Transforming Dublin Responsibly - Sustainability Report 2021 - Hibernia REIT
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Transforming Dublin Responsibly Sustainability Report 2021
CONTENTS
2 CEO foreword 20 Becoming a climate-resilient business
4 Sustainability Manager introduction by 2030
6 Sustainability: past, present and future 24 Environment, health and wellbeing
8 Sustainability at Hibernia 28 Creating positive social impact
12 Emerging trends 32 Progress on previous sustainability targets
14 Becoming a net zero carbon business 36 Sustainability performance
by 2030 44 Independent assurance statement
18 Our roadmap to net zero carbon 47 Glossary
02
CEO foreword
06
Highlights from 2020
08
New Sustainability
Statement of Intent
O ur ambition is to be the most sustainable property
company in Ireland and to become a net zero carbon
business by 2030.
We are the largest Irish real estate investment trust (“REIT”),
owning a property portfolio worth €1.4bn, all of which is located
in Dublin and which mostly comprises city centre offices. We are listed
on the Main Securities Market of Euronext Dublin and the Main Market
of the London Stock Exchange.
18
Our roadmap to
20 36
Task Force on Climate-related Sustainability
net zero carbon Financial Disclosures performance tables
www.hiberniareit.com Hibernia REIT plc Sustainability Report 2021 1
CHIEF EXECUTIVE OFFICER FOREWORD
The link between financial
performance and ESG initiatives
has never been clearer."
More than a year after the start of the 2021 and beyond:
COVID-19 pandemic, we still find ourselves Transforming Dublin Responsibly
in challenging, uncertain times. COVID-19 The continued success of the Group
has tested our resilience and forced us all to throughout the pandemic has shown that
adapt. It has also made many of us reflect our strategy of focusing on the best office
on our pre-pandemic lives and question buildings in central Dublin and our long-
established ways of doing things. But term approach to balancing value and
Hibernia’s commitment to being a leader growth for our stakeholders is the correct
in environmental, social and governance one. We must continue to evolve, though, if
(“ESG”) matters in Ireland, both in the we are to remain both relevant and resilient
property sector and more broadly, remains in the coming years. To that end, we
unchanged. And the link between financial launched Transforming Dublin Responsibly,
performance and ESG initiatives has never our Sustainability Statement of Intent for
been clearer. In this Sustainability Report the period to 2030, simplifying our ESG
(the “Report”), we describe our ESG targets around three key principles that
targets, set out how we plan to achieve we see as critical to tackling the material
them and outline our progress to date. issues we and our stakeholders are facing.
The key principles for Hibernia are to:
Progress in 2020-21
Despite being a highly challenging year, • become a net zero carbon and
we made further progress with our ESG climate‑resilient business by 2030;
performance in 2020. We increased • provide spaces that prioritise the
our Global Real Estate Sustainability environment, health and wellbeing; and
Benchmark (“GRESB”) score, achieving • create long-term positive social impact
a four star rating for the first time. through our operations.
We obtained an excellent score of B- in
our first CDP climate change response As we look ahead we are confident that,
and we carried out a gap analysis to with the commitment of our fantastic team
determine how we can align with the and support of our stakeholders, we can
recommendations of the Task Force on build on our first seven years as a company
Climate-related Financial Disclosures and achieve ESG excellence through
(“TCFD”). We formed a strategic Transforming Dublin Responsibly.
partnership with A Lust for Life, a young
persons’ mental health charity bringing I hope that you enjoy reading the 2021
digital learning to schoolchildren, and Hibernia Sustainability Report and that
supported 10 local charities and community it gives you a clear understanding of
organisations with over €70,000 of funding. our current work and of our ambitions
And we achieved this despite having to for the future.
postpone for a year our much-loved
flagship fundraising event, Dragons at the
Docks, due to COVID-19 restrictions.
Kevin Nowlan
Chief Executive Officer
14 June 2021
The Dockers Pub, part of 1SJRQ, South Docks
2 Hibernia REIT plc Sustainability Report 2021 www.hiberniareit.com
Sustainability at Hibernia
Highlights
Launched Transforming Dublin
Responsibly, our new Sustainability
Statement of Intent
Set a target of becoming a net
zero carbon business by 2030
Signed up to the Better Building
Partnership's Climate Commitment
and World Green Building Council's Net
Zero Carbon Buildings Commitment
€70,000 donated to local community
groups and charities through our
fundraising efforts
Instituted our artist in residence
programme helping to keep culture
and collaboration flourishing in the
Windmill Quarter
A Lust For Life (young persons’
mental health organisation) chosen
as charity partner for next two years
Awards
Four green stars
with an overall
score of 80%
(+5pp on prior year)
Achieved a positive
score of B- in our
first CDP climate
change submission
EPRA sBPR:
retained Gold
Award in 2020 for
the third successive
year for our
Sustainability Report
2 Cumberland
Place on track to
be awarded LEED
Platinum certification,
and soon to be home
to 3M
www.hiberniareit.com Hibernia REIT plc Sustainability Report 2021 3
S U S TA I N A B I L I T Y M A N AG E R I N T R O D U C T I O N
Economies, institutions and
industry are considering climate
change risk and solutions
with greater urgency."
CEO, Kevin Nowlan and
Sustainability Manager, Neil Menzies
Welcome to the 2021 Hibernia our recent commitment to becoming a net
Sustainability Report zero carbon business by 2030 reflects this.
This is our third stand-alone Sustainability In collaboration with our occupiers, we
Report and our first opportunity to explain will improve our existing assets, and deliver
in detail our new responsible business new developments and refurbishments, in
strategy, shaped around the three key line with the latest scenario modelling on
principles outlined by Kevin in his foreword. possible global temperature rises. We have
The decision to simplify our strategy and published our Net Zero Carbon Pathway,
reduce our key principles from five to three the first Irish real estate company to do
was taken following detailed engagement so, and have set an internal price on carbon
with our stakeholders over the past (again, we believe, a first for any Irish
18 months and with a view to the emerging property company), ensuring that a
sustainability-related risks and opportunities meaningful financial impact is applied to
facing the property sector over the medium projected carbon emissions from today.
and long term. More detail about the material Further detail on our net zero carbon
sustainability issues and the three new strategy, as well as information on how
principles can be found on pages 8 to 11 we are aligning our climate resilience
of this document. frameworks and governance with that
of the recommendations of the TCFD,
While, understandably, much of society’s can be found on pages 14 to 23.
attention since early 2020 has been on the
COVID-19 pandemic, there has also been As we look ahead, we are excited by the
increasing focus on issues of sustainability challenge of meeting our ambitious targets
and resilience. This change in global and continuing to improve our ESG
outlook, as reflected in the World Economic reporting and performance. We look
Forum’s Global Outlook 2021, was under forward to working with our stakeholders
way prior to the pandemic, but has to bring about positive change and we
accelerated as economies, institutions and welcome any feedback you have, which
industry are considering climate change can be sent to either info@hiberniareit.com
risk and solutions with greater urgency. or our 1WML offices.
It is clear to us that climate change has
far greater potential repercussions than
COVID-19 in the long term and that Neil Menzies
sustainability considerations are going Sustainability Manager
to be fully incorporated in decision-making 14 June 2021
in the property market in the near term;
The retained tramyard gate at 1SJRQ, South Docks
4 Hibernia REIT plc Sustainability Report 2021 www.hiberniareit.com
About our Report
Clarity on our Sustainability Report As part of this we have simplified what Reporting benchmarks
We seek to be transparent in all aspects were our five previous key principle areas We respond annually to the GRESB
of our reporting. If you think we could into three principles, which are to: and CDP climate change questionnaires
improve our reporting in any way, please and present in this Report our 2020
let us know. • become a net zero carbon and performance. The submissions we
climate‑resilient business by 2030; make and scores we receive from these
Context • provide spaces that prioritise the benchmarks give shareholders independent
Our 2021 Sustainability Report relates to environment, health and wellbeing; and external reassurance of our performance.
the work undertaken in our financial year – • create long-term positive social impact
1 April 2020 to 31 March 2021. The EPRA through our operations. External assurance
performance tables relate to our assets Further to our GRESB and CDP
These three principles form this Report’s
and social and governance metrics for submissions, we recognise the importance
core. They are supported by extensive data
the calendar year 2020. The scope of of disclosing accurate and reliable data as
and are guided by our material issues.
our Report reflects our business activities a public company, so our environmental
i.e. property investment, development and social performance data is externally
and management in Dublin. Sustainability reporting frameworks assured. We have engaged JLL Upstream
We compile and align our outputs with the to ensure that the data contained in our
EPRA Best Practices Recommendations for
Structure and materiality Sustainability Report and that submitted
Sustainability Reporting ("EPRA sBPR") to EPRA, GRESB and CDP is assured
As in previous years the Report’s structure
which, in turn, align with the Global in accordance with the AA1000
reflects how we manage our ESG issues in
Reporting Initiative ("GRI") standards. This AccountAbility Principles (AA1000AS v3)
the context of our day-to-day business
allows for both a broader reporting format standard. (See the assurance statement
activities. During 2021, we introduced
comparison and a real estate-specific on pages 44 to 46).
Transforming Dublin Responsibly, our
one. In addition, we follow the TCFD
Sustainability Statement of Intent, designed
recommendations (see pages 20 to 23).
to capture the sustainability issues most
relevant to our business to the year 2030.
www.hiberniareit.com Hibernia REIT plc Sustainability Report 2021 5
Sustainability: past, present and future
2013-2019
Past activities
2020-2021
Present activities
2013 2016 2018 Net zero carbon – carry out net zero
Company First Exceeded 50% carbon audits of all existing assets,
founded and sustainability recycling at our agreeing capital expenditure plans
successfully disclosures managed assets to reduce energy consumption and
floated aligned with for the first time increase on-site energy generation.
EPRA sBPR Commence whole life carbon
Launched the assessments for latest development
1 Cumberland Step-Up projects, agree energy-use intensity
Place becomes campaign to targets and maximise on-site
2014 our first LEED- promote the renewable generation.
First certified health and
properties building wellbeing of Social impact – launch artist
acquired (awarded tenants in our in residence programme with
Platinum) managed assets stakeholders in the Windmill Quarter
and measure impact of A Lust For Life
partnership in local communities.
FY21 highlights
2015 2017 2019
Four key 1WML became First stand-alone
sustainability our first LEED Hibernia Sustainability
principles Gold-certified Report published
identified building Net zero carbon
100% of electricity
Hibernia purchased for
Sustainability managed assets from
Committee renewable sources
established
Installed our first solar
Sustainability photovoltaic ("PV") In FY21, we modelled our projected
Policy and array in 1WML baseline carbon emissions to 2030 and
Sustainability decided to reduce our footprint in line
Strategy Installed our first with UK Green Building Council energy
developed beehives on the roofs performance targets for offices.
of managed assets
Supplier Code of We also signed up to the Better
Conduct issued Completion of LEED Buildings Partnership's ("BBP") Climate
Gold-certified 2WML Commitment and to the World Green
€0.5m raised for in the Windmill Building Council's ("WGBC") Net Zero
local charities Quarter Carbon Buildings Commitment.
through first
15,155 tCO e
Dragons at the Began trialling indoor
Docks event air quality smart
sensors in landlord
and tenant spaces
in two buildings
1SJRQ became
our second LEED
Scope 1, 2 and 3 greenhouse
2
Platinum-certified
development gas (“GHG”) emissions 2020
6 Hibernia REIT plc Sustainability Report 2021 www.hiberniareit.com
2025-2030
Future goals
TCFD – engage consultant to carry out Carbon offsetting – start offsetting annual 2025
scenario analysis against potential global corporate carbon emissions through verified Review Net Zero
warming scenarios. local projects that offer opportunities for Carbon Pathway
employee participation. progress and targets
Carbon Reduction Fund – formalise
internal price of carbon to be applied Occupier engagement – continue to issue Set quantifiable social
to the embodied carbon of major new sustainability newsletters and host quarterly impact targets
developments that will seed fund energy meetings. Organise a breakfast forum on
reduction projects in existing assets. sustainability for all occupiers once office- Carry out baseline
based working fully resumes. biodiversity studies
Remuneration – make ESG-linked
performance goals part of the performance Employees – ensure a safe and positive
objectives of every Hibernia employee. return to office working once COVID-19
restrictions allow.
Energy management and reporting Supporting good causes
100% of managed assets now utilising Despite having to cancel our flagship 2030
real-time energy and resource monitoring, Dragons at the Docks event in 2020 due Achieve net
empowering our building managers to to COVID-19 restrictions, Hibernia and the zero carbon
optimise building management systems other cornerstone sponsors committed over
0
for our tenants. €70,000 of funding to four local charities.
In addition, we raised a further €60,000
for local charities and community groups
Climate change resilience through various initiatives. Of this, €78,000
was specifically for COVID-19-related causes.
To better understand the climate-related risks Health and safety
that face Hibernia we engaged KPMG Smart We have certified all managed office
Futures to analyse our current reporting buildings to the internationally recognised
against the TCFD recommendations and ISO 45001 standard and started the
set a target year of 2022 for full alignment. process of validating our COVID-19
Our first TCFD disclosures can be seen on response measures by pursuing certifying
pages 20 to 23 and a summarised version to the WELL Health Safety Rating.
can be found on pages 43 and 44 of the
2021 Hibernia Annual Report.
www.hiberniareit.com Hibernia REIT plc Sustainability Report 2021 7
S U S TA I N A B I L I T Y AT H I B E R N I A
Our sustainability ambition Material issues identified in 2020
Our ambition is to be the most sustainable
property company in Ireland. It is fundamental • Climate change mitigation and resilience Priority 1 – Report on
to the future value of our business and • Energy efficiency in detail and where
to lessen our impact on the environment • Business conduct possible include
and society that we act now. We have • Waste management measurable KPI or
an opportunity to make a meaningful • Tenant engagement goal and include
difference and we look forward to working • Environmental compliance external assurance
with our occupiers, suppliers, communities • Health and safety
and sector peers to achieve common goals • Building obsolescence
and provide buildings that are adaptable • Air quality
and resilient to climate change and that • Smart buildings
promote the health and wellbeing of the • Governance
occupants and the surrounding areas. • Transparency
We have set challenging targets which will • Efficient use of raw materials
Hierarchy
be independently assured, and we will draw
on innovation and partnerships to bring
about effective change.
Our materiality issues • Communities Priority 2 – Report at
In early 2020 we carried out our first • Supplier engagement least in narrative and
materiality assessment, helping us identify • Staff engagement wherever possible
and prioritise the ESG issues that matter • Building design include measurable KPI
most to our stakeholders. Identifying the • Sustainable transport
importance of these issues involved, in part, • Water management
reaching out to external stakeholders to • Employment and skills
capture their views as to what is most • Human rights
important for the Group from a sustainability • Public realm
perspective. As the COVID-19 pandemic • Diversity and inclusion
has progressed we have added to our
understanding by engaging with investors
through virtual meetings and roadshows,
with tenants through conversations and
surveys and with staff through continuous
discussions and surveys, all complemented
Transforming Dublin Responsibly: that and are committed to becoming
Our Sustainability Statement of Intent a net zero carbon business by 2030
by research carried out by consultants on
We have launched Transforming Dublin in line with the growing expectations
our behalf.
Responsibly, our Sustainability Statement of our stakeholders.
The process not only helped us understand of Intent for the period to 2030. It consists
of the three key principles outlined below 2. Provide spaces that prioritise the
what we need to disclose in our Sustainability
that we regard as critical to tackling the environment, health and wellbeing
Reports, but also informed our recently
identified material issues of (see pages 24-27 for more detail)
launched Sustainability Statement of Intent
our stakeholders. We remain committed to clustering our
out to 2030 and Net Zero Carbon Pathway.
buildings so we can provide better services
Details of our 2020 materiality 1. Become a net zero carbon and to our occupants, promoting health and
assessment can be found here. climate-resilient business by 2030 wellbeing and environmental protection.
(see pages 14-23 for more detail) When designing new developments and
If the property industry is to achieve a refurbishing existing buildings, we will
meaningful reduction in carbon emissions, create flexible, inclusive and accessible
commitments which result in tangible spaces that benefit the wellbeing of our
actions must be made now. We have done occupants and of the community.
8 Hibernia REIT plc Sustainability Report 2021 www.hiberniareit.com3. Create long-term positive social How Hibernia manages sustainability Each business function Head is required to
impact through our operations Hibernia’s Board has ultimate oversight ensure that Hibernia’s sustainability agenda
(see pages 28-31 for more detail) of all aspects of the business, including is integrated into their area of work.
Hibernia, as a landlord and a developer, sustainability and risk management.
has an obligation to ensure we create a The Board reviews and approves The Sustainability Manager is responsible
positive social impact. We are putting in the Group’s Strategy and other for overseeing delivery across the business,
place the mechanisms that allow us to policies, and receives updates from with input and support as required from
make a greater contribution to society the Sustainability Committee, which, the Chief Financial Officer and other
through our new developments and as along with other Executive Committees, team members.
we manage these assets in partnership meets at least once per quarter.
with our occupiers and suppliers.
How we will
Our delivery framework sets out the structure by which we aim
to Transform Dublin Responsibly. The framework ensures that
we have the correct processes in place across our business
Transform Dublin
operations in order to meet the requirements of our strategy
and adhere to our policies.
Responsibly
Vision To Transform Dublin Responsibly
Key targets Sustainability Statement of Intent
• Become a net zero carbon and climate resilient business by 2030
• Provide spaces that prioritise the environment, health and wellbeing
• Create long-term positive social impact through our operations
Enablers • Sustainability Policy
• Net Zero Carbon Pathway
• ISO 14001 Environmental
Management System
• Sustainable Development Brief • ISO 45001 Occupational
Health and Safety
Sustainability
• Supplier Code of Conduct
Management System
• C
ommunity Engagement
• WELL Health Safety Rating
Charter
• LEED/WELL certification governance
framework
Performance monitoring Ongoing
• S
ustainability
Fortnightly
• B
uilding Managers meetings
and communications performance dashboard
• Real-time monitoring system
on energy performance
• Occupier meetings
Quarterly Annual
• Sustainability Committee • Sustainability Report
• Executive Committees • Annual Report
• Energy performance reports • ISO audits
• Occupier sustainability • ESG reporting
newsletters • Occupier surveys
• Occupier sustainability • Employee surveys
working groups
www.hiberniareit.com Hibernia REIT plc Sustainability Report 2021 9S U S TA I N A B I L I T Y AT H I B E R N I A CONTINUED
Transforming
Our ambition is to be the most sustainable property company
in Ireland and we have committed to becoming a net zero
carbon business by 2030. Although our business is located
Dublin Responsibly
in Dublin we are committed to creating a wider impact through
our sustainability ambitions and have chosen to align with the
UN Sustainable Development Goals ("UN SDGs") most closely
linked to our three key principles.
The three key principles UN SDGs Target Indicator
7.2 7.2.1
9.4 9.4.1
Become a net zero carbon and climate-
resilient business by 2030 11.6 11.6.2
12.2 12.2.1
13.2 13.2.2
3.4 3.4.1 & 3.4.2
8.8 8.8.1
Provide spaces that prioritise the
environment, health and wellbeing 11.6 11.6.1
12.5 12.5.1
4a 4a.1
8.5 8.5.1
Create long-term positive social
impact through our operations 11.7 11.7.1
10 Hibernia REIT plc Sustainability Report 2021 www.hiberniareit.comDetails of our Sustainability Statement of Intent can be found here.
Objectives Implementation
• By 2030, reduce our overall carbon emissions by 30% and • Publish Net Zero Carbon Pathway.
operational carbon emissions by 40% against a 2019 baseline. • Reduce embodied carbon of new developments.
• Set an internal carbon pricing mechanism to drive behavioural • Prioritise on-site solar PV panels.
change and fund the energy efficiency and on-site renewable • Formalise Carbon Reduction Fund.
improvements to transition existing assets to net zero carbon. • Source electricity from grid on zero carbon tariffs.
• Offset residual carbon emissions from 2030 onwards once we • Identify high-quality local offsetting solutions for residual carbon.
have implemented all other feasible measures. • Full alignment with recommendations of the TCFD by end 2022.
• Put climate change resilience at the centre of our business • Publish CDP climate change questionnaire response annually.
strategy, aligning with the recommendations of the TCFD, • Incorporate ESG targets into our remuneration schemes.
and further incorporate ESG targets into our • Carry out whole-building carbon life-cycle assessments for all
remuneration schemes. new developments.
• Maintain a tenant energy-reduction engagement plan.
• Prioritise health and wellbeing considerations in all of our spaces. • Obtain LEED and/or WELL certification for all
• Promote initiatives that maintain an exceptional standard of new developments.
health and safety with our employees, occupiers and supply • Develop only flexible, inclusive and accessible spaces.
chain partners. • Maintain Step-Up and Think Greener campaigns.
• Send zero waste to landfill and achieve 70% recycling across all • Maintain a waste management tenant engagement plan.
of our managed assets by 2030. • Certify all managed buildings to ISO 14001 and ISO 45001.
• Ensure biodiversity net gain for all major developments and • Ensure all stakeholders aware of safety culture.
refurbishments by 2030. • Obtain WELL Health Safety Rating for all managed spaces.
• Prioritise green spaces in all buildings.
• Maintain beehives on certain asset roof spaces.
• Undertake baseline biodiversity surveys for new developments.
• Better understand the social value that our business brings to • Carry out a social value assessment of all new developments.
our local communities by 2025 and then set long-term targets • By 2025 be able to set long-term social value goals.
to 2030. • Develop Community Engagement Charter.
• Partner with and support charity organisations and groups • Carry out annual staff surveys and measure staff satisfaction.
dedicated to issues that directly benefit our local communities. • Provide a positive working culture.
• Manage our employees in an inclusive and fair manner that • Ensure our team is appropriately diverse.
promotes development, collaboration, creativity and diversity.
www.hiberniareit.com Hibernia REIT plc Sustainability Report 2021 11EMERGING TRENDS
1.
The challenge to increase as a result of ongoing
Working habits and occupier expectations infection control measures e.g.
are changing and the pandemic has only due to extended heating and
accelerated this. Sustainability is becoming cooling systems maintenance,
The future of the
increasingly important for tenants and increased use of personal protective
investors and it is sustainable buildings equipment ("PPE") and more
that are best positioned to prosper in the extensive cleaning regimes.
future. Some considerations on the near
office and workplace
horizon are: Hibernia’s response
Our strategy of clustering and ESG
• Buildings will need property technology excellence was already in place
("PropTech") services, making it easier for pre‑pandemic in response to changing
landlords to monitor metrics such as
health and wellbeing
occupier demand. In addition, over the
occupancy ratios and real-time energy past year, we have:
consumption, cost savings realised and
reduced resource usage. • Trialled new technologies and ways of
• More naturally ventilated buildings: managing our assets, ensuring we are
COVID-19 has heightened the need even more prepared for the nature of
for good ventilation, something that the future office. Listening to our tenants,
will be facilitated by generally improving researching best practice and following
air quality in cities as traffic congestion government guidelines have been key
reduces and there is greater uptake of to how we have adapted. Our initiatives
electric vehicles. include: installing sensors to reassure
• Walking, running and cycling to work occupiers of the air quality of their
will become even more popular as building’s interior spaces; occupancy
people refrain from using mass transit sensors to ensure cleaning regimes are
systems. There will be greater demand not excessive; and the installation of
for bike spaces, some of which will need electric car, e-bike and e-scooter
charging points for e-bikes, and facilities charging spaces in car parks.
such as changing rooms with showers. • Gained ISO 45001 Health and Safety
• Waste generation, energy usage Management System certification and
and carbon emissions may be likely pursuing the WELL Health Safety Rating
for our managed assets in 2021. This
provides reassurance to our occupiers
that our buildings are safe places in
which to work and that promote their
employees’ health and wellbeing.
• Revisited our pipeline of developments
and asked ourselves, ‘Are we building
the workplaces of the future?’ Where
necessary, we have significantly changed
our plans and factored in what occupiers
will want in the ‘new normal’ – for
example, more shared services on site,
better social areas in common spaces,
better health and wellbeing provision,
and less operational carbon emissions.
• Looking forward, we have commenced
work on achieving WELL certification
for our Clanwilliam Quarter and Harcourt
Square developments and will aim to
incorporate as many of the criteria in
order to achieve the maximum score
possible. This process will allow us to
better identify opportunities for
existing assets.
We believe that the office environment
remains crucial to employee collaboration,
team culture and creativity, and we
continue to be positive about the long-term
prospects for well-configured, prime offices
in Dublin’s city centre. Throughout this
Report, you will find further detail on how
we are responding to these challenges
and on our approach to meeting future
occupier requirements.
Hibernia’s Head Office at 1WML, South Docks
12 Hibernia REIT plc Sustainability Report 2021 www.hiberniareit.com2.
Climate change
The challenge
In a special report published in 2018,
the Intergovernmental Panel on Climate
Change highlights that we are facing a
global climate crisis. Collectively, we must
limit global warming to no more than 1.5oC if
we are to reduce the risks associated
with long-lasting or irreversible changes
to the Earth’s atmosphere and ecosystems.
We have roughly 12 years to get global
warming in check – or we face potentially
catastrophic outcomes. The Irish
Government has adopted the principles
of the EU Green Deal and, in March 2021,
signed into law the Climate Action Bill,
which commits the nation to becoming
a net zero carbon economy by 2050,
lowering greenhouse gas emissions
7% per year.
“Tackling climate change is
one of the most urgent shared
endeavours of our lifetimes,
demanding bold action from
every nation to prevent
catastrophic global warming.”
Alok Sharma, COP26 President
From this, it is clear that buildings will have
to be net zero carbon by 2050. Therefore, PV panels on the roof of 1SJRQ
the property industry has clear imperatives:
contribute to our Carbon Reduction Fund,
it must show that it is on a pathway to
a mechanism that will seed finance the How we identify material issues
achieve this critical target; it must take
capital expenditure costs required to The last twelve months have presented
urgent action to ensure that its portfolios
transition to net zero. Read more about our many challenges and posed many
are resilient; it must meet the growing
Net Zero Carbon Pathway on pages 14 to questions about what is important
expectations of its tenants; and it must
19 and on our website, here. to our occupiers, to our investors
deliver long-term value for its investors.
and to Hibernia itself. The results
'Failure to respond appropriately and of the 2020 materiality review have
Hibernia’s response sufficiently to climate change' is now one only been further confirmed, with
Hibernia has committed to achieving
of our principal risks (see pages 50 and 51 our key stakeholders seeking robust
net zero carbon emissions by 2030, 20
of our 2021 Annual Report for further ESG performance and disclosures.
years ahead of the Climate Action and
detail) and to ensure maximum levels of Coupled with the acceptance that
Low Carbon Development (Amendment)
governance and disclosures as regards our climate change is a major global
Bill 2021 target date of 2050, in line with
climate change commitments, we are in the threat, the uncertainty over the future
the growing expectations from its investors,
process of aligning with the recommendations of the workplace and the necessity for
tenants, employees and partners. We have
of the TCFD and carried out a gap analysis an ethical and just transition for all in
launched our Net Zero Carbon Pathway
in 2020 to identify areas for consideration. society, these are the material issues
aligned with the latest scenario modelling
We now have a comprehensive understanding that Hibernia must concentrate on.
on possible global temperature rises, and
of the scope of physical, transitional and Narrative around these material issues
our commitment, we have signed up to
social risks and opportunities to the business can be found on this and the previous
the Better Building Partnership's Climate
and will further quantify the impact of these page and they form the basis of
Commitment and the World Green Building
through a scenario analysis project in 2021. our revised sustainability strategy,
Council's Net Zero Carbon Buildings
We are aiming for full alignment with the which we call Transforming Dublin
Commitment which commit us to
recommendations of the TCFD by the Responsibly – our Sustainability
transparent disclosure on our progress in
end of 2022. Statement of Intent out to 2030.
our annual reporting. We have established
an internal price of carbon that will
www.hiberniareit.com Hibernia REIT plc Sustainability Report 2021 13BECOMING A NET ZERO CARBON BUSINESS BY 2030
Our plan to be a net zero
carbon business by 2030
Why this is important to our business
model and strategy Energy and emissions performance
The risks of climate change are increasingly
recognised. Within our business, both
occupational and investment markets Energy use intensity reduction from Scope 1: Direct emissions
are focusing more on sustainability, and 2016 to 2020 from landlord-obtained 2019 2020
consequently, commercial consequences utilities in our managed offices on an
for good or poor performance in this area absolute basis
are to be expected. Given the scale of the
2016
global climate challenge, it is clear to us
that an especially ambitious approach is 2017
1,818 1,470
tCO2e tCO2e
now required. That is why we are committing
to achieving net zero carbon by 2030.
-51%
2018
Where we stand right now 2019
Over the past six years, Hibernia has shown
leadership in sustainability in the Irish real 2020
estate sector, setting and achieving
ambitious targets to reduce its carbon
footprint and reduce the energy intensity GHG emissions intensity reduction Scope 2: Indirect emissions
of its buildings. We have demonstrated from 2016 to 2020 from landlord- 2019 2020
our ability to improve the performance of obtained utilities in our managed
existing assets and to develop leading-edge offices on an absolute basis
sustainable buildings. During 2020, we
achieved further reductions during periods 2016
of low occupancy due to COVID-19
2017
1,713 1,129
tCO2e tCO2e
restrictions and lockdowns. In addition,
further building optimisation measures have
-59%
2018
been implemented across the portfolio and
the installation of real-time energy sensors 2019
on all utility meters has increased the
visibility of our performance. 2020
But we are not complacent. There is still
a long way to go to become a net zero
GHG emissions (Scope 1 and 2) Scope 3: Value chain emissions
carbon business by 2030. Realising our
reduction from 2016 to 2020 on
goals will require partnership with all our 2019 2020
a like‑for-like basis (tonnes CO2e)
stakeholders, from designing net zero
carbon buildings with our architects and 2016
mechanical and electrical consultants to
12,556
operating buildings in collaboration with
18,491
2017
tenants who see the benefits of occupying
tCO2e tCO2e
smart, energy-efficient buildings.
-52%
2018
2019
2020
14 Hibernia REIT plc Sustainability Report 2021 www.hiberniareit.comGer Doherty
Director of Development
"Our aim is to develop buildings that
minimise environmental impact
and are aligned with our 2030
pathway to be a net zero carbon
business. We therefore strive to
minimise embodied carbon in the
construction phase and to hand
over to our building management
teams and occupiers spaces that
consume lower levels of energy
than traditional buildings."
Description of our approach
We developed our Net Zero Carbon
Pathway by involving all departments
of the business from day one. We also
consulted independent sustainability
New development – Clanwilliam Quarter
advisers and our assurance providers,
to gain their feedback and to model our
existing baseline, 2030 ‘business-as-usual’
footprint and 2030 net zero carbon
footprint. This gave all stakeholders
a holistic view of the project.
With our new developments currently • installing on-site solar PV panels which
in the design stages, we are exploring will fulfil greater than 10% of the
opportunities to progress these buildings development’s energy demand;
to a net zero carbon standard, or as close • exploring opportunities for utilising
to this as possible, focussing on embodied mixed-mode ventilation;
carbon and operational carbon reduction • investigating the possible use of ground
measures in advance of our 2030 target. source heat pumps;
• mandating that the building uses
At over 200,000 sq. ft., Clanwilliam Quarter electricity only, with zero fuels used for
will be our most ambitious project to heating and limiting the use
date and will deliver on our ambitions by: of refrigerants;
• carrying out a whole life carbon
• mandating that project teams use our assessment, from the design stage,
Net Zero Carbon Pathway as the basis to ensure that carbon-reduction
of their design concepts; measures are identified at all stages
Details of our Net Zero Carbon • adopting a design for performance of the building’s life; and
Pathway can be found here. approach at the design stage through • ensuring we achieve LEED Platinum
to commissioning, ensuring the building and WELL Platinum certification.
operates in line with the design intent;
www.hiberniareit.com Hibernia REIT plc Sustainability Report 2021 15BECOMING A NET ZERO CARBON BUSINESS BY 2030
CONTINUED
Plan
Reduce operational carbon and energy
Operational carbon made up over 66%
of our overall carbon footprint in 2020
and provides the greatest opportunity to
reduce emissions across our portfolio.
We will carry out the following as part of
the process of lowering operational carbon:
• Optimise building performance through
data-driven technologies equipment.
• Transition away from fossil fuel towards
electric only heating, cooling and hot
water solutions.
• Increase on-site renewable generation
through solar PV installation.
• Procure only 100% renewable landlord
electricity and work with occupiers to
do same.
Retrofitting existing assets
• Work with tenants to ensure more
energy efficient behaviour and agree
solutions to improve whole
building performance.
• Adopt a design for performance
approach on all new buildings to
close the performance gap. Through extensive engagement with • upgrading the building management
the occupiers, we will transition existing systems to allow for integration of
Reduce embodied carbon
assets to be net zero carbon-aligned additional IAQ sensor data and other
Embodied carbon contributed 20% of
buildings in advance of our 2030 target. information e.g. local weather data;
our overall carbon footprint in 2020 and
• maximising on-site solar PV panels;
deserves a high degree of attention. We We will achieve this by: • procuring all landlord and tenant
will carry out the following as part of the
electricity from a guaranteed 100%
process of lowering embodied carbon: • establishing, with input from renewable energy supplier; and
occupiers, building specific net • applying for LEED Operations and
• Mandate whole life carbon assessments zero carbon action plans;
for all major new developments and Maintenance certification for the entire
• improving heating and cooling building where applicable and, once
fit-outs. by retrofitting existing plant and
• Develop a Sustainable Development Brief energy reductions and on-site electricity
equipment e.g. demand control generation are realised, applying for
incorporating minimum requirements ventilation mechanical systems
for contractors. LEED Zero, or similar, certification.
or air source heat pumps;
• Carry out research with stakeholders • supplementing the existing in-duct The majority of these projects will be
in lower-carbon construction materials sensors with indoor air quality (“IAQ”) delivered at zero costs to the occupiers
and building methods. monitoring of spaces for humidity, due to the energy savings realised.
• Incentivise the reduction in embodied CO2, occupancy and temperature
carbon through our internal carbon at a minimum;
pricing mechanism.
2030 net zero carbon targetsOffset residual carbon Tenant engagement to drive agenda Challenges
Where it is not possible to eliminate Recognising that more than two-thirds Ultimately setting a net zero carbon
carbon emissions, from 2030 we will of our operational emissions come from target requires a leap of faith as there
offset these residual emissions through tenant-controlled space, the scope of our are a number of uncertainties:
verifiable schemes. In advance we will offset commitment includes space we do not
annual corporate carbon emissions through control. This is obviously challenging, • Much of the carbon emissions from
verified local projects, allowing us learn but it is also an opportunity to strengthen our assets comes from the activities of
more about the offsetting market. We will our relationships with our occupiers as our tenants and from our development
prioritise offsetting projects, such as tree we collaborate on climate initiatives in activities, reducing our level of control.
planting, which offer opportunities for the years ahead. We already have • Some of the advances required to reach
employee participation. sustainability working groups in place net zero (e.g. grid decarbonisation, more
in our managed assets, platforms that energy-efficient plant) are not available
Internal price on carbon facilitate discussion on energy and carbon today and may not be developed by 2030.
To assist in transitioning to net zero carbon, reduction, and we will review our leases to • Nobody knows exactly what carbon
we have established an internal price of ensure they are kept up to date with the pricing and offsetting costs will be in 2030.
carbon of €75 per tonne to help change latest developments in green leasing.
behaviours within Hibernia ahead of 2030. We will work with our stakeholders to
The Carbon Reduction Fund will provide provide clarity around many of these
seed funding for energy improvements uncertainties and refine our model
in existing buildings and will take the form accordingly, providing transparency
of a levy on the embodied carbon of new through our annual disclosures.
developments and refurbishments.
Reducing the environmental impact of buildings across their entire life-cycle is
critical in addressing climate change. I welcome Hibernia REIT’s commitment to
achieving net zero by 2030, and more specifically their ambition to reduce embodied
carbon in future developments and increase on-site renewable energy production.
I truly hope this will inspire others in the industry.”
Pat Barry
Chief Executive Officer of the Irish Green Building CouncilOUR ROADMAP TO NET ZERO CARBON
Through our target
actions of reducing
the embodied carbon
in new developments,
reducing the energy 24.5k
intensity of our
existing building
21k
tonnes C0₂e
tonnes C0₂e
stock and increasing
our renewable energy
generation and
procurement,
we hope to reduce
our carbon emissions
to below 14,000 2019 2030
tonnes by 2030. Baseline
emissions Projected business-as-usual emissions
As we move beyond 2030, it will be
imperative that we continue to reduce
our carbon emissions and reduce our
reliance on carbon offsetting. As we get
closer to our target deadline, we will revise
our modelling with a view to producing
a revised pathway that will allow us to
reach a point of zero carbon or be
carbon negative by the year 2050.
18 Hibernia REIT plc Sustainability Report 2021 www.hiberniareit.comOur Net Zero Carbon Pathway is aligned to the BBP Net Zero
Carbon Pathway Framework and WGBC’s Net Zero Buildings
Commitment. As part of these commitments, we are required to
report on our annual progress and the steps we are taking along
our pathway to achieve our net zero carbon ambition. As we have
only published our pathway in June 2021 we will provide a detailed
review on our first year of progress, including disclosures on the
energy performance of our portfolio, in next year's Report.
43%
reductionB E C O M I N G A C L I M AT E - R E S I L I E N T B U S I N E S S B Y 2 0 3 0
Climate risks
We have agreed to adopt the recommendations of the Task Force
on Climate-related Financial Disclosures ("TCFD") framework. This
supports the assessment, pricing and management of climate risk, and
in our industry
is structured around four thematic areas that represent core elements
of how organisations operate: governance, strategy, risk management
and metrics and targets.
Governance
Recommended
Disclosures Where we are Where we are going
Describe the Board’s The Board, which meets at least six times a year, is responsible for overseeing Improved reporting and
oversight of climate- activities that relate to sustainability and climate change, with the CEO, Kevin training from Sustainability
related risks Nowlan, and CFO, Thomas Edwards-Moss, retaining overall accountability and Committee to Board.
and opportunities. oversight. The CEO and the CFO provide regular updates on our progress on
our Sustainability Strategy. Where approval is sought for strategy direction,
a paper is submitted and presented by either the CEO, the CFO or the
Sustainability Manager. Examples during the last year include approval for
the Sustainability Statement of Intent and the Net Zero Carbon Pathway.
Kevin Nowlan, CEO, chairs the Sustainability Committee and is the main Board
Director with overall accountability for sustainability. Climate change, carbon
reduction and energy management are key material issues of our sustainability
strategy and also the responsibility of the CEO.
In addition to Board oversight, our CEO and CFO both have personal objectives
to lead and progress sustainability initiatives across all aspects of Hibernia, as
evidenced within our Directors’ remuneration report on page 96 to 124 of the
2021 Annual Report.
During the last year, the Board agreed seven new strategic non-financial
operational metrics to sit alongside our financial operating metrics.
The Board attends sustainability-related continual professional training events
which included a session provided by an external consultant on sustainable
finance in 2021.
Describe The Risk and Compliance Committee is responsible for all risk oversight and Integrate sustainability
management’s role management including climate-related risks and reports to the Board periodically commitments as
in assessing and and at minimum on a quarterly basis where the information is used to inform part of all Senior
managing climate- business strategy and decision making. This Committee comprises the CEO, the Management department
related risks CFO, the rest of the Senior Management Team, the Sustainability Manager and goals and individual
and opportunities. the Risk Manager. performance objectives/
remuneration KPIs.
Day-to-day oversight of climate-related issues is undertaken by the Sustainability
Committee, which is chaired by the CEO. This Committee meets at least quarterly
and comprises all members of the Senior Management Team, the Sustainability
Manager and other relevant employees. The Sustainability Committee reviews
performance in terms of climate-related activities, which will now include
progress on our Net Zero Carbon Pathway goals.
The Senior Management Team is provided with frequent updates by the
Sustainability Manager in relation to climate change risks and opportunities as
well as performance of existing assets as tracked through our online sustainability
dashboard. This allows us track and benchmark the performance of individual
assets and the portfolio as a whole.
20 Hibernia REIT plc Sustainability Report 2021 www.hiberniareit.comWe will use the TCFD recommendations to further understand and increase the
transparency of Hibernia’s climate-related risks and opportunities. This will allow us to
better prepare for the impending shift to a low-carbon economy and the challenges of
climate change in ways that are most beneficial to our industry and all our stakeholders.
This is our first disclosure in line with the recommendations of the TCFD. We set out below
our most up-to-date disclosure in addition to the summarised version we have provided in
our 2021 Annual Report. In addition to the disclosure below we also submit responses to
CDP and the GRESB, providing even more insight in this important area.
Strategy
Recommended
Disclosures Where we are Where we are going
Describe the Short term: 1-3 years Disclose our climate-related
climate-related There has been a greater shift in terms of legislation e.g. nearly Zero Energy risks and opportunities
risks and Building ("nZEB") regulations which set a legal minimum rating in terms of publicly through our 2021
opportunities the Building Energy Rating ("BER") for new commercial and non-commercial CDP response and share
organisation has buildings. There is growing demand from occupiers to lease sustainable buildings the output on our
identified over that are energy efficient and that provide cost saving opportunities and greater Group website.
the short, medium, health and wellbeing benefits for their employees. Similarly, investors are
and long term. requesting that we respond to CDP and other sustainability benchmarks and
ratings and are taking a greater interest in the performance of individual assets.
We have an opportunity to collaborate with our stakeholders to deliver significant
reductions in Scope 1, 2 and 3 emissions across our portfolio, ultimately de-risking
our portfolio to the impacts of climate change, providing cost savings for our
occupiers and greater returns for our investors.
Medium term: 3-10 years
The need to decarbonise and adapt to climate change may give rise to higher
market demand for buildings with improved sustainability credentials and
greater energy efficiency. This may lead to stranded assets that are no longer
fit for purpose from an environmental efficiency perspective and provide an
opportunity for us to deliver buildings that meet this need.
Long term: 10-30 years
The speed of market transformation and technological progress may impact
on our ability to decarbonise our business. There may be greater demand for
buildings that have been adapted to accommodate the likely impact of climate
change, including higher temperatures and an increase in extreme weather
events, including flooding and water shortages.
Describe the We invest in, develop and manage property in Dublin city centre and, as such, Model the financial
impact of climate- climate-related issues affect the way we develop new buildings, how we manage impact and
related risks and existing ones and the kinds of suppliers we use to support us in these activities. payback of energy
opportunities on Our Sustainability Statement of Intent drives our corporate approach and is efficiency measures.
the organisation’s supported by our delivery framework enabling policies and documents for our Set a trajectory for
businesses, business activities, setting out how we manage these risks within our developments energy reductions
strategy, and and property management activities and the necessary performance standards for each asset.
financial planning. required to ensure that climate-related risks do not adversely affect our work. Integrate our net zero
For example, in our Sustainable Development Brief there are requirements to requirements at the
attain high BER and LEED ratings which, in turn, help to make our new buildings design stage for
more efficient. new developments.
Better understand
A strategic priority for 2021-22 is to progress the sustainability agenda as set the likely cost of
out in our Sustainability Statement of Intent and our Net Zero Carbon Pathway. carbon offsetting.
Set up the frameworks
required to manage the
Carbon Reduction Fund.
www.hiberniareit.com Hibernia REIT plc Sustainability Report 2021 21B E C O M I N G A C L I M AT E - R E S I L I E N T B U S I N E S S B Y 2 0 3 0
CONTINUED
Strategy continued
Recommended
Disclosures Where we are Where we are going
Describe the Our Sustainability Statement of Intent lays out a clear strategy for dealing Our next step is to look
resilience of with both mitigation of climate change and adaptation to the effects of climate at various climate-related
the organisation’s change. The changing climate will impact our assets and our business strategy scenarios and understand
strategy, taking by presenting both physical risks e.g. flood risks and transition risks e.g. carbon the financial impact to the
into consideration pricing, which will affect the costs of materials used in developing new buildings business from the physical
different climate- and the costs of maintaining and operating existing buildings. and transitional risks
related scenarios. and opportunities.
We have taken the strategy further and have modelled what our carbon
emissions would be by 2030 if we carried on with our current business model.
We then set a net zero carbon pathway to 2030, aligned with climate science
and a 1.5oC global warming scenario, and an action plan to ensure that we reduce
our carbon footprint accordingly.
Risk management
Recommended
Disclosures Where we are Where we are going
Describe how Identification, assessment and management of climate-related risks is fully integrated Carry out reviews of key
processes for into the Group’s risk assessment framework which includes periodic reviews of all suppliers and vulnerability
identifying, assessing, risks, including physical (chronic and acute), regulatory, reputational, market and to climate-related risks in
and managing social climate-related risks. Our sustainability materiality assessment assists in the value chain. Test risks
climate-related risks identifying the risks to the business, and during this assessment in 2020 climate against various climate
are integrated into change mitigation and resilience was identified as one of the key material issues. scenarios.
the organisation’s
overall risk The risks are collated by the Senior Management Team towards year end and
management finalised through the Risk and Compliance Committee, including determination
framework. of the impacts, likelihood and risk ratings for all risks as well as the mitigating
measures being implemented to reduce the level of risk to the business. The
emerging and principal risks are presented to the Board for formal review and
approval. These risks are disclosed through annual reporting and integrated
into planning for the business strategy for the next 12-month period.
The strategy for managing climate-related risk is detailed in our Sustainability
Statement of Intent and further through our annual sustainability reporting.
Each department has responsibility to manage the risks as they relate to their
activities; for example managing energy consumption and carbon emissions is
the responsibility of the building management team, whilst integrating net zero
carbon ambitions in future buildings is the responsibility of the Development
Team as outlined in the Sustainable Development Brief.
The Sustainability Committee has responsibility for agreeing management
strategies and specific projects, as well as monitoring and measuring the
impact on the climate resilience of the business as a result of these actions.
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