LHN Group is a real estate management services group with a history dating back to 1991. The group is distinguished by its ability to generate value through its space optimisation expertise. The group also provides a suite of services in property development, facilities management, and energy resources which complements the space optimisation business. The group has operations spread strategically across Singapore, Hong Kong, Indonesia, Myanmar, and Cambodia.
1. Can you share about LHN’s sustainability approach and how it is integrated into the business operations?
At LHN, we champion sustainability’s pivotal role in safeguarding the viability of the environment, society, business, and individuals alike. Our endeavours focus on striking a balance between the elements of the environment, humanity, and profitability. Hence, instead of relying on one-off, short-term initiatives, we promote a long-term sustainability strategy that integrates sustainable practices into our daily operations. This approach yields a lasting, cumulative positive impact on our workforce, stakeholders, local community, and the environment. Our sustainability approach is governed by a comprehensive environmental, social and governance (ESG) framework.
We adhere to three overarching pillars: (i) protect our environment; (ii) create positive social impacts for our employees, stakeholders and communities; and (iii) maintain good corporate governance practices. We have dedicated committees to tackle multiple aspects of sustainability.
Our three internal committees — the welfare committee, the CSR committee, and the sustainability innovation committee — are responsible for monitoring and managing the key elements while maintaining a balance between our internal and external sustainability objectives.
To amplify the impacts of our ESG initiatives, we establish long-term partnerships with social and environmental agencies/enterprises, fortified by the support and collaboration of our business associates. These partnerships allow us to pool our collective resources and leverage diverse skill sets. In addition, our supplier code of conduct outlines and communicates our expectations of our suppliers and business partners in the ESG area. The mutual commitment to this code will determine the quality and longevity of our business relationship.
2. With the growing focus on sustainability in the property industry, how does LHN intend to adapt to this growing trend?
Buildings have traditionally been viewed as energy consumers within the energy system. However, with current technologies such as solar panels, smart energy management systems, and built-in energy storage facilities, we can transform buildings into energy prosumers. These buildings can consume and produce energy simultaneously, making it more self-sufficient and less reliant on fuel energy.
To ensure the sustainability of our offerings, we enhance the energy efficiency of properties we manage by adopting energy-saving technologies. For example, previously unused spaces such as rooftops have been deployed for photovoltaic (PV) systems like solar panels, while our car park areas have been equipped with electric vehicle (EV) chargers. We continuously improve our offerings and make them affordable for small and medium-sized enterprises who want to take part in this transition. Retaining and grooming individuals is also critical to ensuring the sustainability of our business. We provide training and reskilling opportunities for current staff members who wish to expand their skills in the sustainability sector.
3. What is LHN’s strategy to ensure that the portfolio properties minimise their environmental impact? Any recent initiatives to share?
In our pursuit of long-term zero-emission targets, we have adopted a comprehensive strategy to manage our resource consumption and mitigate negative impacts on the environment we operate in.
Our operation is guided by three key strategies under the “protect our environment” pillar in our ESG framework:
1. Low carbon future
• Green energy adoption: We are transitioning to green energy by installing solar panels on the rooftops of our properties and EV charging points within our facilities.
• Solar panel expansion: The capacity of our solar panel systems has increased from 608 kWp [kilowatt peak] in FY2021 to 2,468 kWp in FY2022. We aim to further grow the energy production capacity of our solar panel systems.
• Deployment of equipment and reducing digital carbon footprint: Any new computers or equipment purchased must meet more stringent environmental criteria, while sets that are no longer productive are sent to recycling facilities for certified data destruction and secure refurbishing. We also went paperless by digitalising all forms and contracts as well as encouraging vendors to send us digital invoices.
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• Boosting green coverage: We aim to increase green coverage by cultivating existing green areas and planting more trees at properties we manage. In every new project, we maximise green coverage by incorporating natural elements such as plants, flowers, or gardens into the design.
2. Responsible consumption
• Energy efficiency initiatives: We have introduced energy-saving measures, including the installation of energy-efficient LED light fittings across our owned and managed properties. We have also implemented motion sensors and timers in common areas to automatically power off electrical outlets and appliances when not in use.
• Water management: Water-saving taps equipped with sensor nodes have been installed in newly acquired properties. They monitor real-time water consumption data and promptly detect leaks, effectively reducing water wastage.
• Reduced intensity: The electrical intensity and emissions intensity for our space optimisation properties is 0.13MWh/m2 and 0.05 TCO2e/m2 for FY2022 respectively. These represent a decrease of 7.2% and 13% respectively, as compared to FY2021.
3. Sustainable communities
• Urban farming at Coliwoo: Since FY2021, the Coliwoo Community (LHN’s space optimisation residential segment) has leveraged the rooftop space in our properties to kickstart an urban farming initiative. Members of the community can thus plant herbs and care for plants within the facility.
• Upcycling: LHN puts effort into introducing and familiarising employees with the upcycling concept, which repurposes discarded objects into a product with a different or higher value than the original. We have partnered with environmental instructors such as TerraSG to provide hands-on upcycling workshops and eco-education programmes.
4. What are some of LHN’s sustainability commitments and how does the group ensure progress in accordance with these commitments?
• Improve property efficiency through thoughtful design: Our space optimisation core business focuses on recycling old and underutilised spaces and enhancing them to maximise the leasable areas. By doing so, we upgrade the building’s internal facilities and usability without tearing them down, reducing noise and air pollution.
• Improve energy efficiency and water efficiency: The deployment of a remote meter monitoring system in our industrial and commercial properties enables us to monitor energy consumption and energy efficiency as well as detect system or equipment anomalies. The data would be then conveyed to an on-site LHN staff via a chatbot, who can swiftly deal with any unexpected electricity leakage issues.
• Transition to green energy and long-term zero emissions: We have committed to shift to green energy by installing solar panels and facilitating the use of EVs. To strengthen our commitment, we have recently become a partner of Carbon Pricing Leadership Coalition Singapore, the decarbonisation arm of the UN Global Compact Singapore.
• Improve employee awareness and commitment to our ESG strategy: To ensure accessibility to employees at all levels, we strive to present our ESG concepts in the most straightforward way possible through our ESG communication deck. This deck also includes practical suggestions on integrating sustainability into daily operations and personal lives.
• Establish long-term partnerships with social agencies/enterprises for sustainable and meaningful corporate social responsibility or CSR initiatives: Since 2021, we have worked regularly with Food From The Heart through golf charity sponsoring, food pack donations and volunteering at their warehouse.
5. With a wide diversification of portfolio, how does LHN ensure that it meets the regulatory requirements for ESG reporting?
• Comprehensive ESG framework aligned with national targets and sustainable development goals (SDGs): We have developed an all-encompassing ESG framework that not only addresses regulatory mandates but also aligns with relevant national targets and SDGs. By identifying goals that resonate with each portfolio segment, the company can ensure its ESG efforts contribute to broader global sustainability objectives.
• Expertise and training: We provide quality training on sustainability-related topics (e.g. LowCarbonSG Programme conducted by UN Global Compact Network Singapore) for relevant personnel within the organisation to ensure they are well-versed in ESG and updated on changing regulations.
• Identifying areas where sustainability initiatives can be applied: Our sustainability innovations committee consists of heads of department and members of the board, who regularly exchange ideas and identify areas in daily operations where sustainability strategies can be effectively integrated.
Candace Li is associate director, research, at the Singapore Exchange Group
About the 5 in 5 series
Designed to be a short read, 5 in 5 provides insights into SGX-listed companies’ sustainability efforts through a series of 5 Q&As with management. Through these Q&As, management will discuss the company’s sustainability journey, governance structure & commitments, material ESG topics and many more. This report contains factual commentary from the company’s management and is based on publicly announced information from the company. For more, visit sgx.com/research. For more company information, visit www.lhngroup.com.