Leadership
Message

Jardines has been working to meet the needs of current and future generations for almost two centuries, particularly in its core markets in Asia, which is forecast to remain the world’s most populous region in the coming decades. Asia is also on track to represent half of the expansion in global consumption by 2030¹ and more than half of global GDP by 2040². We grow and prosper together with the communities we serve across Asia, and we share the challenges of the region in moving towards a greener economy. Together with our 425,000 colleagues, we are committed to embedding sustainability in all our businesses and to introducing sustainable solutions that drive positive change and create long-term value.

Our Group-wide sustainability strategy, Building Towards 2030, structures our response to the megatrends unfolding around the region, including the acceleration in climate impacts, biodiversity loss, urbanisation and rising social and economic inequalities. We are working with our businesses across three core pillars to:

• Lead Climate Action, by decarbonising our business and enhancing climate resilience;
• Implement circular solutions that Drive Responsible Consumption through resource efficiency and waste reduction; and
• Shape Social Inclusion by tackling relevant social and economic issues that impact our communities.

These efforts, together with our overall performance, our successes and the challenges we face, are shared in our sustainability report.

Our decarbonisation journey

At a Group level, our primary focus is on addressing climate change, which is a complex and urgent issue in Asia. In 2022, we saw an overall increase in greenhouse gas emissions and energy usage across the Group, compared to 2021. We anticipated this outcome as we resumed full business operations post-pandemic. Further increases are expected to continue in the short-term, in line with business expansion. This reflects the challenge that we face to decarbonise. Setting medium-term targets and formulating credible emissions reduction pathways that take business growth into account is therefore of the utmost importance.

In last year’s report, we introduced our net-zero framework for guiding decarbonisation efforts across the Group, in line with climate science. In 2022, we reached a significant milestone when Hongkong Land was the first of our businesses to secure approval from the Science Based Targets initiative (‘SBTi’) for its 1.5°C-aligned 2030 targets. Other Group companies have followed suit. Gammon and Hong Kong Air Cargo Terminals Limited (‘Hactl’) have submitted commitment letters to SBTi, while DFI Retail Group (‘DFI’) has committed to 1.5°C-aligned scope 1 and 2 targets for 2030 and 2050.

All our businesses are developing decarbonisation pathways for their operational emissions. We acknowledge the importance of value chain emissions, and will also work towards understanding and reducing them in due course.

Investing for a more sustainable future

While much work is being done to set targets and improve our performance, we believe that an important lever for us to strengthen business performance and increase competitiveness is to embed sustainability considerations into our organic and inorganic investment decisions. This will contribute to the long-term growth of the business and, thereby, ensure continuous payment of dividends.

We are making key investments in practical solutions to support the region’s transition to a greener economy. For example, in Vietnam, as of December 2022, 72%³ of the energy capacity of the portfolio of REE Corporation, a strategic interest of Jardine Cycle & Carriage, was generated from renewables, specifically hydro, solar and wind. Other highlights of 2022 investments across some of our sectors include:

• In mining, PT United Tractors (‘UT’), a subsidiary of PT Astra International, signed a conditional sale and purchase agreement to acquire nickel mining and processing businesses. UT aims to cut its reliance on coal by diversifying into non-coal mineral mining, with the goal of increasing Astra’s business resilience by growing non-coal revenue to 88% by 2030. This diversification into nickel will also enable UT to contribute to the development of the electric vehicle value chain in Indonesia.
• In motors, PT Astra Honda Motor has announced a plan for sales of one million electric motorcycles annually by 2030, as part of its commitment to driving carbon neutrality in Indonesia. PT Toyota-Astra Motor is also introducing a range of new electric vehicles in Indonesia, to increase the supply of greener vehicles there.
• In retail, DFI has been trialling Water Loop technology in Hong Kong. This helps significantly reduce refrigerant gas volumes and risk of leakage, enhancing energy efficiency and reducing greenhouse gas emissions.
• In construction, Gammon has tested a new technology to reduce the overall carbon footprint of concrete by 5%. In partnership with CarbonCure, a Canadian start-up, Gammon aims to address the issue of embodied carbon – the carbon footprint of the materials used in the construction of the building or infrastructure.

Looking ahead

We have focused on building a strong foundation for how we approach sustainability over the past few years and are now starting to realise tangible results. In 2023, we will continue to work with our businesses to set decarbonisation targets with credible reduction pathways towards 2030, and explore circular solutions across the Group. Our actions to protect biodiversity and to minimise the impact our businesses have on the natural environments where they operate are ongoing. This includes active engagement with third parties to guide and ensure effectiveness and transparency in our biodiversity management efforts.

We will also further integrate sustainability into our operations, risk management and capital allocation. We are continuously learning and improving how we create value, use our resources more efficiently, and drive innovation to accelerate the delivery of our sustainable development objectives.

Our approach to sustainability reflects Asia’s overall commitment to a Just Transition, which more equitably distributes the costs and benefits of action to address climate change and accounts for the needs of the region as it minimises the adverse impacts of climate change. As we progress on our sustainability journey, explore new opportunities, and transform our business into the Jardines of the future, we will continue to aim to be a force for good in the communities in which we operate. We will also ensure that we put sustainability at the heart of how we run our business and make sustainability a key driver of future business growth.