB Standards

Third-party Assurance: PwC (limited assurance)

Awards & Recognition

• #1 infrastructure investment manager globally (MAM)
• 2022 MFAA Excellence Awards for Major Lender of the Year
• Emissions House of Year at the 2022 Asia Energy Risk Awards
• #1 Global Renewables Infrastructure Financial Adviser and Global Infrastructure Financial Adviser (Macquarie Capital)
• Top rating for Australian ESG research by institutional investors in 2022 Peter Lee survey

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Business Conduct and Ethics
• Risk Management
• Environmental and Social Financing

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: SASB