Lendlease Annual Report 2021

31% of our Scope 1 and 2 emissions offset in FY21 We are well on our way to offsetting 100% of our residual carbon emissions to achieve Net Zero Carbon by 2025 32% under our 1.5ºC aligned trajectory for Scope 1 and 2 emissions in FY21 We are in a good position to maintain our trajectory to achieve Absolute Zero by 2040 1.5° C aligned Mission Zero As a 1.5°C aligned company, we have set ourselves ambitious science based emissions reductions targets. In May 2021, we launched ‘ Mission Zero ’ , a global campaign to raise awareness about our mission to reach Net Zero Carbon by 2025 and Absolute Zero by 2040. By 2025, we'll reduce greenhouse gas emissions as far as possible, with the remainder offset in an approved carbon offset scheme. Our Net Zero target applies to Scope 1 and 2 emissions. By 2040, no greenhouse gas emissions from our business activities. No offsets. Our Absolute Zero target applies to Scope 1, 2 and 3 emissions. 1 It has been a year since we launched our ambitious environmental and social sustainability targets and we are pleased to report we have already made meaningful progress. Our journey has given us greater conviction around the importance of our mission and that collaboration is the only way to achieve industry transformation. Sustainability A sense of place – one fit for the future • M I S S I O N Z E R O • A B S O L U T E Z E R O B Y 2 0 4 0 • M I S S I O N Z E R O • N E T Z E R O C A R B O N B Y 2 0 2 5 Our progress We have made positive progress in FY21 to reduce our Scope 1 and 2 emissions. The sale of our Engineering business and the ongoing impact of COVID significantly impacted our emissions (see page 55 for our FY21 environmental performance). While Scope 1 and 2 emissions are our immediate focus, we have increased our engagement and collaboration across the real estate sector to also start addressing Scope 3 emissions. 1. Scope 1 emissions are from the fuels we burn, Scope 2 are from the power we consume and Scope 3 are from indirect activities. Step 1 Create a decarbonisation investment strategy in 2021. Established a Lendlease Decarbonisation Investment Group (DIG) to identify decarbonisation investment opportunities and strategy Launched online carbon education tools and resources to help our people understand our targets and what is required to be a 1.5°C aligned business Step 2 Phase out diesel and gas in our operations. Implemented successful renewable diesel (HVO) pilots across a number of UK projects Launched an alternative fuels policy across our UK business, liquid fossil fuels no longer accepted on any new UK construction projects and existing projects have until January 2022 to comply Saved 9.12 ktCO2-eq by using one tonne electric excavators on Manchester Town Hall restoration project – the equivalent of around ten passengers flying from London to New York Trialling a 20 per cent biodiesel blend (B20) at Caboolture Hospital redevelopment and using a 5 per cent biodiesel blend (B5) in cranes, generators, boom lifts and excavators on several other Australian projects Lendlease are designing and delivering ‘all electric’ buildings, including Sydney Metro Victoria Cross – Over Station Development, Sherwin Rise Retirement Living Villas and Monash University's Woodside Building for Technology and Design in Australia, MIND in Italy, 30 Van Ness in San Francisco, and our US residential community at Fort Campbell Step 3 Use 100 per cent renewable electricity before 2030. Continued to deploy energy efficiency measures and upgrades to plant and equipment Lendlease Building Australia switched to 100 per cent renewable electricity from January 2021 Lendlease’s Australian Prime Property Fund (APPF) Industrial signed an agreement to deliver a renewable energy program for up to $20 million Integrated 2MW of solar power systems across the APPF Commercial portfolio From FY22 our Australian corporate workplaces will be powered by 100 per cent renewable electricity All Chicago construction projects are utilising 100 per cent renewable electricity, and Boston’s Clippership Wharf development has been procuring renewable electricity for owner controlled spaces since November 2020 MIND will be powered only by renewable energy sources (see page 26) Step 4 Collaborate with supply chain partners to set pathways to achieve Absolute Zero Carbon by 2040. Became one of the first companies globally to join SteelZero to drive market demand for net zero carbon steel Joined as a founding member of the Materials and Embodied Carbon Leaders Alliance (MECLA), a new industry led coalition to decarbonise Australia’s building and construction industry Joined Race to Zero, one of the first companies in the built environment sector to do so Step 5 Collaborate with our tenants and residents to transition to renewable electricity and achieve Absolute Zero Carbon by 2040. In partnership with Aware Super, our US residential portfolio of urbanisation projects across Boston and Chicago has been verified net zero carbon At London’s Elephant Park, all residents and tenants are now automatically signed up to a green electricity tariff Lendlease Funds Management’s Australian office portfolio has been officially certified carbon neutral Through this five step plan we are going to turn our commitments into action. Here are some of the ways we are already implementing change. The road to Absolute Zero Carbon Alongside our two carbon targets, we are also focused on reducing waste and water consumption, and promoting biodiversity. Waste As part of our circular economy ambitions, we are partnering with WWF Singapore on a Waste in Retail Research Initiative. Through this initiative, we are undertaking research into waste management practices including waste generated at malls. The knowledge we develop will be shared with the retail property management industry and key stakeholders. Water Total village water consumption across our Australian Retirement Living portfolio decreased by 1.8 per cent in CY2020 compared to CY2019, a significant achievement given residents were spending more time at home during 2020 due to COVID. In our 48 villages with real time water monitoring, water consumption decreased by 4.1 per cent over the same period. These savings have been realised by residents through their village water bills. We are now working to roll out real time water loggers nationally. Biodiversity Valuing natural capital continues to be a focus for us globally as we apply nature based solutions to create biodiversity and climate resilient communities. The urban ecosystem at Southbank, Chicago, stands in lush contrast to the site's past history, featuring migratory birdhouses, beehives, a rooftop farm, native grasses to restore the waterways, and a river walk and park for the community. In Malaysia, The Exchange TRX will be delivering a new city park in Kuala Lumpur which will be home to more than 150,000 plantings from close to 150 native plants species, creating a new ecological corridor for urban birds, butterflies and bees. 43 A sense of place 42 Lendlease Annual Report 2021 Managing and Measuring Value