FOR Esther An and real estate giant City Developments Ltd (CDL), a job interview nearly 30 years ago in 1995 was transformative.

 

At the time, the company&rsquo s managing director, the late Kwek Leng Joo, asked the young An what she thought the real estate sector and CDL could do better. &ldquo I said that it could improve its environmental performance, and was hired to help it do that,&rdquo she recalled.

 

As CDL&rsquo s first chief sustainability officer, she quickly championed an ethos that still guides the company&rsquo s business practices today: &ldquo conserving as we construct&rdquo .

 

As the Singapore-headquartered company built and acquired homes, hotels, offices, malls and other properties &ndash it currently has assets in 29 countries and regions &ndash it also became a pioneer in sustainability.

 

In 2008, it was the first organisation in Singapore to begin publishing sustainability reports, and in 2017, it became the first local firm to issue a green bond. Proceeds from the bond were used to repay a loan spent on retrofitting and upgrading works at Republic Plaza, its headquarters, to maintain high levels of performance in energy and water management.  

 

&ldquo At the time, we had to explain to local banks how green financing would work for buildings,&rdquo explained An. &ldquo Today, sustainable finance is becoming mainstream, and banks are well-versed in supporting green buildings and climate action.&rdquo

 

In 2024, CDL became the first corporate in Singapore to adopt the global Taskforce on Nature-related Financial Disclosures (TNFD) framework. In its latest sustainability report, the company set out its strategy and the actions it has taken to minimise its impact on nature as well as mitigate nature-related risks, among other TNFD-recommended disclosures.

 

These are only snapshots of CDL&rsquo s accomplishments and leadership in the sustainability space. In 2007, it launched a   &ldquo 1 degree Celsius Up&rdquo campaign to encourage its tenants to raise their air-conditioning temperatures to save energy.

 

Over the years, CDL has also led green efforts such as energy-efficient retrofitting and initiatives that have helped the company save about S$42 million in energy costs from 2012 to 2023.  

In 2014, CDL was the first Singapore real estate company to launch the green lease campaign for its tenants, with the support of the Building and Construction Authority. In 2017, it achieved 100 per cent participation from its retail and office tenants.

 

&ldquo In the early days of our sustainability journey, most in the built environment sector saw sustainability only as a cost,&rdquo said An. &ldquo Now, more businesses consider sustainability initiatives an important investment to generate long-term value, to reduce their climate-related risks, capture opportunities, and get ahead of environmental regulations. We&rsquo re glad that we started our environmental journey early and are pioneers in many areas, including reporting on TNFD, which we published in March this year.&rdquo

 

Four pillars of sustainability

An explained that real estate companies in particular have a social responsibility to reduce their carbon footprint, given that buildings and construction account for nearly 40 per cent of global greenhouse gas emissions. &ldquo Apart from new developments, it is crucial to better manage buildings and their operations, and continual efforts to retrofit older buildings are key because some 70 per cent of buildings that exist today will still be around in 2050.&rdquo

 

CDL has articulated four key pillars in its sustainability strategy: integration, innovation, investment and impact.

 

&ldquo Integration is critical to effectively embed sustainability into your business strategy and operations,&rdquo An shared, adding that innovation &ldquo enables you to accelerate change and impact by developing or adapting solutions&rdquo .

 

Meanwhile, investment is essential for deploying technologies and solutions for decarbonisation.

 

&ldquo Businesses with strong sustainability (strategies) and performance have better access to responsible investment and sustainable finance,&rdquo said An. &ldquo Most, if not all, companies need the support of banks and investors for long-term growth.&rdquo

 

As for impact, she pointed out that every business decision matters. &ldquo Everything we do has positive or negative consequences, or both. That is why sustainability reporting is essential.

 

&ldquo What you don&rsquo t measure, you don&rsquo t know, and what you don&rsquo t know, you can&rsquo t manage. If you want to improve performance and be future-ready, you need to identify and work on gaps.&rdquo

 

By tracking past and present performance, companies can embark on and hone their forward-looking scenario planning. &ldquo The cost of inaction can be substantial if companies are not prepared for the physical and transitional risks that lie ahead,&rdquo added An.

 

&ldquo CDL has conducted three rounds of climate change scenario studies since 2018. This has allowed us to gain insight into potential risks caused by more severe and frequent climate threats, new regulations and changing expectations of investors, financiers and insurance companies.&rdquo

 

Going green for the long haul

As CDL forges ahead in sustainability, it has always had the full support of its board and management. &ldquo Leadership commitment is key to sustainability integration. More companies have been stepping up on building or enhancing their sustainability capabilities in recent years,&rdquo An said. &ldquo To be effective, the sustainability portfolio needs to be empowered as an independent and dedicated unit for it to ensure that ESG (environmental, social and governance) standards can be integrated into every business and operational unit.&rdquo

 

She cautioned that &ldquo parking sustainability under the remit of risk management, finance or corporate communications is not advisable, as the expertise required is very different&rdquo .

 

CDL&rsquo s sustainability team reports only to the board sustainability committee, which comprises group chief executive officer Sherman Kwek and five independent directors.

 

&ldquo We are entrusted with a weighty task, and we need to be trusted and empowered to do our work well,&rdquo said An. She added that Kwek is dedicated to further enhancing CDL&rsquo s sustainability leadership by integrating it into the company&rsquo s growth, enhancement and transformation strategy.

 

&ldquo I think the fact that CDL is a listed company with Hong Leong Investment Holdings as its major shareholder is an advantage,&rdquo noted An.

 

&ldquo Like many successful global family businesses, it takes a long-term view to sustain growth by future-proofing its business for investors and generations to come.&rdquo

 

She is also doing her part to ensure the company&rsquo s continued care for the environment and pursuit of ESG excellence, by nurturing the next generation of sustainability leaders within the company and the community at large.

 

&ldquo I hire people who are passionate about sustainability, and help them to develop the skills and expertise they need. CDL has long been committed to raising awareness and building sustainable communities through its active stakeholder and community engagement programmes.&rdquo

 

She pointed out that the company&rsquo s Singapore Sustainability Academy &ndash the country&rsquo s first ground-up initiative on sustainability, which is supported by six government agencies and 15 founding industry and NGO partners &ndash has hosted more than 1,000 events and training courses for some 35,000 visitors since its opening in June 2017. &ldquo With a fast-growing network, the Academy is a strong force for positive change and impact,&rdquo said An.

 

For companies that have yet to move towards sustainability, she urges them to take the first step. &ldquo 2023 was the hottest year on record and 2024 is set to break this record. These severe climate conditions and events are threatening the survival of humanity.&rdquo

 

She added: &ldquo Some people have asked me why I remain positive, and what keeps me going after so many years. As a responsible citizen and a parent, I am concerned about the depleting natural resources and environmental degradation. We are living in an era of &lsquo global boiling&rsquo and time is ticking.

 

&ldquo There is real urgency to fast-forward collective action to fight climate change together. Without a healthy planet, no people or business will thrive.&rdquo