Goodman Group Securityholder Review 2013

Strength in numbers

Corporate responsibility & sustainability

Overlaying our CR&S programme with Goodman’s core operating activities, provides a practical framework for improving performance, which reflects the key priorities of the Group and our stakeholders.

At Goodman, we recognise the value that an established Corporate Responsibility and Sustainability (CR&S) programme brings to our operations. It provides a structured approach to improving our long-term environmental, social and financial performance, and supports the sustainable growth of our business.

Sustainability highlights for the 2013 financial year include:

  • publication of Goodman’s first Global Reporting Initiative CR&S Report;
  • submissions to the Global Real Estate Sustainability Benchmark for five separate Goodman wholesale funds;
  • certified green development projects in Australia, Hong Kong, Continental Europe and the United Kingdom (UK);
  • over 15 current developments in Germany seeking certification under the DGNB (German Sustainable Business Council) rating system; and
  • energy upgrade projects completed in Australia, Hong Kong, New Zealand and the UK.

Goodman’s Australian carbon emissions

  • Electricity 94.5%
  • Diesel 2.9%
  • Gas 2.2%
  • Petrols 0.4%
The majority of our industrial developments completed globally during the year incorporated efficient lighting, including T5 fluorescent lighting or cutting edge LED high bay lighting. Benefits include improved cost efficiencies for our customers, and lower energy consumption and carbon emissions.

Our CR&S programme

Goodman’s CR&S programme aims to meet the priorities of our key stakeholders and is strategically aligned with the primary operating activities of Goodman’s business.

Our CR&S strategy currently comprises six programme areas:

  • sustainable development;
  • asset management;
  • engagement and reporting;
  • compliance;
  • corporate performance; and
  • social performance.

A focus on sustainable development

2013 was a busy year for our development teams globally, and it is pleasing to note that various green and sustainable design initiatives, considered optional in the past, are now standard in Goodman’s minimum design specifications.

In a standard warehouse design, efficient lighting with sensor controls provides one of the simplest opportunities to reduce energy consumption, operating costs and carbon emissions.

Certification for our green developments remains a priority. Our Australian Developments team achieved 5 Star Green Star - Office Design v3 certification for Building B (Schneider), at Ferntree Business Park, and has a further three projects currently registered and progressing through the Green Star rating process.

UK Business Parks (UKBP) completed several developments during the period including new facilities for British Gas at Oxford Business Park and PCL Logistics/Arla Foods at Hatfield Business Park. Consistent with our commitment to designing to a minimum standard of BREEAM “Very Good”, both projects incorporated a range of sustainable design features. Highlights at the British Gas development include a biomass boiler, LED lighting and a photovoltaic power system.

Across Continental Europe, our standard design specifications routinely incorporate sustainable design initiatives such as efficient lighting with occupant sensors, increased insulation, maximised natural lighting and efficient heating systems. As a significant portion of Goodman’s Continental European developments are located in Germany and certified to the DGNB green rating system, Goodman has established its DGNB Master Plan, which provides a projected DGNB performance rating for our standard specifications, expediting the certification process.

Our developments in Greater China, including Goodman Interlink in Hong Kong and Goodman Beijing Airport Logistics Centre in China, have created benchmarks for Goodman’s industrial developments in the region. Several of the sustainability initiatives designed into these assets have been replicated in more recent developments completed in Tianjin and Kunshan during the past year.

Managing the performance of our assets

Goodman is a long-term holder of the assets we develop or acquire. From an environmental and financial perspective, we aim to manage our assets efficiently and improve their performance, to lengthen their life cycle and increase overall demand, while reducing their environmental footprint. We believe this approach will enhance the long-term value of assets for Goodman, our customers and investors.

During the course of the 2013 reporting year, our Property Services teams completed various initiatives to enhance the performance of our assets across the globe.

In Australia, several energy upgrade projects aimed at improving the sustainability performance of our assets were completed. These included seven separate lighting upgrade projects, predominantly focused on reducing power consumption of lighting in car parks by replacing existing lighting with efficient T5 fluorescent lighting with occupancy sensors.

For our Hong Kong portfolio, promoting energy awareness among our on-site management teams, contractors and customers has been a priority over the past year, with a particular focus on on-site energy monitoring and the performance of lighting systems.

Our New Zealand operations implemented the Smart Power system during the year, which provides a detailed energy and carbon reporting solution, enabling the tracking of performance against targets.

Across our Continental European operations, results from Goodman’s internal sustainability rating tool developed and rolled out during 2011 and 2012 have been included in our current capital expenditure planning. The objective is to enhance the sustainability and technical performance of our assets via the prudent investment in upgrade projects across the portfolio.

In the UK, our Property Services teams continue to drive efficiencies through building management and upgrade projects across the UKBP portfolio. The major energy improvement project at UKBP’s Apollo Court building at Hatfield delivered energy reductions of 8% in the first half of the 2013 calendar year, when compared with the same period last year.

Australian greenhouse gas emissions

Greenhouse gas emissions (GHG) in Goodman’s Australian operations for the 2013 financial year have been calculated as 44,818 tC02-e. This represents an approximate 7% decrease in our absolute emissions for the period, primarily due to the continued focus on energy efficiency, sub- metering across the stabilised portfolio, and the results of energy improvement projects.

Our GHG calculation includes scope one and two emissions generated from Goodman’s Australian property and building management services, including assets owned directly by Goodman and those within our Australian managed funds. Where sub-metering allows, it does not include the GHG emissions of our customers.

Space to Work

To enhance collaboration and employee engagement across Goodman’s teams and offices, Goodman has introduced the Activity Based Working (ABW) concept in many of our offices globally including Sydney, Melbourne, Shanghai, Brussels and Los Angeles. It provides an evolving, inspiring and flexible working environment tailored to suit the operations of Goodman’s businesses and our staff, with a variety of settings and technical equipment designed to facilitate the sharing of knowledge and information.

During the conversion to our ABW model across our offices, energy efficiency was, and continues to be, a high priority in the design and operation of our leased space. The Sydney head office achieved a 5 star NABERS energy tenancy rating (6 stars is the most efficient) in 2012 and 5.5 star in July 2013, demonstrating ‘excellent performance’ in energy management.