Sustainability Report 2017 Making our experience count Progress Commitments Sustainability Complete Existing commitment (retained) On track Existing commitment (extended) performance Incomplete New commitment at a glance Our commitments and progress to date

Creating jobs and opportunities

Community employment Fairness Diversity Health, safety and security

Commitment Commitment Commitment Commitment Help a total of 1,200 Ensure the working environments Make measurable improvements Maintain an exceptional standard disadvantaged people we control are fair and ensure that to the profile – in terms of gender, of health, safety and security secure jobs by 2020 everyone who is working on our ethnicity and disability – of our in all the working environments behalf – within an environment we employee mix we control Progress control – is paid at least the Living Wage by 2020 Progress Progress Employment secured for 962 people from Progress Participant in the National Chaired the Health in disadvantaged backgrounds Equality Standard assessment Construction Leadership Group Accreditation received from the process. Set specific diversity and launched Mates in Mind Living Wage Foundation metrics to be achieved by 2020 mental health programme

Efficient use of natural resources

Carbon Renewable energy Energy Waste Commitment Commitment Commitment Commitment

Reduce carbon intensity (kgCO2/ Continue to procure 100% Reduce energy intensity (kWh/ Send zero waste to landfill with m2) by 40% by 2030 compared to renewable electricity across m2) by 40% by 2030 compared to at least 75% recycled across all a 2013/14 baseline, for properties our portfolio and achieve a 2013/14 baseline, for property our operational and construction under our management for at 3 MW of on-site renewable under our management for at activities by 2020 least two years, with a longer-term electricity capacity by 2030 least two years ambition of an 80% reduction Progress by 2050 Progress Progress Diverting 99.9% from Progress Since 1 April 2016, our Group Reduced portfolio energy landfill and recycling 70.8% electricity contract is 100% intensity by 13.2% compared Reduced portfolio carbon renewable. 15% of gas now to 2013/14 baseline intensity by 18.5% compared procured from green sources. to 2013/14 baseline 0.6 MW of on-site renewable electricity capacity

Sustainable design and innovation

Resilience Embodied carbon Biodiversity Wellbeing Commitment Commitment Commitment Commitment Assess and mitigate site-specific Carry out embodied carbon Maximise the biodiversity potential Ensure our buildings are designed climate change adaptation analysis to inform the of all our development and and managed to maximise risks that are material across selection and procurement of operational sites. Achieve a 25% wellbeing and productivity our portfolio building materials to reduce biodiversity net gain across the environmental impacts five sites offering the greatest Progress Progress potential by 2030 Progress Staff response to our new head New commitment Progress office at 80-100 Victoria Street, Embodied carbon assessments SW1 puts us in the top 5% of progressing on all major new Developed a methodology with 1,900 organisations surveyed developments. Westgate Oxford The Wildlife Trusts to measure worldwide by the Leesman exceeded its ultra-low biodiversity on all sites. Developing Index for workplace wellbeing carbon target net gain plans at several sites and productivity Strategic update Our purpose is to provide the Contents right space for our customers and 02 Chief Executive’s statement communities – helping businesses 03 Strategic update 09 Working with our supply partners to succeed, the economy to grow 09 Impact assessments 10 Investing through the lifecycle and people to thrive. 12 Welcome to Westgate: Case Study 14 A healthy home: Case Study

To ensure we can do this for years to come, Creating jobs and opportunities 16 Community employment our sustainability work focuses on three 19 Education key areas: 22 Charity partnerships 25 Fairness — Creating jobs and opportunities 26 Diversity 28 Health, safety and security — Efficient use of natural resources Efficient use of natural resources — Sustainable design and innovation 30 Climate change and carbon 34 Energy management We act early to address our biggest 37 Waste management challenges and opportunities. We work 39 Water hard to embed sustainability in everything Sustainable design and innovation we do. And we keep looking for new ways 40 Our approach 42 Resilience to make a bigger positive impact – using 43 Embodied carbon our experience to create great experiences 44 Biodiversity and benefits for others. 46 Wellbeing Additional information From our innovative scaffolding academy 48 Greenhouse gas reporting at HMP Brixton to our pioneering use of 50 Benchmarking and awards 52 Sustainable Development Goals green gas and our leadership on science 53 New metrics for developments based targets – read about the progress 55 Assurance Statement IBC Contact we made this year.

Landsec Sustainability Report 2017 1 We’re looking hard at these and its carbon emission targets approved Chief responding. And we’re now giving close by the Science Based Targets initiative. attention to a number of other issues set We led from the front on green gas and to reshape our industry. 100% renewable electricity. We gained Executive’s What might resource scarcity mean accreditation from the Living Wage for us when we start to develop at Foundation for our commitments to fair scale again? Higher costs and slower pay across our supply chain. And we took statement lead times? our pioneering Community Employment What impact will a growing but Programme nationwide, helping even Our priority is ageing population have on buildings, more disadvantaged people gain access particularly workspace? Will a workforce to the world of work. I’ve seen for myself to ensure we are spanning 16-80 year-olds require a more the powerful effect this can have on inclusive approach to office design? individuals and the local community. sustained as a How will the rapid evolution of For an example of how sustainability strong and admired technology change how people use enhances what we do, take a look at buildings and the way we design them? Westgate, our joint venture with The company. To put that in context, we’re thinking Crown Estate in Oxford. It’s in a highly now about developments that might sensitive setting, so we took a thoughtful But we live in fast-moving times, from open in five years’ time – and still be in approach spanning everything from the political and economic events of the use 30 or 40 years from today. sustainable design to local employment. past 12 months to the deep shifts taking That’s enabled us to go from concepts place across society and technology. A decisive response through public consultations, planning It’s essential that we anticipate what So how are we approaching this array and construction to the opening of change means for us – and for the people of issues and opportunities? We’ve 800,000 sq. ft. of incredible retail, leisure we rely on – and act early to address the set ourselves the ambition to lead our and public space in October 2017 in just opportunities and risks involved. industry on sustainability. We have clear seven years from start to launch. Experience tells us that thinking and stretching commitments. We have I want to highlight a group of well ahead enables us to make much sustainability-related KPIs which are people absolutely key to our approach: smarter decisions today. Get that right linked to remuneration. We’re working our partners. By working with our many and we strengthen our reputation and to embed sustainable thinking at every suppliers and industry peers we can deepen our relationships with the people level of the Company and we seek to have the greatest positive impact. who matter most to us: our customers, incorporate sustainability throughout We believe our progressive approach communities, partners and employees. the asset lifecycle, from buying to to sustainability gives us competitive developing, managing and selling assets. advantage, but that doesn’t stop us Pressing issues, evolving trends And the leadership team is dedicating looking to share and scale innovation The issues we face right now can more time to thinking about the world across our industry. be complex, and they’re often we’ll see around us years from now – the We’re doing all this from a new interconnected. Climate change and its long-term view. headquarters that demonstrates how impact on the built environment. New sustainable design can enhance the Leadership drives us forward regulation. Low levels of productivity employee experience. We’ve created In this report you’ll see how we’ve in the economy. High levels of a collaborative, efficient, technology- worked to help lead our industry. It unemployment and disadvantage in enabled space to help us attract, inspire was a year when we became the first some local communities. Lack of diversity and support talent. It’s a stage on property company in the world to have within our industry. which our people can perform together brilliantly. We’re pleased it’s already earned recognition from others, winning the Offices Refurbishment & Fit-Out award at the BREEAM Awards 2017.

Looking ahead We know there’s more we can and must do over the next 12 months and beyond. Given the pace of change outside the business, we need to keep pushing ourselves inside the business. Most of all, we must continue to anticipate and address our evolving challenges so we keep providing the right space for our customers and communities – helping businesses and people to thrive.

Robert Noel Chief Executive Robert Noel Executive Chief

2 Landsec Sustainability Report 2017 Strategic update Strategic Creating value Stakeholder Beyond creating social and environmental engagement update value, we believe that our sustainability programmes are also actively generating We work with and rely on a broad range short and longer-term value for our of people. We think about stakeholders We buy, sell, Company. We believe that our strategic in terms of four key groups: develop and manage activity as a responsible business results in numerous commercial benefits which Customers commercial property. ultimately help drive our competitive This includes those who occupy or visit position in the market, and in turn, our properties – our office occupiers, We focus on offices, maintain our licence to operate: retailers, restaurateurs and residential retail and leisure buyers. It also includes the employees — Cost savings: By reducing energy of our tenants, shoppers and anyone in London, and intensity across our portfolio we have else who spends time and money in reduced bills for our customers and our space. retail and leisure are responding to their sustainability outside London. priorities. Engagement in action — P roduct differentiation: The We run regular engagement surveys sustainability credentials of our with our customers. We regularly visit Our aim is to create a great experience buildings are playing an increasing our buildings, including our sustainability and real benefits for people, from our role in our customers choosing team, so we can meet with people face- customers to our local communities, our space. to-face and provide practical support. partners and employees. For example, at many of our shopping — R isk mitigation: Mitigating now As the largest listed commercial centres we’ve rolled out a programme for climate risk and ensuring our property in the UK by market informing customers when they’re using properties are more resilient will pay capitalisation, we can have a big impact energy out of business hours. In London, financial dividends in the longer term. when we do things the right way. We our energy management teams have consider carefully both the short- and — M aking our people proud to visited several London assets this year to long-term effects of our actions, putting work for Landsec: Our people are talk about our work on energy efficiency. sustainability at the heart of passionate about our sustainability We also collaborate with customers our approach. commitments and we feel there through our Community Employment Our vision is to lead the UK listed real is a link between sustainability Programme. See the results of our latest estate sector in terms of sustainability. performance, engagement levels and customer engagement survey in London We’ve often set the pace but we’re far attraction and retention of talent. below. from complacent: there are always new — Strengthening our brand: Our challenges to meet and opportunities to sustainability performance is an address. This year we continued to focus important part of our brand identity on truly embedding sustainability at every and plays a key role in how we want 2016 Landsec customer level of the business and setting even to be perceived by our stakeholders. engagement survey higher expectations across the Company. — Responding to investors: We are seeing increased interest on sustainability from some of our key investors, specifically on the environmental credentials of our 85.7% buildings and our carbon reduction Landsec is acting responsibly Communicating programmes. and making tangible improvements about sustainability to the management of energy, water and waste is often a one-way (2015: 82.9%, 2.8% increase) thing. We report on our priorities and actions but we also 84.5% We feel that Landsec is listen to and act acting responsibly and is on what others have having a positive effect on the local community to say, not least (2015: 82.2%, 2.5% increase) our investors.”

Miles Webber Director of Corporate Affairs and Sustainability

Landsec Sustainability Report 2017 3 Communities This includes our neighbours and those who live or work in the areas we do business such as local residents, businesses, schools, colleges and charities. It also includes the national charities we support.

Engagement in action We consult with local residents, businesses and community groups whenever we develop a new asset. We use surveys and meetings to ensure we understand and address their views and keep them up to date with development plans. On retail schemes we approach community engagement on an individual basis as each development is unique with different contexts and stakeholders. Bespoke engagement strategies are evolved and implemented by the development team reflecting this. We have taken great care in Oxford to consult an extensive range of At The Galleria shopping centre stakeholders as they all play a vital role in Hatfield we produce a regular in the city. community newsletter that keeps In London, due to the number of people up to date with our plans developments, we have a dedicated Community Liaison Manager for all We engage closely with local and central Employees projects. We understand the impacts government. This includes members of This group includes everyone who is that new developments can have during our senior leadership team sitting on key directly employed by us. their construction and we always require boards and committees. For example, that our principal contractors provide Colette O’Shea, the Managing Director Engagement in action local stakeholders and residents with the of the London Portfolio, is a business We regularly carry out a survey amongst information they need to minimise any representative on the London Economic all of our employees and we run an all- disruption and disturbance caused. Action Partnership (LEAP), which company conference every other year. brings together local government and The 2016 conference was themed around Partners businesses to support economic growth ‘Anticipating change’ and included This group includes those who have a and job creation. sections on all of our stakeholder groups. direct working or contractual relationship We also aim to shape and inform We regularly run sustainability-related with us and those who share a mutual debate. For example, this year Caroline Food for Thought discussion sessions too. interest with us. So that can mean Hill, our Head of Sustainability, was This year saw us talk about subjects such anyone from joint venture partners to invited to address UK100, a network as science based carbon targets and our service providers and their employees; of local government leaders preparing jobs and training work at HMP Brixton. suppliers and their employees; local and for the transition to clean energy. The This year we also ran a digital campaign central government; NGOs; trade bodies; Company is also an active member of on the sustainability credentials of our and industry organisations. We also key industry groups. We’re a UK Green new head office. include bondholders and shareholders in Building Council Gold Leaf member. this group. Caroline Hill sits on the British Property Federation’s Sustainability Committee. Engagement in action We are a founder member of the Better We have a diverse range of partners but Buildings Partnership and our Head of sustainability is becoming an increasingly Engineering, Neil Pennell, chairs their key area for all. With investors, we Building Operations and Technical communicate throughout the year Working Group. and integrate material sustainability Meeting together regularly, our performance in our updates. We also Customer Improvement Groups seek work closely with our joint venture to ensure that all partners relevant to partners to set and achieve shared a particular area understand our sustainability ambitions. Service partner priorities and policies, and can share agreements now fully integrate with our their perspectives and expertise. sustainability targets and expectations. We bring our representatives from our — Principal designers companies CIG service providers together in Customer — Occupational health contractors CIG Improvement Groups. — Security companies CIG — MEBF companies CIG As part of our Head Office move we ran — Principal contractors CIG an internal communications campaign — Cleaning companies CIG to engage our people on the sustainability credentials of our new office

4 Landsec Sustainability Report 2017 Strategic update Materiality review 2016 Sustainability materiality matrix Diagram 1 Our materiality matrix plots issues according to their importance to our stakeholders and to us. The current Energy & carbon matrix shows that our most material issues are energy and carbon, and sustainable building design. The matrix Local economic Sustainable development building design was the result of a detailed sustainability Waste materiality review carried out by Jones Health & safety Responsible supply Job creation Lang LaSalle (JLL), which completed in chain management March 2016. The review was undertaken Climate Biodiversity & green change infrastructure in line with best practice methodologies Water Building health, wellbeing & productivity supported by the Global Reporting Diversity Transport Initiative (GRI) and AccountAbility, and connectivity & Community accessibility involved consultations with stakeholders Importance stakeholders to programmes Enhancement of inside and outside the Company. the public realm

Crime & Our sustainability safety strategy Last year we used our materiality review Materiality to Landsec to inform the development of our sustainability strategy and programme. It was vital that both met the needs of Our sustainability strategy Diagram 2 our stakeholders, helped us work towards being sustainability leaders in our industry, and supported our drive to create long-term sustainable value. Creating jobs and opportunities We chose to prioritise three areas: — Community employment — Education — Creating jobs and opportunities — Charity partnerships — Efficient use of natural resources — Fairness — Diversity — Sustainable design and innovation — Health, safety and security. We continued to focus on these areas during the year. They are the foundation of our approach and this is reflected in Landsec Vision: Sustainability Efficient use of To be the best Vision: natural resources how we’ve organised this report and in property To be the UK — Climate change and our commitments. See the inside front company in the listed real estate carbon cover for more on our commitments. UK in the eyes of sustainability — Energy management our customers, leader — Waste management our communities, — Water our partners and — Responsible supply chain our employees management.

Sustainable design and innovation — Resilience — Embodied carbon — Biodiversity — Wellbeing.

Landsec Sustainability Report 2017 5 The Committee meets quarterly and Group KPIs Group risks is the senior forum for determining our sustainability strategy and reviewing As well as our 12 longer-term As with our Group KPIs, sustainability performance. sustainability commitments, each year informs all of our principal and emerging the business sets itself a series of annual risks. Three current principal risks relate Sustainability Working Group key performance indicators (KPIs). specifically to: sustainability, health The Sustainability Committee is These are linked to executive and senior and safety, and security. Emerging risks supported by the Sustainability Working management remuneration. include a number of topics covered Group. This meets quarterly and is Sustainability issues inform all of in this Sustainability Report including the delivery mechanism for making our business KPIs in some way but we the Living Wage; Modern Slavery Act; sure sustainability is considered and also have a number of indicators specific resilience of the portfolio to climate integrated throughout the business. The to sustainability. Here are our three change; and energy supply. Working Group includes representatives sustainability-specific KPIs this year, from across the Retail and London and our performance against each: businesses and from corporate Governance functions. It looks at all aspects of our business, from development and project KPI: Deliver an impactful ‘Sustainability Sustainability is a priority for our management to operations, insurance, Matters’ awareness raising and training leadership team, and their commitment engineering, HR, health and safety, and programme has galvanised support across our marketing. The group is chaired by the Performance: Over 95% of employees business. Our Chief Executive takes Head of Sustainability. have completed level 1 online training. overall responsibility, with the wider Level 2 face-to-face training has Board receiving an annual update. Sustainability team been delivered across the business The Working Group is supported by the covering Smart Investments, Efficient Sustainability Committee sustainability team. This is an integrated Operations and Sustainable Design and Ongoing oversight is carried out by team that sits at Group level and Construction. our Sustainability Committee, which supports the entire business with all is chaired by the Chief Executive and aspects of sustainability. The team’s remit KPI: Support operational efficiency by attended by our Director of Corporate includes community programmes, charity conducting site-specific energy reduction Affairs and Sustainability and Group HR partnerships, environment and energy assessments of the like-for-like portfolio Director – all members of our Executive management, sustainable design and to accelerate our existing energy Committee – together with our Head undertaking analysis and research. The management programme of Sustainability, Head of Engineering team is led by the Head of Sustainability. Performance: Site-specific energy & Design and senior representation assessments conducted for all sites in from the London and Retail businesses. the like-for-like portfolio. For our larger sites, funding secured for measures to be implemented in 23 sites (88%). Risk heat map Diagram 3 KPI: 170 people into jobs via our Community Employment Programme The risk heat map illustrates the relative positioning of our principal risks before and and Trainee Academy after mitigating actions. Performance: 183 people have been placed into employment through the Very High 01 Customers — Structural changes in customer and consumer behaviours. programme. 2 02 Market cyclicality — Market and political uncertainty or change in legislation. Our Group KPIs for next year 3 03 Disruption — Failure to react effectively to new disruptors within our sectors, including — Develop our leading Community 1 technological advances.

Employment Programme and, in Impact 7 particular, place 170 people into 04 People and skills — Inability to attract, retain 4 and develop the right people and skills.

jobs. Further expand the programme 5 8 6 05 Major health and safety incident — Accident beyond construction. causing injury or loss of life to employees, 9 — Drive energy management across contractors, occupiers and visitors to our properties. the portfolios in support of our 06 Security threat or attack — Failure to identify or 2030 corporate commitments by prevent a major physical security related threat or Low attack or react immediately and effectively. implementing approved energy 07 Cyber threat or attack — External and internal reduction opportunities. Unlikely Likelihood Almost Certain intrusion to corporate and building management systems and data

08 Sustainability — Increasing environment pressure Movement of risk after and/or properties do not comply with legislation, mitigating actions or meet customer expectations or are unable to withstand the expected challenges of climate change.

09 Development — Unable to deliver capex programme to agreed returns and/or occupiers reluctant to commit to take new space in our developments.

6 Landsec Sustainability Report 2017 The online module covers the global Strategic update Sustainability Matters issues facing society and the expected impacts of climate change; why this To sustain our This was the second year of our is important to Landsec; and why it’s Company-wide Sustainability Matters important to us as individuals. It gives success it’s vital training programme, which is designed an overview of how Landsec approaches to increase sustainability awareness and sustainability through different stages of we take a long- knowledge across the business. the property lifecycle. It also covers the term view on We started by launching an online implications of our sustainability strategy training module back in February 2016. on different job roles across the business. everything from It was mandatory for all employees to The module ends with a short test to employment to complete the module and this was one confirm the employee has understood of our Group KPIs for 2016/17. Over 95% the key points. We’ve seen a pass rate environment, then of our employees have now completed above 99% so far. the course, and the response has been embed progressive very positive. The online training module thinking across now forms part of the induction process for all new employees. the business.”

Robert Noel Chief Executive

Initiatives like Sustainability Matters are absolutely crucial if we are to transform the built environment, and Landsec have taken an exemplary leadership position by championing the education of all staff on sustainability.”

Cat Hirst, Head of Learning & Innovation, UK Green Building Council INTRO PART 1 PART 2 PART 3 CONCLUSION

This module looks specifically at environmental responsibility

Part 1: Global Issues How the issues impact our industry

Part 2: Land Securities’ Response What we need to do as a business

Part 3: What you can do What this means for you in your role

Landsec Sustainability Report 2017 7 To build on our investment in the online Sustainable design and construction module, this year we launched in-depth Designed for employees from our face-to-face training. These new modules development, project management and The Sustainability are designed to provide employees with engineering teams, this course takes a more detailed understanding of how delegates through a typical development Matters training to embed sustainability into day to day lifecycle, starting from the brief and thinking. Attendance is mandatory for working through to completion. This covered important key roles across the asset, development, module includes immersive training and interesting project management, engineering and styles such as mock tender interviews. operations teams. The modules cover: It’s focused on how to have the right issues. I certainly conversations at the right times. Smart investments Feedback has been very positive. came away with This module is for employees from our We ask all participants to rate their lots of new ideas investment, asset management and knowledge on the subject before and portfolio teams. It explores the business after the training in terms of a 5-point for adding value to case and strategies for responsible scale, with 5 being the best. Participants White Rose.” investment. Participants enhance their started at 3.0 on average and moved to understanding of how sustainability 4.2 – a 40% increase. should be considered in the context of We’re looking to develop the training investment and acquisitions; the value in three ways: Dean Stratton implications; and how to effectively Centre Manager, implement our new responsible property — Provide a module for our leasing and White Rose, Leeds investment policy and procedures. marketing colleagues covering how we communicate sustainability effectively Efficient operations — Develop informal drop-in sessions for A workshop for employees from our employees not covered already by the operational on-site teams. It covers the detailed face-to-face training this year Meet our Sustainability Committee key policy drivers and market demand for Top row: efficient buildings; Landsec’s framework — Roll out sustainability masterclasses — Miles Webber, Director of for achieving efficient resource for those that want to extend their Corporate Affairs and Sustainability management; how to measure and knowledge further on specific topics — Robert Noel, Chief Executive optimise the operational performance of — Diana Breeze, Group Human buildings; how to set energy and waste Resources Director reduction strategies; and action planning on biodiversity and wellbeing. Bottom row: — Caroline Hill, Head of Sustainability — Neil Pennell, Head of Engineering & Design and London representative — Jat Sahota, Head of Commercial and Retail representative

8 Landsec Sustainability Report 2017 new developments. This includes a Strategic update Working with combined focus on embodied carbon and responsible sourcing at the early stages of a project. our supply — Further engage our supply partners on our Living Wage commitments and partners implications in the supply chain. In 2017/18 we’ll check all developments. Reducing carbon emissions, resource We’ll also include a formal consumption and waste in our supply commitment in every contract, with chain can help us improve efficiency, all contractors required to measure reliability and pricing – all of which and report the percentage of direct contribute to cost savings. It can also and subcontracted employees paid enhance our resilience to future climate- the Foundation Living Wage. related impacts and market volatility. — Fully implement the steps needed It’s good for our brand reputation, to meet the Modern Slavery Act supporting our competitiveness. And it requirements through the supply chain. can help us to meet our sustainability This will mean checking suppliers’ commitments. Construction workers at procedures in our immediate supply To achieve this we need to New Street Square, EC4 chain, but also checking how they are collaborate in smart ways with our implementing our requirements on supply partners. Our current approach, sites around the country. systems and governance are relatively well developed and robust. They qualifications and work experience include processes to consider issues Impact while on-site at New Ludgate, EC4 such as sustainability, health and — Over 100 learning opportunities safety, insurance, and legislative and for local unemployed and regulatory compliance. Our sustainability assessments underrepresented candidates requirements also focus on: Our activities have a significant impact were provided by our Community on local communities and the wider Employment Programme — Identification and management of UK economy. To better understand sustainability risks, opportunities and — Nearly 1,000 small and medium-sized our impact, we now measure the compliance enterprises were contracted on the socio-economic and environmental project by us and our partner Skanska. — Evaluation of performance against contribution of new developments. energy and carbon reduction Assessing our impact helps us identify A similar report for our Nova, SW1 — Responsible sourcing of materials and where we’re already adding value, but development will be made available in management of waste it also highlights the issues we need to the next financial year. — Management of human rights issues; address to maximise the benefits we We’re now taking our approach commitment to Living Wage and job generate. So far our work has included to the next level, measuring and creation a detailed report on the socio-economic communicating social, economic impacts of our flagship shopping centre and environmental impacts at — Supply chain management including development at Trinity Leeds. our flagship retail development at ethical practices and competency Building on that work, we recently Westgate Oxford. Together with our testing published socio-economic reports on joint venture partner, The Crown Estate, This has brought some level of assurance two of our developments in London we’re carrying out an impact study knowing that there’s a basic standard of – New Ludgate, EC4 and New Street designed to demonstrate the whole compliance amongst our supply chain. Square, EC4. Key highlights from the value generated by the redevelopment But we want to do more. Our aim is to reports include: – once the scheme is completed and ensure our values can be seen through — 3,958 construction workers were in operation. The findings will help us our entire supply chain and that this is employed on the New Ludgate, EC4 maximise our positive impacts in Oxford reflected in our performance. project – equivalent to about 916 full- and give us vital insights to carry into This year we reassessed our time, year-long jobs future developments. In addition, we approach to procurement for — Of the total direct workforce, 22% have commissioned a study to assess developments. Our new approach lived within the City of London and the Landsec’s impact on the UK economy focuses on having the right conversations seven Fringe Boroughs, far exceeding in terms of Gross Value Added (GVA) at the right times. We’re not taking the the 10% target set for construction and job creation, and will be reporting approach of mandating complex targets projects in the City findings later this year. through our contracts; we’re planning to — 30% of the construction workforce get everyone on board so our objectives were aged 45 or older, compared become business-as-usual. to 12% under 25, confirming the Assurance Over the next 12 months our importance of continuing to attract priorities will be to: For the second year our sustainability young people into construction. assurance was conducted by EY, who are — Apply some of the new ideas — 269 new jobs were created throughout also our financial auditors. This is part and processes we’ve learnt from the construction of New Ludgate, EC4, of our journey to embed sustainability refurbishing our new head office to with a further 503 people kept in work across the business and enhance the a BREEAM Outstanding standard as a result of the project integrity, quality and usefulness of and occupying the space in a — Over 300 workers undertook the information we provide. The EY sustainable way across all of our apprenticeships, work-based statement at the end of this report discusses assurance in more detail.

Landsec Sustainability Report 2017 9 We aim to buy, develop, manage We manage the majority of the buildings Investing and sell assets in a way that benefits we own which means we get to see how those closest to the Company – our people interact with them and hear their customers, communities, partners views. Because we have direct control of through and employees. assets, we can then take decisive action We believe that responding to to improve things for the better. people’s needs, and giving careful Across the Company, we aim to the lifecycle consideration to the environment, develop and manage buildings in a economy and community, helps us to sustainable and innovative way; make create enduring financial, social and efficient use of natural resources in physical value over the long term. everything we do; and create jobs and Where we acquire or develop, opportunities for the people who live we work closely with customers and near our assets, including marginal communities to ensure the new space groups who are furthest meets their needs and expectations. from employment.

Refurbish or retrot to re-let

Invest Reinvest capital capital

Buy Develop Manage Sell We acquire an asset if We develop when we see We work with customers, We sell an asset when it has the potential to an opportunity to create communities and we see an opportunity to meet the evolving needs space that will appeal to partners to ensure deploy our capital more of our customers and customers, enhance the our building operates effectively elsewhere. communities, can be area and create financial efficiently and to help Through our investment acquired at the right value for us. increase local prosperity. and activity, the building price, and is likely to We design for We redesign and we sell should perform create financial value for the safety, health and refurbish space if we spot at a higher level than us over time. wellbeing of occupants. an opportunity to make the building we bought This year we We also design for it more attractive, useful – financially, socially and significantly enhanced our efficiency and productivity. and valued. We work with environmentally. This acquisitions due diligence, And we design to occupiers to manage should make it more building in a much improve the public realm energy, waste and valuable. wider set of assessment around our buildings, water as cost efficiency We aim to build a criteria with a strong including connectivity and environmental positive legacy, leaving focus on sustainability. and wider infrastructure. factors. 100% of the a place in a better Our investment and Our development electricity we buy for state than when we sustainability teams activity creates job our managed portfolio arrived. By helping to work together to assess opportunities, both during is now renewable and improve people’s lives, we a potential purchase and construction and when the we collaborate with strengthen our reputation deliver their intelligence development opens. customers to reduce and add value to our to the senior leadership To help us pursue energy consumption. asset. team. Each assessment our aim of being a Thinking about covers our three sustainability leader sustainability helps us to sustainability priority in our industry, this protect the building from areas – creating jobs and year we created a new external risks such as opportunities, efficient Sustainable Development price volatility, changing use of natural resources, Brief which we use to regulation, supply and sustainable design guide our partners. We issues and premature and innovation. set tougher targets and obsolescence. And it Published this year, higher expectation levels enables us to meet our Responsible Property around innovation and our commitments. Investment Policy sets out collaboration. The brief the standards for future now gives added weight acquisitions. to jobs and opportunities, natural resources and sustainable design.

10 Landsec Sustainability Report 2017 importance of this due diligence the industry, but we’re bringing them Strategic update Embedding work was underlined by the publication into our approach as standard on of our new Responsible Property large developments. sustainability in Investment Policy, which clearly As part of our Sustainable sets out the standards we’ve set Development Brief, and to support investment decisions for all future acquisitions innovation on our projects, we’re also As we move through the market cycle we (www.landsec.com/sustainability). aspiring to do something new – either expect to start seeing good opportunities new to our business or new to the Shared intelligence to buy assets. Price is very important, industry – on every development. We’re Under the new approach, our of course, but our number one priority leaving this relatively open, as we want sustainability and property portfolio is whether an asset has the potential to inspire and encourage our employees teams work together from day one to to create long-term sustainable value. and partners to innovate in meaningful assess the current condition and future We must consider if it will meet the and effective ways. potential of an asset. That enables us to changing needs of our customers and better understand the property through What does it take to lead? communities, and also assess how it will the lifecycle and take a more detailed This new approach to development was be affected by environmental, social and look at future risk. With swift decision- the result of a 12-month consultation regulatory changes. making often essential when buying, with employees from across the business Stronger due diligence our teams work to ensure this deeper and 26 of our supply chain partners. Following a review of our processes by consideration of an asset’s future value It was a tough process that revealed consultants GVA, we have significantly supports rather than hinders investment some strengths we didn’t know we had strengthened our due diligence. We now decisions. along with areas for improvement. We assess acquisitions against a much wider The intelligence collected by the asked the question: if we are going to set of criteria using more powerful tools, teams is given to our Retail and London lead listed real estate companies in with sustainability informing every Executive Committees, Investment sustainability for developments, what consideration. Our assessments now Committee and Board. They then would that take? The responses were cover all three of our strategic priority review the information and consider really varied but many asked us to be areas – creating jobs and opportunities, the potential impact of the transaction more demanding, to encourage and efficient use of natural resources, and to our business, balancing opportunity facilitate more innovation, and to provide sustainable design and innovation. The and risk. If we do buy the asset we gain compelling design briefs. That’s what further value from our assessment work, we’ve done. as the data and insights we’ve gathered are used to inform how we develop and New commitment manage the property. We’ve updated Another key change this year is the Landsec’s enhanced our Investment Committee Appraisal introduction of our new resilience Guidelines to reflect this new policy commitment – ‘assess and mitigate site responsible property and expectations. specific climate change adaptation investment strategy Our enhanced due diligence risks which are material across our approach is an important step forward portfolio’. This is supported with a metric and governance given the constant evolution of material for developments: ‘Climate change issues such as climate change, resource adaptation risk review undertaken and demonstrates depletion and demographic change. design measures implemented which true leadership address structural and fabric resilience’. This means new assets will be designed to stakeholders. to resist the onset of climate change. Enhancing our You can read more about our work Their transparent approach to on sustainable design on pages 40-47. approach to assessing development sustainability In January 2017, we agreed a new set considerations in of metrics for our development pipeline that will help us to address all 12 of acquisitions sets our sustainability commitments. In the benchmark the past our Sustainable Development Brief focused on engineering and for investors in the environmental performance. Now this will also include our requirements for industry who wish to creating jobs and opportunities, as well implement similar as diversity and fairness. Many of our existing targets in practices in their own the Sustainable Development Brief investment decision- have become business-as-normal, so we’ve also reset our ambitions. You’ll making processes.” now find tougher targets and higher expectations included in the brief, such as returning surplus materials Jonathan Gibson to their original manufacturer, Head of Sustainability, reducing embodied carbon intensity, GVA responsible sourcing and improving biodiversity. None of these are new to

Landsec Sustainability Report 2017 11 Dreaming spires Our Westgate Oxford We have designed the building to make shopping centre is set the most of the panoramic views of the Our challenge at dreaming spires across the city. To do this to open in Autumn we have provided a central condenser Westgate was the 2017. It features water system which allows many of the retailers to provide heating and cooling delivery of a super- some 100 retailers to their shop units without having to efficient energy install any equipment of their own on and restaurants over the roof. To maximise energy efficiency, loop with one of the 800,000 square feet, we have connected six air cooled heat pumps and an array of eight heat largest deployments plus a beautiful roof rejection units into the central system of centralised air which input heating and cooling to garden. balance the retail unit loads. The central source heating plant is all contained on the roof of just of its kind in the We’ve worked hard to make sure the one of the blocks. As well as preserving development provides a great experience the view, this approach gives us extra UK at its heart. for everyone who visits, while supporting roof space we can turn into value- our sustainability goals. creating accessible areas. The operational efficiencies of this Getting to work Being part of the community From the moment we started designing Throughout development we’ve used system will contribute we thought about how the centre surgeries, notice boards, newsletters, could provide more local jobs and exclusive events, emails and more to significantly to opportunities. One of the ways we’re interact with local people and encourage Landsec’s goal of boosting employment is by partnering them to become involved with the with Aspire Oxford, a charity that centre. Getting to know everyone from delivering the lowest works with ex-offenders, the long-term community groups to individual residents unemployed and those who have been has helped ensure we understand how carbon retail led homeless in the past. With our support, people feel about the site and avoid scheme in Aspire is running two pre-employment potential problems. And it will encourage programmes in construction. Candidates people to visit and enjoy the space. In the country.” learn construction skills and find roles a recent survey, 60% of respondents on our Westgate site, or with our from the local community said our construction partners on other sites. communication was good, and 40% said Phil Grew We’ve planned further programmes in it was excellent. Head of Retail, customer service – due for launch next Hoare Lea Celebrating young business year – so Westgate can have a long-term This year we worked with students impact on employment once it’s open from Oxford Academy, St Gregory the for business. Great School and Oxford City College Making space to grow on a business challenge. With the help The stunning roof space includes a of mentors, students came up with kitchen garden. Different areas will a product idea to sell on a stall. The feature different flowers, so visitors can products were then judged by a team of experience new shapes, textures and experts. The winners caught the judges’ scents throughout the year. The herb eye with hand crafted canvas tote bags garden will include fragrant perennials stencilled with the city’s dreaming spires like rosemary and sage, to be used in and the words ‘City of Oxford’. We’re food, medicines and perfumes. It’s a way now planning for the winners to sell of increasing biodiversity that stimulates their product at a pop-up stall at Castle CGI images of the senses and enhances our customers’ Quarter this summer, and in Westgate Westgate Oxford experience. when it has opened.

12 Landsec Sustainability Report 2017 Westgate Welcome to Strategic update

Landsec Sustainability Report 2017 13 A healthy home

14 Landsec Sustainability Report 2017 We were awarded a BREEAM Fit-Out Strategic update This year we moved 2014 “Outstanding” rating for achieving our head office team a score of 92.3% at the design stage. We Collaboration also tested the space against the WELL to 80-100 Victoria Building Standard and we’re pleased to between the client Street, SW1. Following report that the office is on target to be the largest fully certified WELL space in and project team lay a project to refurbish the UK. at the heart of this the space, over 400 Creating greener developments project to improve We chose products with a high recycled staff now occupy content, including carpet tiles that are the sustainability the first floor. 44% recycled. And we made smart and healthiness of design decisions – for example, we cut the amount of materials needed by Landsec’s new HQ. This is a ten-year old building, which specifying frameless glazing and by demonstrates the resilience of our omitting the suspended ceiling. As a The result is a building properties over time. It’s now a great result, we reduced our impact by 11%, that maximises staff working environment for our people and and used around half the embodied truly sustainable too, winning the Office carbon intensity of a comparable high- wellbeing through Fit-Out prize at the 2017 BREEAM Awards. end office project. See page 43 for more about embodied carbon. improved natural light Focusing on health, and air quality.” wellbeing and collaboration Working to reduce waste We wanted the space to improve staff We removed existing equipment from the health and wellbeing, and remove site, giving six tonnes of it to community BREEAM Judges obvious barriers to collaboration. To groups. Around 98.10% of the materials Refurbishment and Fit-Out do this we needed to design our office removed during the strip out of the Award 2017 environment with wellbeing in mind and, space have been recycled and reused. most importantly, bring the whole team The pre-development furniture was together on to one floor. reused off-site, the main beneficiaries These are worn around the neck on To increase comfort, we increased the were University of Arts London, and not- colour coded lanyards to increase staff amount of fresh air and maximised the for profit organisations including Scout awareness or any unauthorised presence. use of daylighting, we looked at noise and Groups and the Chicken Shed Theatre. There are new safe working issues to temperature control, and added Circadian We also donated five tonnes of our old guard against too. lighting systems to match the behaviour IT equipment through a social enterprise With over 700 places to sit we of natural light. We also specified called Green Machine, which provides needed to create a new Agile Working materials, paint, glue and varnish to affordable computers to charities and Policy. To check how the policy completely remove harmful chemicals. people on low incomes. Refurbishment was working in practice we used a There’s free healthy food, a juice bar, projects like this usually produce over 300 professional ergonomist to review a social hub and shower facilities. There’s cubic metres of waste. By persuading working positions and styles around also a contemplation room and a health suppliers to transport materials in the new space. We also thought about and wellbeing library. We’re pleased to reusable plastic crates, and by sending security, making sure our staff protect say that our efforts were well worth it. spare materials back to manufacturers, their equipment and data when they We conducted a Leesman survey for we reduced waste to just 50 cubic work in several places. workplace productivity and found that metres – around the same volume as two satisfaction with lighting increased by supermarket delivery vans. Creating sustainable supply chains 25%, and air quality levels by over 40%, 99.97% of materials for the fit out came when compared to the previous office. Staying safe, healthy and secure from sustainable sources, as defined 88% of our staff now feel that the new The new office is a multi-tenanted by BREEAM, from glass and aluminium office design enables the Company to building. So we’ve asked team members to sofas and chairs. The project was work productively, against the global to take more responsibility for security. also awarded FSC Project Certification, survey average of 67% and showing a For instance, team members and visitors which guarantees that every piece of 20% increase from our previous office. use security passes to move around. timber was sourced from sustainably managed forests.

Improving energy efficiency Energy Star computer equipment allows us to reduce our energy use from day to day, while LED lighting and efficient building services reduce the amount of energy we need. Meanwhile, a Demand Logic data analytics system – a kind of Fitbit for buildings – helped us commission the buildings controls and allows us to continually assess and improve operational performance and energy efficiency through a user‑friendly interface.

Landsec Sustainability Report 2017 15 on our sites and with our construction from development activity towards more Creating partners. And we help people find work in asset management. In this busy year, we: customer service, in our office properties and shopping centres. To do this we — Opened our Learning Academy at jobs and partner with other organisations, such as Gunwharf Quays in Portsmouth local authorities, charities and specialist This is a partnership with Highbury training providers. College and the local Jobcentre Plus. opportunities By helping people find work, we Candidates develop customer service boost local economies. We strengthen skills, such as good communication, A stronger our workforce for the future. And we with the aim of securing a job with our enhance our reputation. retail brand partners. At the academy’s workforce means jobs fair in October over 494 jobseekers Our Community competed for 88 seasonal roles. better business. Employment Programme — Launched a new programme at Our Community Employment Although unemployment is at an 11-year St David’s in Cardiff Programme is a package of employment This two-week programme offers low, there will be many unfilled vacancies initiatives involving training providers, in construction by 2018. This is a serious candidates customer service training charities and partners from our supply with brand partners such as Apple, issue for our industry: without the right chain. It targets those furthest from the people in the right roles developments plus work experience in shops including job market, including homeless people, John Lewis and EE. 11 previously may be delayed, construction prices the long-term unemployed, people with could rise, and business will slow. unemployed candidates progressed learning disabilities, ex-offenders and into employment. Yet there are people out there who serving prisoners. In 2016/17, 183 people — Launched a new programme at could do great work given the chance, were supported into work through our White Rose in Leeds not least homeless people, disabled Community Employment Programme. This partnership with Construction & people and ex-offenders. Others, The programme plays an important Housing Yorkshire helps candidates particularly young people, have a huge role in the planning process and beyond. develop construction skills. The aim is amount to offer – but don’t think a career It shows local authorities how our work to find them a role at White Rose or in property is an option. can benefit an area. It also enables us with our partners as we build a new We’re connecting these dots: to take an active role in enhancing local cinema and restaurants. bringing more people into our industry prosperity and influencing policy. and building a strong workforce for the — Established a Customer Service future. Alongside partners from our Academy at Nova, SW1 in London communities and our supply chain, we A partnership with Step Ahead, the give disadvantaged groups the training academy will support retail and they need to get back into work. We Landsec is showing hospitality customers in our Nova, SW1 work with schools to encourage students real leadership in development, helping them find the into construction and customer service best candidates for their vacancies. roles. And we attract talented people to the sector – they Landsec by being a great place to work. In this area we focus on community invest in economic employment, education, charity and social priorities partnerships, diversity, fairness, and health, safety and security. supporting people in the communities in which they operate.” 1. Community

Employment Andy Cook Chief Executive, Our commitment: Help a total of Centre for Social Justice 1,200 disadvantaged people secure jobs by 2020 Taking the programme countrywide We support disadvantaged people by When we started the programme in providing training, work placements 2011 we focused on helping candidates and a direct route into a job. We help in London find work on construction candidates find work in construction, sites – particularly our own sites. In 2015 we launched the programme at our Westgate development in Oxford, partnering with City of Oxford College 962 to help 22 candidates find work in both construction and in customer service. Since 2011, our Community This year, while continuing our work Employment Programme at Westgate (see page 12), we expanded has helped 962 people into work the programme geographically, from Portsmouth to Leeds. Working in our shopping centres, we’re also offering more opportunities in customer service – a reflection of our strategic shift away

16 Landsec Sustainability Report 2017 Creating jobs and opportunities

supported you? word That people. train They was very for ‘training’ interesting worked because I had never me, know and I didn’t before on site would never I anything about it. would be here. that I thought have a miracle. me it’s For life? your changed has this How is an achievement Every day learning. I’m because day every earning money, work, Coming to I the future. but also learning for independent again. more just feel but life my changed only not It’s whole family The life. family’s my this job. because of happy are Construction Academy: Academy: Construction story Chantal’s was years Chantal unemployed for joining our Constructionbefore After and some training Academy. she earned work placement, a Traffic a full-time job as a herself managing with Keltbray, Marshall in and outvehicles of the flow She our construction sites. of winner at our Community was a Awards. Employment joining do before you What did Academy? the Construction look I used to I had a job as a carer. houseafter go from and elderly the was car my day One house. to was finished. and the job stolen until years me seven Then it took fished me out! Landsec has Keltbray How Landsec Sustainability Report 2017 17 Report2017 Sustainability Landsec 2

7 96 01 Chart 4 62 9 77 201 Trainees Trainees constructing a platformscaffold at our Academy Brixton at HMP Jeff Joseph Jeff 3 58 2015 commitment Higgins Construction programme.” are essential in essential are recognising therecognising and work ethic of work ethic of and themselves on thethemselves individuals who find Community Investment Manager, Manager, Investment Community Employment Awards Awards Employment Landsec’s Community Community Landsec’s 6 42 2014 3 6 20 201

105 2012 Target 1 26 201 Working with Bounce Back, we’d we’d with Bounce Working Back, Jobs 0 0 0 20 40 800 600 1200 1000 Cumulative total number of jobs secured of number total Cumulative already launched a dry lining training already the – 2015 Brixton Prison in in HMP centre extended we ouryear This in the UK. first Alandale with working prison programme, launch a scaffoldingto Scaffolding again a – in the prison centre training fortackles the need The centre first. UK And, recruits in our industry. scaffolding helping it’s with the dry lining centre, as In Bounce rates. reoffending reduce to impact in most recent report, Back’s who of people rate the reoffending 2014, was their programmes had been through nationalwith a 12% compared less than 50%. of average Bouncing back into employment Bouncing back into we we This year canresearched how it Knowing that impact. more make year a £50,000 over costs the taxpayer someone prison and £26,000 in keep to for we looked them on benefits, keep to supportways to and prisoners ex-offenders. Community employment Diagram 5

Step 1 Inputs (people) NEETs (not in education, Ex-oenders and employment or training) serving prisoners Long-term unemployed Homeless

Step 2

Programme Work placement Training Landsec’s support will ensure Step 3 candidates have a Outputs (employment) smooth transition

from custody into Scaolding Security Hospitality Retail Painting the outside world, to secure meaningful employment and return home to lead a productive and law-abiding life.”

Fred Sirieix General Manager, Galvin at Windows and creator of The Right Course: an initiative giving young offenders the skills they need to enter the hospitality industry

I am delighted to see Landsec pledging to help 1,200 disadvantaged people, including Recognising success ex-offenders, secure jobs by 2020. Landsec, To celebrate five successful years like the Ministry of Justice, see prisoners as of our Community Employment potential assets, people who can contribute Programme we held our Community Employment Awards. The event to society and give something back. The MoJ recognised people who, by taking part in our programme, have is committed to making prisons places of overcome obstacles to find jobs and reform where offenders can change their lives do them well. The audience heard from inspiring speakers: Jules Pipe, around and turn away from crime. It is only the Deputy Mayor for Planning, through better rehabilitation that we will reduce Regeneration and Skills; Fred Sirieix, General Manager at Galvin reoffending, cut crime and make our streets restaurants; and Kali Hagenstede, our Highest Achiever from 2015. safer. Employers and trainers like Landsec are Jules Pipe said: “This programme absolutely vital to this work.” has a positive impact on the lives of those it helps back into work.” Sam Gyimah MP, Prisons Minister, Ministry of Justice 18 Landsec Sustainability Report 2017 Creating jobs and opportunities

Karen Barker Karen Sir Simon Milton Sir Simon Milton Westminster UTC Westminster Principal Designate, Principal Designate, We are grateful grateful are We for the use of their use of the for superb venues and Landsec have been have Landsec the College towards the College towards they’ve helped steer sustainable success.” success.” sustainable Landsec Sustainability Report 2017 19 Report2017 Sustainability Landsec incredibly supportive. incredibly Our education programmes also Our education programmes Our work encourages more students, students, more encourages work Our backgrounds, of range wider a from like businesses making industry; our into successful. and more diverse more ours more assets our are It also ensures which the local area, of representative appealing to them more makes in turn localpeople. wider community, help us engage the schools and families. including students, of awareness raise The programmes start conversations, our developments, In our local relationships. and develop work there’s we where the areas of many we so – social inequality of a degree those out to reach to particularlywant jobs creating disadvantage, of pockets and opportunities all. for

Do It Too

in Girls Can Participants

Chief Executive, Executive, Chief Stephanie Burras Stephanie Ahead Partnership Ahead Partnership Since our first project back in supported over partnership with Grade to schools, schools, to Grade people at a much us bring Make the us bring Make accelerated rate.” rate.” accelerated across the UK. The the UK. across Through our educationThrough 2012 Landsec have Landsec 2012 colleges and young Landsec has helpedLandsec 2,000 young 2,000 young people Inspire youngInspire people about career opportunities in our industry to increase under from representation 25s Give them skills the need they to succeed in those careers Enable our employees – and our partners volunteer their – to energy expertise and —  —  —  programmes we: programmes While general unemployment is low, is low, unemployment While general peopleyoung especially – people many – specific groups from ethnic and those them accessing barriers stop that face role a lack of There’s industry. jobs in our people Often, girls. for especially models, available. the roles understand don’t skills for the right have don’t Others to apply. or the confidence those jobs, property the industry is not a result, As in the communities of representative which we operate. 2. Education 2. Inspiring young minds Helping more students This year we worked with over 800 Make the Grade students between the ages of 12 and 18, We also found ways to reach more particularly focusing on students from students by working with a range disadvantaged backgrounds through of training providers. These included working with schools that have a higher Construction Youth Trust, and also Ahead than average proportion of children Partnership – a social enterprise that receiving free school meals. We built on connects communities with enterprise. our existing programme by running our: This year we grew our work with Ahead by launching new initiatives — Introduction to Property Development through their school-specific programme programme, which introduces sixth Make the Grade. For example, we ran formers to topics such as construction, a Master Planning challenge at our marketing, architecture and development in Ebbsfleet Garden sustainability, and delivers training in City, in collaboration with Ebbsfleet employability skills Development Corporation (EDC) — UrbanPlan, an interactive learning and other partners. 90 students programme that teaches students from Ebbsfleet Academy visited The about developing the built Observatory, our viewing platform Girls Can Do It Too environment and marketing suite, before creating their own master plan for developing We launched our new girls’ education — Mentoring programme at Westminster Ebbsfleet Valley. After some model- programme, Girls Can Do It Too, to City School, where employees from building and a meet-the-employer show girls there’s a place for them our customers, partners and other session, students presented their ideas in the construction industry. We businesses volunteer to support to a panel from Landsec and EDC. As partnered with two girls’ schools students well as helping students understand in London – St Martin-in-the-Fields — Reward Scheme with Whitehawk how projects work, this showed that High School in Tulse Hill and Mount Academy, which incentivises pupils we design developments with the Carmel Catholic College in Archway to improve their attendance by community in mind – countering some – and asked students to design and rewarding them with fun activities local misconceptions. build a model of a new property at Brighton Marina Other Make the Grade activity development. Alongside our partners included Girls Can Do It Too, Made in Keltbray and JLL, we ran sessions to Developing the right skills Oxford, and the Trinity Kitchen help students think about everything We’re supporting Sir Simon Milton Challenge in Leeds – see our highlights. from finance to sustainability. Westminster University Technical College (UTC): a new kind of college Then we invited students to pitch Learning by giving for students wishing to pursue a career their ideas to a panel of ‘dragons’. Volunteers are vital to our programmes. in construction, engineering and other The winning development was a Our own employees work on everything roles that require both academic and futuristic leisure centre in the shape from one-off careers days to long- technical ability. The college is due to of a giant football from Mount term projects like the Ebbsfleet Master open in September 2017 and we’ve Carmel’s Interstellar team. Planning. Our partners are pivotal too: played a key role in promoting student for instance, women from demolition recruitment. To complement the and engineering company Keltbray curriculum, we’ve planned and will help and property investment management run industry challenges for students. business JLL got involved in Girls Can Do It Too. Volunteering is a rewarding 800+ experience. As well as supporting Number of students we worked with last year students, volunteers often bring new ideas and skills back into the workplace. 41% Across the available data, 41% of What employers said about our Make the Grade programme Chart 6 pupils involved in Make the Grade are eligible for the Pupil Premium. 10 The national average is 29%. This suggests that Make the Grade 8 8 is reaching more students from 77 disadvantaged areas – which is 6 66 an important part of our work in 55 levelling the playing field. 4 4 4 3 Teachers report that participation 2 in Make the Grade is a contributory 11 1 1 factor in reducing the risk of young 0 00 0 0000 0 000 people becoming NEET: not in Strongly Agree Neither agree Disagree Strongly employment, education or training. agree or disagree disagree Developed understanding of business Positive school relationships Improved sta engagement Linking learning and working Increased employability

20 Landsec Sustainability Report 2017 Creating jobs and opportunities Chris Rees Paul Roberts Paul ASPIRE Oxford ASPIRE Oxford Head of 6th form, 6th form, Head of By engaging By employment employment and unique credible socialcredible Chief Operating Officer Operating Chief Oxford project Oxford disadvantaged disadvantaged opportunities.” subcontractors Westminster City School City Westminster proactively with proactively and embedding on the Westgate on the Westgate we are delivering we are impact in Oxford and women from Make the Grade Make gives students a students gives Landsec and their and Landsec (Employment & Partnerships), & Partnerships), (Employment outcomes for men for outcomes the conventional the conventional backgrounds at all backgrounds the world work.” of Landsec Sustainability Report 2017 21 Report2017 Sustainability Landsec classroom, crucially crucially classroom, experiences outside connecting to them range of meaningful of range

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Members of East End Community End Community East Members of 20 the which administers Foundation, helping – Fund Legacy Street Fenchurch prospects employment improve to and opportunities people for living most deprived areas. in London’s Brighton Marina Brighton Ofsted-accredited Reward Scheme at Reward Ofsted-accredited students rewarding Academy, Whitehawk goodfor behaviour. City of London London City of

s school of Number employers with connect What schools say about how Make the Grade helps them helps them Grade the Make about how What schools say Education and charity and partnershipsEducation Launching a new Our partnership with Mencap: 3. Charity partnership: Barnardo’s As our partnership with Mencap partnerships comes to a close, we’ve announced +£360k our new national partner: Barnardo’s, Raised to support people We work with charity partners to: the UK’s largest children’s charity. For with learning disabilities — Help disadvantaged people into work the first time, we asked employees to nominate charities that could help us — Support and educate young people to achieve our goal of creating jobs — Respond to local issues, such as and opportunities, and we put our final rising homelessness shortlist to a company vote – 70% of +1,000 respondents chose Barnardo’s. Working People took part in We work with one national charity across together, we will continue to support Mencap events our business. At the same time, our young people – particularly those who are shopping centres and larger sites have not in education, employment at least one local charity partnership. or training. We offer whatever we can – funding, volunteers, pro-bono support – and open Local partnerships 52 up our spaces for community events. During the year we completed a review People got work placements As well as benefiting our charity of our local partnerships. We’re now partners, this work allows us to run confident that all our partnerships will activities such as firewalks and pop-ups, help us create jobs and opportunities. enhancing the experience of shoppers We also set up a Retail Community Fund. and employees. It also allows teams to Teams from our properties can bid for 21 come together in rewarding projects, grants from this fund, to set up new People got a job helping to keep employees happy and charity partnerships. helping us retain talented people. Our new Community Champions are responsible for our charity and Celebrating our work with Mencap community partnerships. This network This was the third and final year of our of employees builds and manages national partnership with Mencap, the relationships locally. 30 Community UK’s leading learning disability charity. Champions across the Company met up Across our partnership we raised over this year for workshops and training. £360,000. This is thanks to fundraising events such as our Step Up Challenge, where employees raised money by climbing 37 floors of our 20 Fenchurch Street, EC3. We also created work opportunities for people with learning disabilities. 52 Mencap clients have now completed work placements. 21 have found work through our Community Employment Programme.

Our work together has helped improve lives and raise awareness of learning disability both within local communities as well as internally within Landsec itself.”

Jan Tregelles Chief Executive, Mencap

22 Landsec Sustainability Report 2017 Creating jobs and opportunities

Catherine Sermon Catherine We want want to We Employment Director at Director Employment for generously generously for Military Talent’ Talent’ Military thank Landsec supporting our This year we This year supported the Salute My Job.” Salute Job.” My ‘Capitalising on‘Capitalising Business in the Community toolkit, produced toolkit, in partnership with in donations. Veteran Business in the Community written in partnership with– Toolkit specialists, recruitment military It is designed to Job. My Salute their help businesses strengthen veterans offering by workforce The launch fulfilling second careers. Hill, Caroline saw the toolkit of and Debbie Sustainability, Head of and Economy Head of Akehurst, attend an event Communities, and meet Charles at HRH Prince House. Dumfries Supporting veterans Supporting veterans employment into part are the Ministry of of We Covenant Corporate Defence enablewhich is designed to – into supportbusinesses to veterans space we offer example, For work. military for centres in our retail We charities and recruitment. British Legion launched the Royal Appeal at our Bluewater Poppy the and across centre Retail portfolio £127,000 over raised Landsec Sustainability Report 2017 23 Report2017 Sustainability Landsec

We also expanded our work in also expanded our We support to we continued year This a co-ordinated customers This gives Continuing our work in homelessness work our Continuing help to continued in London Our teams partAs our of homelessness. tackle we partnered strategy, Work Homeless to a charity Hume Centre, with the Cardinal homeless peopleyoung and localhelping support, financial offered We families. by raised including almost £20,000 Concert. Christmas Carol the Landsec also our team from volunteers 20 with activitieshelped such as speed- looking students classes for conversation their English. improve to We’re the UK. homelessness across where particularly on Oxford, focusing partnered We’ve homelessness is rising. and Homeless Pathways, with Oxford a proactive homelessness developing are open our to we prepare as policy Autumn in shopping centre Westgate more. for 12 See page 2017. youth end their mission to in LandAid Partner, a Foundation As homelessness. financial supportwe offer pro- and bono expertise. Fund Legacy Street Fenchurch 20 working with WharfCanary In 2015, End Community and East Group Fenchurch 20 we set up the Foundation, Fund. Legacy Street year In the first charity. giving to of way local five to was distributed £96,436 people28 the fund, to Thanks charities. 128 benefits and work-related came off 165 qualification. gained an accredited employment. in sustainable now are Rick Cuthbert, a Landsec Rick Cuthbert, part taking in Ride employee, our for money raise to London partnercharity Mencap 20 Fenchurch Street, EC3 Street, Fenchurch 20 Our wide range of community work in Lewisham this year shows what a powerful impact Spotlight on Lewisham we can have at a local level.” Lewisham in South London is an area facing anti-social behaviour and Jat Sahota youth violence. To help tackle this, Head of Commercial our team at Lewisham Shopping launched partnerships with:

The Circle Collective This sportswear store is a social enterprise helping young people learn work skills, develop self-discipline, and find jobs. In four years of working together, we’ve offered free retail Retail portfolio – Mencap funds raised 1 April 2016 – 31 March 2017 Chart 9 space, funding, workplace visits and work placements – and jobs for 10,000

young people with our partners. £8,675.48 This year we found a space for the Circle Collective to use as a pop-up 8,000 shop. After a successful pilot, which d provided over 100 work experience yt 6,000 shifts, Lewisham Shopping will host £5,013.52 aised the pop-up for another six months. 4,000 £3,683.74 XLP Amount r This charity fights poverty and £1,933.68 2,000 £1,673.05 educational failure in inner cities. £1,381.67 We help them deliver mentoring at

two local schools – Prendergast Vale 0 and St Matthew’s Academy – to Trinity White Gunwharf Xscape Galleria West India support young people who may be Leeds Rose Quays Yorkshire Quay at risk of joining gangs. XLP also Landsec bring their X-mobile recording studio to our shopping centre every Thursday, General donations Mencap challenge event Step Up (spons) Landsec challenge event to reach more young people in the community.

Giving trees This Christmas we ran our Giving Tree initiative. We encouraged We’ve been working with Landsec shoppers at Bluewater, Kent, for several years now and they are St. David’s, Cardiff, White Rose, Leeds, O2 Centre, NW3 and the perfect charity partner. We can’t Lewisham to buy an extra gift, and to leave it under our Giving Tree for a thank Landsec enough for their child in need. The result: gifts for over ongoing and committed support.” 30,000 children. While supporting local charities, this generated over £500,000 of sales across our centres, and gave us a return of £3 for every Cathy Corcoran £1 of marketing budget we invested. Chief Executive, Cardinal Hume Centre

24 Landsec Sustainability Report 2017 Creating jobs and opportunities

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Landsec Sustainability Report 2017 25 Report2017 Sustainability Landsec The Foundation London London The Foundation in 2017 Living Wage £8.45 Foundation The UK in Living Wage 2017 £ 9.7 5 Director, Director, Katherine Chapman Katherine Living Wage Foundation Living Wage company, their company, We are pleased are We accreditation of of accreditation to announce theto great leadership.” leadership.” great In 2016 we issued Modern first our 2016 In through also met suppliers We Living Wage showsLiving Wage Wage employer. As employer. Wage Landsec as a LivingLandsec commitment to the to commitment and the UK’s largest and the UK’s a FTSE 100 company 100 company a FTSE commercial propertycommercial Modern slavery Act came into Slavery The Modern Day make to steps taken We’ve 2015. in force chain partners and supply our staff sure to Actand adhere the of aware are labour and human forced Slavery, it. in place in no have society, trafficking chain, in our supply or our organisation approach tolerance a zero we take and this. to how explaining Act Statement, Slavery and slavery of the risk addressing we’re We in our business. human trafficking our and briefed our teams then trained of spot the risks to on how suppliers modern slavery. to Groups Improvement our Customer slavery across tackle ways to discuss well as asking As chain. our supply pre-qualification go through to suppliers we working with clearance us, before carry out due to reserve the right now made We necessary. whenever diligence with cut ties simply won’t we it clear that with this struggling who are suppliers anything. solve that doesn’t as problem, working. of ways fair help them find We’ll

Because so much of our expenditure our expenditure Because so much of And in Retail, we’ve worked closely closely worked we’ve And in Retail, We were were delighted whenthis year We Being fair is the right thing to do, do, thing to is the right Being fair is on labour, we can influence suppliers we can influence is on labour, in building a fairer way and lead the – 2015, In successful industry. and more chain construction supply we asked Living partners the Foundation pay to This chain. in their own supply Wage whether this is check we started to year our developments, being across achieved Moving Oxford. Westgate startingwith also include a formal we’ll forward, requiring contract, in every commitment and report measure to the contractors direct and subcontracted of percentage Wage. paid the Living employees with suppliers and servicewith suppliers and partners, 2020 meet our we’ll confident we’re target. we became an accredited Living Wage Wage Living we became an accredited Foundation. Wage the Living by Employer across recognises that, The accreditation paid at are all employees our own team, and interns except Wage, least the Living the from exempt who are apprentices business, In our London rates. Foundation 100% compliant. now we’re Foundation Living Wage Foundation for rates the new In November, were Wage Living the Foundation an hour in London, £9.75 announced: This is based outside London. £8.45 ethically and commercially. It helps and commercially. ethically great and retain motivate us attract, competitors It shows customers, people. a responsible we’re that and investors ourAnd it strengthens business. with our partners. relationships and their families what employees on we made good year This live. need to target. 2020 our towards progress Fairness is partly aboutFairness paying people a about also upholding But it’s wage. fair their celebrating and their human rights about making it’s And individuality. and respected in the safe feel they sure workplace. Our commitment: Ensure the Ensure Our commitment: we working environments ensure and fair are control that everyone who is working within an – on our behalf is – we control environment paid at least the Foundation 2020. by Living Wage 4. Fairness 4. Setting specific metrics 5. Diversity Overall, however, neither our industry nor we have been good enough at Our commitment: Make measuring the impact of our initiatives, as pointed out by the National Equality measurable improvements to Standard assessment process which we the profile – in terms of gender, took part in last year. So, while responses ethnicity and disability – to our current diversity initiatives are positive, we need to respond to the of our employee mix. National Equality Standard’s findings. That’s why this year we’ve set out these Getting greater diversity into the very specific metrics for the business, to Company – including around gender, be achieved by 2020: ethnicity, social mobility, disability and sexuality – is very important for us. It — Ensure that Landsec continues to means we better reflect the character of meet all the voluntary targets set by our customers and communities and are the Hampton-Alexander Review (33% more likely to understand their changing of Executive Committee and direct needs. It helps us avoid ‘group think’ in reports are female) – ongoing timeline our decision-making as a result of too — Improve female representation at narrow a perspective. It fosters innovation Leader level to 30% and creativity, and enhances the way we consider and manage risk. And it’s — Improve the Engagement scores for also critical from a talent perspective, BAME colleagues – bringing them into because a culture that’s not inclusive line with employees overall limits the pool of talent it draws from. — Improve the transparency of our Ultimately, it’s key to our reporting of all diversity data, sustainability as a business. including the accurate measurement Our overall objective is to achieve and tracking of engagement of other true diversity of thought within the specific groups – including LGBT and Company through better representation disabled colleagues by gender, community background, age and experience – at all levels, but We’re already doing good work on particularly senior leadership. We want to connecting with diverse groups of create and express a truly inclusive culture young people through our community too, so that anyone feels they can have employment, education and charity a fulfilling career with us. We also want partnerships work. But there’s clearly to address an industry-wide issue around more to do. The toughest challenge the narrowness of the pool within which we face in this area is increasing property companies seek fresh talent. ethnic diversity and creating a truly inclusive culture across the sector. This Moving in the right direction is a complex issue and we need to fully We already exceed the recent Hampton- understand why some groups do not Gender profile Chart 10 Alexander recommendations for females see property as an area of opportunity Gender Prole Men at our Executive Committee and senior for them. Women leader level (combined % of 33%) and 54% female representation has increased by 1% overall. We’ve seen a 3% increase in employees identified as black, Asian or mixed ethnicity. 46% Employee responses to initiatives Diversity can make such as the Best Places to Work in Property survey indicate greater parity us a stronger of feedback across all groups, which business and this suggests we’re creating a more inclusive culture here. Feedback on specific year we’ve taken Ethnicity Chart 11 initiatives, such as our female mentoring Ethnicity big steps forward 2% White programme, has also been very positive. 2% 5% Other 5% And we’ve spearheaded joint initiatives, to improve how we Mixed such as new recruitment and search 6% Black guidelines sent to recruitment partners recruit from a wider Not stated by human resources directors from group and develop Asian across the sector. our diverse talent.”

80% Diana Breeze Group Human Resources Director

26 Landsec Sustainability Report 2017 Creating jobs and opportunities

Celebrating with with Pride Celebrating a numberyear of During the initiate to together got employees bisexual gay, lesbian, the first network (LGBT) and transgender were They within the Company. at our involvement to responding the biggest LGBT Pride in London, from Employees in the UK. parade and joined the parade, Landsec our advertising at Piccadilly screens a special Pride Lights featured the event. celebrate to takeover Getting a better balanceGetting a better Balance (REB) is an Estate Real female of a group association by run different and male leaders from in real and disciplines organisations the address to want who estate We gender imbalance in our sector. supporters the founding of were Our year. when it set up last group Director, Human Resources Group Talent is on the group’s Diana Breeze, Committeeand Development and Robert Noel, Executive, our Chief and has at the launch event spoke During been forum. part the CEO of a successfulwe hosted year the REB in for event speed-mentoring and a fast provided which Victoria, furious opportunity mid-career for up and follow meet, to females across models from senior role with, the sector. Landsec Sustainability Report 2017 27 Report2017 Sustainability Landsec t or 20% 80% Chart 12 Supp 54% 46% Our Academy Trainees Our Academy ofessional Pr 51% 49% Manager ader 20% 80% Le ader

36% 64% Senior Le

e Women 71% 29% Executiv Men 0 10 ender by management level management ender by 70 20 50 30 40 80 60 90 100 G We maintained 6. Health, safety and security OHSAS Our commitment: To maintain an exceptional standard of 18001 health, safety and security in all the working environments we control. Our priorities in 16 reportable RIDDORs. health, safety and security are:

— Health: to make sure every worker has a transferable occupational health record, and to make sure all Working in our maintenance and construction partners have a wellbeing policy partnership with the Supporting a — Safety: to have zero reportable health National Counter new strategy and safety incidents Terrorism Security — Security: to raise awareness of Working with other companies, physical and cyber security, in our own the Minister of State for Disabled Office and other organisation and across our industry People, Health and Work, Penny stakeholders from the Mordaunt MP, and with the HSE, Businesses know that accidents delay we contributed to a new Strategy projects, damage reputations and make commercial sector, for Health in Britain’s Workplaces. it hard to attract skilled people. But few Landsec demonstrate In line with our intention to elevate understand the long-term impact of health to the same status as safety, unhealthy practices like inhaling diesel leadership, innovation the strategy focuses on reducing fumes. Fewer still know that poor mental workplace stress, lung diseases and health costs employers billions every year. and commitment in musculoskeletal disorders. It was By setting outstanding health and the security sector.” launched in December 2016 at our safety standards, providing the right Nova, SW1 building in Victoria in environment for people to thrive, we can recognition of the role we played help build a healthier, happier and more in shaping the strategy. Michael Pearce productive workforce. And by introducing National Counter a new focus on security, we can help Terrorism Security Office protect people, information and business value. Landsec are Safety: working towards zero This year, we continued sharing best continually practice through our ‘One Best Way’ guidelines and our Health and Safety seeking to raise pledge, which new starters and standards through external customers signed up to. We also maintained our OHSAS 18001 a collaborative certification, the benchmark for health approach with and safety management systems. We continued work on our Traffic their supply Risks and Protection of Vulnerable Road Users policy. This protects people chain and the travelling near our sites by specifying broader industry things like safety guards and audible alerts on lorries. It also rates sites stakeholders.” according to certain standards. In March 2017, all our London development sites reached the highest ‘Gold’ rating. Andy Brown Despite our efforts, incidents HSE Director, Mace reported under the Reporting of Injuries, Diseases and Dangerous Occurrences Regulations 2013 (RIDDORs) increased this year.

28 Landsec Sustainability Report 2017 Creating jobs and opportunities

Ian Strudley As Chair of of Chair As Head of Health Unit, Health Unit, Head of

Construction the Health in HM Principal Inspector, HM Principal Inspector, Construction Division, HSE HSE Construction Division, been one of thebeen one of major factors inmajor factors enthusiasm andenthusiasm that the industry commitment hascommitment Clive’s leadership, leadership, Clive’s raising awareness raising Leadership Group, Group, Leadership managing dangers to workers’ health.” workers’ to needs to do more in more do needs to Landsec Sustainability Report 2017 29 Report2017 Sustainability Landsec Health in Construction Summit

2 0.11 2014/15

Table 13 Table shows that 0.14 1 2015/16 0.26 (per 100,000 hours worked) hours 100,000 (per 2016/17 Accident Frequency Rate 0 (hours (hours worked) 2014/15 5,187,006 5,187,006 1. Office for National Statistics for National Office 1. There, in conjunction with the HCLG the HCLG with in conjunction There, we Council, Safety British and the a mental in Mind, launched Mates designed Specifically health programme. a it’s the construction industry, for people that shows how programme support illto mental with colleagues research The latest health. the construction industry is associated The risk suicide. of very high risks with whose jobs suicide among labourers of work, physical the most routine involve 3.7 is such as digging foundations, We average. times above the national will be supporting in Mind the Mates our contractors requiring by programme session training a 45 minute up to sign to sessions half-day and all employees, for managers. line for objectives setting new Security: objective train set a new to have We all our people and cyber in physical will help people The training security. with everything data protecting from safe staying to working remotely when Members of incidents. during terrorist Committee our Executive already have so they’re the training, completed in upskilling the front leading from our team. 1 (hours (hours worked)

2015/16 7,045,319 7,045,319

0 (hours (hours worked) 2016/17 6,194,341 Accident Frequency Rate (AFR) calculation = number of RIDDORs (non-fatal) x 100,000/ average number of average 100,000/ x RIDDORs (AFR) calculation = number (non-fatal) of Rate Frequency Accident worked. hours Fatalities 2. 2. Developments Reportable fatalities and Accident Frequency Rate at our developments Rate Frequency Accident and Reportable fatalities some 150 CEOs – discussed ill health – 150 CEOs some in construction. Health: raising our profile raising Health: Health, Head of our Group Johnson, Clive chair continued to and Security, Safety the Health in Construction Leadership sure make aims to HCLG (HCLG). Group gets as – health including mental – health in our industry, much attention as safety awareness raise and has campaigned to In diseases. respiratory workers’ of held its second HCLG 2017, January 300 construction over where summit, – including leaders and influencers We believe this is because we havewe because this is believe We culture transparent a more created Improvement Customer our through partners, our where (see page 4), Groups and service contractors employees, partners be can open honest about and Better incidents. health safety and better achieve results conversations we because also It’s and relationships. developments complex on several worked which had over SW1, including Nova, – But one time. at 2,000 people on site we doing work, more when we’re even for this as a reason accept shouldn’t any increase. Leadership on targets Efficient 1. Climate change Last year we set a science based target for reducing our emissions. Science based and carbon targets help companies determine how use of much they must cut emissions to prevent Our commitments: the worst impacts of climate change Continue to procure 100% and stay in line with the Paris Agreement natural commitment. They’re developed and renewable electricity across assessed by the Science Based Targets resources our portfolio and achieve initiative, a partnership between UN 3 MW of on-site renewable Global Impact, World Resources Institute, WWF (World Wide Fund for Nature) and Being more electricity capacity by 2030. CDP (formerly the Carbon Disclosure resourceful Project). Reduce carbon intensity Our target is: to reduce our carbon We use a lot of natural resources in our (kgCO /m2)by 40% by 2030 intensity by 40% by 2030, compared 2 with a 2013/14 baseline, for properties work, from the energy needed to develop compared to a 2013/14 and manage assets to the materials we’ve managed for at least two years, required in construction. baseline for properties under with a longer-term ambition of an 80% When we buy, use, re-use and our management for at least reduction by 2050. Carbon intensity is the amount of carbon dioxide emitted dispose of these resources efficiently we two years, with a longer-term see big benefits. We minimise our impact per square metre of floor space. on the environment. We reduce costs, ambition of an 80% reduction In December 2016, the Science Based both for us and for our customers and by 2050. Targets initiative approved our target, partners. And we give our assets and our making us the first real estate company business greater resilience in the face of 2016 saw the ratification of the Paris in the world to achieve this approval. We climate change challenges, from scarce Agreement, committing countries to think this is an important step in terms resources to new regulation. keep global warming below 2°C – the of setting stretching carbon targets. We We believe our work in this area can tipping point at which damage will be spoke about our approach at events also give us a competitive advantage, irreversible according to a consensus throughout the year, including at built by helping us develop enduring trust and amongst climate scientists. 2016 was environment conference Ecobuild and at good relationships with our customers, also the hottest year on record; a sign a UK Green Building Council masterclass, communities, partners and employees. that it has never been more important sharing best practice and encouraging To use our natural resources to act on climate change. others to follow our lead. efficiently, we plan, act and measure A broad scientific consensus our impacts across four key areas: believes that human activity is climate change and carbon, energy accelerating climate change, largely management, waste and water. through increases in carbon emissions. With the built environment accounting for 37% of all emissions in the UK, as the UK’s largest listed commercial property company, we must lead the way in reducing emissions and supporting Landsec is showing the Paris Agreement. great leadership within the global property industry, Landsec carbon emissions intensity pathway Chart 14 90

positioning itself 80 to future-proof 70

2 60

growth as the world m e/

2 50

transitions to a low- CO 40 Kg carbon economy.” 30 20

10 Pedro Faria 0 Member of the Science 2015 2020 2025 2030 2035 2040 2045 2050 Based Targets initiative Landsec pathway – target Sector pathway steering committee, CDP Landsec pathway – actual Landsec pathway – projected

30 Landsec Sustainability Report 2017 Staying on track Getting to work on Scope 3 To date, we have reduced carbon intensity Although we’re making good progress on by 18.5% compared to our 2013/14 reducing our own emissions, we need to baseline, which puts us on track to remember that we influence emissions achieving our initial target for 2030 and our from our supply chain and customers. This long-term ambition for 2050. This is largely year we worked with the Carbon Trust thanks to our active energy management to scope out and report on the entire programme, which is enabling us to reduce range of measurable carbon emissions the energy we use to power our offices and associated with our business. shopping centres. We’re also generating Emissions can be divided into three more of our own energy too, through Scopes. Scope 1 and 2 emissions are those renewable sources such as solar panels on we directly control. These are produced our properties. You can read more about when we use energy to heat and power this on page 32. our head office or the landlord-controlled Taking the lead with Our carbon performance has been spaces within our properties. green gas helped by reductions in the UK’s average For the first time, we’ve looked emission factor for electricity. In other closely at Scope 3 emissions: those Green gas is a low-carbon substitute words, producing electricity now generates indirectly associated with our business. for mined or fracked gas. To create fewer emissions than it used to. This is Scope 3 includes the ‘embodied carbon’ it, organic matter such as food or in part because businesses like ours are emissions produced by construction garden waste is put in an air-tight buying more renewable energy, driving up companies and other suppliers when tank. Bacteria then break down demand for sustainable energy producers they work with us to develop a property, the matter, releasing a methane and improving the UK energy mix. such as emissions from transporting and rich biogas. That’s why it’s so important that this manufacturing building materials. Scope This year, green gas made up year we continued our commitment to 3 also includes the emissions produced 15% of our gas purchases. This buy 100% renewable electricity; and also by suppliers helping us run a property, means, as a proportion of our total extended our commitment to include a or customers using energy in their own gas use, we’re one of the top green metric for on-site renewable generation. areas within our properties. gas consumers in the FTSE 100. And We have committed to increase on-site We found that 5% of our Scope 3 thanks to our scale and the amount Efficient use of naturalresources renewable electricity generation capacity emissions are recorded when we report we buy, we can drive demand, to 3 MW by 2030 from the current amount against our targets, in situations where boost the renewables industry, and of 0.6 MW. This will reduce costs for our we buy energy on behalf of our customers. increase the proportion of green gas customers, cut our carbon emissions and But that means 95%, the vast majority, in the UK’s energy mix. This makes improve the resilience of our assets. are not. And since our work with the the whole industry greener – and in As of 1 April 2016, all the sites we Carbon Trust has established that Scope turn helps us hit our carbon targets. manage are supplied by SmartestEnergy, 3 emissions make up 91% of our total What’s more, much of our the UK’s first officially certified 100% emissions, we need to address this. green gas is sourced from our water renewable electricity producer. As we So, while continuing our work in reducing suppliers and derived from their reported last year, we were the first Scope 1 and 2 emissions, we’ve set two sewage treatment facilities. So the property company to join RE100, a group stretching targets related to Scope 3: cleaning of our wastewater actually of influential businesses committed to helps to produce the fuel we use to renewable energy. This year we also started — Encourage all main contractors to set heat our buildings – a real closed to buy green gas – another way science based targets and to help us loop story. of promoting the low-carbon economy. reduce carbon emissions when we’re See the highlight story for more. developing a property together — Work with the customers who occupy our buildings to help them reduce the energy they use and partner with us to Landsec is showing create lower-carbon floor space its pioneering leadership by supporting the Our carbon emissions – Scopes 1, 2 and 3 Diagram 15 UK’s growing biomethane-to- 2% grid industry.” Scope 1 emissions: Direct emissions from activities controlled by us Virginia Graham 7% Chief Executive of Renewable Scope 2 emissions: Energy Assurance Ltd and the Indirect emissions associated with our consumption of Green Gas Certification Scheme purchased energy 9 1% Scope 3 emissions: Indirect emissions which are caused by our activities but not controlled by us

Landsec Sustainability Report 2017 31 Boosting on-site generation We are committed to increasing the amount of renewable electricity generated on our sites and pioneering low carbon technologies to improve the efficiency of our assets. We’re seeing more on-site renewable generation come to life as new developments and refurbishments such as 20 Eastbourne Terrace, W2, open and the technologies we specified at design We continue to champion low carbon stage are switched on. Our on-site technologies such as heat pumps and capacity is ever increasing and currently combined heat and power (CHP). The amounts of 0.6 MW of electricity with ground-source heat pumps at One 323 MWh being generated in 2016/17. New Change, EC4, continue to provide We are reviewing opportunities to low-cost and low-carbon heat for our retrofit technologies onto existing assets customers and we are utilising air-source and we are in the process of installing heat pumps within our Westgate Oxford solar panels at our White Rose and development. Trinity shopping centres in Leeds. These CHP provides low-carbon heat installations will more than double our and electricity within our recent current capacity to 1.4 MW with White developments and is successfully in Rose contributing 0.8 MW of this. When operation at Zig Zag, SW1, 60 Ludgate up and running, the panels will generate Hill, EC4, and Mizuho House, EC4. At 830 MWh of electricity per year with solar 20 Fenchurch Street, EC3, the Fuel Cell power directly contributing 20% of White has delivered 1,139 MWh of electricity for Rose’s landlord electricity demand. the building, providing low-carbon power for our customers.

Our carbon reduction approach Diagram 16

Carbon

Solar louvres at 20 Eastbourne Terrace, W2

Using less energy On-site generation – Supporting eg.White Rose PV de-carbonisation of UK energy mix through procuring renewables

32 Landsec Sustainability Report 2017 We’re the first property company to have its science based emissions target approved, which underlines that we’re serious about cutting emissions.”

Caroline Hill Head of Sustainability

Reducing our footprint GeoPhy, a technology company expert at examining real estate data, recently ranked us in the top three Real Estate

Investment Trusts across EMEA in terms Efficient use of naturalresources of carbon efficiency. This is measured by

the amount of CO2 we emit per dollar we take in rent. It shows that the buildings in our portfolio are well managed and efficient as well as profitable.

Becoming resilient As well as working to tackle climate change, we need to understand the risks it poses to our business – and find ways to mitigate them. We’ve started a new project to do this, to make our business more resilient. Read more on page 42.

Investing responsibly We’ve worked hard to improve the way The progress Landsec has made over we develop and manage our portfolio to the past two years is commendable. reduce environmental impact. But if we acquire assets with a poor energy They are one of the most engaged landlords performance it will impact on our ability to reach the targets we have set. This M&S works with on sustainability and this year we published a new Responsible is evident in their achievement of becoming Property Investment Policy. It sets out how we will now factor in a much the first real estate company globally wider set of sustainability performance considerations when assessing potential to set a science based target.” acquisitions (see page 11 for more on the policy). It’s an example of how we’re looking at sustainability across the Lydia Hopton entire lifecycle of our assets and our core Plan A Project Manager, activities – buy, develop, manage, sell. Marks & Spencer

Landsec Sustainability Report 2017 33 An overview — Finding more ways to use energy 2. Energy Last year, we reported on our new, more efficiently in our individual Company-wide Environmental and properties management Energy Management System, where You can read more about these below. we achieved ISO 50001 certification — Setting and hitting a new Group Our commitment: alongside our existing ISO 14001. In April KPI to create energy reduction Reduce energy intensity 2017, we successfully transitioned to the plans for each of our sites new 2015 version of ISO 14001, well ahead (kWh/m2)by 40% by 2030 For the first time, we set a Group KPI of requirements. Both are important for energy. It required us to make compared to a 2013/14 and we’re proud to have an integrated energy reduction plans for each of baseline, for property under management system. ISO 14001 is an our properties and approve a certain environmental management system amount of energy reduction measures our management for at that checks we’re compliant in things at those consuming most energy. least two years like handling hazardous substances and waste management. ISO 50001 is an All this activity is united within our active There are lots of reasons why using energy management system that keeps energy management programme: our energy more efficiently is important to us in line with the government’s Energy integrated way of reducing energy use our business. It helps us reduce carbon Savings Opportunity Scheme (ESOS), by and impacts across our business. intensity, keeping us on track to hit our ensuring that we’re always improving targets. It keeps costs down, for us and our performance and reducing energy A strong performance for our customers. Renewable energy consumption where we can. Since our 2014 baseline, we have reduced makes us less dependent on fossil fuels, We built on this work over the past our energy intensity by 13.2%. This is while on-site electricity generation 12 months. Highlights included: equivalent to a carbon reduction of means we don’t have to rely so heavily 18,589 tonnes of CO2 and meant that on the National Grid. — Becoming the first property our customers reduced costs of £2.9m on Efficient use of energy is also company to sign up to EP100 their annual energy bills. important to us because it’s important EP100 is a campaign by The Climate The results vary across the different to our stakeholders. In our most Group challenging businesses to parts of our business. In London, we recent materiality review (see page 5 double their energy productivity within focused on optimising our existing for details), energy reduction was 25 years. We measure our energy assets, and fine-tuning the low carbon highlighted as a priority. By setting productivity by floor space, just like our technologies on our new developments. and achieving targets in this area, we energy intensity – so, reducing energy As a result, energy intensity fell by 14%. show people that we’re listening to their usage per square metre leads to a Meanwhile, in our Retail business, energy concerns and taking action. reduction in energy intensity and an intensity decreased by 3%. Several of our Just as we use carbon intensity to increase in energy productivity. This Retail properties made big improvements measure our carbon emissions, so we means our target to reduce energy – the Galleria, Gunwharf Quays and use ‘energy intensity’ as a measure to intensity by 40% by 2030 puts us on Bluewater shopping centres, for instance. track our energy performance. This is the track to doubling our productivity We’ll use what we’ve learned at these amount of energy used per square metre. within the required timescales. properties, particularly in lighting, to We also set the same target – a 40% improve energy performance across our reduction by 2030. This stretching target wider Retail business. underlines that energy management has an important role to play in our journey to a low-carbon world. We are pleased Landsec energy intensity Chart 17 that Landsec is 300 demonstrating

250 247 bold and ambitious

213 leadership by 200 joining EP100

2 and committing m 150 129 KW h/ to double energy 112 100 productivity.” 77 64 62 50 Damian Ryan Acting Chief Executive, The Climate Group 0 2013/2014 2016/20172013/2014 2016/20172013/2014 2016/2017 Baseline Baseline Baseline London Retail Landsec

London energy intensity 2030 target Retail energy intensity Landsec energy intensity

34 Landsec Sustainability Report 2017 Some highlights how it’s using energy and what energy At our 140 Aldersgate London office reduction measures we could implement. building in London, we looked at what Across 23 of our 25 largest-consuming our customers needed in terms of properties we’ve approved several of heating and cooling. Then we carried out these measures. a range of fine-tuning and optimisation To look in more detail: across measures on central plant such as our portfolio we identified 141 energy boilers. The property now uses 270,621 reduction measures. Together, these kWh less energy, saving customers have the potential to reduce energy £12,763 annually. consumption by 13,115,090 kWh and save At our multi-storey car park at our customers £1.4m in energy bills per Brighton Marina, we replaced the year. 64 of these measures are approved existing lamps with LEDs. As well as for implementation – we believe they will reducing energy demand and cutting reduce energy by 7,724,446 kWh and maintenance costs, this has increased cut customers’ bills by almost £900,000 light levels by 400% – making the space a year. brighter and safer for customers. The These 64 approved measures cover upgrades will save over £12,500 a year. approximately 60% of the total energy At our White Rose shopping centre reduction we think we can achieve, and A powerful partnership in Leeds, we replaced the heaters over would reduce our energy intensity by 4%. Last year we reported on our trial the entrances with new, efficient, air- The remaining 77 measures are still to be partnership with our engineering barrier technology. As well as having approved. We believe they could reduce partner NG Bailey, which was lower running costs, this technology energy intensity further still, by designed to improve energy produces warmer internal temperatures, an additional 3%. performance at our six highest- creating a more pleasant experience Looking at a ‘best case’ scenario consuming London properties. To for our customers and guests. The in which the remaining 77 measures date, our partnership has saved project stands to save £3,500 a year for are taken forward, and considering 10% in energy compared with just one entrance. We installed similar the reduction in energy intensity we’ve our baseline, and has reduced technologies at our Bluewater and achieved so far, our projections show customers’ energy costs by Efficient use of naturalresources Buchanan Galleries centres, and are we’re on track to meet our 2030 target. £880,696. The initiative was named now looking at other opportunities This is testament to a great collaboration The Most Inspiring Energy Reduction across the portfolio. between our sustainability, technical, Project of the Year at the 2016 operations, and portfolio management Energy Managers Association Energy Hitting our target teams as well as our service partners. Management Awards. We didn’t just hit our new KPI target; Next year will be all about delivering This year we expanded the we exceeded it. We created an energy these measures at each of our properties. partnership to other London reduction plan for each property to show properties and produced savings of £63,820. Through the partnership, we gather detailed data about Energy reduction Diagram 18 energy use at our properties, enabling NG Bailey to operate Asset upgrade Fine-tuning those properties more efficiently. For example, together we looked at — 11 energy reduction — 27 energy reduction measures approved measures approved times when people were actually for implementation for implementation using the lighting in the properties, — Estimated to save — Estimated to save 824,787 kWh per year 1,654,224 kWh per year compared with when it was on and — Estimated annual savings — Estimated annual savings consuming electricity – then we to our customers in reduced to our customers in reduced made controls adjustments, which energy bills of £94,812 energy bills of £173,806 — Payback of under 5 years — Payback of under 1 year at one property, will save occupiers over £2,000 annually in electricity costs for common areas. Having successfully proved Estimated to save 64 energy this innovative concept through 7,724,446 kWh per reduction our trials, we now use a unique year, equivalent to a measures further reduction of approved for contract structure across the 4% from our current implementation portfolio. NG Bailey combine consumption levels facilities management with energy

Combined payback Estimated annual performance in one contract. So, of just under 3 years savings to our as part of their planned operations, (based on a total customers in reduced their team can deliver energy project cost of energy bills of just £2,447,811) under £900,000 efficient upgrades, ensuring our (£877,257) buildings are operating correctly and keeping our customers happy. This is our vision for all future building Lighting services.

— 26 energy reduction measures approved for implementation — Estimated to save 5,245,435 kWh per year — Estimated annual savings to our customers in reduced energy bills of £608,639 — Payback of just over 3 years

Landsec Sustainability Report 2017 35 Connecting with customers We’re working closely with our customers to help them use less energy in our properties. For example, at The Galleria outlet centre in Hatfield we analysed retailers’ historic and current energy use. We sent out their results and are now following up to discuss how we can help reduce their usage and costs. In one unit at The Galleria we’ve already worked with the customer to upgrade their lighting to more efficient LEDs. The new fittings make the shop brighter and will save them £750 per year. In London, we introduced some helpful improvement measures at 20 Fenchurch Street, EC3, such as creating regular reports for occupiers and offering one-to-one meetings to talk about energy use. We also spoke to occupiers at One New Change, EC4, and 123 Victoria Street, SW1, New Street Square, EC4 about our move to a 100% renewable electricity contract, giving them the inspiration and information they need to consider a similar move.

A lightbulb moment Judges were We were delighted 80% of the projected energy savings in our retail business will come from impressed by the to award Landsec lighting upgrades. There’s a double ability of Landsec and the Chairman’s benefit – as well as reducing energy usage and carbon emissions, great NG Bailey to work in Cup for New Street lighting can enhance our customers’ experience. We’re now planning to partnership across Square this year. Their install new lighting across many of a broad estate that partnership approach our shopping and leisure centres. This includes the Xscape Milton Keynes included people from and continued leisure centre, where we’ll upgrade different teams.” engagement with all lighting to LEDs. This will not only give the centre a bright new look, occupiers has led to it will save customers over 600,000 Lord Redesdale kWh per year and pay for itself in some remarkable CEO of the Energy Managers three years. Association and judge of the results.” EMA Most Inspiring Energy Reduction Project Award 2016 Ryan Clark Recycling and Clean City Awards Officer, City of London

36 Landsec Sustainability Report 2017 or recycling them instead of sending face-to-face training, using multiple 3. Waste them to landfill or incineration. The World languages on our signage and installing Economic Forum believes the circular more colour-coded bins. We also installed management economy could significantly enhance weighing machines and shredders at global construction industry productivity some properties. Our commitment: and save more than $100 billion a year. The work in our London business was Send zero waste to landfill Last year our waste targets were: shortlisted for the Materials Recycling World (MRW) National Recycling Awards, with at least 75% recycled — In London, to increase the recycling rates to 75% and continue to send zero in the Team of the Year category. Our across all our operational and waste to landfill teams were also winners in the City of London Clean City Awards (see our construction activities by 2020 — In Retail, to reduce – and aim to highlight story). eliminate – waste sent to landfill, When companies fail to manage waste except where we have no other option Increasing data accuracy in retail well, there’s a huge impact on our planet. (for example, in getting rid of asbestos In Retail, we sent 68.4% of used The Ellen MacArthur Foundation predicts or Japanese knotweed) and to materials for recycling – a slight decrease that by 2050 there will be more plastic increase the recycling rate across our on our previous year’s performance of in the sea than fish. Of course, waste leisure assets to 75% 69.3%. This is due to improved accuracy also costs money. Using up resources on — In developments, to divert all of data, retendering several waste waste collection, throwing things away construction waste from landfill and contracts, and amalgamating some that could be reused or recycled – it’s bad send 75% for recycling of these to increase efficiency and give for business. customers better value. We also diverted The UK construction sector — In our head office, to reduce waste by 99.9% of waste from landfill, up from produces 109 million tonnes of waste 10%, including reducing paper waste 99.0% the previous year. This year we per year. Our own development projects by 50% from a 2015/16 baseline. sent 36.7 tonnes of waste to landfill – produced around 7,571 tonnes of waste 0.1% of total operational waste. We have last year, while our operational teams Seeing success in London now stopped sending waste to landfill at managed 34,934 tonnes. So, we have In our London business, we sent over 77% all our properties bar one – we’re planning a responsibility to help partners and of our used materials for recycling and continued to divert 100% of waste from to retender the waste contract for that

customers manage waste effectively. Efficient use of naturalresources property this year. Although our final Across our operational portfolio we landfill. That puts us ahead of our target, result will be affected by any acquisitions have recycled 70.8% of waste and and is an improvement on last year’s we make, we believe we’re on track to diverted 99.9% from landfill. This is an recycling rate of 74%. report zero waste to landfill next year, improvement on our previous year’s We achieved this by continuing putting us ahead of our 2020 target. performance of 70.3% recycled and our work with Bywaters, our lead waste 99.3% diverted from landfill. services provider, to help customers By working together, we can move better separate different types of waste to a circular economy: where we buy and on site. We supported occupiers by use products and materials, then put offering to audit their activities and them back into circulation by re-using premises, giving their cleaning teams

Landsec monthly portfolio recycling rates 2014– 2017 Chart 19

90%

80%

70%

60%

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30% Mar 14 Sept 14 Mar 15 Sept 15 Mar 16 Sept 16 Feb 17

London Retail Landsec Commitment

Landsec Sustainability Report 2017 37 Beneath the headlines, the picture across Making changes at head office our Retail business is quite complex. This This year we finished refurbishing our new Success at the is because we play a different role across head office building at 80‑100 Victoria different types of property. For example, Street, SW1 and moved in. Because of Clean City Awards we don’t manage waste at some leisure this, we disposed of more operational New Street Square, EC4, features and retail parks, such as Boldon Leisure waste as a company than we did last more than 26,600 square feet of Park. But we do manage waste at year. Some of this waste was non- office space, along with over 5,000 shopping centres, and at leisure centres recyclable, which is why our percentage square feet of retail. We manage all like Xscape Milton Keynes. Also, the of recycled waste dropped slightly. the non-hazardous waste produced properties vary dramatically. Combined, As part of our head office move, we there, including mixed recycling, our Trinity Leeds and Bluewater shopping have set ourselves challenging new general waste, food waste and glass. centres produced as much waste as our goals to reduce waste, especially paper We send the general waste to be entire London portfolio – not because consumption. All employees have been incinerated, and the food waste for they’re inefficient, but because these are issued with tablets to enable flexible anaerobic digestion so that it can such large, busy sites. Recycling rates on working and discourage printing. In produce green gas. Nothing gets average are lower in our Retail portfolio our first month of having this new sent to landfill. due to the complexities of these sites technology across the Company, we’ve Last year we hired a full-time and different make up of customers. reduced our monthly average printing waste operative at the property. This volumes by 46%. We hope to see a person can train customers’ staff Setting a new target continued reduction and have set and cleaning teams to help them for developments ourselves a paper reduction target of use our waste management facilities This year we sent 124 tonnes of waste 50% by 2020. Turn to page 14 for more properly. We included a weighing to landfill – less than 2% of construction about our new head office building. machine in the loading bay, which waste – and exceeded our 75% recycling means customers can measure target. As well as making sure we Creating a circular economy and monitor their own waste. And manage waste well, we want to limit During the year, we carried out a project we recently installed a shredding the amount of waste we produce in the to understand how we might implement facility. Working with Bywaters, our first place. So we expanded the scope of circular economy principles in our waste services provider, and with our waste commitment to look at the business. We started by reviewing our customers, we undertook a waste volume of construction waste produced waste management practices. After a audit to show where we can all on our sites. Our updated commitment series of workshops and site visits, we become more efficient. All this has is: to send zero waste to landfill with agreed three areas of focus: helped us increase recycling rates by at least 75% recycled across all our 7% in less than eight months. activities, and reduce construction — Making sure waste management Our work was recognised at the waste to <6.5t/100m². services focus on customer needs. City of London Clean City Awards. We also committed to a new For instance, we need to check that The New Street Square team won metric that will encourage contractors our facilities are accessible, and that the Premier Award in the Facilities and design teams to send any waste our communications with customers Management category, and took materials that can be recycled back to are clear and consistent home the Chairman’s Cup. their original source. This new metric is: — Encouraging our peers to standardise to measure and report the percentage practices and metrics. This will help of waste materials removed from site by businesses across our industry learn Evaluating 20 the original manufacturer. We now plan from one another, and it will help to measure this on new developments, so establish our position as a leader in Fenchurch Street, EC3 we can set a new target for the future. this area Having completed a number — Plan to make our business more of developments in our last Recycling at head office Table 20 resilient, particularly in terms of development cycle, this year we evolving customer needs, the cost of started the first in a series of post-

Divert from Total materials and market changes occupancy evaluations. We began Recycling landfill volume with 20 Fenchurch Street, EC3. Year percentage percentage (tonnes) Although this initial work focuses on We worked alongside our partners, 2013/14 66.9% 100% 75.5 waste management, we want to develop Canary Wharf Group, and with the 2014/15 83.4% 100% 100.9 a comprehensive circular economy property’s original engineer Hilson 2015/16 86.5% 100% 127.5 strategy that encompasses other areas Moran, over a nine-month period 2016/17 86.1% 100% 131.6 such as energy. This strategy would to complete the evaluation. We include buying circular services in areas collected customer surveys and Waste in developments Table 21 like lighting and heating, ventilation other data, carried out a post- and air conditioning, helping us tackle construction review, and reviewed energy costs and create more value a full year of energy and water-use Tonnes Percentage for customers. Total construction waste 7,571.32 – performance against our initial Total construction waste expectations. Gathering feedback 4.97 98.37% diverted from landfill from building users and the building Total construction waste 123.48 1.63% management team in this way will to landfill help us to create designs for the Total construction waste 7,4 42.88 98.30% recycled future that are even more efficient, appealing and successful.

38 Landsec Sustainability Report 2017 Being tax efficient This year we are disclosing for the first generated will help us to target specific By helping customers to recycle more time the composition of our waste in waste streams so we can continue to and send less waste to landfill, we help both our London and Retail portfolios adopt a circular approach to managing avoid significant amounts of landfill tax. (see Charts 22 and 23). For Retail, its disposal. Whilst managing waste is This year we partnered with responsible there are more types of waste to the easy bit, the real challenge comes waste service providers to divert 34,897 manage due to the varied nature of our with trying to generate less in the first tonnes of waste from landfill, avoiding Retail operations and there is a large instance. How we engage and work £2.9 million in landfill tax. Across our proportion of cardboard due to the with our occupiers to achieve this will business, over the past three years, we’ve packaging requirements of our retailers’ be integral to our waste strategy for a avoided over £8.5 million in landfill tax. goods. Dissecting data in this way and circular economy. understanding how and where waste is Exploring waste intensity We’ve been working to decide how to calculate the ‘waste intensity’ for LondonLondon Po rtportfoliofolio 2016-17 2016-17 YT D WastCharte St re22amRetRetail Breaailkd Po portfolioowrtfon lio 2016-17 2016-17 Wa ste StChart23ream Breakdown our properties. This will allow us to waste stream breakdown waste stream breakdown compare waste management across our properties more easily, and help us make better decisions about how to improve. However, waste intensity isn’t as simple as looking at the amount of waste produced per square metre. There are lots of other factors to consider. For instance, in shopping centres we need to think about the footfall across the space, the activities happening inside, the location of the centre and its opening General waste (sent to energy from General waste (sent to energy from waste facility) 22.50% waste facility) 32.0% hours. We’ll continue this work over the Mixed recyclables 34.11% Mixed recyclables 25.7% next 12 months to find a meaningful Food to anaerobic digestion 22.27% Cardboard 16.3% measurement that will help us hit

Cardboard 0.97% Total food waste 12.8% Efficient use of naturalresources our targets. Glass 19.30% Glass 9.0% Con dential paper 0.50% Total reused waste 2.3% Cooking oils 0.34% Metals 1.1% Plastics 0.8%

Waste to land ll 0.1%

4. Water Landsec water usage Chart 24 1,000,000 0.65 We want to use water as efficiently as 900,000 possible across our portfolio. Compared 800,000 0.63 700,000 to last year we have reduced our water 600,000 0.61 2 consumption intensity by 1% (water 3 /m

500,000 3 m consumed per metre squared). Whilst m 400,000 0.59 these reductions are modest, they should 300,000 be considered in the context of increased 200,000 0.57 customer footfall in our Retail portfolio. 100,000 At design, we can make most impact – 0.55 on water usage on our developments, 2015/16 2016/20172015/16 2016/20172015/16 2016/2017 by including the right features in the London Retail Landsec right places. To help us to do this, we work to BREEAM and SKA, which are Water usage Water usage intensity respected industry standards. This usually means installing low-flow equipment in communal areas – in particular, rainwater harvesting systems for flushing toilets. We included this kind of system in our plans for a Sumner Street office development in Southwark, which we’ve just submitted for approval.

Landsec Sustainability Report 2017 39 We also learned that our base building Sustainable 1. Our approach design standards are usually high enough to meet WELL certification, Our focus for the last ten years has which recognises healthy buildings where design and been on building strong foundations: happiness, mindfulness and productivity achieving energy and water efficiency, can thrive. But we also found areas green building certification and low where we need to improve. For instance, innovation carbon emissions. We’re proud to have we learned that the carbon emissions delivered this in recent projects. For created in our developments (Scope 3 Building the future example, our recent Zig Zag Building, emissions) make up a huge part of our SW1, 20 Fenchurch Street, EC3 and New total carbon footprint and we need to The way we design buildings has a Ludgate, EC4 developments in London focus more of our attention in this area. huge impact on how people use them. are all buildings that will stand the test We’re working on this now, as we explain Great design increases efficiency and of time. on page 31. encourages people to spend time in our However, there are new challenges. spaces. This is good for our customers, Climate change is affecting the way New metrics, new brief communities and partners – and buildings and businesses operate. Cities Following our assessment, we set therefore good for us. The right design are rapidly losing green space. As these new metrics to help us make all our also allows buildings to be flexible across factors converge, we need to up our developments more sustainable. These their lifespan, enabling them to adapt to game. Which is why we’ve been exploring are outlined on page 53. The biggest changing customer needs. With the built how we can make our developments change to our existing approach is that environment generating 37% of the UK’s even better. we’re extending our focus, from the point total carbon emissions, smart design we create a design brief to when the can make our buildings greener too – Assessing the way we work building is occupied. So we need to use reducing our impact, reducing future risk, We started by working with people inside our Sustainable Development Brief in the improving our reputation and inspiring and outside the business. We asked right way, making sure we have the right the wider industry. them: how do we currently achieve conversations at the right times. This is However, designing developments is sustainability in new developments? And the best way to ensure designers and a complex challenge. It means second- how can we do better? contractors buy into our approach early guessing what will be in demand when We heard lots of positive things. and our operations teams continue to the property is completed in five or six For instance, people praised our soft experience successful soft landings. years’ time. And it means designing a landings process: our smooth handovers We’ll launch our new Sustainable building today that will still be efficient, between teams, from construction to Development Brief later this year. The flexible and desirable for decades to handover to operations. These help us brief will outline our new metrics, and come. to avoid situations where, for instance, will make sure everyone involved in a This is why innovation in design an architect designs something that development knows what we expect and is critical – not just in the blueprints an operations team ends up reworking how we’ll measure success. we create, but how we design the – situations that waste time, resources Of course, our sustainability metrics entire lifecycle of an asset. Using truly and money. Our success here is mainly will still include things like BREEAM (see sustainable and innovative design means because of the way we work across the below) and FSC Project Certification. But our developments can be fit for the whole property cycle, managing buildings these will be ‘business as usual’. Our new future from the moment they open from the point they’re built or acquired metrics and new brief will enable us to their doors. to the time they’re open and operational. push the boundaries. Our work in this area is focused on This joined-up working is a key strength. climate resilience, embodied carbon, As our cities and infrastructure Owning the sustainability plan biodiversity and wellbeing. continue to grow we’ll need to think A part of our enhanced approach to more about how our buildings connect development, we’re asking our with transport. Developing close to Development Directors to own a infrastructure can be challenging, but Sustainability Plan for each development enabling people to travel to and from our they oversee. This means the whole buildings easily is important for success. sustainability process will be clearly Our developments at Nova, SW1 and accountable, strengthening our 21 Moorfields, EC2 show how working governance. As well as outlining the closely with our cities can lead to better same metrics as in our new Sustainable connections and more sustainable Development Brief, the plans will include transport options. information about BREEAM requirements

Our sustainable development process Diagram 25

Preparation Concept Development Technical Handover Construction

RIBA and brief design design design and closeout

Soft landings and post s Sustainability Supply chain Sustainable Sustainability Sustainability s

e Development Brief occupancy evaluation

c Policy requirements Plan preliminaries o ur P r O Project Management Framework

40 Landsec Sustainability Report 2017 Our BREEAM rated space Table 26

Feb-16 Feb-17 Total common and tenanted space (m²) 2,681,066 3,021,432 Total space with BREEAM rating (m²) 583,919 996,585 Percentage of total which is BREEAM rated 22% 33%

BREEAM rating Table 27

Area m2 % of our total space Outstanding 4,864 0.2% Excellent 534,490 17.7% Very Good 218,959 7. 2% Good/Pass 238,272 7.9% and planning conditions. In short, the experience of working with different plans will bring all of our objectives sustainability standards which include together in one place. This approach has BREEAM, SKA, WELL and LEED. already proved successful on our Westgate development in Oxford, where we’re Joining the innovation lab currently tracking progress against 45 To explore new and effective ways of Refreshing ideas at objectives set at the outset of the project. working, we’ve joined the UK Green Cardinal Place, SW1 Business Council’s Innovation Lab. And Increasing our BREEAM space now, alongside Canary Wharf Group, Our work in sustainable design BREEAM, a well-established assessment Carillion and M&S, we’re leading a doesn’t just apply to new method and ratings system for buildings, consortium of UKGBC members to developments; it helps when we’re continues to be a valuable indicator of develop new ways to innovate within refurbishing existing buildings. For quality and sustainability. It looks at a our industry. example, this year we refurbished building’s performance and rates it on The plan is to identify and work several floors of our Cardinal Place, a scale which includes Pass, Good, Very on a breakthrough challenge. This will SW1, retail and office development, Good, Excellent or Outstanding. BREEAM be a nine-month project, and it will where our head office is now housed. originally covered just the basic elements, aim to solve systemic issues in the built We wanted to create an efficient, like waste and energy efficiency. But environment. For instance, we might attractive and healthy space – so we it has evolved to become much more look for ways to adapt the development used SKA assessments to measure comprehensive, looking at everything process to stop companies ‘locking in’ our success. SKA is the leading from how contractors manage a site certain design features too soon and sustainability assessment tool for to the way resources are bought. We’re missing the opportunity to include fit-out projects and helps businesses pleased to report that the percentage of new technologies. We’ll definitely think like ours make sure their designs BREEAM-rated space across our portfolio about key industry issues such as exceed best practice for health and increased from 22% to 33% this year. climate change resilience and shifting wellbeing, energy efficiency and All of our new developments were rated demographics. This is an opportunity to sustainable materials. Sustainable and innovation design BREEAM Very Good or Excellent. broaden our thinking, to learn how to On various floors, we Given that 33% of our space is innovate within our own business. It’s also have carried out ‘Category A’ BREEAM-rated, you might wonder a chance to reshape the way our industry refurbishments – in other words about the other 67%. Although we have thinks about design and development. we replaced the raised floors, been using the BREEAM Certification suspended ceilings, and upgraded process since it was first published in Our sustainable development process the mechanical and electrical 1990, many of the buildings we have Our sustainability process matches the services including new energy certified have been sold and are no RIBA (Royal Institute of British Architects) efficient LED lighting, giving tenants longer in our portfolio. BREEAM was stages – a series of steps commonly used a blank canvas to move into. These conceived as a voluntary environmental in design and development. works achieved the highest SKA rating scheme which developers used to We start with a policy that lays out rating, ‘Gold’. We’re expecting a benchmark their buildings. It has only our approach and gets the right partners further 54,000 sq ft of Category become widely used in the past five to on board. We then use our Sustainable A refurbishments to receive SKA ten years – so only a relatively small, but Development Brief to clearly convey ratings later this year. All this is growing, proportion of properties in the our commitments and metrics. As the helping us bring a ten-year-old UK are BREEAM-rated. Often we buy design develops we draw together a property up to date in a positive older assets that are not BREEAM-rated Sustainability Plan, and make sure that and sustainable way. with the intention of redeveloping and business-as-usual is covered through our improving them in the future. preliminaries. Finally, before construction We’re also starting to undertake finishes, we start planning the soft LEED assessments in our London landings process – the handover from portfolio where this is preferred by one team to another – and evaluate our customers. LEED is a comparable the building as soon as it’s complete. standard to BREEAM and is popular in Our Project Management Framework the USA and Europe. This adds to our describes this whole process and enables our employees to know what’s expected when.

Landsec Sustainability Report 2017 41 Our ambition is that, as a result of our 2. Resilience work, our customers won’t notice a thing. They won’t lose a week’s trading when Our commitment: the next big storm hits, and they won’t notice sharp spikes in cooling costs in Assess and mitigate site- hotter periods. As a responsible landlord, specific climate change keeping customers open for business adaptation risks that are – and keeping their costs down – is the most important thing we can do. material across our portfolio Seeing the bigger picture Climate change is affecting our business Becoming truly resilient goes beyond today. Warmer temperatures, higher climate change. It means thinking now rainfall and more variable weather are about how people’s lives, behaviour and putting new pressures on our buildings. expectations are evolving. For instance, While there are well-established models driverless cars may mean our shopping for anticipating natural disasters, the centres will need fewer car park spaces in models for incremental changes – like 20 or 30 years’ time. That means today rising temperatures – aren’t well used or we should consider designing car parks Changing risks agenda understood. We don’t yet understand all so they can be converted into something the risks that climate change poses. So else when they’re no longer needed. 20 Finance Ministers and Central this year we’ll consider the most likely Bank Governors recently asked the future scenarios closely and carefully, Financial Stability Board (FSB) to helping us to prepare, become resilient look at how the financial sector and share best practice. can take account of climate- Resilience is related issues. The FSB noted that Understanding the risks companies need to provide better We formed a new commitment this becoming a major information about climate-related year: to identify climate change risks consideration for risks and opportunities, so that we across all our developments, and to see more informed investment, mitigate them. This new commitment businesses with lending, and insurance underwriting is supported in our new list of metrics impact on insurance, decisions. A better understanding of for designing sustainable developments climate risks will help us transition (see page 53). There’s now a metric valuation and rents smoothly to a lower-carbon requiring teams to carry out a risk review economy, avoiding market shocks. of the development and implement already starting Last year, the FSB launched its Task design measures to improve structural to show in many Force on Climate-related Financial and fabric resilience. We also met with Disclosures. This task force has stakeholders across the business, and countries. Landsec now developed a framework for planned how we can start work on this climate-related financial disclosure. commitment in the new financial year. are leading the way We’re aware of the task force’s The more we understand about our by committing to recommendations, and are in the risks, the more our teams can look at process of commissioning a study to further measures to make our business protecting their assess our own portfolio’s risks from more resilient. For example, all our new climate change. developments already carry out flood risk properties and assessments and measures are included in the design to avoid and mitigate customers from the risks. Going forward, we will look at the impacts of measures such as introducing trees and green space to a development to soak climate change as up extra rainfall. We could adapt the these risks become building design, moving services from the basement to a higher level or include more apparent.” flood defence measures to protect against flooding. But more broadly across our business, it means looking Darren Holmes at the protection we already have with Head of GB Risk Management, our insurers. We need to ask: does our Willis Towers Watson existing cover do all the things we think we’ll need it to do in future? We plan to work with a climate resilience specialist along with our research function and asset managers, to further explore this.

42 Landsec Sustainability Report 2017 Setting new metrics 3. Embodied carbon To support our focus on Scope 3 Powered up at Nova, SW1 emissions, this year we created a new set Our commitment: of metrics for embodied carbon. While This year we launched the first phase continuing our existing target to reduce of our Nova, SW1 development Carry out embodied carbon our embodied carbon intensity by 15%, in London’s Victoria. This includes analysis to inform the we also set out to: the Nova Energy Centre, which will selection and procurement of — Aspire to an embodied carbon supply residential units, retailers and intensity of 900kg CO /m² for customers’ offices across the entire building materials to reduce 2 commercial buildings and 500kg CO2/ development with low carbon heat environmental impacts m² for retail and power. — Undertake a lifecycle cost exercise, The Energy Centre features two This year we carried out a full review of to make sure we consider embodied gas-fired Combined Heat and Power our carbon footprint. This highlighted carbon long term throughout the engines, which are designed to heat, that a high proportion of our carbon building’s lifetime cool and power the office buildings emissions – 91% – come from Scope 3 above. Initially, only one of the units — Specify and buy responsibly sourced emissions that are outside our direct will be operational with the second core construction materials such as control. You can read more about this coming online once the development steel and concrete, which have a lower on page 31. is fully let. Any excess power will be carbon footprint Our Scope 3 emissions include exported to the grid network where embodied carbon emissions. These are In the past, we targeted the it will be used to power buildings in the emissions involved in constructing our reduction of embodied carbon on the local area. The system has the properties, including the manufacture a project-by-project basis. The new capacity to supply the new office and transportation of materials. targets and reporting show how we’re buildings that will arrive in the second Reducing embodied carbon is embedding this work across our business. and third phases of the Nova, SW1 tough, not least because it requires us The targets use embodied carbon development and the capability to to influence our partners and suppliers intensity as a key metric. This is the export any excess heat to an external deep into our supply chain. But if we get amount of carbon emitted to construct heat network and adjacent properties this right we can make a big difference. a building, measured against the size of such as our own nearby Portland Reducing embodied carbon can have that building. The new target will build House property in the future. a knock-on effect on other emissions on these great examples and ensure We expect the Energy Centre too; for instance, sourcing low carbon low carbon design and construction will to reduce our customers’ carbon materials locally can reduce transport become business as usual. emissions by 15%. emissions. To address embodied carbon at a fundamental level we need to work in a new way across the design and We’ve strengthened First to target: construction stages, thinking about 1 New Street Square, EC4 the emissions of an asset over its entire our approach to lifecycle. Our experience puts us in a development this Last year we reported that we great position to do this. As a vertically carried out an embodied carbon integrated business we already manage year, setting new assessment for 1 New Street Square, each stage of the life of many assets. We EC4 in the early design stages of understand how different teams operate sustainability targets the development. This allowed Sustainable and innovation design and connect at different points. Having that will challenge us to make choices that saved worked across residential, commercial 5,570 tonnes of carbon and and retail projects, we know where our our development reduced our material costs by embodied carbon hotspots are. And we more than £600,000. have the scale and relationships needed and construction We also designed the building to inspire and influence others. teams.” to be flexible, so it can be adapted across its lifetime according to changing customer needs. We made Neil Pennell certain decisions – small things, like Head of Engineering & Design increasing the amount of parking for bikes. And bigger things, like making With six months left sure the ground floor reception we have already space can be easily adapted to accommodate changing occupier reduced the carbon requirements in the future. The building opened its doors impact of Westgate last year. Its final embodied carbon by over 30,000 report shows that we achieved a 15% improvement on our baseline. It tonnes, with zero cost was the first of our developments to to the project.” meet our embodied carbon target and provides proof that we can hit our target through sensible, cost neutral design solutions. Neil Read Project Director, Westgate Oxford

Landsec Sustainability Report 2017 43 4. Biodiversity Westgate Oxford: exceeding our ultra Our commitment: low target Maximise the biodiversity When we planned our Westgate potential of all our shopping centre Oxford City Council development and required us to reduce embodied carbon by 25,777 tonnes. We’re operational sites delighted to report that we’ve Biodiversity is the variety of plant and exceeded this target, avoiding over animal life across different habitats. 30,000 tonnes of embodied carbon It can inspire people to spend more emissions. These are the emissions time in a space and help give them a that would have been created if we’d great experience – so it’s an important used an earlier design, but which consideration in our developments. we’ll avoid now that we’ve used However, the activities of our a more informed approach. This industry can damage biodiversity by means the building has avoided as building on green spaces, over-using many emissions as it will expect to natural resources and employing generate over the next 30 years. processes that pollute water and To hit our target, we used a high damage soil. That’s why we’re taking volume of recycled materials. For action to reduce and mitigate our instance, we bought local recycled impacts and actively increase biodiversity aggregate and used a type of at our assets. For example, in all of concrete with a high recycled our developments we consider green content. We also set up a disposal infrastructure carefully. We can use site close to the construction site, green roofs, made from sedum (a type which meant we didn’t have to of flowering plant) or other vegetation, transport waste far. By the time the where it’s not practical to add ground project is complete, total emission level landscaping. We’re seeing growing avoidance should reach 39,000 enthusiasm for green roofs amongst tonnes. Given that the total embodied customers, local communities and carbon emissions across our business planning authorities. amounted to 126,000 tonnes last year, this is an important step Working with The Wildlife Trusts forward and a powerful example for This year we continued our work with future development to learn from. The Wildlife Trusts, exploring ways to Bluewater, Kent The table below shows the increase biodiversity across our portfolio. key things we did to reduce We’ve developed a methodology that embodied carbon: enables us to determine each site’s Actions Carbon savings (TCO ) potential for biodiversity and to measure The Wildlife Trusts 2 Earthworks and 10,700 biodiversity at a local and company- excavation – wide level. believe that local disposal everybody has a part 96% recycled 9,000 content steel to play in changing reinforcement Replacing 9,850 the natural world for cement with industrial waste the better. Landsec’s products ground-breaking 100% recycled 1,000 content sheet commitment piling Total savings 30,550 raises the bar for to date its own sector and others.”

Stephanie Hilborne OBE Chief Executive, The Wildlife Trusts

44 Landsec Sustainability Report 2017 By providing new guidance on Net Gain and through their commitment to CIRIA’s biodiversity awards, Landsec stands out as a champion and thought leader in a rapidly growing sector.”

Dirk Vennix CIRIA CEO

Current Targeted Sites rating rating Bluewater, Kent A A+ Gunwharf Quays, B B+ Portsmouth St David’s, Cardiff C B+ The Galleria, C B+ Hatfield White Rose, Leeds B+ A

Championing excellence with CIRIA The methodology gives each site an A, B We’ve learnt that increasing biodiversity For the second year, we’re supporting or C rating, based on an assessment of net gain on site isn’t always enough the 2017 BIG Biodiversity Challenge: an what’s there and how it could connect to maximise its potential. It is vital to initiative led by the Construction Industry with neighbouring sites. This rating integrate measures into the surrounding Research and Information Association system helps us to prioritise our efforts landscape, especially if we’re to fulfil our Sustainable and innovation design (CIRIA) that aims to strengthen and achieve the greatest value from our long-term biodiversity commitment. biodiversity across the UK. The challenge investments. is recognised as the number one industry Following a pilot of the methodology Setting specific targets initiative for increasing biodiversity within across eight sites, we’ve now identified Based on our work with The Wildlife construction and the built environment. the properties with the greatest Trusts, we have set a new metric for We’re sponsoring the Community potential for biodiversity gain. Across our biodiversity programme so we can Engagement Award category. a number of sites, we’ve carried out measure progress. We’re also sponsoring CIRIA’s ecological assessments, developed — Achieve a 25% biodiversity net gain Biodiversity Net Gain project. This habitat management plans and created across the five sites currently offering 12-month research project will explore landscape drawings. This will help us the greatest potential by 2030. and develop the idea that, in order understand how to increase each site’s to stop natural habitats being lost, rating and the likely effect on biodiversity These sites are Bluewater, Kent, developers like us must commit to ‘No gain. We also carried out a risk analysis St David’s, Cardiff, Gunwharf Quays, Net Loss’ and ‘Net Gain’ outcomes. This of measures that could potentially affect Portsmouth, The Galleria, Hatfield, and fits with our new metric, which commits future development. White Rose, Leeds. The table to the us to creating net gain in biodiversity for The table below shows the right lists the five sites and their rating all developments. classification of our portfolio. classifications. Additionally, we always The resulting report will form the look to achieve a biodiversity net gain basis of a white paper, to be put to the Classification rating No of sites on all new developments. Government next year when they review A 3 the Wildlife Act. We also hope it will help Local Authorities to work consistently B+ 3 and effectively to increase biodiversity. B 28 C 27 + indicates protective species potential

Landsec Sustainability Report 2017 45 Just as important as putting the right 5. Wellbeing things in is taking the wrong things out – for example, avoiding construction Our commitment: materials or cleaning products that contain harmful chemicals and affect Ensure our buildings are air quality. designed and managed To make sure we really can achieve to maximise wellbeing our commitment to maximise wellbeing we created two supporting metrics and productivity this year: White Rose, Leeds: Whenever we design a new development — To assess and design optimum air we think hard about the experience a home for bees quality, daylight, lighting and noise of the people who will use and visit it – factors everyone from office workers and their According to the British Bee Keeping — Where applicable, to design and clients to shoppers and retail staff, local Association, around 70 of the UK’s construct new developments for neighbours and tourists. Our buildings food crops depend on visiting bees. future WELL certification, a new should help to make people happier, But the number of honeybees has benchmarking scheme which healthier and more productive. In other been falling since studies began in recognises buildings that maximise words, we want our properties to increase 1985. Back in 2014, we introduced the positive effects of health and people’s wellbeing. Our ambition is to two modern Bee-Box hives to our wellbeing measures White Rose shopping centre in Leeds, create truly great places to work that to help boost the bee population. help our customers attract, support and We have conducted a trial of WELL Today, the hives are managed inspire the very best talent, and to create certification on the fit out of our new by Adam Whiteley – a team leader shopping centres and leisure spaces that headquarters at 80-100 Victoria Street, with our cleaning partner Interserve will draw people from miles around and SW1 to learn more about the process. – who took an apprenticeship with provide them with a memorable day out. This will enable us to help our customers a local beekeeper. As well as helping deliver WELL projects for their employees Fresh thinking pollinate nearby crops, flowers and in the future. Go to page 14 to see We start by getting the fundamentals trees, the bees provide White Rose how we included health and wellbeing right. That means ensuring there’s lots of with a surprisingly large amount of measures in the design of our new head natural light, great views and plenty of award-winning honey. We share the office fit out. fresh air. honey with local groups and partner organisations. Adam has also used the honey to generate some great local publicity. Over the past three years we’ve added three more hives to the site. Now, in the summer months, there’s between 500,000 and 750,000 bees.

Cardinal Place, SW1: bat tracking We’ve continued to support the Victoria Business Improvement District as their team tests whether green infrastructure enhances biodiversity. The team is working at Cardinal Place, SW1 to see whether green infrastructure can increase local bat populations. We have one of the bat detectors on our site to record the echolocation calls bats use when hunting in the dark. These calls are then analysed to see which species of bat they come from, which shows how many different species of bat are in the area. Five species of bat have been recorded to date. These include Nathusius’ pipistrelle and Leisler’s bat, both of which are rare in the UK. Monitoring the bats over a number of years will tell us more about how they, and other species, are responding to their urban surroundings.

46 Landsec Sustainability Report 2017 Sponsoring Better Places for People This year we continued to sponsor the Better Places for People Campaign, an initiative from the World Green Building Council that aims to inspire companies to think about the effects of their property on people. We’ll also support the campaign by producing case studies to show how sustainable design affects health and wellbeing offices and shops. For instance, in Retail, we’ll show how natural lighting and green space affects the experience of shoppers and retail workers. And, looking at our 80-100 Victoria Street, SW1 office development, we’ll reveal how sustainable design has affected business outcomes. Eastbourne Terrace, W2: a natural environment Productivity When we redesigned our 20 Landsec’s continued Eastbourne Terrace, W2 office building improvements support of the BID we wanted the space to be like a of 8 – 11% are boutique hotel. We created a calm and work towards atmosphere by using floor-to-ceiling common as a windows that increase natural light promoting and and by using natural materials result of better improving local air throughout the space. We introduced air quality.” LED lighting that works according

quality has great to natural rhythms and turns itself Sustainable and innovation design off when nobody is around. We also Harvard TH Chan benefits to the local created spaces where people can School of Public Health environment and socialise: a café area and communal business lounge, and a planted roof population. Their terrace with incredible views across London. There’s also a garden with transparent and trees. We particularly wanted to help collaborative approach people stay fit, so we included cycle spaces and showers to encourage with occupiers and people to run or cycle to work. And supply partners helps we built a feature staircase that not only looks spectacular; it encourages push this agenda people to take the stairs rather than forward.” the lifts.

Ruth Duston Chief Executive, Victoria Business Improvement District

Landsec Sustainability Report 2017 47 We report our greenhouse gas (GHG) are indirect emissions associated with Additional emissions annually in accordance with the our consumption of purchased energy. World Resources Institute’s Greenhouse Scope 2 emissions are reported using Gas Protocol. Landsec is also committed both the “location-based” and “market- information to EPRA Best Practice Recommendations based” accounting methods. Location- for Sustainability reporting, for which based emissions are reported using UK we have won a Gold award for three Government Greenhouse gas years running. We believe that such reporting – Conversion factors 2016. 1. Greenhouse gas reporting improves transparency and Market-based emissions are reported reporting performance. We report our data using using the conversion factor associated an operational control approach to with each individual electricity supply This year we have made define our organisational boundary. as per the supplier’s guidance. Scope 1 A detailed description of our reporting emissions are currently reported using strides in calculating and methodology and data, including only the location-based method. reporting the full impacts of our EPRA figures, can be found at Scope 3 emissions are those that our business. By assessing our www.landsec.com/sustainability are a consequence of our actions, but GHG emissions are broken down which occur at sources we do not own full greenhouse gas emissions into three Scopes, 1,2 and 3. or control and which are not classed as for the first time, we can Scope 1 emissions are direct Scope 2 emissions. The GHG Protocol emissions from activities controlled identifies 15 categories of which eight are identify those areas where by us that release emissions into the directly relevant for Landsec. we can make the most atmosphere, whereas Scope 2 emissions positive impact.

CO2e conversion factors – location-based* Table 28 2015/16 2016/17 % change Electricity 0.57492 0.51680 -10.1% Natural gas 0.20928 0.20899 -0.1% * Combined conversion factor including well-to-tank and transmission and distribution factors The above table outlines the “location-based” emission factors used for the 2016/17 year and how they compare to the previous year.

Landsec – Scope 1 and 2 emissions 2015-2017 Table 29 Scope 1 and 2 Location-based emission factors Market-based emission factors mandatory reporting

Emissions 2015 2016 2017 2016 2017

Scope 1 tCO2e 13,711 13,648 16,477 Scope 1 tCO2e 13,648 16,477

Scope 2 tCO2e 64,114 55,688 47,066 Scope 2 tCO2e 34,259 3,862 Scope 1 and 2 77,825 69,336 63,543 Scope 1 and 2 47,907 20,338

tCO2e tCO2e

Intensity Scope 1 and 2 0.041 0.038 0.038 Scope 1 and 2 0.026 0.012 2 2 tCO2e/m tCO2e/m

90000

80,000 64,114

70,000 55,688 47,006 60,000

e 50,000

2 34,259 tCO 40,000

30,000

3,862 20,000

16,477 16,447 10,000 13,711 13,648 13,648

2015 2016 2017 2016 2017 Location-based emission factors Market-based emission factors

Scope 1 tCO2e Scope 2 tCO2e * Landsec did not report market-based emissions in 2015. Therefore, this data is not included.

48 Landsec Sustainability Report 2017 Total GHG emissions using location- The table below provides a breakdown of Landsec Scope 3 GHG Chart 30 based emission factors have dropped our entire emission inventory including Figure 6 - Landsec Scope 3 GHG emissions 2016/17 emissions 2016-2017 by 8% since the previous year. This has Scope 3. been driven by a reduction in electricity The GHG Protocol splits Scope 3 consumption and the drop in national emissions into 15 categories. We assessed emission factors due a cleaner energy each one individually and decided which mix. In terms of market-based emissions ones were applicable to our business. Capital goods 45.82% we have seen a significant reduction For the categories that are applicable Downstream leased assets 41.76% Purchased goods and services (PG&S) 9.96% of 58%. This has been due to our move we have obvious hotFigure spots 6 which- Landsec are Scope 3 GHG emissions 2016/17 Fuel- and energy-related activities 2.26% to 100% renewable electricity via our highlighted below: Others 0.20% contract with SmartestEnergy. The two largest contributing This is the first year where we have categories are Capital goods and fully reported our Scope 3 emissions Downstream leased assets, making up having worked with The Carbon Trust to 80% of our entire emissions. Capital Capital goods 45.82% establish an accurate and repeatable goods include the emissions associated Downstream leased assets 41.76% methodology. We believe it was with the manufacture and transport of Purchased goods and services (PG&S) 9.96% important to do so to fully understand materials used within our construction Fuel- and energy-related activities 2.26% Others 0.20% and disclose the total emissions activity and Downstream leased assets associated with our business. are those associated with our customers within our assets. We are working to reduce our impacts in these categories by working ever closer with our supply chain partners and customers.

Landsec Scope 1, 2 and 3 emissions 2016/17 Table 31

GHG Scope Category Emissions (t CO2e) % of total emissions Scope 1 Scope 1 16,477 2% Scope 2 Scope 2 47,066 7% Scope 3 1. Purchased goods and services (PG&S) 61,647 9% 2. Capital goods 283,570 42% 3. Fuel- and energy-related activities 13,982 2% 4. Upstream transportation and distribution Grouped under PG&S 0% 5. Waste generated in operations 740 0% 6. Business travel 360 0% 7. Employee commuting 182 0% 8. Upstream leased assets Not applicable 0% 9. Downstream transportation and distribution Not applicable 0% 10. Processing of sold products Not applicable 0% 11. Use of sold products Not applicable 0% 12. End-of-life treatment of sold products Not applicable 0% 13. Downstream leased assets 258,428 38% 14. Franchises Not applicable 0% 15. Investments Not applicable 0% Additional information

Landsec Sustainability Report 2017 49 Benchmarking scores Table 32 2. Benchmarking Activity Performance and Awards Carbon Disclosure Project (CDP) 2016: A- (Leadership) 2015: disclosure 99/score B Taking part in rigorous external 2014: disclosure 96/ score A- benchmarking of our performance 2013: disclosure 88/score B 2012: disclosure 92/score B helps us to track and assess our progress. It also provides stakeholders Global Real Estate Sustainability 2016: score 77% Benchmark (GRESB) 2015: score 77% with confidence that we’re turning our 2014: score 78% commitments and targets into action. 2013: score 67% And it underlines our ambition to be 2012: score 68% a sustainability leader in our industry. Dow Jones Sustainability Index (DJSI) 2016: score 76/percentile ranking 92 This year we received high scores from 2015: score 72/percentile ranking 89 our key benchmarking schemes: 2014: score 70/percentile ranking 87 2013: score 72/percentile ranking 87 2012: score 70/percentile ranking 85 FTSE4Good We continue to retain our established position in the FTSE4Good Index EPRA Received a Gold Award at EPRA Sustainability Awards 2016 for Sustainability Reporting Better Buildings Partnership’s Real Estate Offices Environmental Benchmark (REEB) — 2016: 13th out of 22 in performance league table — 2015: 22nd out of 23 in performance league table Retail — 2016: 4th out of 13 in performance league table — 2015: 10th out of 13 in performance league table

Community investment data Value of resources given Over £2m equivalent of time, promotion and cash investment. 2,6781 hours spent by employees volunteering National Charity Partnership Over £360,000 raised for partner Mencap in our three-year partnership

50 Landsec Sustainability Report 2017 Awards Table 33 Award name Category Date Better Society Awards 2016 Winner: National Commitment to the Community Award May 2016

City of London Building of the Year Winner: Building of the Year Award, 1&2 New Ludgate, EC4 July 2016 Awards 2016 RICS Awards 2016 Winner: Best Commercial Building, 1&2 New Ludgate, EC4 October 2016

Leading European Architects Forum Winner: Developer and Development Project of the Year, October 2016 (LEAF) Awards 2016 1&2 New Ludgate, EC4 EMA Energy Management Awards 2016 Winner: EMA Most Inspiring Energy Reduction Project 2016 November 2016 – NG Bailey in Collaboration with Landsec World Architectural Festival Winner: World’s Best Office, The Zig Zag Building, SW1 November 2016

The City of London Clean City Winner: January 2017 Awards Scheme 2017 – New Street Square, EC4, Premier Award for Facilities Management and Chairman’s Cup – 20 Fenchurch Street, EC3, Platinum Award BREEAM Awards 2017 Winner: BREEAM Offices Refurbishment & Fit-Out award March 2017

National Recycling Awards 2017 Shortlisted: Team of the Year Award March 2017

National CSR Awards 2017 Shortlisted: Clean and Green Award March 2017

Better Society Awards 2017 Shortlisted: Partnership with a National Charity March 2017

Business Charity Awards 2017 Shortlisted: Charity partnership – property & construction March 2017

BITC Responsible Business Awards 2017 Shortlisted: Environmental Leadership Award April 2017 Reaccreditation: Work Inclusion Award Additional information

Landsec Sustainability Report 2017 51 3. Sustainable Development Goals In 2015 the UN introduced 17 Sustainable Development Goals (SDGs). We believe these set out a clear, helpful and appropriately ambitious framework for progress towards a more sustainable world.

We’ve mapped our sustainability programme to the SDGs to ensure our priorities are in line with the wider world. Our activities relate to all 17 goals but the following are especially pertinent to what we do and how we do it:

— Good health and wellbeing – we are committed to ensuring our buildings are designed and managed to maximise wellbeing and we put strong emphasis on health, safety and security in everything we do — Quality education – we run a high-profile community education programme that has a real impact on local communities — Gender equality – we’re committed to making measurable improvements to the profile – in terms of gender, ethnicity and disability – of our employee mix — Affordable and clean energy – we’re committed to buy 100% renewable electricity across our portfolio and to invest in low carbon technologies in our buildings, including solar power — Sustainable cities and communities – we work to create spaces and places that help our customers and communities thrive, that includes thinking abut how we can enhance local infrastructure and prosperity — Responsible consumption and production – we have stretching waste management targets and we’re now working to implement circular economy principles — Climate action – we were the world’s first property company to have an accredited science based carbon reduction target, underlining that we’re playing our part in keeping to a 2 degrees world.

52 Landsec Sustainability Report 2017 On page 40 we explored how we have 4. New enhanced our approach to development. This new approach was the result of a sustainability 12-month consultation with employees from across the business and 26 of our framework supply chain partners. metrics for In January 2017 we agreed these new metrics for our development pipeline developments that will help us to address all 12 of our sustainability commitments. Each metric will be measured through a Sustainability Plan.

Creating jobs and opportunities Table 34 Commitment: Supporting metrics: 1. Community employment: Help a total of 1,200 disad- — Define and achieve a project specific community employment target vantaged people to secure jobs by 2020 — Provide support for existing, or create new education partnerships — Provide support for nominated national and local charities — Measure the percentage of project value spent with social enterprise and community interest companies 2. Fairness: Ensure the working environments we control — All construction partners to measure and report the percentage of direct are fair and ensure that everyone who is working on and subcontracted employees paid the Living Wage our behalf – within an environment we control – is paid at least the Living Wage by 2020 3. Diversity: Make measurable improvements to the — All construction partners to measure and report the percentage of male/ profile – in terms of gender, ethnicity and disability – female staff in construction management and operative roles of our employee mix — Provide reports detailing the support provided for improvement of all forms of diversity in the project team and supply chain 4. Health, safety and security: Maintain an exceptional — Zero reportable health and safety incidents standard of health, safety and security in all the — Every worker to have transferable occupational health records working environments we control for operatives — All construction partners to have a wellbeing policy — All developments to be designed in accordance with principles of the Secured by Design framework or recommendations of a specialist security review

Efficient use of natural resources Table 35

Commitment: Supporting metrics: 5. Renewable electricity: Continue to procure 100% — Construction partners to use a renewable energy tariff for temporary renewable electricity across our portfolio construction supply and commissioning where possible 6. Waste: Send zero waste to landfill with at least 75% — Send zero waste to landfill with at least 75% recycled across all our recycled across all our operational and construction activities, and reduce construction waste to <6.5t/100m² activities by 2020 — Measure and report the percentage of waste materials removed from site by the original manufacturer 2 7. Carbon: Reduce carbon intensity (kgCO2/m ) by 40% — Measure and report the percentage of operational energy provided by 2030 compared to a 2013/14 baseline, for property through low carbon and renewable on-site solutions under our management for at least two years, with a — Report projected annual cost savings from investment longer-term ambition of an 80% reduction by 2050

8. Energy: Reduce energy intensity (kWh/m2) by 40% by — Performance data for comparable buildings to be shared with the design 2030 compared to a 2013/14 baseline, for property team by RIBA Stage 2 under our management for at least two years — Use our soft landings framework to optimise performance against design Additional information intent and conduct a post-occupancy evaluation after two years of operation or following 95% occupancy

Landsec Sustainability Report 2017 53 Sustainable design and innovation Table 36

Commitment: Supporting metrics: 9. Resilience: Assess and mitigate site specific climate — Climate change adaptation risk review undertaken and assess appropri- change adaptation risks which are material across ate design measures to implement which address structural and fabric our portfolio resilience

10. Embodied carbon: Carry out embodied carbon — Achieve at least a 15% reduction in embodied carbon measured against a analysis to inform the selection and procurement of Stage 3 baseline building materials to reduce environmental impacts — Aspire to an embodied carbon intensity of 900kgCO2/m² for commercial buildings and 500 kgCO2/m² for retail — Undertaking of a Life Cycle Cost exercise — Specify and procure responsibly sourced core construction materials 11. Biodiversity: Maximise the biodiversity potential of all — Achieve full FSC project specific certification our development and operational sites — Measure and report the percentage gain in biodiversity quality — Production and adoption of a Habitat Management Plan

12. Wellbeing: Ensure our buildings are designed and — Assess and achieve optimum air quality, daylight, lighting and noise managed to maximise wellbeing and productivity factors — Design and construct developments to be prepared for WELL certification, where appropriate

One New Change, EC4

54 Landsec Sustainability Report 2017 2. Conducted site visits at two sites The limitations of our review 5. Independent (Nova, SW1 and Westgate, Oxford) Our evidence gathering procedures to understand how the sustainability were designed to obtain a ‘limited Assurance Statement agenda is being managed at the level’ of assurance (as set out in site-level. ISAE3000 Revised) on which to base to the management our conclusions. The extent of evidence 3. Reviewed the Group’s approach gathering procedures performed is less of Land Securities to stakeholder engagement through than that of a reasonable assurance interviews with employees with Group PLC engagement (such as a financial audit) responsibility for managing engagement and therefore a lower level of assurance activities and reviewed selected We have performed a limited is provided. associated documentation. assurance engagement on Completion of our testing activities selected performance data and 4. Reviewed the Group’s process for has involved placing reliance on the Group’s controls for managing and statements presented in the determining material issues to be included within the Report. reporting sustainability information, with Land Securities Group PLC the degree of reliance informed by the (‘the Group’) 2017 Sustainability 5. Reviewed the coverage of key issues results of our review of the effectiveness Report (‘the Report’). within the Report against the key issues of these controls. We have not sought raised in external media reports and to review systems and controls at the Respective responsibilities the sustainability reports of the Group’s Group beyond those used for selected The Group’s management are responsible peers, as well as the topics discussed in sustainability data (as presented in the for the collection and presentation our management interviews, site visits table above). of the information within the Report. and by the Sustainability Committee and We have only sought evidence to Management are also responsible other internal working groups. support the 2016/2017 performance for the design, implementation and data. We do not provide conclusions on 6. Interviewed staff responsible for any other data from prior years. maintenance of internal controls relevant data reporting and carried out the to the preparation of the Report, so that following activities to review selected Our conclusions it is free from material misstatement, sustainability data: Based on the scope of our review our whether due to fraud or error. — Reviewed the guidance on data conclusions are outlined below: Our responsibility, in accordance reporting, key processes and quality with management’s instructions, is to assurance performed. Inclusivity carry out a ‘limited level’ assurance — Selected a sample of data points Has the Group been engaging with engagement on selected data and from across the business and sought stakeholders across the business to performance claims in the Report (‘the documentary evidence to support develop its response to sustainability subject matter information’). We do not the data. issues? accept or assume any responsibility for — We are not aware of any key any other purpose or to any other person — Conducted a walk-through of data stakeholder groups that have been or organisation. Any reliance any such reported from a sample of sites to test excluded from dialogue. third party may place on the Report is consolidation. — We are not aware of any matters that entirely at its own risk. — Reviewed any explanations provided would lead us to conclude that the for significant variances. What we did to form our conclusions Group has not applied the inclusivity — Reviewed the Report for the Our assurance engagement has been principle in developing its response to appropriate presentation of the data planned and performed in accordance sustainability issues. including limitations and assumptions. with ISAE3000 (Revised)1 and to meet Materiality the requirements of a Type 2 assurance Our review of data processes was limited Has the Group provided a balanced engagement as defined by AA1000AS to the following selected data sets: representation of key topics (2008). 2 The criteria we have used to — Community employment: People concerning its sustainability evaluate the Report (‘the Criteria’) performance? include the AA1000AS (2008) assurance into jobs through the Community Employment Programme — We are not aware of any key topics principles of Inclusivity, Materiality and concerning the sustainability Responsiveness; and, for selected data, — Greenhouse gas emissions: Direct performance of the Group which have Landsec’s own criteria as set out in GHG emissions (MtCO e), Indirect 2 been excluded from the Report. the Report and in the Environmental GHG emissions (MtCO2e), and Reporting Methodology document. GHG intensity from building energy — Nothing has come to our attention The procedures we performed were 2 that causes us to believe that the (tCO2e/m / year) based on our professional judgement Group’s management has not applied — Waste: Waste diverted from Additional information and included the steps outlined below: its processes for determining material landfill (tonnes) and percentage issues to be included in the Report. of waste recycled 1. Interviewed a selection of the Group’s management and reviewed 7. Reviewed information or Company-level documents to explanation about selected data, understand the progress made in statements and assertions regarding the area of sustainability during the the sustainability performance of reporting period and test the coverage the Group. of topics within the Report.

Landsec Sustainability Report 2017 55 Responsiveness — Landsec continues to have well- Has the Group responded to structured processes for collecting stakeholder concerns? and analysing portfolio energy – We are not aware of any matters that consumption data through the would lead us to conclude that Landsec Optima Energy Management System. has not applied the responsiveness At this time, other environmental principle in considering the matters to data, such as refrigerants, waste and be reported. water consumption, are captured manually in spreadsheets, which Completeness and accuracy of introduces a higher risk of human performance information error than an electronic data system. — We are not aware of any material Landsec may want to consider more reporting units that have been automated data systems to capture omitted from the stated scope of the environmental data beyond energy. Company-level sustainability data. — Nothing has come to our attention Our independence that causes us to believe that the data We have implemented measures relating to the above topics has not to comply with the applicable been collated properly from Company- independence and professional level systems. competence rules as articulated by the IFAC Code of Ethics for Professional — We are not aware of any errors that Accountants and ISQC1.3 Ernst & Young’s would materially affect the data as independence policies apply to the firm, presented in the Report. partners and professional staff. These How plausible are the statements policies prohibit any financial interests and claims within the Report? in our clients that would or might be — We have reviewed information or seen to impair independence. Each explanation on selected statements year, partners and staff are required regarding the Group’s sustainability to confirm their compliance with the activities presented in the Report firm’s policies. and we are not aware of any We confirm annually to the Group misstatements in the assertions made. whether there have been any events including the provision of prohibited Observations and areas services that could impair our for improvement independence or objectivity. There were Our observations and areas for no such events or services in 2016/17. improvement will be raised in a report Our assurance team has been drawn to the Group’s management. Selected from our global Climate Change and observations are provided below. Sustainability Services Practice, which These observations do not affect our undertakes engagements similar to this conclusions on the Report set out above. with a number of significant UK and — Through our interviews with international businesses. management we noted that Executives at Landsec are engaged Ernst & Young LLP, London in the Company’s key sustainability 12 June 2017 programmes, and are aware of the business’s sustainability priorities. The importance of sustainability to 1. International Federation of the Accountants’ International Standard for Assurance Engagements Landsec has been conveyed by the (ISAE3000) Revised, Assurance Engagements CEO, and this top-down leadership has Other Than Audits or Reviews of Historical Financial enabled sustainability awareness to Information. be cascaded across the Company and 2. The 2008 edition of AccountAbility’s AA1000 assurance standard. further embedded into operations. 3. Parts A and B of the IESBA Code; and the — This is the first year Landsec has International Standard on Quality Control 1 (ISQC1) reported measurable diversity metrics, which are designed to drive improvement across the business. At this time, outcome metrics have only been developed for gender diversity. We note that Landsec is leading a cross-industry collaboration to increase engagement and performance on diversity in the real estate sector. We would encourage Landsec to consider developing outcome-based targets for other prioritised aspects of diversity, such as ethnic diversity.

56 Landsec Sustainability Report 2017 Contact Land Securities Group PLC Caroline Hill Copyright and trade mark notices. Head of Sustainability All rights reserved. T: +44(0)2070245462 © Copyright 2017 Land Securities Group PLC E: [email protected] Landsec, Land Securities, the Cornerstone logo, the “L” Logo and ‘Everything is experience’ are trade marks of the Land Securities Group of companies. Landsec is the trading name of Land Securities Group PLC. All other trade marks and registered trade marks are the property of their respective owners. Produced by Brightsource Limited, a Cello Signal company. Printed by CPI Colour. Cover and text printed on Munken Design Kristall Smooth which is produced from FSC and PEFC certified wood pulps and manufactured at a paper mill which has ISO 14001, EU Ecolabel and EMAS certification for environmental standards. Independently certified on behalf of the Forest Stewardship Council (FSC®).

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