OUR ESG STRATEGY
Understanding our carbon footprint
Lavastone has been committed to playing its part in protecting the environment and preserving our natural resources through waste reduction and the increasing use of energy-efficient equipment, amongst other measures. Over the past few years, given the nature of our activities and their contribution to carbon emissions, we have sharpened our focus on reducing our carbon footprint. In 2021, we appointed Dynamia Ltd, specialists in impact assessments and regenerative strategies, amongst many other services, to gain insights into our carbon footprint and establish a baseline against which we can measure our progress. Only by understanding and taking stock of our current carbon footprint can we develop a realistic, relevant and targeted strategy.
Dynamia’s investigation covered three scopes, which include all direct and indirect gas emissions resulting from our activities:
Scope 1 covers direct emissions from owned or controlled sources.
Scope 2 covers indirect emissions from the generation of purchased electricity, steam, heating and cooling consumed by the reporting company.
Scope 3 includes all other indirect emissions that occur in a company’s value chain.
The findings of the report produced by Dynamia, illustrated in the table below, revealed Lavastone’s major sources of CO2 emissions: employee commute (journey to and from work) and energy consumption. Similarly, the report on our assets (besides our offices) occupied by our tenants indicated energy consumption as the highest contributor towards CO2 emissions.
The investigation of our Scope 3 emissions was carried out with limitations this year due to the complexity of the endeavour. Since Scope 3 involves other actors who operate along our value chain, we require substantial data from our suppliers, customers and partners, which aren’t readily available or easy to obtain. The drive to reduce Scope 3 emissions will require companies to extend their sustainability production systems to include procurement, product development, supplier development, sales and logistics. For our part, at Lavastone, measuring and improving Scope 3 emissions in our upstream supply chain will call for an overhaul of our current approach to supplier selection and management, as well as the development of new skills and competencies. We aim to further explore our Scope 3 emissions in FY2023.
One of the opportunities identified was the carbon sequestration process, achieved via the afforestation of land holdings belonging to SWSG. Afforestation represents a greenhouse gas (GHG) strategy involving the planting of trees in the region to sequester, or capture, carbon dioxide being released into the atmosphere and storing it.
Lavastone’s strategy
In the real estate industry, there is growing interest and concern from stakeholders and businesses to occupy spaces that allow for a reduced carbon footprint. We have therefore recognised that beyond improving our own operations, our strategy must also provide solutions to improve the efficiency and sustainable operations of our assets, and in doing so, reduce the carbon footprint of our tenants, while also future-proofing our assets.
With this in mind, and following the carbon footprint report, a roadmap was defined, setting out quick wins, medium-term wins and long-term wins that take into account our financial and strategic costs and benefits.
Our roadmap to achieving carbon neutrality is centred on the following priorities:
To establish a potential pathway to net zero, we have started identifying changes to be made in the three aforementioned categories – business operations, assets operations and new developments – that could reduce or eliminate emissions from our value chain. The actions were then ranked in ascending order, in terms of their feasibility and potential impact. With respect to our tenants, the implementation of each ‘green’ feature or initiative will be carried out on a case-by-case basis, in accordance with their different business models.
Identified actions within Lavastone’s business operations
Identified actions within existing assets (same assessment criteria to be applied for new acquisitions)
Identified actions within new projects
Our progress and performance in FY2022
