ENVIRONMENT, SOCIAL & GOVERNANCE (ESG) GROUP POLICY
Topland recognises the increasing environmental concerns, the rapidly developing legal and voluntary frameworks and the growing stakeholder interest in corporate ESG credentials. These present us with an opportunity to review and continue to develop our strategy and goals. We believe ESG initiatives are opening valuable new financing channels (green finance) and can increase and safeguard property values, reduce tenants’ churn, improve buildings’ resilience and, ultimately, boost the health and productivity of occupants.
Topland Group is a UK centric commercial real estate, investment, lending and development business responsible for a multi-billion-pound portfolio throughout the UK. The Group recognises that its business activities have wide-ranging environmental, social and governance (ESG) impact and we have therefore adopted a company-wide strategy to address ESG issues. We stand for a responsible, sustainable and ethical approach to investing in and managing our properties. We seek to create an optimal environment for our many stakeholders including occupiers, local communities, joint venture partners, staff and suppliers, the people who work, shop and live in our buildings as well as the wider society who benefit from our activity, creating positive social and environmental outcomes.
ESG encompasses a broad range of issues that have a material impact on the risk/return characteristics of our investments. Although Topland is not required to follow any legal framework, we are abreast of the most up-to-date information available, understand the associated risks and seek to incorporate ESG considerations and opportunities into day-to-day business operations as feasible. As part of Topland’s overarching ESG strategy we seek to identify the issues that matter most for us by conducting materiality assessments in order to determine both acute and chronic risks. Topland counts on the input of a wide pool of individuals and different teams, including those responsible for property and asset management, health and safety, finance, HR and the company secretarial function. This multi skilled team is responsible for driving initiatives forward and reporting to the UK Executive Board who takes ultimate responsibility for ESG initiatives within the Group.
Topland adopts a Corporate Code of Conduct and Ethics setting out the standards expected from personnel, including behavioural standards such as integrity and transparency. Our senior managers have a commitment to communicate ESG strategies and help to embed those standards among the workforces. Controls are implemented and improved to ensure higher levels of awareness and compliance, both internally and with third parties. Our policies and procedures are readily available to those who need them.
Finally, making sure that supply chains are free from illegal and unethical employment practices and suitable to undertake works on our clients’ behalf is vital for our business. As a way of managing ESG compliance in the supply chain, Topland conducts appropriate due diligence before engaging with any supplier or contractor and expects them to adopt ESG initiatives at least to the same standards as Topland. This is an ever-evolving process for Topland.
IN PRACTICAL TERMS, WHAT ESG MEANS TO TOPLAND GROUP
With climate change and the increase in flooding and extreme weather, we experience a massive shift in the way property and asset management activities are conducted. The Board is committed to managing its ESG impact in the most effective, responsible, and sustainable manner possible by implementing best practice in areas such as energy, waste, water and statutory compliance to improve business reliance and enable sustainable growth. Our focus is on the reduction of energy consumption and the improvement of resilience of our buildings.
As a business we strive to engage with specialist consultants as part of our pre-acquisition due diligence. Energy Performance Certificate (EPC) rating is a key consideration when acquiring real estate and, where necessary, a feasible strategy to improve this rating to a compliant level must be present.
Our development activities seek to incorporate sustainability into design, and we look to achieve a minimum rating under the Building Research Establishment Environment Assessment Method (BREEM) of ‘Very Good’ or higher, when possible.
We work with many suppliers and contractors in seeking to improve the environmental performance of our assets through the supply chain, engaging, where possible, with our occupiers to promote sustainability and identify, where feasible, cost-efficient improvements to protect the future quality of each asset we hold.
As an organisation we adhere to all compliance obligations working with current legislative requirements and maintaining stringent internal processes and procedures which help us focus on achieving our sustainability targets. This prepares the Group for the future changes which inevitably lie ahead. Where relevant, the Group will seek to educate staff in environmental risks, opportunities, and best practices, incorporating sustainability objectives into business planning and reporting.
New development sustainability
Setting high standards in terms of sustainability and design is important to Topland Group. As part of these high standards, we are keen to ensure that all our new developments and refurbishments capture the principles of designing for a long life, flexible occupation, affordability, comfort, resilience, and efficient operation.
In respect of our developments, we seek to set out a range of scenarios to be explored during the design process to enable us to find the most appropriate path to creating a low-carbon, energy efficient buildings whilst maintaining the desired level of shareholder return.
Existing portfolio sustainability
The Group seeks to set and maintain high standards in terms of sustainability in the management and maintenance of our existing assets with an ultimate goal of reduction in energy consumption and the implementation of solutions to safeguard buildings and users.
The use of sustainable materials and renewables is being encouraged at every opportunity and, where possible, implemented as part of our ongoing desire to enhance Topland assets. We aim to ensure that our buildings are as energy/carbon efficient as possible and we look to implement greater efficiency in tech-enabled management systems and processes where possible.
Topland has also engaged with Carbonxgen to improve its ESG strategy. There are a number of factors which should be taken into consideration as they all contribute to the end result. The various elements include EPCs, Heat Network Regulations, ESOS, SECR, ESG and Net Zero Carbon. This is a big focus for the Group going forward and essential to maintaining the high standards we set ourselves.
Engaging occupiers is a key part of our approach to sustainability. We seek to actively involve them in the efficient running of the building and where possible, look to share best practice with them in order to enable occupiers to operate more efficiently themselves.
Decarbonisation of the National Grid is a major factor in the switch to renewable energy across the UK. To complement this, it has been a clear focus for the business to ensure all renewed utility contracts are exclusively Green Energy contracts.
Topland is currently undertaking feasibility studies across the portfolio for solar possibilities to complement the two existing properties where this has been successfully installed. Waste is managed by one of our main contractors. Recycling is encouraged throughout the commercial portfolio where waste facilities are managed by us and we are always looking to enhance this offering. Annual reporting is also a key element to enable us to benchmark where we are and how we can work towards improving this.
Focus has been placed on reducing embodied and operational carbon emissions, but it is also accepted that there will be some residual emissions that cannot be eliminated. In this regard, Topland is looking to certified schemes to offset as much of this as possible.
With Topland’s newest ESG committee running from January 2023, we aim to regularly review progress and set realistic targets once the benchmark has been confirmed.
The social factors relate to how we manage our relationship with employees, suppliers and the communities in which we operate.
Health & Safety / Wellbeing / Diversity and Inclusion
The continued success of Topland Group is driven by the commitment and professionalism of our people. As health and safety issues become increasingly entangled with workplace social ethics since the Covid-19 pandemic, employee health and safety has been high on the employer agenda and this no different at Topland. We are increasingly working on overall wellbeing and value creation for our people, improving employee satisfaction and retention rates. The Group recognises the importance of employee wellbeing, engagement and professional development as central to the success of what we do. We are driven by wellbeing culture, not only internally, but we also replicate our drivers within the external environment by aiming to create a good experience for our occupiers. We do this by creating an environment where they want to stay. This is driven by access to energy and affordability, as well because of their own staff being in a healthy and productive environment.
As a business we are also committed to promoting equality and diversity throughout the workplace. Topland is committed to a policy of equal opportunities in employment where individuals are selected and treated based on their relevant merits and abilities, without regard to age, disability, gender reassignment, marital or civil partner status, pregnancy or maternity, race, colour, nationality, ethnic or national origin, religion or belief, sex or sexual orientation.
Stakeholder & Community Engagement
We recognise that our operational practices have a significant impact on the health and wellbeing of those who occupy and visit our portfolio. Hence, where Topland operates, we endeavour to make a positive contribution and seek to support businesses to grow and prosper within the community by using local suppliers, supporting charitable causes, promoting diversity and inclusion. This is, as we call it, our inclusive economic growth strategy.
Topland has developed a practical framework for how the Group is managed, directed and controlled and this is reflected in how it manages its environmental as well as social aims and responsibilities. Topland Group operates a robust corporate governance framework, based on ethical corporate behaviour which seeks to ensure all risk and governance practices are embedded into the decision-making process at the highest level. The Board is fully aware of current and emerging ESG issues, impacts, risks, opportunities and trends specific to the industry, supply chain and operating environment. Topland’s governance framework seeks to develop ESG strategies and manage investment and operational risks.
The Board adopts and regularly reviews ESG policies and ensures ESG commitments are integrated into existing and new corporate policies, as applicable. This ensures accurate and structured reporting is provided to our many stakeholders. All employees are required to read and confirm their understanding and compliance with the Group’s policies which includes ethics, anti-bribery, anti-money laundering and fraud protection procedures, among others.
Responsive business practices
We believe responsive business can be a force for positive change and the directors establish the tone of compliance for the entire organisation. At Topland we continuously seek to improve our impact on the world by using ethical trading, supporting human rights and keeping people safe.
Board diversity and structure
The Board favours a composition that reflects the diversity of the marketplace. The Board aims to review ESG competency in their evaluation process as a way of developing and improving the necessary skills, knowledge and experience to enable them to assess more effectively the ESG risks and opportunities that the business faces.
As we aim to promote our core values and build long term relationships with occupiers and suppliers in order to produce flexible and efficient buildings with an open and responsible approach by management teams, Topland adopts a transparent approach with stakeholders by disclosing the company’s action taken towards adapting to a net-zero economy and overall ESG strategies.
Conflicts of Interest
Board directors are in a special risk position as they see the most sensitive business information and have the capacity to make the most critical decisions. At Topland, not only the directors but all employees are required to comply with the conflicts of interest policy. Should a conflict be identified or perceived, senior management will work on a mitigation plan and full disclosure. All deals and transactions are conducted on an arm’s length basis and follow a strict approval process.
Bribery & Corruption
We aim to conduct all our business in an honest and ethical manner. The company has in place adequate procedures designed to prevent persons associated with it from undertaking bribery. Everyone within the organisation has a responsibility to prevent, detect and report any instances of bribery or attempted bribery and other forms of corruption – whether originating from work colleagues or from external individuals or organisations they encounter during the course of their employment (eg. tenants, suppliers, agents, advisers, and government and public bodies).
Topland adopts practical steps to ensure that AML regulations are met within its commercial lending arm and the business in its entirety. Overall responsibility for anti-money-laundering verification, systems and controls are overseen by a senior manager who applies consistent policies and procedures to minimise money laundering risk.
Topland is committed to act with integrity and transparency on all the Group’s tax compliance and reporting duties. Our Tax Policy can be found at www.topland.co.uk.