Green Financing
Green Financing
We are committed to integrating sustainability considerations into our financing mechanisms. By obtaining green financing through green bonds, green loans and sustainability-linked loans, not only do we support the transition to a low-carbon, more resource-efficient and sustainable economy, we also reaffirm our commitment to sustainable development and to designing and developing sustainable projects that improve the wellbeing of building occupants and local communities.
We target to achieve a minimum of 50% of bond and loan facilities from green financing by 2025 and 80% by 2030. By the end of 2024, approximately 70% of our current bond and loan facilities came from green financing.
The issuance of our first green bond in January 2018 symbolised Swire Properties’ profound and ongoing commitment to sustainability. The bond raised USD500 million at a coupon rate of 3.5% and is due in 2028. In 2020, our commitment deepened further, with the issuance of four more green bonds totalling HKD1,934 million. In July 2023, Swire Properties became the first Hong Kong corporation to issue an RMB-denominated public green bond, known as a “green dim sum bond”. The transaction raised RMB3.2 billion, making it the largest-ever corporate green dim sum bond issuance in Hong Kong. In 2024, we issued green bonds totaling approximately HKD6.9 billion, of which RMB3.5 billion was issued by way of dim sum bond in September 2024, the Company’s largest offshore RMB bond issuance to date.
As of the end of 2024, 100% of the net proceeds from these green bonds had been fully utilised.
The proceeds of our green financing, including our green loans, have been allocated to the following projects:
Allocation of Green Bonds and Green Loan Proceeds
(As at 31st December 2024)
Our Green Finance Report 2024 was released in March 2025, providing information on the projects funded by our green bonds and green loans and the estimated quantitative environmental impact, including energy and water saving, renewable energy generation, wastewater management practices, and other impacts.
Internal Carbon Pricing Updates
Internal Carbon Pricing Updates
In 2023, Swire Properties began piloting the use of internal carbon pricing (“ICP”) to determine the potential impacts of carbon emissions on our investments, quantify carbon risks to our business operations and better reallocate capital towards low-carbon and energy efficient investment and opportunities. ICP also facilitates engagement across departments and teams, allowing them to integrate carbon-reduction strategies with business objectives and achieve our common decarbonisation goal.
The ICP Committee, consisting of representatives from the FMSD and Finance Department, jointly administers the decarbonisation funds generated by ICP initiatives, which are used to finance innovative solutions to help us achieve our science-based targets. The ESGSC oversees the overall mechanism and project approval to ensure that funds are effectively channelled towards meaningful and impactful projects.
The ICP mechanism is a hybrid model comprising a carbon fee and shadow pricing. The internal carbon fee that has been set is based on the units of emissions generated by Scope 1 and 2 operational emissions and on the Scope 3 business travel emissions generated in the previous financial year. Proceeds collected through the fee are set aside in a decarbonisation fund to support additional decarbonisation projects. A carbon fee of USD22/tCO2-e was applied for 2023 and 2024, but this will be adjusted to USD40/tCO2-e in 2025 to bring the fee closer in line with prices forecast by the Asian Development Bank.
The shadow pricing mechanism provides additional information about the impact of emissions associated with our businesses’ capital expenditures and thus aligns the investment decision making process with our carbon reduction goals. It also reveals hidden risks and opportunities present throughout our operations and supports strategic decision making related to future capital investments. The shadow pricing mechanism will be applied to planned projects that exceed a threshold value or projects that meet selected criteria. A shadow carbon price of USD50/tCO2-e was applied for 2023 and 2024 but this will be adjusted to USD100/tCO2-e in 2025 to bring the fee into alignment with projections made by the High-Level Commission on Carbon Pricing.
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