Embedding Environmental, Social and Governance (ESG) into our Core Business

To help accelerate progress towards our portfolio climate targets, we have introduced an expanded approach to include climate analysis in our ESG integration framework. The analysis is mandatory for all new investments that are evaluated by our investment committee. It examines climate impact from several perspectives:

A range of absolute and relative metrics is employed in the analysis and contributes to the evaluation of climate considerations and investment decision making. These metrics include total carbon emissions and ratios such as carbon intensity and carbon efficiency which allow us to assess the impact of the new investment on portfolio targets.

• We have also incorporated a carbon price in the evaluation of new investments to create a heightened awareness of the potential impact of a company’s greenhouse gases (GHG) emissions to its value. The current internal carbon price of US$50 per tonne of carbon dioxide equivalent (tCO₂e) supports decision making in line with broader climate targets; enhances the understanding of the possible future impact of carbon pricing on the investments that we make; and creates awareness of the societal costs that emissions will impose over time. A portion of our staff’s long term incentives will be aligned with our 10-year carbon targets.