Material sustainability matters

Hektar REIT defines material sustainability matters as areas with significant ESG impact on Hektar REIT and its stakeholders. Hektar REIT conducted a comprehensive stakeholder engagement exercise to gather insight on the relative importance of specific economic, environmental, social and governance issues.

The methodology

We commissioned an external consultant to conduct a comprehensive study of the most material aspects of our sustainability programme in the last quarter of 2021. An impartial external party was chosen to secure the anonymity of the respondents. We sought feedback from representatives of all major stakeholder groups:

We asked stakeholder representatives to rate the importance they placed on 17 areas of sustainability. We asked respondents to indicate how important each criterion was, from a scale of 'very unimportant' (1) to 'very important' (5). A 5-point Likert Symmetric Scale was chosen so respondents could specify their level of agreement with (3) being neutral.

Sustainability Pillars	Focus Areas	What it means to Hektar REIT	GRI Topics	Boundaries
Economic	Financial Returns & Stability	Delivering healthy financial returns and growth potential for the benefit of unitholders	Economic performance	Shoppers, Tenants and prospects, Property manager, Investment community, Industry
		Corresponding UNSDGs
	Regulatory Compliance	Ethical business conduct and complying with all applicable social and environmental regulations including anti-bribery and corruption	Anti-corruption Anti-competitive behaviour Environmental compliance Socioeconomic compliance	Tenants and prospects, Property manager, Investment community
		Corresponding UNSDGs
	Sustainable Supply Chain Management	Integrating social and environmental factors into the supply chain	Procurement practices Supplier environmental assessment Supplier social assessment	Tenants and prospects
		Corresponding UNSDGs
	Industrial Advancement & Nation Building	Advancing the real estate industry and contributing to economic growth through Hektar REIT's operations	Indirect economic impacts	Property manager, investment community and industry
		Corresponding UNSDGs
Environment	Energy & Climate Change	Managing energy and greenhouse gases effectively to reduce them whenever possible	Energy Emissions	Tenants and prospects, Property manager, Joint Management Body and Management Corporation
		Corresponding UNSDGs
	Waste	Minimising all types of waste and recycling whenever possible	Waste	Shoppers, Tenants and prospects, Property manager, Joint Management Body and Management Corporation
		Corresponding UNSDGs
	Water	Using water efficiently	Water and effluents	Shoppers, Tenants and prospects, Property manager, Joint Management Body and Management Corporation
		Corresponding UNSDGs
Social	Diversity, Equal Opportunity & Non-Discrimination	Promoting diversity and equal opportunities and eliminating all forms of discrimination in the workplace	Diversity and equal opportunity Non-discrimination	Employees
		Corresponding UNSDGs
	Community Engagement and Contributions	Having a positive influence on local communities through charitable contributions and Corporate Social Responsibility initiatives while maintaining active engagements with them	Local communities	Tenants and prospects, Property Manager, Community, Joint Management Body and Management Corporation
		Corresponding UNSDGs
	Human Rights	Protecting all aspects of human rights including protecting staff welfare and ensuring no child or forced labour	Human rights assessment Rights of indigenous peoples Security practices Child labour Forced labour	Employees, Joint Management Body and Management Corporation
		Corresponding UNSDGs
	Training and Development	Providing training and education to employees to expand their knowledge base for career development	Employment Training and education	Employees
		Corresponding UNSDGs
	Occupational Health & Safety	Keeping all workers safe and free from injury and both non-communicable and infectious diseases	Occupational health and safety	Property manager, Employees, Joint Management Body and Management Corporation
		Corresponding UNSDGs
	Public Safety and Security	Enhancing security measures and monitoring infrastructure	Customer health and safety	Shoppers, Tenants and prospects, Property Manager, Community, Joint Management Body and Management Corporation
		Corresponding UNSDGs
	Tenants' Satisfaction	Ensuring high levels of tenants' satisfaction	Non-GRI topic	Tenants and prospects
		Corresponding UNSDGs —
	Customers' Satisfaction	Ensuring high levels of shoppers' satisfaction	Non-GRI topic	Shoppers
		Corresponding UNSDGs —
	Customer Privacy and Cybersecurity	Protecting customers' and tenants' privacy through safe data management	Customer privacy	Shoppers
		Corresponding UNSDGs
	Responsible Operations	Being a responsible and considerate asset owner and manager by offering facilities such as disabled access, mothers' rooms and shuttle transportation services	Non-GRI topic	Shoppers, Tenants and prospects, Property manager, Investment community, Community, Industry, Joint Management Body and Management Corporation
		Corresponding UNSDGs —

We discovered a natural skew in the results, with each stakeholder group not represented equally. We received the most responses from our shoppers and employees with fewer received from 'government, regulators, trustees, local councils & other local authorities', 'tenants & prospects' and 'community & NGOs'.

We calculated an average score for all areas within each stakeholder group to rectify the sample imbalance before obtaining an average rating from all 11 stakeholder groups.

We also asked members of our Board of Directors to complete the survey. Their views represented Hektar REIT.

The results

We considered all scores of 3 as medium importance. Stakeholder scores ranged from 4.24 to 4.61; Hektar REIT's was between 3.80 and 5.0. All issues are important to some degree. We adopted a scale from high to highest as even the lowest scores fell into the important category. The materiality assessment results are presented in the following materiality matrix.