Supply chain management was identified as a megatrend and one of the top 10 material issues to the Company’s operations in the 2023 stakeholder-driven materiality assessment. Companies are facing increased regulatory requirements to identify and address ESG risks beyond their own operations, and stronger investor focus around sustainable procurement practices.
Swire Properties sees this as an opportunity to build long-term, mutually beneficial relationships with our business partners, and more importantly, to identify new collaboration opportunities with our partners to innovate sustainability practices.
As such, we have in place a robust sustainable procurement strategy to discuss, manage, track and report supply chain sustainability issues.
Sustainable Procurement for Hong Kong and the Chinese Mainland in 2023
HKD 559 million
8%
Since no new development projects were completed in 2023, the procurement spend on construction materials and related low-carbon construction materials decreased compared to 2022.
Sustainable Procurement Guidelines and Specifications
Since 2015, Swire Properties has implemented environmental procurement guidelines in accordance with the ISO 14001 Environmental Management System. This system tracks our consumption of office supplies, building services equipment and building materials that meet specific environmental criteria – such as whether the products have been certified or accredited by reputable independent third parties. We use this data to evaluate our sustainable procurement performance and identify further opportunities to source more sustainable products.
Beginning in 2020, we expanded our green procurement process to include sustainability-related products and services, including expenditures on promoting safety, health and wellbeing in our properties and new developments.
Swire Properties was the first real estate developer in Hong Kong to introduce low-carbon specifications for new developments, detailing such specifications for concrete, reinforcement bar (“rebar”) and structural steel and obtainment of green building certifications. These specifications have now been adopted into the main contract for new developments in Hong Kong and the Chinese Mainland. Pre-qualification checks will be conducted to ensure tenderers fulfil all sustainability requirements in their tender specifications. We also track our consumption of specific construction materials used in projects under development, such as timber, concrete and rebar. This allows us to benchmark our consumption of these materials and their environmental impact during the construction of new developments.
In our existing operations, we require our key service providers – such as engineering services, cleaning, landscaping, and others – to obtain certification under internationally recognised environmental and H&S standards.
We also provide sustainable procurement guidelines to our procurement staff in Hong Kong and the Chinese Mainland for non-key materials and services, such as office equipment and catering, to empower them to consider environmental performance during the procurement of goods and services.
Partnerships and Recognitions
We have been a member of the Hong Kong Green Purchasing Charter of the Green Council since 2013 and a member of their Sustainable Procurement Charter since 2018. We also joined the WWF-Hong Kong Sustainable Seafood Business Membership Programme in 2023, which commits us to promoting the sustainable sourcing and consumption of seafood in Hong Kong.
Since 2021, we have worked with Tsinghua University to explore the availability and use of low-carbon building materials in the Chinese Mainland.
To facilitate the low-carbon transformation of our supply chain, we also regularly share our experience with contractors and building material suppliers in the real estate and construction industries through publications, presentations at conferences and other channels. The aim is to collaborate with our supply chain partners to innovate low-carbon best practices and push for a greater general availability of low-carbon building materials.
The relevant SDGs are:
SDG 12
Ensuring sustainable consumption and production patterns.
SDG 13
Taking urgent action to combat climate change and its impacts.
Prioritising Low Embodied Carbon Construction and Development
Taikoo Li Xi’an Construction Carbon Accounting
As part of the drive to continuously achieve carbon reduction in our construction projects, we have adopted an embodied carbon calculation tool that was co-developed by the Company and Tsinghua University to measure and benchmark the upfront embodied carbon of the Taikoo Li Xi’an project.
With the project’s foundation work completed and the superstructure work in progress, we are continuing to conduct environmental due diligence and explore the availability and feasibility of low-carbon materials for this project. We have also conducted site visits to several steel manufacturing plants with the aim of ensuring a stable supply of low-carbon steel for use at Taikoo Li Xi’an.
Taikoo Li Xi’an Construction Carbon Accounting
Six Pacific Place
The Six Pacific Place construction project continued to meet our ambitious SD targets in 2023, with 100% of the concrete used in the superstructure construction being Platinum-certified under the Construction Industry Council (“CIC”) Green Product Certification scheme. Almost 6,600 tonnes of rebar were also used, of which 65% was green rebar containing more than 60% recycled content. Grid power was connected during construction and no on-site generators were used, minimising noise and air pollution and reducing site carbon emissions.
To date, the Six Pacific Place project has achieved an embodied carbon figure for concrete and rebar of around 539kg of CO2e per construction floor area (“CFA”), which is about 27% less than the baseline. The project’s power consumption is also 66% less than construction sites that use on-site generators.
The Six Pacific Place site won several construction industry awards in 2023:
- 29th Considerate Contractors Site Award
- Outstanding Environmental Management & Performance Award
- Innovation Award for Safety and Environmental Excellence
- Gold Award in the Developer (Private Sector) Category at the CIC Sustainable Construction Award 2023
Six Pacific Place
Sustainable Design at our Taikoo Li Xi’an Office
After several months of construction, the office at our Taikoo Li Xi’an project was ready for occupation on 1 May 2023. As with our other Taikoo Li projects, it merges historical culture and modern lifestyle and creatively integrates our SD 2030 strategy into the office environment.
The office’s construction and design incorporates recycled materials and intangible cultural heritage craftwork into materials and furnishings, including local artwork and terrazzo tiles and adobe bricks made from recycled materials.
The terrazzo tiles used in the flooring recycled and repurposed five tonnes of discarded oyster shells, 2.4 tonnes of ceramics and 1.6 tonnes of construction waste (including 405kg of discarded red bricks, 405kg of discarded ceramic tiles, and 800kg of mixed construction debris). The adobe bricks used for the reception backdrop were recycled from approximately 1.2 tonnes of adobe, 170kg of discarded ceramics, 130kg of mineral slag and 15kg of green waste plant fibres.
Other indoor finishing materials were selected for their eco-friendliness and low-VOC properties, while much of the furniture is Forest Stewardship Council (“FSC”)- or Good Environmental Choice Australia (“GECA”)-certified and meets ISO 14001 standards. The workstation chairs are also ergonomic, prioritising health and comfort.
The office’s approximately 7,600 sq ft outdoor area features a diverse selection of mostly local plants that enrich the street environment and boost neighbourhood biodiversity. The landscaping is primarily evergreen tree species which effectively improve air quality and reduce noise and light pollution. The trees are arranged in clusters that exhibit different visual effects depending on the season, while the patio uses formaldehyde-free bamboo as the primary material, with glue that meets EO-grade emissions standards.
Sustainable Design at our Taikoo Li Xi’an Office
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Continuous Expansion of our Sustainable Sourcing Programme
Swire Properties is committed to expanding our sourcing of sustainable materials across all areas of our business. In 2023, we continued to make significant achievements with this, including:
Low-carbon Construction Solutions
Swire Properties continued to support industry organisations to accelerate the scaling of low-carbon material adoption through active participation in industry associations, public seminars and academic research.
In 2023, we made further strides and began exploring the use of ground blast furnace slag ("GGBS") concrete in our trading portfolio and our improvement projects. GGBS concrete has a lower carbon footprint compared to conventional concrete, as it utilises the by products from the iron and steel industry, that would otherwise be disposed of as one if its raw materials.
Portfolio Management Offices and Facilities:
- Air handling units, paints and coatings, panel boards and water pumps with CIC Green Product Certification.
- Toilet paper and printing paper certified by the Forest Stewardship Council (“FSC”).
- Office printing paper with 100% recycled content in our Hong Kong internal offices.
- Tea bags with Rainforest Alliance Certification.
Hotel Operations:
- Sustainable seafood that meets guidelines set out by the WWF Seafood Guide or the Aquaculture Stewardship Council.
- Plant-based meat alternatives on menus, helping to lower carbon emissions and reduce the ecological footprint of our operations.
- Vegan, organic and biodynamic wines added to menus.
- Coffee beans processed with solar power and packaged in biodegradable materials.
- Bamboo material bathroom amenities.
- Simplified packaging for room amenities such as removing paper boxes.
- Toilet paper rolls replaced with 90-100% recycled fibre certified by FSC.
- All office printing paper certified by FSC.
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