Corporate Responsibility Report 2011-2012 Gazit-Globe Table of CONTENTS
A Message From Our President 88Section 5 About This Report Section 3 Environmental Labor Practices Performance & Human Rights Section 1 60 About Gazit-Globe Green Building Labor Practices Conservation & Recycling HR Programs Energy Introduction Recruitment Energy conservation Our Vision Job Training and Career Global Presence Development Water Binding Values Performance Reviews Emissions Sewage & Waste Code of Conduct & Ethics Transitioning to Retirement Global Compact Diversity and Equal 8 Maala Opportunity FTSE4GOOD Index Green Building Human Rights Corporate Governance Global Compact Board of Directors Forced and Section 4 Directors Section 2 Compulsory Labor 74 Social Performance Executive Management Economic Performance Child Labor Compensation of Senior Employees 48 Freedom of Association Stakeholders Benefiting the community Direct Economic Value Shareholders Support the community Board of Directors Indirect Economic Influence Customer satisfaction Subsidiaries Community – Charitable Investment Employees Anti-Corruption Financial Implications & Risks Customers: Tenants and Consumers Risk management and Opportunities Due to Suppliers Climate Change Anti-competitive behavior Regulatory Authorities 126Section 6 Health and safety Analysts & Institutional Investors Global Reporting Media Initative (GRI) Community Environment Information Membership in Associations
2 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 3 A Message From Our PRESIDENT
Dear Stakeholder, responsibility to uphold social and environmental, as well as corporate, Millions of consumers shop at our centers, which are located mostly in high-density standards in all of our operations. urban areas. While more people use - and are linked by - electronic devices and social We are proud to present Gazit-Globe’s The Corporate Responsibility policies Corporate Responsibility report for media than ever before, there is still a deep need to connect in person. Our shopping and ethical standards that we have put 2011-2012. in place over the past several years aid centers play an important role in building that connection and facilitating that sense of In this report, we demonstrate how our us in evaluating our day to day activities community. Corporate Responsibility policies and and complying with the increasingly activities are intertwined with our three- stringent laws and regulations of our pillared strategy of urbanization, quality industry. More and more, our strategies certification standards, particularly and personal lives is very important to manner is important to us. It not only and growth. and management practices, as well as in Canada, Brazil and the Nordic us. That is why we are dedicated to allows us to measure our progress in how we work in the field, are guided countries. providing them with competitive pay these important areas, but to share Gazit-Globe is fortunate to be engaged and shaped by the principles of the and benefits, solid training, educational with you, our stakeholders and the in a business that impacts communities Not only does our strategy of UN’s Global Compact initiative which growth and opportunities for career community at large, our commitment around the world. Millions of consumers urbanization (i.e. developing properties we adopted several years ago. Global advancement worldwide. We also to proper corporate governance and shop at our centers, which are located in city centers) reduce energy Compact is a strategic policy initiative regard the health and safety of our business ethics. These reports are mostly in high-density urban areas. consumption by lowering automobile employees, tenants and customers also meant to foster a dialogue with for businesses that are committed to use, our centers, with their broad array While more people use - and are linked with the utmost importance and take our stakeholders, and we welcome aligning their operations and strategies of shopping possibilities, eateries, and by - electronic devices and social measures to ensure conformity with your feedback. with ten universally accepted principles conveniences, such as post offices, media than ever before, there is still a industry standards. in the areas of human rights, labor, also act as “one stop shops” for Like our careful development of a deep need to connect in person. Our environment and anti-corruption. We consumers. Our consumers reduce Above and beyond our business property, we are steadily building shopping centers play an important are committed to this initiative and are their travel, and thus emissions and activities, we believe that it is a and refining Gazit-Globe’s corporate role in building that connection and proud of our behavior as a result of our energy use and enjoy their time while fundamental duty to contribute to the culture into a paradigm of Corporate facilitating that sense of community. alignment with the Global Compact’s doing so. community. During the past several Responsibility. We are propelled by a Our assets serve as central places for principles. years, we have steadily expanded our sense of duty to our stakeholders, by our families to spend quality time together Our Corporate Responsibility support for numerous educational and growing role in the global community, and for friends to meet. Not only do During the past two years we have activities are focused inward as social initiatives. In 2011 and 2012, and by our firm commitment to act as we invest great effort in making them made important strides. Our focus well. Our employees are our most we donated over NIS 11 million ($3.1 a model corporate citizen. safe and inviting, we continually offer on both quality and the environment important asset, and one of the million) to educational programs that new and technologically advanced have accelerated our implementation basic fundamentals of our Code of promote academic excellence, as well amenities, which you will learn more of green building practices and led Business Conduct is to treat them Roni Soffer as to various charitable organizations. about in this report. Because our us to upgrade our development and fairly. Their satisfaction with their jobs, President properties are such vital communal redevelopment activities to LEED® employment terms, work conditions Reporting our Corporate Responsibility spaces, we feel an extra sense of (Leadership in Energy and Design) and the balance between their work activities to you in a transparent
4 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 5 About This Human Rights Businesses should The Global support and respect the protection of internationally proclaimed human rights; Report Compact and
make sure that they are not complicit in human rights abuses.
This report covers our Corporate that comprises management and information from our Israeli privately The Global Compact is an initiative Responsibility activities during 2011- external advisors. This committee held subsidiary, Gazit Globe Israel developed by the UN aiming to mobilize Labor Businesses should uphold the freedom of association 2012 and follows our previous helped us determine the appropriate (Development) Ltd. Their operations the international business community for and the effective recognition of the right to reports for the years 2009-2010 content, scope and structure of this reflect our values and our commitment the adoption in their business practices collective bargaining; and 2007-2008. In this report, we report, and in general assists us in to promote and implement Corporate of internationally accepted values which describe our business approach engaging in Corporate Responsibility Responsibility. All data compiled by are represented in 10 fundamental and our operations, and how they best practices. our subsidiaries regarding economic, principles in the areas of Human Rights, the elimination of all forms of forced and compulsory affect the communities that we environmental, human resources Labor Standards, Environment and labor; serve and in which we operate, the In producing this document, we have and other metrics was formulated Anti-Corruption. Gazit-Globe has been environment, our employees and other utilized the G3.1 Global Reporting in accordance with Best Practices. a signatory of the Global Compact stakeholders, as well the economy, in Initiative (“GRI”) reporting standard, In this report, Equity One and First since 2010. the effective abolition of general. This report is an important a widely-accepted and inclusive Capital Realty are often referred to as child labor; and tool in our continuing efforts to reporting framework that has also “EQY” and “FCR”, respectively. communicate with our stakeholders, been adopted by our subsidiaries, to Selected data from the following and it reflects our policy of maintaining promote transparency and adherence reports of our subsidiaries were the elimination of discrimination in respect a high level of transparency. to internationally accepted standards. included in this report: of employment and We also highlight our participation occupation. In describing our relationship with and leadership in other initiatives that Equity One: 2012 Corporate various stakeholder groups, this promote Corporate Responsibility Responsibility and Sustainability Environment Businesses should report sheds light on who is impacted around the globe. Report support a precautionary approach to environmental directly - or indirectly - by our business First Capital Realty: 2012 challenges; activities, and with whom we have This report includes material Corporate and Sustainability day-to-day interaction or a mutual information relating to Gazit-Globe, as (CRS) Report dialogue, or wish to engage in one. well as data collected by several of our Citycon: 2012 Annual and undertake initiatives to promote greater subsidiaries abroad, including Equity Sustainability Report environmental responsibility; and We publish our Corporate One in the United States (“EQY”), First Responsibility reports on a bi-annual Capital Realty in Canada (“FCR”), and All information contained in this basis. This report also includes Citycon in Northern Europe. These report was prepared by qualified encourage the development and diffusion some information related to activities publicly traded companies represent professionals, and all calculations of environmentally friendly technologies. following the reporting period, which Gazit-Globe’s major holdings in have been based on widely-accepted is noted accordingly. which we conduct a material portion standards. We have noted when
of our activities, and these holdings specific calculation models have been Anti-Corruption Businesses should work against corruption in all its We have established a Corporate are fully consolidated in our financial used. forms, including extortion Responsibility Steering Committee reports. The report also includes and bribery.
6 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 7 In our business, good corporate citizenship is not an option, it is A must.
Section About Gazit-Globe 1.
Broadway Plaza, Bronx, New York, USA
Kista Galleria, Stockholm, Sweden
8 > Gazit-Globe Corporate Responsibility Report 2011-2012 Introduction Our Vision
growth markets with high barriers privately-held subsidiaries. Its The following principles define our vision for the Company: to entry and attractive demographic public subsidiary companies are trends. In addition, the company is listed on several major stock active in the healthcare real estate exchanges including the New Creation of value for Think Global, Act Local: We Enhanced corporate sector, owning and operating medical York Stock Exchange, the Toronto shareholders: We seek to believe that the best way to build responsibility: We embrace office buildings in North America. Stock Exchange, the Helsinki Stock maximize shareholder value over our company is through the Corporate Responsibility, in its Exchange, Euronext Amsterdam and time by growing and enhancing combination of global and local broadest sense, as a guide and Gazit-Globe is listed on the New the Vienna Stock Exchange as of our global real estate platform, management teams, thereby framework for our worldwide York Stock Exchange (NYSE:GZT) September 30, 2013. our cash flow and our dividends. combining the Group’s overall activities. For us, Corporate Gazit-Globe (NYSE;TSX;TASE: since December 2011, the Toronto expertise and best practices with Responsibility includes the GZT) is one of the world’s leading Stock Exchange (TSX:GZT) since The Group operates in more than 20 Expanded global presence our local management teams’ mandate to be socially aware, multinational real estate companies October 2013, and the Tel Aviv Stock countries, owns and manages 584 and market dominance: keen regional insight. to contribute to, and aid the engaged in the acquisition, Exchange (TASE:GZT) since 1983 properties with a gross leasable area With the goal of continually communities in which we development and management of and is included in the TA-25 and Real- of approximately 6.7 million square strengthening our position as a Micro focus in our macro- operate, to adopt ethical and income-producing properties. The Estate 15 indices in TASE. meters, has a consolidated total asset leading multinational real estate operations: As a key to transparent modes of conduct company focuses on necessity-driven value of more than US$20.0 billion company, we strive to increase maximizing our growth, we and do the utmost to conserve real estate, primarily supermarket- Gazit-Globe operates internationally and a gross annualized income of our market presence, both in the insist upon excellence in all our the world’s natural resources. anchored shopping centers in urban through its publicly-traded and about US$1.9 billion. regions in which we are already operations and maintain high Gazit-Globe is committed to active and in new regions. quality standards. In practice, leading processes which reflects this takes the form of an its beliefs, and aims to set an Promenada, Warsaw, Poland intensive focus on the countless example of good corporate small details that comprise our citizenship. strategies and ongoing work plans.
10 > Gazit-Globe Corporate Responsibility Report 2011-2012 IGlobalntrodu Pcresention ce
Organization Chart (As of December 31, 2012)
Canada United States Brazil Europe Israel 45.6% 45.5% 100% 48.8% 75% First Capital Realty (FCR) Equity One (EQY) Gazit Brazil Citycon (CTY) Gazit Globe Israel (Development) 100% 34.5% ProMed Properties Atrium EuropeanReal Estate (ATR)
100% Gazit Germany
12 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 13 A Global Real Estate Platform
Helsinki Stockholm Talinn Edmonton Warsaw Vancouver Montreal Moscow Calgary Toronto Frankfurt Prague San Francisco Boston New York Atlanta Los Angeles Tel Aviv Miami
Sao Paulo
Rio Grande do Sul
14 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 15 Subsidiaries
UNITED STATES in growing metropolitan areas of EUROPE The shares of Atrium are listed on ISRAEL BRAZIL the US, most of which are located the Euronext Amsterdam exchange We operate in the US primarily In Northern Europe, Gazit-Globe Gazit-Globe’s headquarters are Gazit Brazil, a wholly-owned in close proximity to hospitals and (Euronext: ATRS) and the Vienna through our subsidiary Equity One operates through its subsidiary located in Israel. subsidiary of Gazit-Globe, is active university campuses. As of December Stock Exchange (VSX: ATRS). As of (“EQY”), a fully integrated real estate Citycon, an owner, developer and in the acquisition, development and 31, 2012, ProMed owned and December 31, 2012, Atrium owned investment trust listed on the New operator of supermarket-anchored In addition, we are active in the management of shopping centers operated 16 buildings with a total 156 properties with a total GLA of York Stock Exchange (NYSE: EQY). shopping centers and commercial acquisition, development and in Brazil. As of December 31, 2012, GLA of approximately 136,000 square approximately 1.2 million square EQY engages in the acquisition, properties. Listed on the Helsinki management of shopping centers Gazit Brazil owned and operated meters. meters. management, development and Stock Exchange (NASDAQ OMX: in Israel through Gazit Globe Israel three shopping centers with a total redevelopment of quality retail CTY1S), Citycon is the market leader (Development) Ltd. (“Gazit Israel”), GLA of approximately 23,000 square In Germany, our Company’s wholly- properties in strategic metropolitan in Finland, has established a strong which is 75% owned by our Company. meters and one shopping center owned subsidiary, Gazit Germany, areas across the US. These properties CANADA position in Sweden and a firm foothold As of December 31, 2012, Gazit Israel under construction. In Canada, we operate primarily is active in the shopping center are anchored by necessity-driven in the Baltic countries and Denmark. owned 10 properties with a total GLA through our subsidiary First Capital business. As of December 31, 2012, businesses, including leading As of December 31, 2012, Citycon of approximately 126,000 square Realty (“FCR”), Canada’s leading Gazit Germany owned 6 properties supermarkets, pharmacies and retail owned 78 shopping centers and meters, as well as land for future owner, developer and operator of with a total GLA of over 101,000 store chains. As of December 31, retail properties, with a total GLA of development. supermarket and drugstore-anchored square meters. 2012, EQY consolidated property approximately one million square neighborhood and community portfolio comprised 167 properties meters. Gazit Israel is also the controlling shopping centers in growing totaling approximately 1.9 million shareholder of Dori Group (73.9%) a metropolitan areas. As of December square meters of leasable area (GLA). In Central and Eastern Europe, our publicly-traded construction company 31, 2012, FCR owned and operated Company operates through our whose securities are listed on the 169 properties with a total GLA of Gazit-Globe also operates in the US subsidiary, Atrium European Real Tel-Aviv Stock Exchange (TASE: approximately 2.2 million square through ProMed Properties, a wholly- Estate (“Atrium”), an owner, operator DORI). Dori Group is active in a wide meters. Its securities are listed on the owned subsidiary. ProMed is engaged and developer of shopping centers. array of real estate development and Toronto Stock Exchange (TSX: FCR). in the acquisition and management of construction activities in Israel and in medical and research office buildings eastern Europe.
16 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 17 Binding Values
Our core values influence our global activities, inspire our performance and impact our daily decisions.
We believe that conducting our business ethically is a fundamental value, and we work diligently to instill this value in all of our employees.
Financial Business Social Professionalism Transparency Reliability Growth Discipline Responsibility
18 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 19 overall responsibility for various information and to maintain the CODE OF matters, including the following: confidentiality of the “whistle-blower’s” identity. BUSINESS Receiving, collecting, examining, approaching, treating, The Code applies to all employees investigating and resolving any of Gazit-Globe Ltd. as well as to the concerns and reports raised by CONDUCT employees of its private subsidiaries. employees or other individuals, in The attitudes, values and behavior of matters described in the Code;
our managers and employees impact Working with legal counsel from not only our tenants, suppliers and time to time to review the Code the consumers who shop in our malls, in reference to developments in Global but also their fellow employees. We the law; believe that conducting our business ethically is a fundamental value, and Presenting directly to Compact we work diligently to instill this value in management on a periodic basis, unless immediate attention is all of our employees. Our strategies and management required, a copy of any report practices, as well as how we work As a guide for our actions, for a received that relates to the in the field, are guided and shaped number of years we have been using Company’s oversight methods by the principles of the UN’s Global and continuously refining a corporate and disclosure practices in Compact initiative which we adopted Code of Business Conduct (“Code”). connection with accounting, It outlines the Company’s duties and auditing and means of internal in 2010 as part of our Corporate attitudes towards our stakeholders, control; Responsibility Report for 2009-2010. including our employees, suppliers, Providing guidance on the The Global Compact is a strategic clients, and shareholders, and includes meaning and implementation of policy initiative for businesses that are moral principles, such as avoiding the Code; committed to aligning their operations conflict of interests, conducting Reporting periodically and strategies with 10 universally business fairly, creating a decent work to management on the accepted principles in the areas of environment. This document serves implementation and effectiveness human rights, labor, environment and as a usable, authoritative reference for of the Code and other our employees looking for guidance anti-corruption. We are committed to compliance matters. regarding decisions made in the this initiative and have incorporated course of everyday business behavior, the Global Compact’s principles as especially in the case of ethical Under the Code, employees may part of our business practices. dilemmas. submit a report anonymously regarding a violation and/or a concern Our former Corporate Responsibility An Administrative Enforcement regarding a violation (including an report, for the years 2009-2010, Officer has been appointed to be expected violation) of a law. The Code included our adaptation of the responsible for the implementation of states that the Company undertakes, principles of the United Nation’s Global Palac Flora, Pargue, Czech Republic the Company’s enforcement program. subject to the provisions of any law The officer deals with the Company’s and to the extent possible, to treat the Compact initiative and incorporated routine compliance affairs and has information reported as confidential them as part of our business practices.
20 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 21 The following is a summary of the Global Compact principles and how we align our business practices with them:
Subject Global Compact Principle Gazit-Globe Position Subject Global Compact Principle Gazit-Globe Position
Human GC #1 & #2: Protecting human rights is one of Environment GC #7, #8, #9: We are committed to setting new Rights Businesses should support and our core values. Our commitment to Businesses should: models for guidance and leadership respect the protection of internationally support and protect human rights is a) support a precautionary in environmental performance. Most proclaimed human rights and ensure an inherent part of our multinational approach to environmental of our subsidiaries observe green that a business is not complicit in business practices and extends to challenges; construction principles, strive to human rights abuses promoting equal opportunity for all, b) undertake initiatives to promote conform to green-building standards, providing fair wages and employment greater environmental such as LEED, and are committed to terms, offering training programs and responsibility; going to great lengths to manage their enrichment and fostering an open c) encourage the development and business in an environmentally friendly dialogue with all of our employees. diffusion of environmentally manner. friendly technologies GC #3: We highly respect the freedom of Labor Businesses should uphold the association of our employees and their freedom of association and the right to join a labor union as mandated effective recognition of the right to by the law and regulations. Currently, collective bargaining there are no labor unions at Gazit- Globe.
GC #4: Within our sphere of influence, we are Businesses should eliminate all forms against any and all forms of child labor of forced and compulsory labor and compulsory labor, encourage Anti GC #10: Our Code of Business Conduct states decent employment opportunities and Corruption Businesses should work against that the Company and its employees support employees rights at work. corruption in all its forms, including must maintain high ethical and extortion and bribery. professional standards in dealing with government officials and the private GC #5: We are strongly committed to the sector representatives. Gazit-Globe Businesses should uphold the effective effective abolition of child labor. Our property or services must not be abolition of child labor company doesn’t employee underage given, either directly or indirectly, to minors and we follow all rules and anyone in an improper effort to obtain regulations regarding this issue in the or retain business for Gazit-Globe or countries in which we operate. to obtain special or unusual treatment GC #6: Our policy is to conduct our in connection with any business Businesses should uphold the business, recruit employees, engage transaction. elimination of discrimination in respect subcontractors, train, promote, of employment and occupation transfer, make redundant, recall or terminate employees, without regard to race, religion, gender, ethnic origin, See http://www.unglobalcompact.org/participant/12469-Gazit-Globe-Ltd for more information about our commitment to sexual orientation, age, disability or the Global Compact. In addition, examples of practical actions that we have taken to conform to Global Compact principles any other classification protected by as well as our measurement of outcomes related to them, can be found in this report marked by the symbols above. applicable law.
22 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 23 Maala FTSE4Good
Our values are also expressed and As part of its program, Maala ranks In addition to recognition by Maala, refined through our association with its member corporations according we are gratified that our Corporate Index Maala, a non-profit organization to their performance using a Responsibility activities have earned For the third consecutive year in a row, whose membership includes over a variety of Corporate Responsibility us additional recognition, as follows: Gazit-Globe has been named a constituent hundred of Israel’s most prominent criteria, concerning business company in the FTSE4Good Index Series, companies. It is a leading professional ethics, human rights policies, work Dun & Bradstreet rated Gazit- a global responsible investment index resource that assists Israeli companies environment, community involvement, Globe as Israel’s leading real created by the FTSE Group, the global index in developing and implementing environmental commitment and estate company in 2012 due to company, and designed to identify companies Corporate Responsibility strategies corporate governance. Gazit-Globe the sharp surge in the Company’s that meet globally recognized corporate and that helps them integrate social, was awarded Maala’s Platinum equity. responsibility standards. Companies in the environmental and ethical values into ranking for the past four years (from FTSE4GOOD Index are working towards their business strategies. Gazit-Globe 2009-2012), and received a Platinum The European Public Real Estate environmental sustainability, developing is a proud member of Maala and an Plus ranking for 2013. Association (EPRA) cited our positive relationships with stakeholders active supporter of its activities. Citycon subsidiary’s Corporate and upholding and supporting universal Responsibility Report as one of human rights. the best in the real estate sector for 2011 and 2012.
Platinum Green Building
Another strong value of our company is building and maintaining our properties in an environmentally friendly manner. Several of our subsidiaries conform their building activities to LEED® (Leadership in Energy and Design), the internationally recognized green building certification system. LEED provides third-party verification that a building has been designed and built using strategies intended to improve performance in metrics such as energy savings, water efficiency, CO2 emissions reduction, improved indoor environmental quality, and stewardship of resources and sensitivity to their impacts. A LEED® certification demonstrates that a construction project is eco-friendly.
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Board of Directors
We are committed to sound principles the provisions contained in Israel’s external directors whose terms of of corporate governance. Our Board Companies Law and Securities Law, are determined according to Israel’s of Directors (“Board”), which is the and are designed to provide additional Companies Law). The criteria which supreme governing body of the oversight for the Company. qualify candidates for the Board Company, is responsible for outlineing include, among other things, business the policy of the Company overseeing The Company also complies with rules knowledge; expertise; integrity; and monitoring the performance of and regulations enacted by the NYSE, experience related to the Company’s our senior management team, the TASE and TSX on which markets the core business activities; proven body which is charged with the day- Company’s shares are traded. leadership qualities; and proven ability to-day conduct of our business. to exercise sound judgment. The fundamental responsibility of As of the date of this report our Board the Board is to exercise business is comprised of eleven members, Following a screening process by the judgment on matters of strategic and three of whom were appointed in Board and relevant professionals, critical significance to the Company in 2012 and one in 2013. The Board biographical information regarding the furtherance of the best interests of the includes the Board’s Chairman, nominees is provided to shareholders, Company and its shareholders. Chaim Katzman; Active Deputy and an approval process is followed. Chairman, Arie Mientkavich; and Iso Omena, Espoo, Finland Our Company’s Code of Business Executive Vice Chairman, Dori Segal. The Board currently has five standing Conduct includes procedures to avoid The Chairman is not an executive committees: Audit and Financial conflict of interest at all levels of the officer of the Company. Biographical Statement Review, Investment, Company. In addition, the Company information regarding each Board Nominating and Corporate has adopted internal regulations member is provided below. Four of Governance, Compensation, and relating to transactions with interested the board members are considered Corporate Responsibility. The three matters, fair employment issues, performance of the Company at least Shareholders, employees and other parties. The purpose of these to be external according to the Israeli latter committees were established by our relationship with our suppliers, once a year. interested parties are invited to regulations is to establish mechanisms Companies Law (two male and two the Board at the end of 2011. social investment in the communities contact Board members directly. and controls for identifying, approving, female), and three are considered in which we operate, environmental In addition to approving strategic Written communications to Board and reporting agreements between to be independent of the Company The Corporate Responsibility matters and other important CR policies and activities of the CR members may be forwarded to Gazit- the Company and its controlling according to the Israeli Companies Committee is responsible for Corporate Responsibility issues that Committee, the Board takes an active Globe’s headquarters. shareholders and other interested Law (all of whom are males). supervising Corporate Responsibility may affect our performance, business interest in CR matters, including social parties, including offices of the activities of the Company, including activities and reputation. Prior to investment, and is regularly updated Company and their positions with the Board members may serve for up the establishment and implementation the establishment of the Corporate about executive management Company. The provisions of these to three years, after which they are of our Corporate Responsibility Responsibility Committee, the Board decisions related to CR. regulations are based, inter alia, on eligible for re-election (excluding policies. Its mandate includes ethical assessed Corporate Responsibility
26 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 27 Members of the Board (As of December 31, 2013)
Arie Mientkavich, Deputy Chairman Mr. Mientkavich is Active Deputy Chairman of the Board Chaim Katzman, Chairman of Directors of the Company and Chairman of the Board Mr. Chaim Katzman is the founder, controlling shareholder and of Gazit-Globe Israel (Development). He is also Deputy Chairman of Gazit-Globe. Mr. Katzman is also the founder, controlling Chairman of the Board of Directors of IDB Holdings shareholder and Chairman of Norstar Holdings (formerly Gazit Inc.), Corporation, as well as Chairman of the Board of Elron the parent company of Gazit-Globe, the Chairman of Equity One, Electronic Industries and RDC - Rafael Development which he founded in 1992, and Chairman of First Capital Realty Corporation. He is also a member of the Board of Given since 2000. In 2008, Mr. Katzman was appointed as Chairman Imaging and NuLens. In addition, Mr. Mientkavich is on of Atrium European Real Estate, and in 2010, as Chairman of the License Committee and a member of the Advisory Citycon. Mr. Katzman is a member of the International Council of Committee of the Bank of Israel, and a member of the Shopping Centers (ICSC), the National Association of Real Estate Advisory Board of the National Defense College of Israel. Investment Trusts (NAREIT), the Urban Land Institute (ULI), the Real Previously, Mr. Mientkavich was Chairman of the Israel Estate Roundtable and the Association of Foreign Investors in Real Discount Bank and the Israel Securities Authority, member Estate (AFIRE). He received an LL.B from Tel Aviv University Law of the Israel CPA Advisory Council and a member of the School. Mr. Katzman is a well-known civic leader, philanthropist and Advisory Board of the Bank of Israel. He was also General supporter of numerous organizations in the US and Israel, and serves Counsel to the Israel Ministry of Finance. In the public sector, as a Trustee of the Board of Governors of Tel-Aviv University. He Mr. Mientkavich is Chairman of the Academy of Quality of recently established the Gazit-Globe Real Estate Institute at Israel’s Government Movement in Israel, and the Public Committee Interdisciplinary Center (IDC) Herzliya, Israel, for the research and of Yad Sarah, an NGO in the field of humanitarian support study of the field of real estate initiation and management. of public health. Mr. Mientkavich holds degrees in Law and Political Science from the Hebrew University in Jerusalem and was admitted to the Israeli Bar in 1972.
Dori Segal, Executive Vice Chairman Mr. Segal is Executive Vice-Chairman of Gazit-Globe, President and CEO of First Capital Realty; Vice Chairman and Director of Equity One; Director of Gazit-Globe Israel (Development), U. Dori Group and Norstar Holdings. Mr. Segal joined Gazit-Globe in 1993 both as a principal investor and a senior member of the management team. Since 1997, Mr. Segal has been active in the acquisition, development and redevelopment of shopping centers in Canada. He was mainly responsible for the purchase of Gazit-Globe’s initial portfolio in Canada and then played a key role in the acquisition of First Capital Realty Inc. (formerly known as Centrefund Realty Corporation) in August 2000.
28 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 29 Haim Ben Dor, Director Gary Epstein, Director Mr. Ben Dor is a corporate consultant in the field of finance and investments. Mr. Ben Mr. Epstein chairs the Global Corporate and Securities Department, and is a member Dor holds a degree in Accounting from the College of Management in Jerusalem and of the Executive Committee and a Principal Shareholder at Greenberg Traurig, LLP, an auditors’ certificate from the Ministry of Justice. an international law firm. Mr. Epstein has been with Greenberg Traurig since 1980. Mr. Epstein received a B.A. and B.H.L. in English and Jewish Studies at Yeshiva University, an M.A. in English Literature from New York University and a J.D. from Harvard Law School.
Noga Knaz, External Director Ms. Knaz is the CEO of Rosario Capital Ltd. She formerly served as CEO of Dash Douglas Sesler, Director Underwriting Ltd. and Chief Investment Officer in Dash Securities and Investments Mr. Sesler is a private real estate investor. From January 2009 through February Ltd. Previously, Ms. Knaz also held positions with Migdal Capital Markets, including 2011, Mr. Sesler served as head of Global Real Estate Principal Investments of Bank Co-CEO of Madanes Financial Services Ltd. Ms. Knaz holds a B.A. in Economics and of America, Merrill Lynch. From 2005 until December 2008, Mr. Sesler served as Business Administration from Haifa University. Managing Partner and later as Co-head of Real Estate Investment Banking at Merrill Lynch. Mr. Sesler received a B.A. in Government from Cornell University.
Nadine Baudot-Trajtenberg, External Directorr Yair Orgler, External Director Ms. Nadine Baudot-Trajtenberg is currently Associate Dean of the School of Mr. Orgler was Chairman of the Board of the Tel Aviv Stock Exchange until 2006, Economics at IDC Herzliya in Israel with fields of expertise in global economic and a Director of Bank Hapoalim until 2010. He is Professor Emeritus of the developments, financial economics and the Israeli economy. Ms. Baudot-Trajtenberg Faculty of Management at Tel Aviv University. Mr. Orgler holds a B.S. in Industrial holds a BSc. in Economics from the University of Montreal, an MA in Politics- Engineering and Management from the Technion; an M.S. in Industrial Engineering Philosophy-Economics from the Oxford University where she was a Rhodes Scholar from the University of Southern California; and a Ph.D. in Management-specializing and a Ph.D. in Economics from Harvard University. For 20 years, Ms. Baudot- in Finance - from the Carnegie-Mellon University, Pittsburgh, Pennsylvania. Trajtenberg was employed in a variety of positions at Bank Hapoalim including Senior Economist, head of the Research and Advisory Services in its Securities Division and head of Investor Relations. She is chairperson of the investment committee of Menora-Mivtachim Insurance, external director of Menora-Mivtachim-Pension and the Menora-Mivtachim-Provident fund.
Shaiy Pilpel, Director Ronnie Bar-On, External Director* Mr. Pilpel is the CEO of Wexford Capital Israel Ltd. Mr. Pilpel holds a B.S. in Mathematics Mr. Bar-On served in a variety of governmental positions in Israel from 2003 to 2013 and a B.A. in Philosophy from Tel-Aviv University, an M.Sc. in Mathematics from the including Minister of Finance, Minister of the Interior, Minister of National Infrastructure, Hebrew University in Jerusalem, and an MBA from Columbia University, New York City. Minister of Science and Technology, Chairman of the State Control Committee, Mr. Pilpel also holds a Ph.D. in Statistics from the University of California, Berkeley. Chairman of the Foreign Affairs and Defense Committee, and as a member of the Knesset. Prior to entering public service, Mr. Bar-On practiced law for twenty seven years in a private law firm of which he was also the founding partner. Mr. Bar-On has a law degree from the Hebrew University of Jerusalem.
30 > Gazit-Globe Corporate Responsibility Report 2011-2012 *Appointed following the reporting period. Gazit-Globe Corporate Responsibility Report 2011-2012 < 31 Eran Ballan, Senior Executive Vice President and General Counsel Executive Management Mr. Ballan serves as Senior Executive Vice President and General Counsel. Mr. Ballan joined Gazit-Globe in 2007. Prior to joining Gazit-Globe, Mr. Ballan was a Partner at Our executive management is responsible for the ongoing management of the Naschitz, Brandes & Co. in Tel Aviv, one of Israel’s largest law firms. Previously, Mr. Company according to the Company’s vision and goals, and for executing the Ballan was an Associate at Paul, Weiss, Rifkind, Wharton & Garrison LLP, in New York. Mr. Ballan holds a LL.M. degree from New York University and a LL.B from Essex strategic plans and policies established by our Board of Directors. University in the U.K.
Our executives cooperate with the management of our privately-held subsidiaries and support them in their activities. The management of Gazit-Globe’s publicly-held subsidiaries is carried out by their independent management teams. Gazit- Rami Vaisenberger, Vice President and Controller Globe is involved in the activities of these public companies through representation on their respective boards. In general, Mr. Vaisenberger joined Gazit-Globe in July 2004 as Controller, and was appointed Vice our management team strives to maximize knowledge share, capabilities and synergies between all the members of the President in 2011. From 2000 through 2004, Mr. Vaisenberger served as an auditor Gazit-Globe Group. at Ernst & Young. He holds a Bachelor’s Degree in Business Management from the College of Management in Tel-Aviv and is a certified public accountant. The members of our Executive Management include the following individuals:
Roni Soffer, President Varda Zuntz, VP of Corporate Responsibility Mr. Soffer serves as President of Gazit-Globe. Since joining our Company in 1997, and Member of the Executive Committee Mr. Soffer has held several senior executive roles and leadership positions. During his Mrs. Zuntz has served as VP of Corporate Responsibility since March 2012. Most tenure at Gazit-Globe, Mr. Soffer has attained extensive expertise in both the retail recently, Mrs. Zuntz served as our Company Secretary, a position she held since and healthcare real estate sectors in public as well as private markets and has been December 1998. Mrs. Zuntz is also a director of several Gazit-Globe subsidiaries. involved in the Group’s worldwide M&A activity and the growth of its global platforms to Previously, she was Personal Assistant to Mr. Chaim Katzman. a total value of approximately $18 billion across 20 countries. From 2001 to 2009, Mr. Soffer was based at the Group’s offices in the US. More recently, Mr. Soffer led Gazit- Globe’s IPO in the US and the listing of its shares on the New York Stock Exchange Shlomi Drori, VP Supervision and Control (NYSE: GZT). Mr. Soffer also serves as CEO of Gazit Group USA, a private subsidiary Mr. Drori was appointed VP Supervision and Control in January 2013. Mr. Drori joined of the company; a Director of Atrium European Real Estate (VSX/Euronext: ATR); and Gazit-Globe in November 2011 and is in charge of supervision and internal control Executive Chairman of ProMed Properties and Gazit Senior Care, Gazit-Globe’s private activities, administrative enforcement and SOX for the Group in Israel and overseas. subsidiaries. Mr. Soffer holds a B.A. in Economics and an LL.B from the College of Prior to joining Gazit-Globe, Mr. Drori served as Internal Auditor at Pelephone Management, Academic Studies, in Israel. Communications, VP Finance and Operations at TADSEC and head of risk management at Cellcom. Mr. Drori holds a BA in business administration and accounting from the Gil Kotler, Senior Executive Vice President College of Management Academic Studies and is a Certified Public Accountant (Israel). and Chief Financial Officer Mr. Kotler has served as Senior Executive Vice President and Chief Financial Officer since October 2012. Mr. Kotler joined Gazit-Globe in 1998 as Chief Financial Officer, a Ronen Geles, VP Finance position he held for 12 years. Form 2009 to 2012 Mr. Kotler served as Chief Strategy Mr. Geles was appointed VP Finance of Gazit-Globe in January 2013. Mr. Geles joined Officer and was located at the Company’s offices in Miami, Florida. During his tenure Gazit-Globe in July 2006 and formerly held the position of Treasurer and Financial Risk as Chief Strategy Officer, Mr. Kotler was engaged in a wide range of strategic activities Manager. As part of his duties, Mr. Geles is responsible for the financial operations including leading the group’s international financial activities. Prior to joining Gazit- of the Company, which include, inter alia, managing the credit array and the hedging Globe, Mr. Kotler served as a Manager at Ernst & Young Israel. Mr. Kotler holds a B.A. strategy. Prior to joining the Company, Mr. Geles worked at Bank Leumi on the corporate in Economics and Accounting from Tel-Aviv University and he is a graduate of the desk in the foreign currency trading room, and as an economist for its construction Harvard Business School General Management Program for Executives. Mr. Kotler is a and real estate sector. Mr. Geles holds a BA with honors in economics and business Certified Public Accountant (CPA). administration from Bar-Ilan University, as well as an MBA, specializing in finance and accounting, from Tel Aviv University.
32 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 33 Compensation of Senior Employees
Rutherford Marketplace, Canada
office holder’s personal performance. office holders in connection with whether due to material changes in The policy applies to the compensation termination of their position with the the Company – its size, character and conditions of all the office holders Company), and any benefit, other areas of operation, variety of risks, of the Company, which include, as payment or undertaking to make such the markets in which the Company of the date of adopting this policy, payment, granted for such tenure or operates, among others, or whether the President, Senior Executive Vice employment. In determining the policy, due to material changes in the macro- Presidents and Vice Presidents. This the Compensation Committee and economic environment and market policy shall also apply to each board the Board considered the nature of practices in Israel pertaining to office member filling an executive position the Company’s activity and structure holder compensation in general and in the Company (excluding controlling as of the date of adopting the policy. in comparable companies specifically. On November 2012, the Knesset established by the Company and Company, as well as to allow for the shareholders of the Company). It was also taken into consideration The Compensation Committee will passed Amendment no. 20 to that operates in accordance with the employment of new office holders Compensation conditions mean: the that the man power structure in the examine at least once per year whether the Companies Law, 1999 (the provisions of the Companies Law. selected from a strong pool of human terms of the tenure or employment Company primarily includes a small such material changes have occurred, “Companies Law” or the “Law”) resources that can contribute to the conditions of the office holder, number of senior executives, mid- and in any event the committee and setting forth for the first time the This policy has practical significance, Company, promote its objectives and including providing exemptions, level executives, legal and finance the Board will examine the substance statutory principles of office holder with respect to the manner of improve its performance, as well as insurance, indemnity undertakings departments, and administrative of the policy once every three years, compensation policy that every public approving actual compensation define and create appropriate linkage or indemnity by additional indemnity support employees. as required by the Law. company is required to adopt. The conditions of any of the Company’s between the performance of the commitment, severance pay (bonus, compensation policy specified in office holders in the future, but it Company and the office holders and payment, reward, compensation Naturally, the compensation policy this document combines the new also has basic significance, as it the compensation granted to them. or any other benefit granted to must be examined from time to time, provisions of law on the matter, methodically and publicly prescribes The formulation of a universal policy with the principles pertaining to the main principles deemed relevant by may also improve the transparency of remunerating the Company’s office the Company’s Board regarding office the Company’s compensation rules The various compensation components are intended to encourage continued holders, previously adopted by the holder compensation and the manner (within and without of the Company), employment of the Company’s office holders in the Company, as well as to allow for the Company’s shareholders, following of application of such principles in align the expectations of the employment of new office holders selected from a strong pool of human resources that the approval of the Company’s practice. The various compensation Company and its office holders, and Board of Directors pursuant to components are intended to is intended, inter alia, to create a basis can contribute to the Company, promote its objectives and improve its performance, the recommendation of the encourage continued employment of for compensation of each of the office as well as define and create appropriate linkage between the performance of the Compensation Committee that was the Company’s office holders in the holders that takes into account such Company and the office holders and the compensation granted to them.
34 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 35 Stakeholders Stakeholder Shareholders, including Institutional Investors Board of Stakeholder Interaction with Stakeholder Environment Directors Shareholders, We communicate with our shareholders through our Annual Meetings of including Institutional Shareholders where decisions are taken by our shareholders through a voting Community Subsidiaries process that is mandated by the law. As a corporation registered under the laws Investors of the State of Israel, we comply with the Israel Companies Law, as amended, which states that the following corporate issues must be discussed and approved Media at a general meeting of shareholders: Shareholders in the Company Employees participate in the management of our company regulations and jurisdiction of the Board organization through their votes at appointment, termination and work terms of the auditing accountant Financial shareholder meetings. Shareholders’ Analysts rights and duties are detailed in the appointment of external directors Customers: Company’s Articles of Association approval of transactions with interested parties Tenants and and in corporate statutes. Regulatory Consumers increase of registered capital stock Authorities merger activities According to our Company’s Article of Association and Israel Companies We also communicate with our shareholders through our website, as well as Suppliers Introduction Law, a shareholder holding 1% or through our annual, quarterly and other periodic financial reports and immediate more of the Company’s voting rights is reports. These reports include, among other things, information about our entitled to suggest a topic for inclusion In identifying our stakeholders and subsidiaries and employees. Our Responsibility activities. Together financial performance, our corporate governance and other company activities. on the agenda of our next General parties who are impacted directly or ‘external’ stakeholders are our with other materials that we publish Meeting. Any shareholder holding 5% indirectly by our business activities, customers, including tenants and in print and or online containing We also hold quarterly conference calls in both Hebrew and English during which or more of the Company’s outstanding we used the following parameters: consumers, as well as regulatory information related to our Corporate our CEO and CFO review financial and other events of the preceding financial equity and 1% or more voting rights, or authorities, our suppliers, the media, Responsibility activities, this Report reporting period and allow for questions from participants on the call. A press any shareholder holding 5% or more groups with whom the Company financial analysts, the community and is meant to cultivate a transparent conference is also held following the publication of our annual financial results of the voting rights of the Company, has day-to-day interaction the environment. dialogue with our stakeholders. It also every year in March. In addition, we conduct investor days to provide information can call for a Special Meeting of groups with whom the Company includes contact information to enable to institutional investors. Shareholders. holds a mutual dialogue, or The publication of this Corporate members of our stakeholder groups wishes to engage in one; Responsibility Report, which relates to reach out to us regarding issues Our contact information (telephone numbers and email addresses) is published The Company also counts numerous our performance, in general, to our Corporate Responsibility that are important to them. on our website, as well as on all of the written materials that we disseminate to institutional investors among its and with respect to Corporate activities during 2011 and 2012, our shareholders and to the exchanges in which our securities are traded. shareholder base. Responsibility, in particular, as it as well as our previous Corporate The following section further defines may affect, or be affected by each Responsibility reports for the years our stakeholder groups and the In addition, we are registered on a variety of public directories that provide of the groups 2007-2008 and 2009-2010, serve as methods by which we interact with investors with detailed information about our Company, which we update on a Our ‘internal’ stakeholders include an important mechanism for informing them. regular basis. our shareholders, Board of Directors, our stakeholders of our Corporate
36 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 37 Stakeholder Stakeholder
Stakeholder Interaction with Stakeholder Stakeholder Interaction with Stakeholder
Board of Directors Employees
Our Board of Directors dictates Our Board of Directors governs our Company by establishing broad policies and As of December 31, 2012, we Among the activities we engage in to interact with our employees are the following: Company policy and supervises its objectives; selecting, appointing, supporting and reviewing the performance of have 36 employees working at We conduct employee satisfaction surveys from time to time to obtain performance, business functions our executive team; ensuring the availability of adequate financial resources; our headquarters in Tel-Aviv. The feedback on management performance, employees’ overall satisfaction and and operations. They accomplish approving annual budgets; setting the salaries and compensation of Company satisfaction of our employees with the Company’s volunteer activities. The results of the surveys are distributed this through regularly-scheduled and management; and accounting to our stakeholders for our Company’s their jobs, employment terms, work to employees and serve as a basis for discussions at meetings attended by special meetings of the Board and performance. In addition to ensuring the Company’s prosperity by collectively conditions and balance between employees and management. its committees. (See page 28 above directing the Company’s affairs and meeting the appropriate interests of our their work and personal lives is very We engage in annual performance reviews of employees which are attended for biographical information on our shareholders and stakeholders, our Board deals with challenges and issues important to us. by each employee’s manager. We also engage in periodic discussions Board members.) During 2012, the relating to Corporate Responsibility. regarding performance, if required. Board held 24 meetings and the Audit Once a year, the CEO meets with each employee. Committee conducted 13 meetings. We maintain a Work–Life Balance policy to help employees achieve a In 2011, the Board met 25 times, the balance between their work and their personal lives. When possible, we Audit Committee met 21 times and make an effort to meet the needs of our employees by providing flexible the Investment committee assembled work hours and enabling them to work from home. We also host events one time during the 2011. for employees and their families, including family vacations and holiday gatherings. In addition, we encourage employees to continue their academic studies by adjusting their employment conditions to allow for study periods Stakeholder Interaction with stakeholder and unpaid leave. We maintain an “Open Door” policy thereby encouraging our employees to communicate with our management. Our employees attend a bi-annual training sessions related to ethics and Subsidiaries sexual harassment designed to allow for dialogue between management and employees. A major shareholder in six publicly-held Through our intensive interaction with our privately held subsidiaries, we help companies, Gazit-Globe also controls guide their management teams with their strategic direction. We also sit on the a number of privately-held companies Boards of Directors of our publicly held companies thereby contributing to their throughout the world. You can find management. We organize an annual management conference attended by all information about these entities on of our subsidiaries which is hosted by a different subsidiary each year. These page 12. Their financial performance gatherings include brainstorming and interaction. In addition, we hold regular and operations determine the conference calls with the management of our subsidiaries to discuss ongoing performance of our Group. business issues and activities.
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Stakeholder Interaction with Stakeholder Stakeholder Interaction with Stakeholder
Customers: Tenants and Consumers Suppliers
Our customers include not only end-user consumers who shop for products and services in our shopping centers or visit Contractors, appraisers, architects, We negotiate agreements with potential suppliers in a fair and responsible manner our properties, but also our tenants who rent space in the shopping centers as well as in our medical office buildings. engineers, supervisors and suppliers and in accordance with accepted business norms and regulations. of raw materials act as suppliers to Tenants We interact with our tenants in several ways: negotiating agreements with them, our company. They provide us with Our goal is to incorporate Corporate Responsibility criteria into our background conducting satisfaction surveys to obtain feedback, and holding tenant focus the products and services we need to checks of major potential suppliers in which we plan to engage in long term groups to ascertain their needs. The managers of our centers maintain contact develop our propertities and maintain relationships. We do this by requesting that they complete a questionnaire about with tenants to ensure harmonious business dealings with them, and to respond them. Our goal is to ensure that they their Corporate Responsibility activities. During 2011, we obtained confirmation to their concerns. Many of our subsidiary companies employ an employee who provide for the needs of our tenants from our top ten suppliers that they reviewed our Code of Business Conduct and is focused on tenant relations. These ‘tenant relations managers’ duties include: and end-user customers. that they agree to follow the Code’s guidelines in the conduct of their businesses. developing relationships with tenants and acting as a one-point source of contact Attorneys, accountants, economists, We are concerned that our subcontractors conduct their business activities marketing and advertising according to accepted norms and regulations, especially with respect to facilitating meetings between tenants and our executives to coordinate professionals, public relations employment. At our headquarters in Tel-Aviv, we conduct annual checks of our leasing, property management and asset management issues managers, human resources sub-contractors’ pay slips to confirm that they pay salaries and benefits to their maintaining retailer information compensation consultants, and employees as required by law. Because we are strongly committed to the abolition proactively assisting agents by providing them with leasing information research companies assist us to of child labor and don’t employ underage minors in any of our businesses, we ensure that we conform to regulatory strongly encourage our suppliers and sub-contractors not to employ underage Our leasing representatives attend trade shows and conferences throughout the and other requirements. minors, as well. year, some of which are held in conjunction with local chambers of commerce, where brokers and tenant representatives are invited to obtain information about space available for lease in our shopping centers. Our subsidiaries’ websites also provide information for potential tenants, including contact information.
Consumers Our leasing representatives attend trade shows and conferences throughout the year, some of which are held in conjunction with local chambers of commerce, where brokers and tenant representatives are invited to obtain information about space available for lease in our shopping centers. Our subsidiaries’ websites also provide information for potential tenants, including contact information.
40 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 41 Stakeholder Stakeholder
Stakeholder Interaction with Stakeholder Stakeholder Interaction with Stakeholder
Regulatory Authorities Financial Analysts
We rely upon the approvals of a broad We interact with governmental authorities through the applications that we submit Many analysts representing different We communicate with analysts on a regular basis. We conduct an investor day range of governmental and municipal to them for approvals, periodic reports that we file with them on our activities, and financial institutions follow the to provide information to financial analysts and institutional investors. In addition, regulatory authorities to conduct our payments that we make to them in the form of taxes and fees. These authorities Company’s activities and progress. A management makes itself generally available to analysts to answer their queries business. These include development include the following: list of analysts covering our Company about the Company. The Company also proactively manages its relationship authorities and others that are and their contact information is with analysts by offering to meet with them to enable them to better understand responsible for urban planning and Securities Authorities: We report financial and other information related to available on Gazit-Globe’s website. the Company’s business in order to disseminate educated research on the zoning, as well as local building and our business activities to the New York Stock Exchange (NYSE), the Toronto Company. Occasionally, we also organize property tours for analysts to visit our planning committees that approve Stock Exchange (TSX) and the Tel Aviv Stock Exchange (TASE), on which shopping centers and personally observe our operations as well as meet with the architectural, engineering and Gazit-Globe’s shares are listed, as required by these exchanges’ rules. In executives of our subsidiaries to gain a thorough understanding of our business. environmental protection plans. Many addition, we also maintain an ongoing dialogue with the security authorities of these governmental bodies and of several jurisdictions as required of publicly traded companies. Our publicly authorities also pass laws, regulations traded subsidiaries, including First Capital Realty, Citycon and Equity One, and directives which directly affect are also listed on various exchanges around the world and similarly comply how we conduct our businesses in with the securities authorities in their jurisdictions. their jurisdictions. Tax authorities: We submit regular filings to Israeli and other tax authorities, as required by those authorities’ laws and regulations. Local authorities: We cooperate fully with local authorities to obtain building Stakeholder Interaction with Stakeholder licenses and to conduct our businesses according to municipal building codes and other legislation. Media Environmental authorities: We cooperate fully with federal and local environmental agencies in the jurisdictions in which we operate, and maintain The economic press and media As part of our ongoing efforts to increase transparency and enable stakeholders continuous contact with environmental personnel to ensure compliance with organizations throughout the world to make informed decisions, we issue press releases for broad media distribution environmental standards maintained by them. review our business activities and that contain information regarding material developments or financial results of financial results in their newspapers, the Company. An archive of these press releases can be found on the Company’s magazines, television shows, web website. As stated above, we also conduct an annual press conference sites, news blogs and other media, following the release of our annual financial statements and post information on thereby providing the general public our website. In addition, our management is regularly requested by traditional with objective information on our and online media, including business newspapers, magazines, websites and Company. television programs, to comment on various issues relating to our company and the commercial real estate industry.
42 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 43 Stakeholder Stakeholder
Stakeholder Interaction with Stakeholder Stakeholder Interaction with Stakeholder
Community Environment
Our shopping centers play a significant We conduct surveys of the populations of the communities in which we operate We continue to progress in our efforts We comply with rules and regulations mandated by Israel’s Ministry of role in hundreds of communities in order to assess their shopping habits and to obtain feedback on their particular to incorporate green building practices Environmental Protection, as well as the environmental ministries of other countries around the world. As a result, these needs. This enables us to create a proper mix of goods and services for each into our development program. in which we operate in the development and operation of our commercial centers communities are also stakeholders in shopping center that we operate. Green construction, or sustainable and other business activities. We interact with non-governmental organizations our business. In addition to serving building, refers to an environmentally (“NGO’s”) that are active in protecting the environment, and hire consultants to as shopping destinations, our Our contributions to the community are determined by an internal charitable responsible and resource-efficient assist us in assessing the environmental impact of our activities. They advise centers provide community services, activities group that is comprised of members of our management. This group progress throughout a building’s us in the use of green construction methods and in reducing our environmental entertainment and to places to establishes our corporate giving goals and identifies target areas in which we will life-cycle: from ‘siting’ to design, impact. This benefits not only us, but our tenants, who reduce their electricity socialize. focus our charitable activities. construction, operation, maintenance, and water costs. We also influence the communities renovation and demolition. Green in which we operate through our For instance, to galvanize the community to support charitable causes, buildings are designed to reduce the philanthropic activities directed to a Gazit Israel G shopping centers sponsor events for various charities. They also overall impact of the built environment variety of organizations and social maintain Facebook pages on which they interact with members of the community, on human health and the natural projects that educate, aid the poor, provide information regarding events held at their shopping centers and provide environment, They do so by efficiently distribute food, support under- members of the community with access to managers of the shopping centers. using energy, water, and other privileged children and youth, and Such information is also presented in the company’s website. In addition the resources, protecting occupant health others. Our employees are also company issues magazines and local brochures to potential visitors. Interaction and improving employee productivity, encouraged to volunteer their time to is also made through municipal magazines and Israeli newspapers. and reducing waste, pollution and the non-profit organizations and volunteer degrading of the environment. programs.
44 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 45 Membership in Associations
Gazit-Globe and its subsidiaries maintain memberships in the following industry and other organizations:
EPRA: European Public Real BOMA: Building Owners and Building NAREIT: National Association of Real Estate Association UNEP SBCI: UNEP’s Sustainable Council of Canada Estate Investment Trusts Buildings and Climate Initiative
RAKLI: The Finnish Association of Building Owners and Construction WBCSD: World Business Council for CaGEB: Canadian Real Building ULI: Urban Land Institute Clients Sustainable Development Council
ICSC: The International Council of CREW: Corporate Real Estate FiGBC: Green Building Council Shopping Centers WRI: World Resources Institute Women Finland
NCSC: The Nordic Council of United Nations Global Compact Ontario Infrastructure and Land Shopping Centers Corporation
Israel - America Chamber of GRI: Global Reporting Initiative Commerce
Israel - Canada Chamber of IEA: The International Energy Commerce Agency
UNEP: United Nations REALpac: Real Property Association Environment Program of Canada
46 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 47 With hundreds of shopping centers visited by millions of consumers, our business affects not Section only our stakeholders, Economic but communities Performance worldwide. 2.
Shoppes at Dundas, Ontario, Canada
48 > Gazit-Globe Corporate Responsibility Report 2011-2012 Introduction
As a global real estate company managing and operating income- We act as a spur to the creation and chains, specialty shops, cafes and extends to our contributions to various growth of businesses, commercial restaurants, banks and service non-profit organizations to support producing properties around the world, our operations have both a activity and jobs. We promote centers. Our development and their activities in the community. substantial economic growth by redevelopment activities also have an strong direct and indirect economic impact on the communities in leasing space to tenants who employ economic impact by creating work which we operate. tens of thousands of people in their opportunities for the construction supermarkets, drug stores, clothing industry. Our economic impact also
Sheridan Plaza, Hollywood, Florida, USA
50 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 51 DIRECT ECONOMIC VALUE
Prado Shopping Center, Campinas, State of Sao Paulo, Brazil
Our primary objective is to create value through long-term Our rental revenues in 2012 were NIS traded and privately-held subsidiaries, allocation and improves our resilience 5,249 million, compared to NIS 4,718 has driven this substantial and to changes in economic conditions maximization of cash flow and capital appreciation, and to increase million in 2011. Our net operating consistent growth. We leverage and the cyclicality of markets, income (NOI) was NIS 3,544 million in our expertise to grow and improve enabling us to apply successful ideas our dividends over time. We do this through a differentiating 2012, compared to NIS 3,196 million the operations of our subsidiaries, and proven market strategies in focus on a recession-resilient, necessity driven asset class for 2011. maximize our profitability, mitigate multiple countries. Our global reach, our risk and create value for together with our local management which has demonstrated an ability to generate strong Perhaps one of the best indicators shareholders. teams, enables us to make accretive of our economic performance is the acquisitions to expand our asset and sustainable cash flow through consistent growth in our dividend by With the goal of achieving a leading base, both in the countries in which more than 11% annually over from position in each of our markets, we we currently operate as well as in new different economic cycles. 2000 to 2012 and our total average work to expand our presence in the ones. annual return of 18%. We distributed countries in which we operate while a dividend of NIS 1.56 per share value also expanding into new markets. We Please refer to our website for all in 2011 and NIS 1.60 per share value grow our business both organically financial disclosures, including our in 2012. as well as through acquisitions and 2012 Annual Report http://gazit- strategic partnerships with leading globe.com/financial-reports. The business model that we have global institutions. developed and implemented over the years, whereby we own and operate Our geographic diversity provides our properties through our publicly- us with flexibility in terms of capital
52 > Gazit-Globe Corporate Responsibility Report 2011-2012 Carrefour St-Hubert, Quebec, Canada Gazit-Globe Corporate Responsibility Report 2011-2012 < 53 DIRECT ECONOMIC VALUE Demonstrated Long-Term Value Creation NOI Diversification
Gazit-Globe (TASE) Tel Aviv100 S&P 500 EPRA Global 5% 1% Key Figures Europe 36% Canada 32% (NIS million) 26% 36% USA 26% As of December 31, 2012 Israel 5% 1,200 Total annual return Brazil 1% 32% 2012 2011 2010 +18% 1,000
Total Assets 71,062 64,599 50,408 800 Investment Properties 59,753 53,926 43,558 600 NOI Breakdown by Interest Bearing Liabilities 40,834 38,520 31,370 Credit Rating Shareholder’s Equity Including Minority 22,649 19,628 15,191 400 1%
Shareholder’s Equity 7,849 7,310 5,986 200 AA+ and above 14% Net Debt to Total Assets 56.1% 58.0% 60.7% Countries 85% 0 Other Investment Grade Countries 14% AA+ and above Below Investment Countries 31 Dec 99 31 Dec 00 31 Dec 01 31 Dec 02 31 Dec 03 31 Dec 04 31 Dec 05 31 Dec 06 31 Dec 07 31 Dec 08 31 Dec 09 31 Dec 10 31 Dec 11 31 Dec 12 Grade Countries 1% 85% * The Company has early adopted New Standards1, beginning with its financial statements dated June 30, 2012. The New Standards prescribe retroactive implementation, and the data for prior years in the financial statements adjusted accordingly. As a result, financial data and figures in the table above has been also adjusted accordingly.
Consistent Dividend Growth for 14 years Gross Leasable Rental Revenue NOI FFO (NIS per share) Area (GLA) (NIS billions) (NIS billions) (NIS millions) (Millions sqm)
11.2% 2.4% 12.5% 12.2% 21.8% CAGR (Compound Annual Growth Rate) CAGR CAGR CAGR CAGR 1.72 1.60 1.56 1.48 1.42 5.25 3.54 533 6.82 6.77 4.72 6.50 1.24 3.20 4.15 2.81 405 1.08 1.00 359 0.89 0.76 0.71 0.64 0.57 0.47 0.39
99 00 01 02 03 04 05 06 07 08 09 10 11 12 13E 10 11 12 10 11 12 10 11 12 10 11 12
54 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 55 INDIRECT ECONOMIC INFLUENCE CHARITABLE INVESTMENT
Our hundreds of income producing properties throughout the world Above and beyond our business children, students and youth. The of several thousand students; 105 activities, Gazit-Globe believes that focus of our activities is on small students who completed their army have a strong indirect economic influence. Our tenants include it is both a duty and a privilege to towns in Israel’s Negev region, service or national service with contribute to the community. supermarkets, drug stores, banks, appliance stores, apparel shops, including Yeruham, Mitzpe Ramon, scholarships for higher academic During 2012, we donated NIS Dimona, Kiryat Gat, Kiryat Malachi, studies in the amount of NIS 15,000 and other shops and service providers. They market and sell goods 5,220,000, 49% of which amount (NIS Sderot, Netivot, Ofakim and Arad, as per student; and to build and operate 2,541,000) benefitted educational well as several Bedouin communities. Young Adults’ Centers in Negev and services valued at hundreds of millions of dollars a year, employ initiatives and institutes. In 2011, We provide support for programs communities to strengthen teens and thousands of people and pay taxes to the local jurisdictions in which we donated NIS 5,790,000, 46% at the elementary school, junior young adults in those communities. In of which (NIS 2,656,000) was used high school and high school levels, 2012 we supported ten such centers. especially those with economic gaps our centers are located. for to educational and charitable In 2011, we established, and will among the populations which have organizations geared to academic maintain over a long-term period, achieved average or low test results. excellence, reducing societal the Gazit-Globe Real Estate Institute To drive economic growth, we populations. We also strive to build institutions, thus easing the economic The remedial programs we support inequality and assisting young people. at Israel’s Interdisciplinary Center make our commercial centers easily and operate our commercial centers burden on these centers and their are designed to assist teachers and During 2011, we launched our “La’ (IDC) Herzliya. The Institute will accessible, convenient and a pleasant in an environmentally friendly way, communities. provide pedagogic activities and Darom” project which includes house an academic and research environment in which to shop. In by employing green construction social activities for students. programs to strengthen education in program focused on innovation and addition to leasing space to large methods and conservation methods Our indirect economic influence Israel’s south, with an emphasis on In 2012, we provided funding to 20 entrepreneurship in the real estate department stores and supermarket in an effort to create additional also extends to the taxes we mentoring, supporting and nurturing schools in the Negev with an aggregate sector. anchors, we also rent space to small economic and other benefits for the pay in the jurisdictions in which and medium-sized businesses that communities where we operate. we operate. These taxes help to benefit by being located adjacent finance government activity aimed at to larger stores which attract strong Our medical offices also generate improving the welfare of citizens in the traffic. To best serve consumers, we economic and other benefits. Several countries in which we operate. also focus on creating a consumer- of our medical offices share human friendly and safe environment, a resources, knowledge, infrastructure diverse shopping experience, and and equipment with surrounding easy accessibility for disadvantaged medical centers and research
56 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 57 CHARITABLE INVESTMENT FINANCIAL IMPLICATIONS & RISKS AND OPPORTUNITIES By establishing and supporting the Curatorial Practice. The main lobby than Life” and “Etgarim” projects so Institute we hope to strengthen of the Company’s corporate office at that every employee can select a academic excellence and research King Liberty Village in Toronto, Ontario, manageable opportunity in which he/ DUE TO CLIMATE CHANGE in real estate sector, build academic Canada showcases the results of the she can contribute. first art competition sponsored by programs and develop a cadre of During 2011–2012, the annual First Capital Realty in 2010. professional real estate executives. volunteer time of Gazit-Globe In addition, the Institute will work to In the health field, for over 10 years employees was higher in comparison strengthen ties between academia we have been a major supporter of to the average volunteer time of and real estate professionals in the “Larger Than Life” (“Gedolim other companies. In 2011, we also field and will work to deepen the public Mehachaim”), a non-profitappointed a manager of Corporate Citycon: discourse about real estate. Company organization whose goal is to Responsibility activities who is management and its professionals improve the quality of life and responsible for day-to-day activities Without doubt, risks associated with climate change will contribute their professional well-being of children with cancer supported by other Company will affect our Citycon subsidiary substantially in the experience to the Institute to add and their families. We also support employees. short term. An increase in the frequency of extreme a practical dimension to academic hospitals and other organizations weather conditions, such as violent storms, floods and studies. providing medical care. In the field of snowstorms will increase maintenance costs and erode arts and culture, we support museums In addition to education, our corporate profitability. philanthropy extends to organizations and theaters, and in the field of welfare, we support underprivileged and initiatives that are involved in Land use and construction also threaten to disrupt health, welfare, arts and culture, families with food and by funding biodiversity. In most cases, an environmental impact primarily in Israel, the US and Canada. summer camps for children. assessment, including a biodiversity assessment, is conducted in connection with zoning and major projects. For instance, in 2012 our FCR The Social Responsibility of subsidiary provided $45,000 in Gazit-Globe employees: As part of strengthening ties with the local Over the long term, as global warming continues, so- sponsorship funding for a number community, we encourage our called climate refugees from densely populated areas will of program initiatives at OCAD U, employees to volunteer for appropriate be forced to relocate to other countries and continents. including the Graduate Exhibition, social activities and projects. In their host countries, some of these refugees will end up a public sculpture competition, in relatively low-skilled and low-wage jobs. Citycon may and awards for the university’s top We offer several options for hire these people for different types of positions, such as graduating students in Sculpture/ volunteering in the areas of education cleaning, construction work and property maintenance Installation and Criticism and and welfare such as the “Larger which may involve risks related to work conditions and human rights. Citycon seeks to eliminate these risk factors by preparing codes of ethics for its supply chains as well as by requiring its subcontractors to act ethically and responsibly.
58 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 59 Who is Gazit-Globe? It’s our people and the experience, talent and commitment they bring to Section building our business and Labor Practices making a difference. & Human Rights 3.
Olde Oakville Market Place, Oakville, Ontario, Canada
60 > Gazit-Globe Corporate Responsibility Report 2011-2012 Introduction LABOR PRACTICES
Gazit-Globe’s employees and One of the core values of our The following table illustrates the number of employees working at Gazit-Globe corporate headquarters, as well as at several management are our most important company is Human Rights, our of its major subsidiaries and holdings included in the scope of this Report, as of December 31, 2012: asset. That is why we and our commitment to support and protect subsidiaries are focused on finding the human rights is central to our global % Permanent Geographic % Full-Time right people to work in our business business. Our company supports Company Employess contract Region employees and providing them with competitive the principles of the United Nations employees pay and benefits, strong training, Universal Declaration of Human Gazit-Globe Headquarters Israel 36 88.2% 100% educational opportunities and Rights, which calls for equality, civil opportunities for career advancement. and political rights and economic, Gazit Israel Israel 70 97% 100% Their health and safety, as well as that social and cultural rights. We believe First Capital Realty Canada 397 98% 97.7% of our tenants and customers, is in the freedom of association of our very important to us and we employ employees and their right to join Equity One USA 177 97% 99% methods to conform with industry labor unions as mandated by law. We Citycon Europe 129 96.9% 94.6% standards in these areas. also strongly oppose child labor and employment of underage minors, as Dealing fairly with our employees is well as forced or compulsory labor. one of the basic fundamentals of our GC1 GC2 GC3 GC4 GC5 HR Programs Code of Business Conduct. We pride The primary focus of our HR programs ourselves on conducting our business is to influence employee commitment, without discrimination based on motivation and engagement through race, origin, religion, gender, sexual Saving Plans best practices, rewards, performance preference, age or disability. Our management and communication. recruitment, employment, training, Our recruitment, employment, training, We strive to create a rewarding, Parental Leave promotion, transfer and termination promotion, transfer and termination stimulating and fun place to work Stock Options of employees are based solely on Loans of employees are based solely on the where individuals are treated with the employee and his/her ability, Vacation employee and his/her ability, achievements, respect and dignity. While we have achievements, experience, conduct a broad base of best practices, the Holiday Gifts and other reasonable business experience, conduct and other reasonable graphic to the right illustrates several Social Activities considerations. GC6 business considerations. benefits that we provide to our Social Benefits employees:
Professional Development Days Reimbursement Basic Disability Coverage Tuition Travel Allowance
62 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 63 Recruitment Job Training and Career Development
Our recruitment procedures are designed to ensure that we hire highly qualified personnel with a strong skill base. Our job training strategy focuses To retain our valued employees During the years 2011 and 2012, The following table illustrates the total number and rate of employee turnover by age, group, gender, and region: on enhancing skills, motivation and and advance their careers, we offer management spent a cumulative 318 ethical behavior and we also work career development opportunities, hours engaged in training programs, (Data for 2012) to encourage and develop employee where possible. Due to the size and and professional employees skill levels and positive attitudes to geographic scope of our operations, spent a cumulative 235 hours on Geographic Total No. of maximize our operations. We also where appropriate we encourage our training. Administrative staff spent Company Under 30 30-50 Over 50 Women Men Region New Hires strive to increase the skill base of employees to move from one position approximately 196 hours on training. Gazit-Globe Israel 8 2 5 1 4 4 our employees by supporting long- to another within our organization in This information relates to staff at term self-development, for instance, order to advance their careers. Gazit-Globe’s headquarters. Gazit Israel Israel 8 1 6 1 4 4 through further or advanced studies. First Capital Realty Canada 92 29 49 14 56 36 Equity One USA 48 16 27 5 28 20 Citycon Europe 28 8 15 5 13 15
Total No. of Geographic Employees Citycon: Company Under 30 30-50 Over 50 Women Men Region Who Terminated Employment In addition to its 129 employees, Citycon indirectly employs a large number of people through the Gazit-Globe Israel 5 3 1 1 3 2 procurement of various services. Gazit Israel Israel 22 7 13 2 13 9 One of the key HR priorities is to build one Citycon by enhancing in-house co-operation and First Capital Realty Canada 42 8 22 12 23 19 interaction both across operational and geographic boundaries. A high-profile project designed to promote cross-border co-operation was the project, where in selecting the winner, special attention Equity One USA 58 10 34 14 43 15 was paid to ways in which the initiative promoted internal co-operation. Citycon Europe 28 0 19 9 11 17 During 2012, there were 469 days of training sessions during the year, the equivalent of 3.6 days per employee.
All employees have their personal competence development plans which are updated every year in discussion with the supervisors. All competence development actions are planned to support the achievement of personal targets and performance in a specific role. Competence development actions include several methods such as internal development events, training, mentoring, on the job learning, etc. Citycon Days, held once a year, is a company-wide development event and held in the spring for all employees. In addition, tailored development programs are planned for specific personnel groups. Training is also offered to improve language skills or develop IT skills in using certain applications. In 2012, Citycon employees completed 469 training and development days, or 3.6 days per employee.
64 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 65 First Capital Realty: Performance Reviews Number of hours of training by gender and employment category
2010 2011 2012 2012 versus 2011 Change (%) Our managers are required to conduct formal and informal feedback. They annual performance appraisals of their include providing the employee with Employment Category Total Males Females Total Males Females Total Males Females Total employees to ensure that expectations feedback for the previous period, are understood, and performance establishing targets for the coming Senior Management 21 21 20 21 17 23 20 -19 16 -7 Citycon: acknowledged and rewarded. period and tailoring a personal short- Middle Management 7 12 11 11 16 22 18 31 97 66 Appraisals are a key element in our and long term development plan. At Citycon, employee performance strategy to analyze employee skill At Gazit-Globe, the CEO personally Professional/Technical 9 12 15 14 6 5 5 -46 -67 -61 review is an essential tool for managing levels and performance on a regular meets with all employees on an annual target-oriented activity and employee Administrative 3 0 8 8 0 3 3 N/A -63 -65 basis and to encourage bilateral basis. skills. In 2012 62.9% of employees constructive communication and both Building Support 0 8 N/A 8 0 N/A 0 -94 N/A -94 were reviewed once, while 26.7% Total N/R 11 11 11 9 7 8 -16 -32 -26 were reviewed twice.
First Capital Realty: Employee Training and Education
Our First Capital Realty (FCR) HarvardManageMentor®: Career As a result of FCR’s significant growth, First Capital Realty: subsidiary encourages its employees Management, Difficult Interactions, many employees have enjoyed Percentage of employees who received formal performance reviews by to advance in their careers. Managers Feedback Essentials, Goal Setting, opportunities to expand their skills gender and employment category are required to conduct annual formal and New Manager Transitions were and expertise. FCR offers a generous performance appraisals of their made available to employees. A employee training and assistance 2010 2011 2012 employees to ensure that expectations management training program for program to its full-time permanent are understood and performance new and mid-level managers was employees. Employees can receive Employment Category Total Males Females Total Males Females Total is acknowledged and rewarded. launched to enhance the skills of its up to a maximum of $1,500 annually Employees are encouraged to take managers. The program focused on towards tuition reimbursement Senior Management 100 100 100 100 100 100 100 professional development courses the role of the manager, recruitment providing the area of study is relevant Middle Management 91 97 97 97 100 100 100 and seminars. FCR also provides and performance management. FCR to his or her current role or will develop Professional/Technical 97 97 94 95 100 100 100 internal training related to company also hosted lunch and learn sessions new skills of mutual benefit to the programs and process changes (e.g., on well-being, personal safety, stress subsidiary. and the individual. Costs Administrative 88 100 95 96 75 98 97 new computer software, employee management, seasonal stress and that are eligible for reimbursement Building Support 83 95 N/A 95 92 N/A 92 benefit programs). gardening with native plants. In include tuition for in-class, on-line/ addition, monthly newsletters from its distance learning courses, exams and Total N/R 97 95 96 97 99 98 In 2012 FCR introduced a number Employee Assistance Program were books. of new training and communication posted on its portal. programs. Five programs from
66 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 67 Gender Age Group Transitioning Gazit-Globe Israel % Women % Men Under 30 30-50 Over 50 to Retirement Board of Directors 0 100% 0 0 1 Management 33% 66% 0 9 0 Professional Employees 60% 40% 1 26 3 Administration 100% 0 7 2 0 Maintenance 100% 0% 5 9 7 First Capital Realty:
FCR provides transition assistance for Gender Age Group Equity One retiring and terminated employees. Diversity and Equal % Women % Men Under 30 30-50 Over 50 Its HR Department and RRSP service Board of Directors 28.6% 71.4% 0 1 8 provider offer assistance to employees Opportunity with pre-retirement planning. The Management 35.7% 64.3% 0 32 10 service provider supplies investment Professional Employees 64.5% 35.5% 16 37 9 information, regulatory expertise and Our recruitment, employment, training, While we and our subsidiaries do Administration 91.7% 8.3% 4 50 18 guidance to employees. When a decision promotion, transfer and termination everything possible to prevent cases Maintenance 0% 100% 0 0 1 is made to terminate an employee, of employees are based solely on of discrimination in the workplace FCR uses a third-party provider to the employee and his/her ability, we understand that there is a need support the employee in this transition. achievements, experience, conduct to establish suitable mechanisms Services include skills assessment and and other reasonable business for handling them, if and when they Gender Age Group employment counseling. Individual First Capital Reality considerations. We conduct our occur. GC6 % Women % Men Under 30 30-50 Over 50 employment contracts and HR expertise business without discrimination based Board of Directors 22% 78% 0 3 6 define the basis of the severance pay. on race, origin, religion, gender, sexual The following graph illustrates the Senior Management 39% 61% 0 10 12 preferences, age or disability. GC6 composition of our governance bodies according to their gender, age group Middle Management 44% 56% 4 57 35 and minority group membership (as of Professional Employees 70% 30% 12 84 19 December 31, 2012): Administration 95% 5% 30 68 33 Maintenance 0% 100% 2 13 19
Gender Age Group Gender Age Group Gazit-Globe Citycon % Women % Men Under 30 30-50 Over 50 % Women % Men Under 30 30-50 Over 50 Board of Directors 20% 80% 0 1 9 Board of Directors 20% 80% 0 3 7 Management 20% 80% 0 4 1 Management Committee 20% 80% 0 2 3 Professional Employees 45.5% 54.6% 2 19 1 Professional Employees 47.3% 52.7% 6 45 23 Administration 88.9% 11.1% 3 5 1 Administration 72.7% 27.3% 6 34 4 Maintenance 0% 0% 0 0 0 Maintenance 0% 100% 1 4 1
68 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 69 Serramonte Shopping Center, Daly City, California, LABOR PRACTICES USA
We are proud that during 2012 no incidences of harassment or discrimination against employees were reported at Gazit-Globe headquarters. GC6
In addition to our Code of Business Conduct, our subsidiaries have formulated procedures for promoting equality and protecting their employees from insult and harassment, including procedures for dealing with sexual harassment. Citycon: Managers oversee the implementation of these procedures, including issuing warnings to During the year 2011, there were no reports of employees regarding possible sanctions. We harassment or discrimination against employees employ all measures required under Israel’s law The personnel survey is a key workplace well-being for preventing sexual harassment. We hold a bi indicator at Citycon. In 2012, a personnel survey annual training session focused on this subject, was not conducted due to organizational changes. the statute is publicly displayed in our offices and The next survey will be conducted in spring 2013. management officers of both sexes are available in case of possible harassment, or for filing complaints.
First Capital Realty: Equity One:
Our FCR subsidiary has clearly defined its expectations of employees, officers and directors in its Code During 2012, OSHA did not perform any inspections of Conduct and Ethics, Anti-Corruption Compliance Policy and Whistleblower Policy. Employees, at our EQY subsidiary; therefore, EQY did not receive officers and directors are required to acknowledge having read these documents and agree to comply any notices of non-compliance or related fines. The with these policies upon joining FCR. Employees are required to re-acknowledge these documents subsidiary is continually evaluating ways to improve annually thereafter. The employee’s manager is responsible for ensuring that he/she completes this health and safety in the workplace and continues to Aerial View: acknowledgement. FCR’s VP, Business Process & Risk Management tracks and reports compliance pursue the necessary means to keep its health and Serramonte Shopping Center, Daly City, California, USA with this directive which was 98% for 2012 to the EVP and CFO. During the reporting period there safety rating at “best-in-class”. were no reported incidents of harassment or discrimination.
70 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 71 HUMAN RIGHTS
Upholding human rights is one of the core values at Gazit-Globe and our All of the companies in the Gazit-Globe Group strongly oppose basic human commitment to support and protect human rights is an inherent part of rights violations. The Group’s companies employ adults who work of their own Gazit-Globe’s multinational business practices. Our respect for humanity is a free will and who receive appropriate pay and decent work conditions. top priority. Employees working for the Company are granted basic rights as mandated by law such as fair wages, rest times, annual leave, convalescence, etc., as well as additional benefits such as social activities, holiday gifts and families gatherings. GC1 GC2 Freedom of
We also respect and support the Association Citycon: Global principles of the United Nations’ Child Labor Universal Declaration of Human Gazit-Globe highly respects the Compact Rights, which, in addition to equality, Gazit-Globe is strongly committed freedom of association of its Respect for Human Rights and include civil and political rights as to the effective abolition of child employees and the right to join labor In 2010, we adopted the principles of well as economic, social and cultural labor. The Company doesn’t employ unions as mandated by laws and Labor Rights the United Nation’s Global Compact rights. GC1 GC2 underage minors and follows all rules regulations. Currently, there are no initiative and incorporated them as part and regulations regarding this issue labor unions at Gazit-Globe. GC3 Within its sphere of influence and legal requirements in the countries where of our business practices. The Global in the countries where it operates. our Citycon subsidiary operates, Citycon respects and supports internationally Compact is an initiative to motivate Forced and We have never been the subject of acknowledged human rights as expressed in the United Nations Universal businesses to align their operations a complaint, investigation or action Declaration of Human Rights and the basic labor rights stated in the ILO and strategies with ten fundamental Compulsory pertaining to child labor. GC5 Declaration on Fundamental Principles and Rights at Work. Citycon will not principles in the areas of human employ forced labor or child labor and respects the right of all personnel to rights, as well as labor, environment Labor decide on joining trade unions and other associations. and anti-corruption. A summary of the Global Compact principles, and how All of the companies in the Gazit- we align our business practices with Globe Group strongly oppose the them, can be found on page 21. GC1 violation of basic human rights. The GC2 GC3 GC4 GC5 GC6 GC7 GC8 Group’s companies employ adults GC9 GC10 who work of their own free will and who receive appropriate pay and decent work conditions. In all of our years of operations, there has never been a single complaint, investigation or action pertaining to forced labor. GC4
72 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 73 Ethical. Helpful. Careful. These are our guide stars in operating a global business with a Section conscience. Social Performance 4.
San Pelegrino Shopping Mall, Caxias do Sul, Brazil
74 > Gazit-Globe Corporate Responsibility Report 2011-2012 Introduction bENEFITING THE COMMUNITY
We are committed to acting as a model corporate citizen. We express this Our shopping centers are through our daily business activities and by making substantial contributions predominantly anchored by supermarket or drug stores, and Citycon: to numerous charitable organizations and initiatives in the areas of education, also include discount retailers, health, welfare, the arts and culture. restaurants, banks, medical clinics as well as smaller local businesses. They Citycon strives to support the local communities in which it operates. They We firmly believe that our business We also appreciate that through our During the reporting period, we were provide a variety of basic necessities, call it “Citycommunity.” of developing, managing and financial support and the volunteer not subject to any legal action for anti- products and services that are typically operating shopping centers and activities of our employees, we can competitive behavior, anti-trust, or required on a regular basis and offer a Citycon’s centers are located close to where the people live and work, medical office buildings has a strong make a difference in the lives of at- monopoly practices. diversity of shopping experiences for so they can be a part of their society and everyday life. There is a natural positive effect on the communities risk populations, in educating future consumers in one easily accessible role in social interaction, which is more than only shopping. CityCon in which our businesses operate. generations and in advancing culture. location. Our medical offices platform, sells more than space; their operations are driven by the fact that they which is engaged in acquiring and are in a hospitality business, where they want to attract and bring people managing medical office buildings together in their shopping centers, because they need or want to be adjacent to best-in-class teaching there. One concrete way to create a positive customer experience hospitals and research institutions in and enhance communality is through focusing on digital marketing urban neighborhoods with growing like Facebook. At the end of the year, Citycon invited consumers on populations, provide attractive, Facebook to take part in shopping center development activities. This convenient premises for the medical involves four groups of different-age consumers discussing various ways profession and patient populations. of developing the local shopping center. In Finland, CityCon increased its number of ‘fans’ on Facebook by a factor of six during the year.
First Capital Realty:
FCR renovated an abandoned contaminated industrial property transforming it into First Capital Realty: an attractive neighbourhood community shopping center. A historic building in FCR annually sponsors a competition for wall art with the the Leaside community was preserved Ontario College of Art and Design University (OCADU) in and repurposed and more importantly, re- Toronto, Ontario. With this art program, FCR provides an established its historic prominence in the opportunity at selected properties for students to exhibit their community. The improvements incorporated creativity in a public space while elevating the aesthetics of its strong environmental and sustainable properties. attributes.
76 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 77 Support the Community Citycon: Equity One:
Citycon is implementing several value-added initiatives at its EQY is proud to provide annual continual Kista Galleria shopping center in Stockholm with the addition annual support to many charitable Above and beyond our business The primary focus of our communal of “Kista Idea City”, an extensive, state-of-the-art digital organizations and events and to regularly activities, we believe that it is both a investment, however, is on library scheduled to open in August 2014. The library is a key grow that level of support whenever duty and a privilege to contribute to education with a particular emphasis element of Citycon’s on-going program to nurture stronger possible. As EQY has expanded into the community. Several years ago, on achievement, leadership and community ties, apply principles of sustainability, and further different regions, it has also been given we formulated a Social Investment social responsibility. Nearly half of strengthen the financial performance of its largest shopping the opportunity to make an impact in new Policy which outlines our Group’s our contributions to the community - center. A joint investment with the City of Stockholm, the areas and to come up with fresh ideas for commitment to contribute, invest NIS 2,541,000 - supported 2,400-square-meter library will feature the latest digital how it can enhance the lives of others. and assist the community, as well educational initiatives in 2012, technology in addition to traditional books, offering its visitors These include The Bowery Mission to as our philanthropic activities and and 46% of our support – access to various tablet and other computers, interactive which EQY contributed $15,000 towards opportunities for employees who NIS 2,656,000 - was targeted for services, and a café. its efforts to aid the homeless; serving wish to volunteer their time to programs in education in 2011. food at Camillus House, a Miami-based, various organizations. The policy We believe that education is a full-service homeless shelter; contributing is established by our Corporate fundamental and essential element in to the March of Dimes in Miami, Florida, Responsibility Committee which is bringing about change in society and to garner support for research related to comprised of Gazit-Globe board in reducing societal and economic treating and preventing medical issues members and management. The inequality. that threaten the health of newborns and committee determines the guidelines babies; and contributing to OneBlood of contributions, monitors their Our employees are also encouraged in North Miami Beach, Florida, which effectiveness and the influence to volunteer their time to non-profit First Capital Realty: collects blood donations and provides of sponsored projects, as well as organizations and volunteer programs. them to hospitals. employee volunteerism. FCR understands that when it acquires a shopping center, constructs a new During 2012 we donated development or redevelops an existing NIS 5,220,000 million to educational property, it creates an impact on people and charitable organizations that in their neighborhoods. It therefore share our values. Those values include strives to create environments and promoting academic excellence, amenities at its shopping centers to Citycon: reducing societal inequality and enhance the communities’ experience assisting young people. Our corporate of “Shopping for Everyday Life.” One Citycon’s Kista Galleria in Stockholm boasts a wet-waste philanthropy extends to organizations example is FCR’s creation of the Vaughan conversion system to collect wet waste from its food court and and initiatives that are involved in Imagination Zone in the atrium of a new process it into biogas. Each month it produces sufficient fuel to health, education, welfare, arts and development, Rutherford Marketplace in power about 12,000 km of the local bus system’s operations. culture, primarily in Israel, the US Vaughan, Ontario. Working in close collaboration with the City of Stockholm and and Canada. In 2011 we donated Stockholm Water, this environmentally and financially beneficial NIS 5,790,000 million. project is one means by which Citycon is improving its sustainability performance.
78 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 79 Customer Satisfaction Anti-Corruption
We regard client satisfaction as a Our Code of Business Conduct states at our company and those of our Practices Act of 1977, as amended top priority. Clients of Gazit-Globe’s that Gazit-Globe and its employees subsidiaries. The survey’s findings (“FCPA”). The FCPA’s anti-bribery subsidiaries can be divided into must maintain high ethical and were examined and discussed by provisions prohibit making payments, two groups: tenants, who rent professional standards in dealing the managements of our companies promises or offers of anything of stores in our shopping centers, and Citycon: with government officials and the and they also come under discussion value to foreign government officials consumers who use the facilities private sector. In addition, Gazit- by our Board’s Audit Committee. or employees (at any level), political and stores in the shopping centers. Citycon’s Swedish portfolio comprises shopping centers in locations Globe property or services must not We are strictly implementing its candidates, or political party officials, We check the satisfaction level of with steady traffic and a strong base in grocery and fashion. The be given, either directly or indirectly, to recommendations and decisions, to obtain or retain business or to these two client groups through centers are designed to meet the needs of consumers and are anyone in an improper effort to obtain and, over time, examining its secure an improper advantage. surveys at our shopping centers. conveniently located between their work and residences. Citycon or retain business or to obtain special implementation according to the These surveys enable management conducts customized market surveys at all of its Swedish shopping or unusual treatment in connection recommendations and our discussions The jurisdictional reach of the FCPA to understand the needs of our centers. The surveys help to pinpoint targets for improvements in the with any business transaction. The of the subject. Our company can be broad and we require full clients and consumers and result company’s operations. These included issues related to engaging Code also states that employees implements work procedures compliance with the FCPA and all in improved service and greater the customer. As a result of the surveys, several shopping centers must not engage in unfair, deceptive and controls, as well as various other applicable anti-corruption laws satisfaction on their part. In consumer established measurable goals relating to offers, loyalty, goodwill, or misleading practices, and that internal control activities including by all of our employees, officers surveys, participants are asked to etc. and steps have been taken to implement them throughout the employees must always represent the questionnaires and disclosure and representatives, regardless of rate their overall satisfaction with the organization. Citycon shopping centers hold team meetings to improve company in an honest and forthright committees, and also established a citizenship or work location. Violations shopping center and specific issues the customer’s retail experience. Management also communicates manner. Employees must also not reporting hot line in order to minimize of such laws can carry severe civil and such as store variety, their shopping with tenants through monthly meetings,newsletters and on Facebook. take unfair advantage of any person our exposure. We have also further criminal penalties for the Company experience, and café and restaurant Suppliers are also actively selected who support hospitality. by manipulation, concealment, strengthened our internal control and its employees and representatives diversity. abuse of privileged information, systems by complying with provisions personally. Violations of company In addition, each shopping center has a local public relations plan misrepresentation of material facts, of the U.S. Sarbanes-Oxley Act which policies can have severe employment which is updated monthly and implemented. or any other unfair dealing practice. establishes standards, among other consequences, up to and including We also retain an internal controller things, for the prevention of fraud. termination. and external accountant to facilitate The Company also conducts anti- transparency, responsibility and anti- corruption tests following its auditor’s All employees are required to comply corruption throughout the Group. report. Within this framework, a with the policies and guidelines GC10 survey was conducted among our set forth in our Anti-Corruption subsidiaries. Compliance Policy. The Policy applies Most of our employees receive training to our Company, our privately-held in our Code of Business Conduct, Following our public offering of subsidiaries, as well as to those acting which includes information about our securities in the US in 2011, we are on behalf of the Company, including anti-corruption policies. also committed to complying with laws officers, directors, employees, and to the highest ethical standards in stockholders, dealers and other Within the framework of our multi-year all of our business conduct, including agents of the Company. audit plan, we carried out a survey strict compliance with the letter and related to embezzlement and fraud spirit of the U.S. Foreign Corrupt
80 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 81 First Capital Reality: Equity One: Citycon
Our FCR subsidiary has clearly defined its expectations of Our subsidiary, EQY’s Code of Citycon’s Code of Conduct lays down In addition, Citycon and its Removing discrimination from employees, officers and directors in its Code of Conduct Conduct and Ethics document is the ethical principles and business stakeholders engage in dialogue workplaces and professional life. and Ethics, Anti-Corruption Compliance Policy and provided to each of its employees standards that the company adheres on the principles underlying ethical Offering a safe and healthy Whistleblower Policy. Employees, officers and directors at the commencement of their to in its operations. operations. Within its sphere of working environment for are required to acknowledge having read these documents employment. It is also posted on influence, Citycon aims to ensure that employees. and agree to comply with these policies upon joining the its corporate website. The Code The Code of Conduct lays the its partners and subcontractors also foundation for its business operations. adhere to Citycon’s to ensure that its organization. Employees are required to re-acknowledge introduces each employee to EQY’s Read more at: www.citycon.com/ It guides Citycon’s management and partners and foundation of all our new these documents annually thereafter. The employee’s expectations regarding its ethics sustainability/code_of_conduct/ manager is responsible for ensuring that he/she completes and anticorruption policies and personnel regarding ethical business and existing business relationships. practices and compliance with laws The ground rules based on Citycon’s this acknowledgement. The VP, Business Process & Risk sets the stage for proper conduct. Citycon does not support the activities and regulations in effect in each business relationships are: Management tracks and reports compliance with this It is important to EQY to provide of any political parties or political country. As stated in the Code, Citycon directive which was 98% for 2012 to the EVP and CFO. a workplace conducive to open Openness and integrity in all groups. However, Citycon wants to assumes responsibility for all issues During the reporting period there were no reported incidents discussion regarding its business operations. engage in open dialogue with regional it has the authority to control within of harassment or discrimination. GC10 practices. As part of the Code, EQY Adherence to statutory rules and officials and political decision-makers the scope of its operations. Citycon employs an independent contractor regulations. in its operating areas. In 2012, in (Ethics Point, Inc.) to administer an adheres to the Code of Conduct in Zero tolerance of corruption and connection with the zoning or planning unbiased and confidential reporting all of its operating countries without bribery. of its development projects, Citycon’s exception. Internal communication mechanism by which employees and representatives participated in the and training is provided to help Adherence to the principles of members of the public can report any meetings of municipal political bodies. employees adopt and comply with sustainable development. suspicious or potentially unethical The objective of participation was to the principles specified in the Code. Taking environmental issues into FCR’s Principles to Work by: dealings. This hotline is available increase interaction and to learn more Citycon’s employees are continuously account in daily operations. 24/7, does not trace or record calls about municipal decision-makers’ Conduct ourselves in a forthright and honest manner encouraged to raise issues related and allows reporting individuals to Respecting human right. local community development ideas. Be fair and considerate in all deallings to the Code and to report on any remain anonymous. During 2011, no Recognizing the right to assembly possible compliance problems. Maintain professional behaviour in all relationships calls or complaints were reported to and the right to collective A separate reporting procedure Make only commitments we believe that we can Ethics Point. GC10 bargaining. keep - and keep them has been established for bribery, Banning the use of child and Respect the rights and dignity of all individuals corruption or fraud; this procedure is forced labor. Obey the law described in Citycon’s Whistleblowing Policy. Values to live by: Equity Fairness Dignity
82 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 83 Risk Management Anti-Competitive Behavior
Risk Management includes our ability management applies to each and risk management (e.g. implementing to identify, assess and treat deliberate, every one from our Board of Directors activities to secure data and acquiring systematic and consistent risks that to management and down to the last insurance policies), and managing threaten our achievement of goals employee – everyone in their area of legal risks (for example, through and objectives, as well as the ability to responsibility and activity as a part of the use of enforcement programs). analyze events, draw conclusions and our organizational culture. We also adopted the familiar and take actions to reduce damage and accepted COSO model to manage prevent future recurrences. We engage in risk mapping, and this subject. it specifies specific activities for Our approach is that risk assessment managing the material risks inherent In addition, we implement a series is not a separate process or operation, in our operations and in corporate of audit and internal control activities but an integral part of our routine control, including financial risk that are aimed at strengthening our daily operations and management. management (such as making internal structures and systematic Hence, the responsibility for risk hedging transactions), operational risk management of our various activities and those of the companies we control. We also comply with Israel’s ‘Goshen‘ ISOX Committee requirements, and subsequent to our IPO in the United States and the listing of our shares on the NYSE during 2011 we are further strengthening our internal control systems and our compliance with U.S. law (Sarbanes Oxley).
We are working systematically and consistently to strengthen our corporate governance as well as our risk management. In 2011, (in recognition of the importance of this issue, we appointed a manager that specializes in this area, given that this The Group meets all statutory discrimination. During the reporting is not a one-time project, but an area requirements and avoids any period, the Company was not subject that requires professional oversight practices intended to subvert or to any legal action for anti-competitive over the long term as an integral eliminate competition and refrains behavior, anti-trust, or monopoly part of our ongoing activities and from price-fixing contracts and price practices. management.
84 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 85 Health & Safety Equity One: First Capital Realty:
The health and safety of the employees, tenants, patrons and FCR’s health and safety policy also fosters a other stakeholders present within the offices and operating safe and healthy work environment. Employees Introduction properties are a high priority for EQY. They administer safety must comply strictly with the letter and spirit protocols through regular internal communication channels such of applicable occupational, health and safety We regard the health and safety of our as supervisor/employee meetings, security services at certain laws and the public policies they represent. employees, tenants and customers properties, bulletin board postings, memos and other written They must not engage in illegal or dangerous with the utmost importance and Citycon: communications. In addition, EQY continues to monitor their crisis behavior and are required to report promptly take all possible measures to management plans to ensure that all pertinent personnel are fully any accident, injury or unsafe equipment, ensure conformity with the strictest In occupational health activities, Citycon’s main focus is on preventive trained on potential man-made and natural disaster responses. practices or conditions or violent behavior. FCR standards. Our subsidiaries arrange action, for example ergonomics and ways of maintaining work capacity. has zero tolerance for acts of violence, threats training for security personnel, Citycon also offers an extensive range of health care services. Other ways In 2012, there were no work-related injuries or illnesses. In 2011, of violence, acts of intimidation and hostility develop crisis management protocols of promoting employees range of health care included exercise vouchers, there were two reported work-related injuries that were very minor towards another person or group of persons. and implement comprehensive health which employees can use to pay for their fitness activities. Citycon in nature and did not cause any related absenteeism. During 2011 and safety policies for the optimal also paid its employees’ participation fees in various sporting events. and 2012, OSHA did not perform any inspections; therefore, In addition, the Company has a practice to operation of their properties and the the company did not receive any notices of non-compliance or evaluate the health and safety impacts of its safety of employees and customers. The theme of its 2012 Citycon Days, an annual event that brings the entire related fines. EQY is always evaluating ways to improve health and buildings and shopping centers at certain life personnel together for a few days, was stress management and mental safety in the workplace. We will continue to pursue any avenues cycle stages. When designing a new shopping well-being. Due to the nature of work carried out by Citycon personnel, necessary to keep our health and safety rating at best-in-class. center, the design team is responsible for work-related accidents are infrequent. ensuring that buildings and properties comply In 2012, the company consolidated employee benefits under with regulatory requirements related to health During 2012, there were no accidents resulting in absence. one carrier, United Healthcare. The move to United from Oxford, and safety. When demolishing buildings, the First Capital Realty: Humana, Blue Shield of California and Lincoln Financial provided contractor responsible for demolishing the To ensure the safety of shopping center personnel and customers, Citycon the employees with a richer network of doctors and hospitals structure is responsible for ensuring that the FCR’s employee benefits include acquires the services of security guards and security officers from its as well as deeper discounts on medical services requiring a demolition is conducted in a safe manner. health care and life insurance. Its partners. In all of Citycon’s operating countries, the security guards must coinsurance payment. EQY offers full medical, dental and vision Employee Assistance Program is a complete a training program where issues such as risky situations and health plan coverage to all full-time employees after they have voluntary and confidential support liaising with minority groups are discussed. completed 30 days of service. service that helps employees and their immediate family members In Finland a crisis management simulation training is arranged every two EQY administers safety protocols through regular internal with everyday work, health and years (the training was last held in 2012). In Sweden a crisis management communication channels such as supervisor/employee meetings, life issues, as well as major life simulation training was arranged in 2012. security services at certain properties, bulletin board postings, challenges. memos and other written communications. EQY continues to There were no incidents of Citycon’s non-compliance with regulations and monitor crisis management plans to ensure that all pertinent voluntary codes concerning health and safety impacts of products and personnel are fully trained on potential man-made and natural services. disaster responses.
In 2012, there were no work-related injuries or illnesses.
86 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 87 For us, environmentalism starts with the first shovel in the ground.
Section Environmental Performance 5.
Galeria Dominikanska, Wroclaw, Poland
88 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 89 Introduction Citycon: Case Study
We believe that protecting the use and conservation of water in all The following graph illustrates the strategic objectives for environmental responsibility that have been established by environment is important from both of our operations. We are sensitive to Citycon, as well as new annual objectives: an environmental and a long-term protecting the biodiversity of species Targets for Results for Targets for economic point of view. This belief in their natural habitats, examining 2012 2012 2013 translates into action: We adhere biodiversity issues in our efforts to to innovative green-construction obtain LEED certification for our Climate Change principles and building standards projects, as well as building permits Reduction of greenhouse gas emission In l-f-l shopping in a growing number of our projects and zoning variances. Several of by 20% by year 2020 from the 2009 2-3% √ 2-3% centers-3.3% throughout the world. Our overriding our subsidiaries have implemented level goal is to improve the environmental a variety of waste, emissions and Energy footprint of our operations, become sewage management policies. In more energy efficient and minimize general, we strive to carry out the Reduction of energy consumptin In l-f-l shopping (electricity, heating and cooling) by 9% 2-3% o 2-3% environmental damage associated activities that have an environmental centers-1.7% with our activities. GC7 GC8 GC9 impact, such as the construction by 2016 from 2009 level and maintenance of our commercial feasibility study in Identifying solution that utilise renewable An integral part of our strategy buildings in an environmentally _ In progress √ (re) development energy for minimizing our environmental responsible manner. GC7 GC8 GC9 projects footprint is to decrease our use of Water natural resources, energy and non- perishable materials, while increasing Lowering water consumption to an In l-f-l shopping 4.0 l / visitor √ 3.9l / visitor our use of recycled materials. For average level of less than 3.5 liters centers-3.9l / visitor instance, we promote responsible Waste
Shopping centre waste recycling rate to 78% 83% √ 80% be raised to at least 80% by 2015
Reduction of landfill waste to a 22% 17% √ 20% Citycon: Case Study maximum of 20% of total waste by 2015
Land Use and Sustainable Construction In March 2012, Citycon created a Green All Projects All Projects All development projects to be campaign for its shopping centers. ongoing in 2012 ongoing in 2012 implemented in accordance with Achieved √ In addition, almost all of Citycon’s shopping as sessed with as sessed with environmental classification principles centers participated in Earth Hour. LEAD criterias LEAD criterias
Development projects are located in built-up enviroments witin reach of good 100% Achieved √ 100% public tranport connection
√ Achieved o Nearly Achieved 90 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 91 GREEN BUILDING
Over the past few years, we have made amount of CO2 emissions and office buildings in the Greater Toronto Some of our achievements in green Case Study As of December 31, 2012, 27 major strides forward in our efforts to greenhouse gas (GHG) emissions. Area. FCR also installed geothermal building include: First projects at 18 properties comprising incorporate green building practices. Measures to reduce GHG emissions technology at three properties during 548, 829 square feet of GLA or
According to the US Environmental from buildings fall into one of 2012: Broadmoor Shopping Centre in Case Study Capital Realty: 2.2% of the Company’s GLA were Protection Agency, green building is three categories: reducing energy Richmond, British Columbia, Leaside Citycon: certified to LEED. The Company had In May 2006 FCR made a commitment defined as “the practice of creating consumption and embodied energy Village in Toronto, Ontario and Fuzion another 78 projects at 45 properties During 2012, CityCon was awarded to build all new developments to structures and using processes in buildings, switching to low-carbon condominium, a residential and retail encompassing 2.2 million square feet the Green Star level in the global LEED standards, the first shopping that are environmentally responsible fuels including a higher share of property in Toronto, Ontario, Canada. of GLA under development, in the GRESB (Global Real Estate center developer in Canada to and resource-efficient throughout renewable energy, or controlling the Geothermal technology typically uses process of construction or awaiting Sustainability Benchmark) survey. make this commitment. LEED is a building’s life-cycle from siting to emissions of non-CO2 GHG gases. heat pumps to transfer heat from the LEED certification. These projects It also reached the gold level in an internationally recognized green design, construction, operation, GC8 ground to a building during the winter combined represent 9.1% of the EPRA (European Public Real Estate building rating system. It uses a whole- maintenance, renovation and season. Conversely, in the summer Company’s GLA. Association) sustainability reporting. In building approach to sustainability by deconstruction. This practice expands Some of our achievements in green season this cycle is reversed, with the addition to its sustainability reporting, addressing five key areas: sustainable and complements the classical building include: FCR continues heat being transferred from a building BOMA BESt (Building its financial reporting also won agold site development, water efficiency, building design concerns of economy, to develop its properties to LEED and rejected into the ground. Environmental Standards) medal, making CityCon a double energy efficiency, material selection utility, durability, and comfort. standards. As of December 31, In 2011 FCR began the process of winner. and indoor environmental quality. Green building is also known as a 2012, 28 projects at 19 properties Finally, the Company implemented seeking BOMA BESt certification for The Vice-President of Construction ‘sustainable’ or ‘high performance comprising 603,000 square feet of water conservation measures, such existing properties. BOMA BESt is for each region is accountable for building’.” GC7 GC8 GC9 gross leasable area (“GLA”) were as installing sensors and retrofitting the largest environmental assessment ensuring that all new development certified to LEED standards. sprinklers, at several properties. Gazit and certification program for existing Case Study projects comply with this company Green building often includes All of these initiatives enhance buildings in Canada. Building directive. Quarterly updates on taking measures to reduce energy Another 78 projects at 45 properties the Company’s environmental Israel: owners complete a questionnaire the LEED certification status of consumption – both the energy comprising over 2.2 million square feet performance, and many of them that critically evaluates six key areas Gazit Israel constructs its new these projects are submitted to the required to extract, process, transport of GLA are under development, in the reduce operating costs, benefitting of environmental performance shopping centers according to Israeli Chief Sustainability Officer and the and install building materials, as well as process of construction or awaiting FCR’s tenants and shareholders. and management: energy, water, standards related to preventing air Sustainability Council. operating energy required to provide LEED certification. Reducing energy waste and site, emissions and services such as heating and power consumption is also key, and the and water pollution, sewage, waste, As of December 31, 2011, 21 effluents, indoor environment, and for equipment. To reduce operating Company has implemented several and noise. Among other things, projects at 15 properties comprising environmental management systems. energy use, high-efficiency windows energy conservation measures, such the company places an emphasis 330,584 square feet of GLA or These standards address the and insulation in walls, ceilings, and as retrofitting lighting to more efficient on climate control in its structures 1.4% of the Company’s GLA were environmental performance of existing floors increase the efficiency of the technology. especially in places where there are certified to LEED. The Company has buildings based on independently building envelope and solar water large internal spaces, and is careful to another 62 projects at 42 properties verified information. As of December heating further reduces energy costs. FCR entered the Barrymore and 85 use the appropriate glass sheathing. encompassing 1,981,502 square feet 31, 2012, 20 properties comprising GC7 GC8 GC9 Hanna Avenue buildings into Race to For example, in its Ikarim House under of GLA under development, in the 1,580,169 million or 6.3% of the Reduce, a Greening Greater Toronto construction, the three upper floors process of construction or awaiting Company’s GLA were certified to The energy used to heat and power initiative aimed at reducing total passed an examination for energy LEED certification. These projects these standards. buildings accounts for a substantial energy use by 10% in participating efficiency. GC8 combined represent 8.5% of the Company’s GLA.
92 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 93 CONSERVATION AND RECYCLING Energy
Case Study Case Study consumption and consumed 42% of Equity One: First First its energy. Enclosed shopping centers Gazit comprised 26% of its GLA reporting Case Study Recycling Activities Case Study Capital Realty: Capital Reality: energy consumption and consumed Israel: 50% of the energy. Office buildings Equity One, our US-based subsidiary, Due to varying local recycling and Energy in the form of natural gas and The Company signed a supply comprised 2% of the GLA reporting has launched an extensive recycling waste markets across the country, electricity supplies heating, cooling agreement with Dorad Energy for energy consumption and consumed program across its entire portfolio FCR currently does not have a and power to FCR’s properties. In each of its centers, and from January 8% of the energy. of shopping centers and within its national comprehensive, recycling/ most cases, tenants in its open air 2014, about 80% of energy that will corporate offices. The program waste program for its properties. shopping centers are separately be produced for the centers will Because FCR’s portfolio comprises includes the recycling of glass, However, in 2012 FCR spent $3.7 metered for natural gas and electricity be produced by turbines powered primarily open-air shopping centres, plastic, metal, wood with the goal of million on waste recycling/disposal consumption. They pay the utility by more environmentally-friendly most of the subsidiary’s energy decreasing the generation of solid costs across its entire portfolio. It companies directly for their energy natural gas. Our Company and its subsidiaries use consumption is used to power exterior waste, encouraging recycling and also has a comprehensive waste consumption. At its Yavne center, Gazit Israel a variety of resources and materials in common area building and parking creating a positive impact on natural reporting system in 40% of its portfolio avoided installing a central air our commercial offices and shopping lot lighting. resources and the environment. representing 10.1 million square feet Due to the design of the mechanical conditioning system that consumes centers, ranging from energy and To date, the implementation of this of GLA. For each property in these and electrical systems of its enclosed energy and water, and air conditioning water to office equipment, paper, program has saved over $730,000 regions, a waste report is generated shopping centers and offices, not all of systems of the tenants will be cost- ink toner, bottles and packaging. on the company’s waste removal identifying the recycling/waste stream, FCR’s tenants are separately metered effective VRF systems. An integral part of our strategy for expenses, and has increased the quantity of recycling/waste generated for heating, cooling and power. FCR’s minimizing our environmental footprint recycling of its total waste stream from and method of disposal or diversion. open air shopping centers comprised is to decrease our use of natural 20% to 47%. This has saved over 72% of FCR’s GLA reporting energy resources, energy and non-perishable 12,000 cubic yards of landfill space. materials, while increasing our use of recycled materials. We also strive to Community Waste Events collect used products and materials To celebrate Earth Day 2012, FCR for recycling and/or re-use. hosted electronic waste events at several of its shopping centers In our shopping centers, we employ collecting over 19 tons of electronic conservation measures wherever waste, 1,000 liters of unused paint possible, ranging from the installation and 15 kilograms of batteries. of water-saving devices in restrooms 2009 - 2012 Energy Consumption for Gazit-Globe’s Headquarters: to the employment of ‘dry garden’ principles in landscaping, the recycling 2009 2010 2011* 2012* of packaging materials and the use of low energy lighting and alternative kWh 201,317 kWh 261,761 kWh 142,420 kWh 183,072 energy sources. GC9
* This data relates to Gazit House in Tel Aviv, Israel. [HSA -T1]
94 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 95 Energy
Case Study First Citycon: Case Study Capital Realty: Energy In 2012, CityCon’s total energy consumption was 2,718 Mwh. It procured a total of 183.4 gigawatt hours of electricity in 2012. The annual target for reduction in energy consumption was achieved. The total consumption of primary energy in Citycon was 1,956 terajoules. First Capital Realty’s 2012 Energy First Capital Realty’s 2012 Energy Consumption and Costs by Energy Consumption and Costs by Energy Source in Open-Air Shopping Centers Source in enclosed Shopping Centers Energy consumption by property type
Electricity Source Consumption (kWh) Source Consumption (kWh) Total Energy Type of Waste Stream Consumption in Heat Consumption Consumption* Common Areas Natural Gas 21,972,000 Natural Gas 13,910,000 2009 Electricity 49,882,000 Electricity 37,542,000 Shopping Centers 92,217 108,966 201,378 Other Retail Properties 16,193 30,529 46,769 Total 71,854,000 Total 51,452,000 2010 Shopping Centers 91,596 136,142 229,217 Other Retail Properties 13,256 35,200 48,584 2011 First Capital Realty’s Energy First Capital Realty’s Energy Consumption (kWh) in Open-Air Consumption (kWh) in enclosed Shopping Centers 92,520 109,655 204,862 Shopping Centers Shopping Centers Shopping Centers 21,189 28,498 49,746 2012 Shopping Centers 90,657 115,285 210,155 31% 27% Shopping Centers 19,002 28,110 47,129
69% 73% Change-% in SC 2012/2011 -2.0% 5.1% 2.6% Change-% in Other 2012/2011 -10.3% -1.4% -5.3% Natural gas Natural gas Change-% in SC 2012/2009 -1.7% 5.8% 4.4% Electricity Electricity Change-% in Other 2012/2009 17.3% -7.9% 0.8%
96 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 97 Energy
Citycon: Case Study Citycon: Case Study ENERGY CONSUMPTION energy consumption
Electricity The following graph illustrates the consumption of natural gas or electricity at Citycon’s different categories of shopping Total Energy MWh Consumption in Heat Consumption centers for the years 2010 through 2012, including the percentage change from 2011 to 2012. Consumption* Common Areas Change (%) 2009 108,409 139,495 248,147 Asset Class 2010 (MWh) 2011 (MWh) 2012 (MWh) 2011 Versus 2012 2010 104,853 171,342 277,801 Open-air Shopping Centers 2011 113,710 138,163 254,608 Natural Gas 19,452 20,029 15,338 -23 2012 109,659 143,395 257,284 Electricity 47,802 47,010 44,535 -5 Change-% 2012/2011 -3.6% 3.8% 1.1% Total for Asset Class 67,254 67,038 59,874 -11
Change-% 2012/2009 1.2% 2.8% 3.7% Enclosed Shopping Centers
Natural Gas 23,991 28,693 26,261 -8 Electricity 48,387 46,574 45,504 -2 energy consumption in like-for-like shopping centers Total for Asset Class 72,377 75,226 71,765 -5 Electricity Total Energy MWh Consumption in Heat Consumption Office Buildings Consumption* Common Areas Natural Gas 5,136 4,734 4,239 -10 2011 68,773 83,008 153,600 Electricity 7,540 7,561 7,649 1 2012 65,213 84,300 151,007 Total for Asset Class 12,676 12,295 11,888 -3 Change-% 2012/2011 -5.2% 1.5% -1.7% Entire Portfolio 152,307 154,599 143,527 -7
2010 and 2011 energy consumption and costs were updated to reflect Citycon’s portfolio as of December 31, 2011.
*Total energy consumption incl. electricity in common or gas heating and cooling
98 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 99 Energy 996,433 kWh (31%) saved
Equity One: Case Study Equity One: Case Study TOTAL LIGHTING CONSUMPTION TOTAL LIGHTING CONSUMPTION
4,133,595 kWh 3,173,162 kWh 30.9% Saved 26.2% Saved 20.5% Saved 24.8% Saved Consumed Consumed
2011 2012 kWh kWh kWh kWh
TOTAL LIGHTING CONSUMPTION kWh 762,847 370,830 607,568 391,960 kWh kWh kWh
34% Saved 9.1% Saved 41.5% Saved 14.6% Saved 294,600 273,555 527,071 482,759 kWh kWh kWh kWh kWh kWh kWh kWh kWh 235,776 kWh 97,360 97,275 288,465 867,520 523,993 320,412 124,809 kWh 788,640 273,593 kWh kWh 190,249 2011 2012 Saved 2011 2012 Saved 2011 2012 Saved 2011 2012 Saved 306,695 kWh Sheridan Plaza Shoppes of Oakbrook Shops at Skyline South beach Regional 217,298 kWh 98,216 kWh 46,819 78,880
2011 2012 Saved 2011 2012 Saved 2011 2012 Saved 2011 2012 Saved Daniel Village Buckhead station Lane Mary Centre Pavilion
100 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 101 Energy Conservation
Case Study Case Study Case Study
We consume significant amounts Company continues to upgrade Race to Reduce: The Company of energy to light, heat and cool lighting systems with motion sensors, registered 85 Hanna Avenue and the Equity One: Citycon: Equity One: our properties. As such, we photo cells and astronomical timers. Barrymore building as participating Lighting/Energy Ecology and Economy Solar Power Generation are increasingly focused on the First Capital Realty retrofitted existing buildings in Greening Greater Management
conservation of energy in all of our lighting to more energy-efficient Toronto’s Race to Reduce, a Greater EQY has initiated a pilot program At Citycon, ecology and economy operations, and on the utilization of technology, such as LED, in numerous Toronto CivicAction Alliance initiative. EQY installed a 200kW solar array at on eight of its properties in Florida go hand in hand. To achieve its alternative energy sources where properties including Shops at King This challenge aims to reduce energy its Webster, Massachusetts property and Georgia to install energy environmental targets, Citycon applies possible to operate our shopping Liberty, Parkway Mall Rutherford consumption by participating office which provides benefits to its grocery management systems on common the following principles: centers and other properties. This is Marketplace and Southpark. At buildings by 10 percent over a four- tenant. The system generated nearly area parking lot lighting. The systems a quarter of a million kWh during 2012 an ongoing process which has not yet Wellington Corners, exterior lighting year period. Taking the environment into account were installed to reduce or eliminate bringing lifetime production to nearly been implemented fully throughout was re-wired to provide flexibility to in all operative functions. unnecessary lighting after operating our operations. GC7 GC8 GC9 turn off zones during non-operating FCR spent approximately $5.9 million half a million kWhs since inception in hours. As a result, EQY reduced Complying with statutory rules periods without compromising public on environmental expenditures in 2010. EQY is continuing to evaluate the overall landlord-controlled and regulations, and preparing security. Consequently, the electricity 2012. further opportunities for renewable energy consumption of this group of in advance for future legislative energy sources at its properties. Case Study consumption in 2012 at Wellington properties by nearly a million kWh. EQY changes through active monitoring First Corners decreased by 10 percent The following graphs illustrate the expects to deploy additional systems of transformations in society. from 2011. Working with cleaning nitrogen oxide, carbon dioxide and strategically across its portfolio. It Capital Realty: staff to co-ordinate turning off lights Continuously developing the sulfur dioxide avoided by Equity One also deployed a pilot for LED parking manually after hours, the Tillsonburg management, steering and reporting during the years 2010, 2011 and 2012, lot lighting at one shopping center in In 2012 First Capital Realty continued Town Centre reduced its energy of environmental practices. as well as kilowatts generated during Florida to replace inefficient lighting, those years: to implement energy conservation consumption by 13 percent in 2012 Expecting partners to operate in a and EQY anticipates that the new measures in its portfolio. The compared to 2011. way that supports the fulfillment of LED fixtures will reduce overall Citycon’s agenda. consumption by 67%. Ensuring that the company rate in a FCR ENVIRONMENTAL EXPENDITURES way that supports the fulfillment to all stakeholders. Change (%) Category 2010 ($) 2011 ($) 2012 ($) 2011 Versus 2012 Guiding personnel towards sustainability in environmental issues Building Certifications 665,000 658,100 1,296,700 97 through goal setting, training and Consulting 323,000 65,000 186,800 187 internal communications. Legal 177,000 183,400 82,000 -55 Through its environmental program, Citycon aims to curb climate change, Liability Insurance 110,000 143,000 182,600 28 improve energy efficiency, reduce Site Assessment and Remediation 1,766,000 3,439,500 4,168,400 21 water consumption, enhance waste management and promote sustainable Total 3,041,000 4,489,000 5,916,500 32 construction and land use.
102 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 103 Energy Conservation
Case Study Case Study hours. Each fixture within the parking lighting at one shopping center in Equity One: Citycon: lot is fitted with an individual controller Florida. This property previously so that the kWh reduction on the utilized incandescent light fixtures for the under-canopy lighting and Citycon aims to increase its energy- lighting system is maximized and high-pressure sodium fixtures for the efficiency at each of its properties using we are able to optimize scheduling pole lighting in the parking lot areas. consumption data, energy audits and around tenant operations. During the These antiquated fixtures were not equipment life cycle analyses. Total reporting period, EQY was able to Kilowatts Generated (kWh) Nitrogen Oxide Avoided (Lbs) only inefficient, but they also did kWh NOx energy consumption in like-for-like reduce the overall landlord-controlled not provide optimal lighting for the shopping centre properties decreased energy consumption over this group shopping center. EQY anticipates of properties by 996,433 kWh. They by 1.7 per cent in 2012 compared to these new LED fixtures will reduce the expect to deploy additional systems 617 the previous year. Energy consumption overall consumption at this center by strategically across the portfolio in in properties constitutes 99.2 per cent 67%. GC8 245,822 of Citycon’s carbon footprint. future reporting periods. In addition, 488 there is a pilot for LED parking lot 194,492 Case Study Equity One:
132 52,637 EQY is increasingly focused on the Equity One TOTAL 2010 2011 2012 2010 2011 2012 conservation of energy on all of our 31.8% Saved operations, and on the utilization of LIGHTING alternative energy sources where CONSUMPTION
possible to operate our shopping kWh centers and other properties. kWh
CO2 Carbon Dioxide Avoided (Lbs) SO2 Sulfur Dioxide Avoided (Lbs) 4,133,595 Focused on LEED developments 3,137,162 EQY’s development team finalized
1,858 its LEED certification during the 424,287 2013 reporting period. A LEED Silver kWh
1,470 certification for this EQY Initiated a pilot program on eight properties in 335,691
Florida and Georgia to install energy 996,433 management systems on common area parking lot lighting.These systems were installed to reduce or eliminate
397 unnecessary lighting after operating
90,851 2011 2012 Saved
2010 2011 2012 2010 2011 2012
104 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 105 Water
Our properties use water to included in the municipal property tax Case Study support cleaning activities, supply assessment. First landscape irrigation and to provide In most cases, tenants in FCR’s sewage conveyance, as well as for open-air and enclosed shopping Capital Realty: consumption by our employees, centers and offices are not separately tenants and their customers. In most metered for their water consumption. cases, municipal water treatment First Capital Realty Water consumption1 FCR charges back the costs of water plants provide our properties with consumption proportionately to the potable water, and our wastewater Change (%) tenants based on their square footage. Asset Class 2010 (106L) 2011 (106L) 2012 (106L) is sent to municipal treatment plants. 2011 Versus 2012 We recognize the vital importance of Open-air shopping centers comprised promoting the responsible use and 71% of the GLA reporting water Open-air shopping centers 999 974 993 2 conservation of water in all of our consumption and consumed 73% Enclosed shopping centers 318 302 305 1 operations. GC7 of the water consumption. Enclosed shopping centres comprised 26% of Offices 64 55 59 7 the GLA reporting water consumption Entire Portfolio 1,381 1,331 1,357 2 Case Study and consumed 22% of the water First consumption. Office buildings 12010 and 2011 water consumption and costs were updated to reflect FCR’s portfolio as of December 31, 2011. comprised 3% of the GLA reporting Capital Realty: water consumption and consumed 4% of the water consumption. FCR’s properties use water to supply drinking water, support maintenance Great Canadian Shoreline First Capital Realty 2011 water consumption in FCR’s cleaning activities, supply landscape Cleanup: In 2012 FCR employees Entire portfolio irrigation and provide sewage participated nationally for the fourth conveyance. Municipal water year in the Great Canadian Shoreline 2 treatment plants provide potable Cleanup. This national program is water to its portfolio, and municipal Canada’s largest contributor to the 21 waste water treatment plants treat International Coastal Cleanup, a its waste water. Typically, there is one global initiative to remove litter and water meter installed by the utility aquatic debris from shorelines. In at each property. The Province of 2012, 136,036 kilograms of litter Open-air shopping centers 77% was removed from 3,102 kilometers Quebec is an exception. Typically, Enclosed shopping centers 21% water consumption is not metered of Canadian shoreline by all program Offices 2% 77 in Quebec, and water costs are participants combined.
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Case Study Case Study Case Study
center properties declined by 10%. shopping centers was 4.2 liters, and Citycon: Water consumption proportionate to 3.9 liters in like-for-like shopping Equity One: Gazit Water Consumption sales decreased by 9% compared centers, meeting Citycon’s target to the previous year resulting from for reducing water consumption per Responsible Corporate Israel: Citycon’s water consumption Operations changes in the property portfolio in visitor in 2012.GC8 Our Israeli subsidiary is building its new Our subsidiaries vary in their levels of decreased by 2% in 2012 compared Sweden, where apartments were As part of its corporate initiatives and center in Yavne according to a new implementation of water conservation to the previous year and water sold during the year. In 2012, water IT infrastructure upgrades, our EQY Israeli standard that calls for surface measures. For example, First Capital consumption by like-for-like shopping consumption per visitor in Citycon’s subsidiary implemented an automated runoff water to drain into aquifers. To Realty awarded a contract for the utility data collection system that meet this standard, the company is management of water invoices to tracks all electric, gas and water creating a complex drainage system a third-party provider in order to total water consumption consumption under EQY’s control. which includes drilling a hole into the improve its operational efficiencies The system will allow EQY to analyze subsurface. GC8 GC9 and develop a cohesive data Total water Water intensity Total water Water intensity consumption in like-for- energy consumption data across its collection and reporting system for Total water consumption in shopping 3 in like-for- like shopping M consumption in shopping centers liter/ property portfolio to better discover water consumption and costs. GC8 like shopping centers liter/ centers visitor inefficiencies and provide opportunities centers visitor for capital improvements for long-term 2009 541,130 484,583 373,559 4.2 4.2 reductions in utility expenditures for savings and enhancement of value. 2010 562,604 487,275 392,711 4.0 4.1 The automated process will further 2011 639,457 573,626 425,060 4.3 4.4 drive internal efficiencies through streamlining processes that were 2012 626,953 576,637 382,533 4.2 3.9 previously accomplished manually. The system became fully operational Change-% 2012/2011 -2.0% 0.5% -10.0% at the end of the reporting period. Change-% 2012/2009 15.9% 19.0% 2.4% An illustration of EQYs focus on its ecological footprint is its implementation of a more effective pesticide management system.
Case Study
First FCR completed water audits on the in order to improve its operational irrigation systems of several of its efficiencies and develop a cohesive Capital Realty: properties during 2012, and awarded data collection and reporting system G Kfar Saba, Israel Water Conservation and a contract for the management of for water consumption and costs. Management Measures: water invoices to a third-party provider GC8
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Case Study Case Study Gazit-Globe The following graph illustrates Gazit Israel’s GHG emissions for the period: First Capital Realty:
Israel GHG emissions1 GAZIT ISRAEL GHG EMISSIONS (TON) 2010 2011 2012 Change (%) Asset Class (CO2e Tonnes) (CO2e Tonnes) (CO2e Tonnes) 2011 Versus 2012 1,332
1,190 Open-air Shopping Centers Scoop 1 3,530 3,636 2,791 -23 Scoop 2 11,352 11,018 10,143 -8 Scoop 3 331 308 298 -3 491
404 Total for Asset Class 15,213 14,962 13,232 -12 Enclosed Shopping Centers Scoop 1 4,380 5,235 4,794 -8
2009 2010 2011 2012 Scoop 2 17,945 17,495 17,584 -1 Scoop 3 119 117 114 -3 Total for Asset Class 22,444 22,847 22,492 -2 Office Buildings Case Study companies directly for their energy emissions. Enclosed shopping centers Scoop 1 930 858 769 -10 First consumption. Therefore, the GHG comprised 26% of the GLA reporting emissions from these energy sources GHG emissions and generated 58% Scoop 2 2,428 2,431 2,442 0 are not included in its CR reporting. Capital Realty: of the emissions generated. Offices Scoop 3 20 18 18 0 However, GHG emissions from energy comprised 2% of the GLA reporting GHG Emissions sources used to provide power, heat Total for Asset Class 3,378 3,307 3,229 -2 GHG emissions and generated 8% of and cooling in enclosed shopping GHG emissions result from the burning the emissions. Entire Portfolio 41,035 41,116 38,953 -5 of fossil fuels to provide power, heating centers or office buildings which are 1 and cooling to FCR’s properties. The not separately metered were included 2010 and 2011 GHG emissions were updated to reflect FCR’s portfolio as of December 31, 2011. in its report. majority of tenants in its open-air retail shopping centers are separately Open-air shopping centers comprised metered for natural gas and electricity 72% of the GLA reporting GHG consumption and pay the utility emissions and generated 34% of the
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Case Study Case Study First Capital Realty: Citycon: GHG Emissions
2012 ghg emissions in open-air 2012 ghg emissions in enclosed total direct and indirect greenhouse gas emissions shopping centers shopping centers Category 2012 2011 2010 2009
Electricity in common areas 20,744 21,079 17,180 18.106 1% 2% Tenants’ Electricity supplied by the landlord* 25,506 23,222 18,001 17,705 21% 21% District heating and cooling in properties 27,269 25,314 32,335 26,754
Electricity and heat in office occupation 63 61 51 50 77% 78% Wastewater in properties 234 239 210 202
Scope 1 Scope 1 Waste in properties 74 77 68 60 Scope 2 Scope 2 Scope 3 Scope 3 Business travel 239 275 473 282
Commuting 76 78 117 106
Paper consumption and mail 3 4 2 3 2012 ghg emissions in office 2011 ghg emissions in entire buildings portfolio Total 74,208 70,348 68,438 63,267
*Citycon also reports emissions from tenants’ electricity consumption in cases were Citycon is responsible for electricity procurement. When energy procurement is on tenant’s responsibility, it has been excluded from reporting 0% 1% 24% 21% In calculating its carbon footprint, averages (2005-2009) for electricity generation in the Nordic area. Nuclear Citycon applies the Greenhouse Gas and heat generation. In calculation fuel amounts are from the Finnish Protocol developed by the World of greenhouse gas intensity from Energy Industries and total electricity 76% 78% Resources Institute and the World building energy, the same principles generation from Nord Pool Spot AS. Business Council for Sustainable are applied as in the energy intensity Acidifying emission factors (in SO2- Development. The emissions calculation. Used nuclear fuel is eqv.) are based on historical estimates factors for energy are based on calculated on the basis of nuclear fuel on country specific emissions from Scope 1 Scope 1 Scope 2 Scope 2 country-specific statistics gathered use in Finnish and Swedish nuclear energy production. Scope 3 Scope 3 by the IEA consisting of five year power plants and the total electricity
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Case Study
Citycon: Gazit-Globe’s headquarters building’s into water bodies. Some exceptions Gazit Case Study waste water and rain water is led to the do apply. Wastewater from properties municipal sewer system. located in the Greater Victoria Area is Israel: discharged directly into a municipal In every one of our centers/properties sewer system that discharges to the GREENHOUSE GAS INTENSITY FROM GREENHOUSE GAS INTENSITY FROM in which restaurants, food retailers Pacific Ocean. The Greater Victoria BUILDING ENERGY CRE3 BUILDING ENERGY CRE3 Case Study etc. operates oily sewage treatment Area does not have a municipal kgCO e/visitor kgCO e/sqm waste water treatment plant. These 2 2 facilities exist on the premises. The First properties represent 2.3% of FCR’s oily substances are aggregated and GLA. transferred through contained process Capital Realty: 0.39 0.40 into a designated waste management 0.35 0.35 53 Waste Disposal 50 sites. As a result of the oily sewage 47 47 treatment, the biological impact is FCR does not discharge wastewater being significantly reduced. directly to a receiving water body. FCR’s wastewater discharges This system significantly reduces comprise grey and blackwater the backup of biological waste and from building operations. Municipal transfers it to a wastewater treatment wastewater treatment plants treat plant.GC8 GC9 these wastewaters before discharging
2009 2010 2011 2012 2009 2010 2011 2012
CO2 SF6 CH4 N2O HFCS PFCS
SCOPE 2 SCOPE 1 SCOPE 3 INDIRECT DIRECT INDIRECT
Business travel Company owned vehicles
Purchased electricity Commuting
Paper consumption
Waste management and Fuel combustion transport and waste water treatment
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EMISSIONS, EFFLUENTS & WASTE Citycon:
total waste amount by business units
Business Unit 2012 2011 2010 2009 Case Study First Capital Realty: Finland 9,834 10,143 9,314 8,830 Sweden 4,067 4,379 3,734 2,598 Waste Disposal GC7 GC8 Baltic Countries and New Business 994 839 596 491
The following graph illustrates First Capital Realty’s various methods for disposing of non-hazardous waste in its Ontario, Canada centers during 2010, 2011 and 2012: total waste amount total waste amount in shopping centers
2009 11,920 2009 11,382 Change (%) Method of 2010 (Tonnes)1 2011 (Tonnes)2 2012 (Tonnes)3 Disposal 2011 Versus 2012 2010 13,644 2010 12,973
Composting 590 500 425 -15 2011 15,361 2011 14,596
Recycling 2,440 2,960 2,583 -13 2012 14,896 2012 14,118
Waste to energy 3,750 4,180 2,762 -34 Change % 2012/2011 -3.0% Change % 2012/2011 -3.3% Landfill 2,140 5,040 6,307 25 Change % 2012/2009 25.0% Change % 2012/2009 24.0% Entire Portfolio 8,920 12,680 12,077 -5
1 2010 data represented waste generated in 9.7 million square feet of FCR’s portfolio total waste amount in like-for-like shopping centers 2 2011 data represented waste generated in 9.9 million square feet of FCR’s portfolio 3 2012 data represented waste generated in 10.1 million square feet of FCR’s portfolio 2011 11,218
2012 10,293
Change % 2012/2011 -8.2% waste volume proportionate to sales Citycon: Case Study decreased by 12.2%. recycling rate of shopping centers Waste Treatment Measures taken in 2012 to increase waste sorting included: Baltic Countries Finland Sweden Sweden and New Total Properties managed by Citycon Sorting instructions applicable in Business generated 14,896 tons of waste, of shopping centers were issued to which 14,118 tons were collected all parties concerned, and were 2009 69.4% 95.7% 34.5% 73.6% from shopping centers and 778 tons made electronically available at all 2010 71.4% 98.6% 34.3% 77.1% from other properties. In 2012, waste times. volumes saw a year-on-year decrease Training was arranged in shopping 2011 69.8% 94.8% 82.1% 77.1% of 3%. In addition, Citycon’s waste centers as necessary to improve volumes in like-for-like shopping sorting and recycling. 2012 77.5% 95.5% 86.4% 83.2% centers decreased by 8.2% and its
116 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 117 Citycon: Case Study Citycon: Case Study
total weight of waste in CITYCON shopping centers by types total weight of waste in CITYCON shopping centers by disposal routes
2012 2011 2010 2009 2012 2011 2010 2009 Non-hazardous waste tn % tn % tn % tn % Non-hazardous waste tn % tn % tn % tn % Landfill 2,150 15.2% 3,033 20.8% 2.917 22.5% 2,948 25.9% Landfill waste 2,375 16.8% 3,263 22.4% 2,968 22.9% 3,002 26.4%
Energy 3,909 27.7% 3,874 26.5& 3.540 27.3% 2,588 22.7% Incinerated waste 3,909 27.7% 3,874 26.5% 3,540 27.3% 2,588 22.7%
Paper 683 4.8% 671 4.6% 440 3.4% 446 3.9% Composted waste 2,711 19.2% 2,193 15.0% 1,557 12.0% 1,398 12.3%
Plastic 56 0.4% 54 0.4% 44 0.3% 66 0.6% Recycled waste 4,759 33.7% 4,872 33.4% 4,669 36.0% 4,241 37.3%
Cardboard 3,588 25.4% 3,604 24.7% 3.697 28.4% 3,318 29.2% Reused waste 364 2.6% 394 2.7% 240 1.8% 153 1.3%
Compost 2,711 19.2% 2,193 15.0% 1,557 12.0% 1,398 12.3% Total 14,118 100.0% 14,596 100.0% 12,973 100.0% 11,382 100.0%
Metal 145 1.0% 159 1.1% 128 1.0% 125 1.1%
Glass 287 2.0% 384 2.6% 378 2.9% 286 2.5% total weight of waste in like-for-like CITYCON shopping centers by disposal routes Other recycled 338 2.4% 370 2.5% 236 1.8% 125 1.1% 2012 2011 Other unsorted waste 225 1.6% 230 1.6% 51 0.4% 54 0.5% Non-hazardous waste tn % tn % Hazardous 26 0.2% 24 0.2% 3 0.0% 29 0.3% Landfill waste 1,714 16.7% 2,432 21.7% Total 14,118 100.0% 14,596 100.0% 12,973 100.0% 11,382 100.0% Incinerated waste 2,890 28.1% 3,150 28.1%
total weight of waste in like-for-like CITYCON shopping centers by types Composted waste 2,106 20.5% 1,792 16.0%
2012 2011 Recycled waste 3,344 32.5% 3,574 31.9% Non-hazardous waste tn % tn % Reused waste 238 2.3% 271 2.4% Landfill 1,650 16.0% 2,263 20.2% Total 10,293 100.0% 11,218 100.0% Energy 2,890 28.1% 3,150 28.1% Paper 410 4.0% 422 3.8% Plastic 46 0.5% 44 0.4% proportion of waste by disposal route by CITYCON business units Cardboard 2,566 24.9% 2,648 23.6% Non-hazardous waste Baltic Countries Compost 2,106 20.5% 1,792 16.0% Finland Sweden and New Business Metal 100 1.0% 117 1.0% Landfill waste 22.5% 4.5% 13.6% Glass 222 2.2% 343 3.1% Incinerated waste 16.0% 51.3% 41.3% Other recycled 231 2.2% 263 2.3% Composted waste 24.0% 11.9% 3.8% Other unsorted waste 65 0.6% 168 1.5% Recycled waste 34.3% 30.5% 41.1% Hazardous 8 0.1% 8 0.1% Reused waste 3.1% 1.9% 0.2% Total 10,293 100.0% 11,218 100.0% Total 100% 100% 100% EMISSIONS, EFFLUENTS & WASTE Citycon: Case Study
ENVIRONMENTAL RESPONSIBILITY Citycon: Case Study recycling rate of CITYCON proportion of waste by disposal Environmental shopping centers route by CITYCON business units responsibility results Carbon footprint % % for 2012 decreased by % 100 Citycon defined its long-term environmental 3.3% responsibility objectives in connection 90 83.2 with its strategic planning in 2009. It set 77.1 77.6 80 Energy consumption 73.6 targets for its carbon footprint, energy 70 and water consumption, waste recycling down by 1.7% 60 rate as well as land use and sustainable construction. In 2012, Citycon’s aim was 50 to reduce its carbon footprint by 2-3%, Water consumption 40 energy consumption by 2-3% and water per visitor decreased 30 consumption in its comparable shopping 20 centers by an average of 4 liters per visitor by 11.2% per year. In waste management the target 10 for recycling rate was 78% and its annual Recycling rate 0 target for its proportion of landfill waste out 2009 2010 2011 2012 Finland Sweden Baltic of total waste was 22%. of 83.2% Countries and New Business Reused waste The total waste volume generated by of Recycled waste Citycon’s shopping centers amounted to 14,358 MWh Composted waste 14,896 tons (15,361 tn), with landfill waste green electricity Incinerated waste accounting for 2,375 tons (3,263 tn), or Landfill waste 15.9% (21.2%). Gold-level LEED recycling rate of CITYCON shopping centers Waste volumes decreased by 3% certificate for the Baltic Countries compared to the previous year. Waste Finland Sweden Sweden and New Total volume proportionate to sales showed a Martinlaakson Ostari Business decrease of 12.2%. Waste volumes in like- project 2009 69.4% 95.7% 34.5% 73.6% for-like shopping centers, decreased by 8.2% from the previous year. The recycling 2010 71.4% 98.6% 34.3% 77.1% rate in shopping centers improved in each GRESB Star business unit and was 83.2%. Citycon has 2011 69.8% 94.8% 82.1% 77.1% improved in each business unit and waste and recycling goals were achieved. 2012 77.5% 95.5% 86.4% 83.2%
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Equity One: Property Waste Totals 189,043 yards or 47.3% was made up to incinerator facilities, it was able to Equity One: of recyclable materials. The remainder achieve a total diversion rate of 66.7% Waste Stream of this material, or 210,395 yards, was (measured as the total recycled and Incinerator (YDS) Diverted (YDS) Case Study sent to waste disposal facilities. This incinerated waste divided by its total waste data contains only information waste stream). regarding disposal or recycling activities During 2011, EQY reduced the total where EQY controls such activities. EQY actively audits its waste services number of operating properties under
During this reporting period, EQY each year to ensure that the property 77,433 their waste program to 113 properties. waste removal/recycling programs are 239,640 239,641 This reduction was due to the sale of a generated a total of 359,518 yards portion of the property portfolio at the of non-hazardous waste. Of the total in place for each shopping center. waste volume, 162,258 yards, or 45%, end of the reporting period. 181,421 was made up of recyclable materials The following is a snapshot of waste 50,597 During 2011, the operating properties and 77,433 yards were incinerated. totals and resources saved: GC8 in addition to the corporate and The remainder of this material, or satellite offices generated a total of 119,827 yards, was sent to waste 399,438 yards of non-hazardous disposal facilities. Due to EQY’s ability *YDS waste. Of the total waste volume, to identify the waste amounts sent 2010 2011 2012 2010 2011 2012
Equity One: Property Waste Totals Equity One: Resources Saved
Air Pollution Generated (YDS) Landfill (YDS) Energy (kW) Landfill Space (Cu Yds) Avoided (Tons) 15,627 312,540 387,889 20,836,000 206,468 210,395 359,518 260,760 17,384,000 13,038 399,438 199,200 9,960 13,280,000 119,797
2010 2011 2012 2010 2011 2012 2010 2011 2012 2010 2011 2012 2010 2011 2012
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Equity One: Case Study Equity One: Case Study
Equity One: Resources Saved Property Waste Diversion Rate Cinema City, Rishon Lezion, Israel
Water (Gallons) Paper Recycled (Tons) Oil Consumption (Tons) Total Diversion Rate (%) 5,029 67 EQY’s system generated a total of 245,822.56 kWh from January 1, 2012, through December 31, 2012, bringing 60 1,394,796
36,463,000 the lifetime production to 492,951.84 kWh since inception 4,346 1,261,600 in 2010. Production on this site was increased substantially
46 over the previous reporting period due to less snowfall and 30,422,000 1,064,730
3,320 better overall weather conditions. 23,240,000
2010 2011 2012 2010 2011 2012 2010 2011 2012 2010 2011 2012 First Capital
* 2010 does not include information regarding waste incineration due to unavailability of the information from the waste haulers at that time. Reality: Case Study
FCR won an ICSC Silver Maple Leaf Award for its “Be Eco-Logical Annual Recycling Program” at four of its Quebec properties. GC8
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Global Reporting Section Initative (GRI) Information 6.
The Gallery at Westbury Plaza, Long Island, New York, USA
126 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 127 Gazit-Globe GRI Declaration
“The Global Reporting Initiative (GRI) is a network-based organization that has pioneered the development of the world’s most widely used sustainability reporting framework and is committed to its continuous improvement and application worldwide.”
As part of our goal of creating a Report Application Level C C+ B B+ A A+ Corporate Responsibility report that Self-declared meets transparency best practices, Report on: Report on all criteria Same as requirement we determined that this third report Application G3 Profile 1.1 listed For Level C plus: for Level B will be according to the GRI – Global Disclosures 2.1-2.10 1.2 Reporting Initiative’s guidelines for the Output Level 3.1-3.8, 3.10-3.12 3.9, 3.13 purpose of enhancing this report’s 4.1-4.4, 4.14-4.15 4.5-4.13, 4.16-4.17 technical quality, credibility and Gazit-Globe established a clear target relevance. of publishing a Second Application “B” level report. We proudly present G3 Management Not Required Management Approach Same as requirement this third report which reflects our Approach Disclosurces for each for Level B Indicator Category Application commitment to our stakeholders, Disclosures including the communities in which we Output Level operate, the environment in which we live and our Company’s shareholders. In order to comply with the terms of Disclosures Standard Report on minimum Report on minimum Report on each core G3 Report Externally Assured
G3 Perfprmance of 10 Performance of 10 Performance Report Externally Assured and Sector Supplement* Report Externally Assured GRI’s G3.1 guidelines, Gazit-Globe Indicators Indicators, including Indicators, including at Indicator with due regard was required to address the issue of & Sector at least one from each least one from to the Materiality Principle selecting the Application Level most Supplement of: Economic, Social each of: Economic, by either a: reporting suitable for the Company. According Performance and Environmental. Environmental, Humen on the Indicator or b to the GRI, CR Reports aiming to Indicators rights, Labor, explaining the reason for qualify for level C, C+, B, B+, A or A+ Output Society, Product its omission must contain each of the criteria that Responsibility are presented in the column for the relevant level.
128 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 129 3. Report Parameters Profile Disclosure Level of Location of Reason Explanation for Disclosure reporting Disclosure for the reason for omission omission 3.1 Reporting period (e.g., fiscal/calendar year) for GRI Index information provided. √ 6 3.2 Date of most recent previous report (if any). √ 6 3.3 Reporting cycle (annual, biennial, etc.) √ 6 √ Fully reported o Partly reported — Not reported 3.4 Contact point for questions regarding the report or its contents. √ 143 STANDARD DISCLOSURES PART I: Profile Disclosures 3.5 Process for defining report content. √ 6 3.6 Boundary of the report (e.g., countries, divisions, subsidiaries, leased facilities, joint ventures, suppliers). See GRI Boundary Protocol for further √ 6 1. Strategy and Analysis guidance. Profile Disclosure Level of Location of Reason Explanation for Disclosure reporting Disclosure for the reason for 3.7 State any specific limitations on the scope Does omission omission or boundary of the report (see completeness principle for explanation of scope). — not N / A 1.1 Statement from the most senior decision-maker exist of the organization. √ 4-5 3.8 Basis for reporting on joint ventures, subsidiaries, 1.2 Description of key impacts, risks, and leased facilities, outsourced operations, and opportunities. √ 4-5 other entities that can significantly affect Does comparability from period to period and/or — not N / A between organizations. exist 2. Organizational Profile 3.9 Data measurement techniques and the bases Profile Disclosure Level of Location of Reason Explanation for Disclosure reporting Disclosure for the reason for of calculations, including assumptions and omission omission techniques underlying estimations applied to the compilation of the Indicators and other 2.1 Name of the organization. √ 10 information in the report. Explain any decisions √ 6 not to apply, or to substantially diverge from, the 2.2 Primary brands, products, and/or services. √ 10 GRI Indicator Protocols. 2.3 Operational structure of the organization, including main divisions, operating companies, subsidiaries, and joint ventures. √ 12-17 3.10 Explanation of the effect of any re-statements of The interim information provided in earlier reports, and the report of Q1- 2.4 Location of organization’s headquarters. reasons for such re-statement (e.g.,mergers/ Q2/2011 were √ 17 acquisitions, change of base years/periods, restated to 2.5 Number of countries where the organization nature of business, measurement methods). reflect the re- operates, and names of countries with either measurement major operations or that are specifically relevant Does of non-control- to the sustainability issues covered in the report. √ 16-17 — not ling interests exist in a business combination restatement has no effect 2.6 Nature of ownership and legal form. √ 10 on the previos and\or current 2.7 Markets served (including geographic CR report breakdown, sectors served, and types of √ 16-17 customers/beneficiaries). 3.11 Significant changes from previous reporting periods in the scope, boundary, or measurement methods applied in the report. √ 54 2.8 Scale of the reporting organization. √ 10 2.9 Significant changes during the reporting period 10 3.12 Table identifying the location of the Standard regarding size, structure, or ownership. √ Disclosures in the report. √ 130-141 2.10 Awards received in the reporting period. 24 √ 3.13 Policy and current practice with regard to Does seeking external assurance for the report. — not N / A exist
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Profile Disclosure Level of Location of Reason Explanation for 4. Governance, Commitments, and Engagement Disclosure reporting Disclosure for the reason for omission omission Profile Disclosure Level of Location of Reason Explanation for Disclosure reporting Disclosure for the reason for 4.11 Explanation of whether and how the omission omission precautionary approach or principle is addressed by the organization. √ 81, 84 4.1 Governance structure of the organization, including committees under the highest governance body responsible for specific √ 26-27 4.12 Externally developed economic, environmental, tasks, such as setting strategy or organizational and social charters, principles, or other initiatives oversight. to which the organization subscribes or √ 21, 24-25 endorses. 4.2 Indicate whether the Chair of the highest governance body is also an executive officer. √ 26 4.13 Memberships in associations (such as industry 4.3 For organizations that have a unitary board associations) and/or national/international structure, state the number and gender of advocacy organizations in which the members of the highest governance body that √ 26 organization: * Has positions in governance are independent and/or non-executive members. bodies; * Participates in projects or committees; 21, 24, √ * Provides substantive funding beyond routine 46-47 membership dues; or * Views membership as 4.4 Mechanisms for shareholders and employees strategic. to provide recommendations or direction to the 21, 27, √ highest governance body. 37, 39 4.14 List of stakeholder groups engaged by the 4.5 Linkage between compensation for members organization. √ 36 of the highest governance body, senior managers, and executives (including departure 4.15 Basis for identification and selection of arrangements), and the organization’s √ 34-35 stakeholders with whom to engage. √ 36 performance (including social and environmental performance). 4.16 Approaches to stakeholder engagement, including frequency of engagement by type and √ 37-45 4.6 Processes in place for the highest governance by stakeholder group. body to ensure conflicts of interest are avoided. √ 26, 35 4.17 Key topics and concerns that have been raised 4.7 Process for determining the composition, through stakeholder engagement, and how the qualifications, and expertise of the members organization has responded to those key topics of the highest governance body and its and concerns, including through its reporting. √ 37-45 committees, including any consideration of √ 26 gender and other indicators of diversity.
4.8 Internally developed statements of mission or values, codes of conduct, and principles relevant to economic, environmental, and √ 21, 92-93 social performance and the status of their implementation. STANDARD DISCLOSURES PART II: Disclosures on Management Approach 4.9 Procedures of the highest governance body for overseeing the organization’s identification and G3.1 DMAs Disclosure Level of Location of Reason Explanation for management of economic, environmental, and reporting Disclosure for the reason for social performance, including relevant risks and omission omission opportunities, and adherence or compliance √ 27 DMA EC Disclosure on Management Approach EC √ 51 with internationally agreed standards, codes of conduct, and principles. DMA EN Disclosure on Management Approach EN √ 90 DMA LA Disclosure on Management Approach LA √ 62 4.10 Processes for evaluating the highest governance DMA HR Disclosure on Management Approach HR √ 72 body’s own performance, particularly with DMA SO Disclosure on Management Approach SO √ 76-77 respect to economic, environmental, and social √ 26 performance. DMA PR Disclosure on Management Approach PR √ 76-77
132 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 133 GRI Index √ Fully reported o Partly reported — Not reported
Environmental STANDARD DISCLOSURES PART III: Performance Indicators Indicator Disclosure Level of Location of Reason Explanation for reporting Disclosure for the reason for omission omission Materials Economic EN1 Materials used by weight or volume. — Indicator Disclosure Level of Location of Reason Explanation for reporting Disclosure for the reason for EN2 Percentage of materials used that are recycled omission omission input materials. √ 94 Economic performance Energy EC1 Direct economic value generated and distributed, EN3 Direct energy consumption by primary energy √ 95-101 including revenues, operating costs, employee source. compensation, donations and other community 53-55, EN4 Indirect energy consumption by primary source. investments, retained earnings, and payments to √ — 57-58, 79 capital providers and governments. EN5 Energy saved due to conservation and efficiency improvements. — EN6 Initiatives to provide energy-efficient or renewable EC2 Financial implications and other risks and energy based products and services, and opportunities for the organization’s activities due √ 91, 97-98 √ 59 reductions in energy requirements as a result of to climate change. these initiatives. EN7 Initiatives to reduce indirect energy consumption EC3 Coverage of the organization’s defined benefit and reductions achieved. — plan obligations. — Water EC4 Significant financial assistance received from government. — EN8 Total water withdrawal by source. √ 106-109 EN9 Water sources significantly affected by Market presence withdrawal of water. — EC5 Range of ratios of standard entry level wage by EN10 Percentage and total volume of water recycled gender compared to local minimum wage at and reused. — significant locations of operation. — Biodiversity EC6 Policy, practices, and proportion of spending on EN11 Location and size of land owned, leased, locally-based suppliers at significant locations of managed in, or adjacent to, protected areas and operation. — areas of high biodiversity value outside protected — areas. EC7 Procedures for local hiring and proportion EN12 Description of significant impacts of activities, of senior management hired from the local products, and services on biodiversity in community at significant locations of operation. — protected areas and areas of high biodiversity — value outside protected areas. EN13 Habitats protected or restored. Indirect economic impacts — EN14 Strategies, current actions, and future plans for EC8 Development and impact of infrastructure managing impacts on biodiversity. — investments and services provided primarily for EN15 Number of IUCN Red List species and national public benefit through commercial, in-kind, or pro √ 56-58 bono engagement. conservation list species with habitats in areas — affected by operations, by level of extinction risk.
EC9 Understanding and describing significant indirect economic impacts, including the extent of √ 56-58 impacts.
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Indicator Disclosure Level of Location of Reason Explanation for Social: Labor Practices and Decent Work reporting Disclosure for the reason for omission omission Indicator Disclosure Level of Location of Reason Explanation for reporting Disclosure for the reason for Emissions, effluents and waste omission omission EN16 Total direct and indirect greenhouse gas Employment emissions by weight. √ 110-115 LA1 Total workforce by employment type, EN17 Other relevant indirect greenhouse gas emissions employment contract, and region, broken down √ 63 by weight. — by gender. EN18 Initiatives to reduce greenhouse gas emissions 91, 102- √ LA2 Total number and rate of new employee hires and reductions achieved. 105 and employee turnover by age group, gender, and region. √ 64 EN19 Emissions of ozone-depleting substances by weight. — LA3 Benefits provided to full-time employees that EN20 NOx, SOx, and other significant air emissions by — are not provided to temporary or part-time type and weight. employees, by major operations. √ 63, 65-68 EN21 Total water discharge by quality and destination. Gazit’s water- house LA15 Return to work and retention rates after parental and rain- leave, by gender. — water is √ let to the Labor/management relations municipal sewer LA4 Percentage of employees covered by collective system. bargaining agreements. — 115 LA5 Minimum notice period(s) regarding significant EN22 Total weight of waste by type and disposal 115-119, operational changes, including whether it is √ method. 122-125 specified in collective agreements. — EN23 Total number and volume of significant spills. — Occupational health and safety EN24 Weight of transported, imported, exported, or treated waste deemed hazardous under the LA6 Percentage of total workforce represented in terms of the Basel Convention Annex I, II, III, — formal joint management-worker health and and VIII, and percentage of transported waste safety committees that help monitor and advise — shipped internationally. on occupational health and safety programs. EN25 Identity, size, protected status, and biodiversity value of water bodies and related habitats — LA7 Rates of injury, occupational diseases, lost days, significantly affected by the reporting and absenteeism, and number of work-related organization’s discharges of water and runoff. fatalities by region and by gender. — Water LA8 Education, training, counseling, prevention, and EN26 Initiatives to mitigate environmental impacts of 120-121, products and services, and extent of impact √ risk-control programs in place to assist workforce mitigation. 102-105 members, their families, or community members regarding serious diseases. — EN27 Percentage of products sold and their packaging materials that are reclaimed by category. — Products and services LA9 Health and safety topics covered in formal agreements with trade unions. — EN28 Monetary value of significant fines and total number of non-monetary sanctions for non- Training and education compliance with environmental laws and — regulations. LA10 Average hours of training per year per employee by gender, and by employee category. o 65 Transport EN29 Significant environmental impacts of transporting LA11 Programs for skills management and lifelong products and other goods and materials used for learning that support the continued employability the organization’s operations, and transporting — of employees and assist them in managing — members of the workforce. career endings. Overall EN30 Total environmental protection expenditures and investments by type. — 136 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 137 GRI Index √ Fully reported o Partly reported — Not reported
Indicator Disclosure Level of Location of Reason Explanation for Indicator Disclosure Level of Location of Reason Explanation for reporting Disclosure for the reason for reporting Disclosure for the reason for omission omission omission omission LA12 Percentage of employees receiving regular Forced and compulsory labor performance and career development reviews, √ 67 by gender. HR7 Operations and significant suppliers identified as having significant risk for incidents of forced or Diversity and equal opportunity compulsory labor, and measures to contribute √ 72 to the elimination of all forms of forced or LA13 Composition of governance bodies and compulsory labor. breakdown of employees per employee category according to gender, age group, minority group √ 68-69 Security practices membership, and other indicators of diversity. HR8 Percentage of security personnel trained in the Equal remuneration for women and men organization’s policies or procedures concerning aspects of human rights that are relevant to — LA14 Ratio of basic salary and remuneration of women operations. to men by employee category, by significant — locations of operation. Indigenous rights HR9 Total number of incidents of violations involving rights of indigenous people and actions taken. — Social: Human Rights Assessment Indicator Disclosure Level of Location of Reason Explanation for HR10 Percentage and total number of operations that reporting Disclosure for the reason for have been subject to human rights reviews and/ — omission omission or impact assessments. Investment and procurement practices Remediation HR1 Percentage and total number of significant HR11 Number of grievances related to human rights investment agreements and contracts that filed, addressed and resolved through formal — include clauses incorporating human rights — grievance mechanisms. concerns, or that have undergone human rights screening. HR2 Percentage of significant suppliers, contractors Social: Society and other business partners that have undergone — human rights screening, and actions taken. Indicator Disclosure Level of Location of Reason Explanation for reporting Disclosure for the reason for HR3 Total hours of employee training on policies and omission omission procedures concerning aspects of human rights that are relevant to operations, including the — Local communities percentage of employees trained. SO1 Percentage of operations with implemented local Non-discrimination community engagement, impact assessments, √ 77-79 and development programs. HR4 Total number of incidents of discrimination and actions taken. √ 70-71 SO9 Operations with significant potential or actual negative impacts on local communities. — Freedom of association and collective bargaining SO10 Prevention and mitigation measures implemented HR5 Operations and significant suppliers identified in operations with significant potential or actual — in which the right to exercise freedom of negative impacts on local communities. association and collective bargaining may be — violated or at significant risk, and actions taken Corruption to support these rights. SO2 Percentage and total number of business units √ 81-84 Child labor analyzed for risks related to corruption. HR6 Operations and significant suppliers identified as SO3 Percentage of employees trained in having significant risk for incidents of child labor, organization’s anti-corruption policies and √ 81-83 and measures taken to contribute to the effective √ 72 procedures. abolition of child labor. SO4 Actions taken in response to incidents of corruption. —
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Indicator Disclosure Level of Location of Reason Explanation for Indicator Disclosure Level of Location of Reason Explanation for reporting Disclosure for the reason for reporting Disclosure for the reason for omission omission omission omission Public policy Marketing communications SO5 Public policy positions and participation in public PR6 Programs for adherence to laws, standards, policy development and lobbying. — and voluntary codes related to marketing communications, including advertising, — SO6 Total value of financial and in-kind contributions promotion, and sponsorship. to political parties, politicians, and related — institutions by country. PR7 Total number of incidents of non-compliance with regulations and voluntary codes concerning Anti-competitive behavior marketing communications, including — SO7 Total number of legal actions for anti-competitive advertising, promotion, and sponsorship by type behavior, anti-trust, and monopoly practices and √ 85 of outcomes. their outcomes. Customer privacy Compliance PR8 Total number of substantiated complaints SO8 Monetary value of significant fines and total regarding breaches of customer privacy and — number of non-monetary sanctions for non- — losses of customer data. compliance with laws and regulations. Compliance PR9 Monetary value of significant fines for non- compliance with laws and regulations concerning — Social: Product Responsibility the provision and use of products and services. Indicator Disclosure Level of Location of Reason Explanation for reporting Disclosure for the reason for omission omission Customer health and safety PR1 Life cycle stages in which health and safety impacts of products and services are assessed for improvement, and percentage of significant √ 86-87 products and services categories subject to such procedures. PR2 Total number of incidents of non-compliance with regulations and voluntary codes concerning 86-87 health and safety impacts of products and √ services during their life cycle, by type of outcomes. Product and service labelling PR3 Type of product and service information required by procedures, and percentage of significant products and services subject to such — information requirements. PR4 Total number of incidents of non-compliance with regulations and voluntary codes concerning product and service information and labeling, by — type of outcomes. PR5 Practices related to customer satisfaction, including results of surveys measuring customer √ 90 satisfaction.
140 > Gazit-Globe Corporate Responsibility Report 2011-2012 Gazit-Globe Corporate Responsibility Report 2011-2012 < 141 For any inquires or comments regarding the report, please e-mail:
Varda Zuntz VP of Corporate Responsibility and Member of the Executive Committee [email protected] Gazit-Globe 1 HaShalom Rd., Tel-Aviv 67892, Israel
Investor Relations, Gazit-Globe [email protected] Gazit-Globe 1 HaShalom Rd., Tel-Aviv 67892, Israel Main: +972 3 6948000 www.gazit-globe.com
The information contained in this report is not, and should not be viewed as, a complete description of Gazit-Globe Ltd. (the “Company”). No reliance may be placed, for any purposes whatsoever, on the information contained in this report or on its completeness and it should not be considered a recommendation by the Company or any one acting on its behalf (such as any of its directors, partners, officers, employees, advisers or any other persons) in relation to any transaction relating to its securities or any other securities. No representation or warranty is given by or on behalf of the Company or anyone acting on its behalf (such as any of its directors, partners, officers, employees, advisers or any other persons) as to the accuracy, fairness or sufficiency of the information contained in this report. No liability is accepted for any errors, omissions or inaccuracies in such information. Certain statements in the information contained in this report are forward- looking statements. By their nature, forward-looking statements involve risks, uncertainties and assumptions which could cause actual results or events to differ materially from those expressed or implied by the forward looking statements. These include, among other factors, changing business or other market conditions and anticipated or assumed future prospects. Forward-looking statements contained in this folder regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. The Company does not undertake any obligation to update or revise any information set forth herein (including any forward-looking statements) whether as a result of new information, future events or otherwise.
Many thanks to everyone who contributed to the creation of this Report including David Kahn Financial Communications for copywriting, Portnov-Mishan for concept and design, and Deloitte Brightman Almagor Zohar for professional consultation. 1 HaShalom Rd. Tel Aviv 67892, Israel Tel: +972 3 694 8000 E-mail: [email protected] www.gazit-globe.com