Second-Party Opinion Download

Sustainalytics is of the opinion that Shui On Land Limited’s Green Finance Framework is credible and impactful and aligns with the four core components of the Green Bond and Green Loan Principles 2018. This assessment is based on the following:

USE OF PROCEEDS

The eligible categories for the use of proceeds – (i) Green Buildings, (ii) Energy Efficiency, and (ii) Pollution Prevention and Control – are aligned with those recognized by the Green Bond and Green Loan Principles 2018. Sustainalytics considers that the eligible projects will lead to positive environmental benefits through decreasing greenhouse gas emissions and waste while supporting green cities in China. Sustainalytics considers that the eligible projects will advance the UN Sustainable Development Goals (SDGs), specifically SDG 7, 9 and 11.

PROJECT EVALUATION/SELECTION

Shui On Land Limited has a two-step project evaluation and selection process. A crossdepartmental sustainable development working group will be established with representatives from Shui On Land Limited’s design, construction, procurement, quality management, finance, branding and operation teams for selecting an initial set of eligible projects. These projects are to be validated and approved by Shui On Land Limited’s Sustainable Development Committee. This process is in line with current market practice.

MANAGEMENT OF PROCEEDS

Shui On Land Limited’s Treasury and Legal team will manage the net proceeds using a register, including information on details of loans and bonds, mapping of eligible projects against the relevant categories, amount allocated, environmental certification or third-party reports, balance and status of unallocated proceeds. Pending full allocation, the unallocated proceeds will be invested in cash or cash equivalents as part of the company's cash management policies or used to repay existing indebtedness. Allocated proceeds will be reviewed on an ongoing basis to track any material change based on eligibility criteria. This process is in line with market practice.

REPORTING

Shui On Land Limited commits to report to investors annually on the allocation of proceeds on its website, within the Environment Social and Governance (ESG) section of its Annual Report. The (i) allocation report will include the list of approved eligible projects, amount of allocated proceeds and balance of unallocated proceeds. With regards to the (ii) impact report, Shui On Land Limited commits to disclose data on relevant KPIs for each eligible category. Sustainalytics views the scope and granularity of Shui On Land Limited’s impact reporting to be in line with current market practice.