Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate change
• Diversity & Inclusion
• Occupational Health and Safety
• Responsible Supply Chain
• Corporate Governance

Environmental Achievements

• Reduced water intake at some construction sites by using water from construction pit drawdown or foundation drainage.
• Did not produce hazardous waste in classes 1–3 during construction.
• Regional projects complied with the new GOST R green standard for apartment buildings (Rauta project).

Social Achievements

• Delivered one school and three preschools.
• Launched Mitki Museum project to preserve the memory of the Leningrad Youth Palace site.
• Expanded life and health insurance programs to over 3,500 employees.
• Provided 270 employees with financial support totaling RUB 13.1 million.

Governance Achievements

• Obtained a primary listing on Moscow Exchange.
• Completed the procedure for delisting GDRs from the London Stock Exchange.
• Developed a new Procurement Regulation to ensure fair competition and prevent antitrust violations.
• Implemented a Company-wide hotline for reporting ethical violations and corruption.

Climate Goals & Targets

Environmental Challenges

• Negative macroeconomic trends impacting buyer financial situations and demand for housing.
• Increased cost of land, materials, and labor due to inflation.
• Regional economic deterioration affecting project economics.
• Reduced availability of land and increased competition among developers.
• Reduced availability of and increased prices for foreign-made materials and equipment due to sanctions.
• Increased prices for resources and construction services.
• Personnel shortages and higher costs to recruit and retain key personnel.
• Limited access to financing due to high interest rates.
• Insufficient liquidity risk.
• Customers' credit risk.
• Exchange rate risks (though mitigated by lack of foreign currency debt).

Mitigation Strategies

• Diversified project portfolio across various locations and stages of completion.
• Developed sales channels and leveraged state programs to support the construction industry.
• Analyzed regional markets' growth potential before expansion.
• Maintained broad regional diversification in the project portfolio.
• Developed financial engineering tools to stimulate demand.
• Improved apartment layouts and developed innovative construction technologies to reduce costs.
• Developed additional services and new business streams for stable revenue.
• Tracked regulatory changes and participated in industry committees.
• Leveraged experience in redevelopment and integrated development projects.
• Expanded land bank through inorganic growth and improved management efficiency.
• Implemented cost controls for contractor services and material purchases.
• Introduced product standards and new construction technologies to optimize production costs.
• Developed the Company’s HR brand and implemented training programs.
• Developed mechanisms for recruiting foreign workers.
• Implemented technological and organizational development to raise labor productivity.
• Leveraged long-term reputation as a reliable borrower and maintained stable credit ratings.
• Developed relations with lenders and used a wide range of debt instruments.
• Maintained sufficient cash balances in escrow accounts.
• Used project debt to refinance costs.
• Used floating-rate debt instruments to potentially reduce interest expenses.
• Monitored project profit margins and conducted stress tests.

Supply Chain Management

Supplier Audits: Random reviews of counterparties conducted quarterly.

Responsible Procurement

• Competitive selection procedures
• Centralized procurement
• Supplier Code of Ethics
• Contractor Code of Ethics
• Anti-corruption clauses in contracts
• Direct contracts with manufacturers

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards, SASB Real Estate and Homebuilders Standards

UN Sustainable Development Goals

• Goal 3: Good health and well-being
• Goal 9: Industry, innovation and infrastructure
• Goal 11: Sustainable cities and communities
• Goal 12: Responsible consumption and production
• Goal 13: Climate action

Etalon Group's initiatives contribute to these goals through various ESG programs and projects.

Sustainable Products & Innovation

• Energy-efficient buildings using resource-efficient utilities equipment and environmentally friendly materials.

Awards & Recognition

• 26th Moscow Exchange Annual Report Competition (Best Annual Report: Investment Case category)