Business outcomes Climate and Nature Near-term climate targets published Near-term climate targets published Operational climate target set Operational climate target set Offsetting continued Offsetting continued Improving our office environment Improving our office environment Combatting plastic pollution Combatting plastic pollution Championing biodiversity Championing biodiversity This year’s outcomes 1 www.netzeroassetmanagers.org 1 www.netzeroassetmanagers.org scroll down Near-term climate targets published In line with last year’s commitment, in April 2024 we published near-term climate targets which were approved by NZAM1. While these targets were not ratified by the Science Based Targets initiative (SBTi) due to challenges in aligning our diverse assets with their reduction pathways, we believe our targets are science-aligned, having followed SBTi guidance throughout. When comparing this year’s carbon footprint to previous years, we see that the sale of large energy infrastructure assets has shifted the majority of emissions to our lending portfolio. This shift will be a focal point in our future transition planning. Our next steps include continuing to improve data collection and quality, and implementing increased process around Group level climate risk management as we continue to progress towards Group level reporting. Our approach continues to reference the guidance of the Task Force on Climate-related Financial Disclosures (TCFD) and the Task Force on Nature-related Financial Disclosures (TNFD). Over the past year, we’ve made strides in enhancing data quality for carbon emission reporting, especially across our Real Estate portfolio by gathering actual energy and carbon emissions data via remote APIs (application programming interfaces) from property meters. We’ve also offered our SME lending and Venture portfolios complimentary access to a carbon accounting tool to help them begin tracking their carbon footprint. Post-trial, should it prove successful, we plan on implementing this tool across all portfolio companies with the aim of further improvements in data quality. While our efforts over the past year have concentrated on data collection, quality enhancements, and target development, we acknowledge the rise in emissions during the reporting period. We believe that establishing science-aligned targets is crucial for reducing emissions, and robust data is essential to identify successful and efficient initiatives. We expected that in the early years of our commitments, as our data quality increases, our emissions will show increases. Following our reduction pathways and implementing emission reduction activity is a key focus for the years ahead. Operational climate target set We have also published our operational climate target, committing to reduce our absolute Scope 1 and Scope 2 emissions by 42% by 2035 from a 2021 baseline year. This target is science-aligned and designed to conform to a 1.5°C scenario by 2030. Offsetting continued We will continue to offset the carbon footprint of our operations, with details provided below. While we don’t see offsetting alone as a complete solution, we recognise it plays a role in a broader transition strategy. This year, we partnered with Abatable to continue support for the Rimba Raya Project in offsetting our 2023 operational carbon emissions. The programme uses carbon revenues for forest restoration and habitat protection, including for the Bornean Orangutan, through activities aligned to the UN Sustainable Development Goals, and in particular Goals 13, 15 and 17. Improving our office environment We continue to work with our building manager to improve environmental practices in our leased offices, though progress has been slower than expected. This year, we switched to new printing providers to reduce the environmental impact of our printed materials. Additionally, we offer employees access to an electric car scheme to encourage low-carbon transport options. Combatting plastic pollution In early 2024, we joined 160 financial institutions, representing around $15.5 trillion in assets, in signing the Finance Statement on Plastic Pollution. We called on governments to support the international treaty to combat plastic pollution before the fourth round of negotiations in Canada in April 2024. We are committed to further addressing this issue within both our investments and internal practices, and we’re also adopting a more mindful approach to corporate gifting, aiming to eliminate plastics. Championing biodiversity We are exploring ways to better incorporate biodiversity into our actions as both a business and investor. We focused on volunteering opportunities that benefit biodiversity (see the Community section and our work with The Conservation Volunteers). As investors, we joined the PRI’s Nature Reference Group to support our TNFD approach and are exploring how to direct more capital toward nature-based solutions (see the Energy section ). We are still early in our TNFD journey, with our current focus on ensuring our net zero strategy is well-structured and effective. Work has begun on this, please see the Housing section and Energy section .