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MENU ABOUT MTR CORPORATION
MTR Corporation Limited (“the Company”) is a publicly-listed company Introduction (SEHK: 0066) headquartered in the Hong Kong Special Administrative Region (“Hong Kong”). The City Unlimited: Sustainabilty Report 2016 In June 2000, the Hong Kong Government (“the Government”) sold a About this report portion of its issued share capital to private investors in an Initial Public Scope of this report Offering. Today, the Hong Kong Government holds a majority (76.5 %) of the shareholding while private investors, including institutional and retail About MTR corporation investors, hold the remainder. Value chain, materiality and stakeholder engagement Our primary business is the construction and operation of mass transit railway systems in Hong Kong, which carried an average of more than 5.6 million passengers every weekday as at the end of 2016. While we Chairman’s Message are recognised as one of the best passenger railway transport providers CEO Letter in the world, we also engage in the development and sale of residential and commercial properties in partnership with property developers, and Safety operate a property management service. Customers In addition to our Hong Kong rail operations, we also have a presence in Community the Mainland of China, Europe and Australia, where we provide operational and maintenance services directly or through joint ventures. Environment In 2016, we carried as many passengers on networks outside of Hong Staff Kong as we did at home. In total, the Company and its subsidiaries and Supply Chain associates employ more than 37,700 people around the world, of which majority are locally-employed staff. Financial and Economic Performance LIST OF AWARDS Corporate Governance Building Our Future Please click here for a list of awards received by the Company during 2016. Mainland of China and International Business Performance Metrics
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MENU Vision, Mission and Values
This concise statement of our Vision, Mission and Values (VMV) is integral to our management approach in all areas of our business. Our success of providing passenger rail transport reflects our consistent and conscientious pursuit of our Vision to be a leading multinational company that connects and grows Introduction communities with caring service.
The City Unlimited: Sustainabilty Report 2016 About this report Scope of this report About MTR corporation Vision We aim to be a leading multinational company that connects and grows communities Value chain, materiality and with caring service. stakeholder engagement
Chairman’s Message CEO Letter Safety Mission Customers We will Community • Strengthen our Hong Kong corporate citizen reputation • Grow and enhance our Hong Kong core businesses Environment • Accelerate our success in the Mainland and internationally • Inspire, engage and develop our staff Staff Supply Chain Financial and Economic Values Performance Excellent Service Value Creation We anticipate, listen and respond to We create profit and community goodwill Corporate Governance customer needs and provide a safe, through growth, effective execution, Building Our Future effective and caring service. continuous improvement and innovation. Mainland of China and Mutual Respect Enterprising Spirit International Business We work internally and externally in a We question the status quo, proactively collaborative environment based on trust, seek improvement and take ownership to Performance Metrics joint commitment and respect. overcome obstacles.
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MENU Our Businesses
Introduction Hong Kong Transport Operations
The City Unlimited: Sustainabilty Report 2016 Hong Kong Network Expansion About this report Hong Kong Station Commercial Business Scope of this report About MTR corporation Property and other Businesses Value chain, materiality and stakeholder engagement Mainland and International Business
Chairman’s Message CEO Letter Safety Customers Community Environment Staff Supply Chain Financial and Economic Performance Corporate Governance Building Our Future Mainland of China and International Business Performance Metrics
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MENU Our Businesses
Introduction Hong Kong Transport Operations
The City Unlimited: Sustainabilty Report 2016 We operate an urban mass transit railway system with 11 heavy rail lines and a Light Rail system. The heavy rail About this report network comprises domestic and cross-boundary services Scope of this report and a dedicated Airport Express link. We also provide intercity About MTR corporation services to and from the Mainland of China as well as a small feeder bus service in Hong Kong. Value chain, materiality and stakeholder engagement Hong Kong Network Expansion
Chairman’s Message Hong Kong Station Commercial Business CEO Letter Property and other Businesses Safety Customers Mainland and International Business Community Environment Staff Supply Chain Financial and Economic Performance Corporate Governance Building Our Future Mainland of China and International Business Performance Metrics
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MENU Our Businesses
Introduction Hong Kong Transport Operations
The City Unlimited: Sustainabilty Report 2016 Hong Kong Network Expansion About this report We manage the design and construction of new railway Scope of this report extensions along with a multitude of other projects each year About MTR corporation to upgrade and improve the operating railway network. The Value chain, materiality and Kwun Tong Line Extension and South Island Line (East) were stakeholder engagement completed in 2016 and the Island Line Extension to Western District was completed in 2014. Two other projects, the Shatin to Central Link and the Express Rail Link, are still under Chairman’s Message construction. Together these five projects will increase the route length of our network in Hong Kong by 25 per cent. CEO Letter
Safety Hong Kong Station Commercial Business Customers Property and other Businesses Community Environment Mainland and International Business Staff Supply Chain Financial and Economic Performance Corporate Governance Building Our Future Mainland of China and International Business Performance Metrics
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MENU Our Businesses
Introduction Hong Kong Transport Operations
The City Unlimited: Sustainabilty Report 2016 Hong Kong Network Expansion About this report Hong Kong Station Commercial Business Scope of this report
About MTR corporation To make the most of our railway assets, we operate related Value chain, materiality and businesses such as the leasing of station retail space, stakeholder engagement advertising in trains and stations, and fixed and mobile telecommunications systems.
Chairman’s Message Property and other Businesses CEO Letter Mainland and International Business Safety Customers Community Environment Staff Supply Chain Financial and Economic Performance Corporate Governance Building Our Future Mainland of China and International Business Performance Metrics
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MENU Our Businesses
Introduction Hong Kong Transport Operations
The City Unlimited: Sustainabilty Report 2016 Hong Kong Network Expansion About this report Hong Kong Station Commercial Business Scope of this report About MTR corporation Property and other Businesses Value chain, materiality and stakeholder engagement We work with leading property developers to build properties above or near our stations. We also manage a portfolio of residential properties, office space and commercial space. Chairman’s Message Other businesses include rail-related consultancy, the Ngong CEO Letter Ping 360 cable car and associated theme village, and the Octopus card payments system. Safety Customers Mainland and International Business Community Environment Staff Supply Chain Financial and Economic Performance Corporate Governance Building Our Future Mainland of China and International Business Performance Metrics
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MENU Our Businesses
Introduction Hong Kong Transport Operations
The City Unlimited: Sustainabilty Report 2016 Hong Kong Network Expansion About this report Hong Kong Station Commercial Business Scope of this report About MTR corporation Property and other Businesses Value chain, materiality and stakeholder engagement Mainland and International Business
Chairman’s Message Our subsidiaries and associates build, operate and maintain railway systems and provide related services in the Mainland CEO Letter of China, the United Kingdom, Sweden and Australia. In the Mainland of China, we are also involved in leasing retail Safety space, providing estate management services and developing Customers properties. Community Environment Staff Supply Chain Financial and Economic Performance Corporate Governance Building Our Future Mainland of China and International Business Performance Metrics
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MENU Properties Owned / Developed / Hong Kong Transport Operations and Network Expansion Managed by the Corporation Telford Gardens / Telford Plaza I and II • 11 heavy rail lines, total route length of 230.9km World-wide House • 93 stations and 68 Light Rail stops Admiralty Centre Argyle Centre Introduction • Average of around 5.6 million passengers per weekday Luk Yeung Sun Chuen / Luk Yeung Galleria New Kwai Fong Gardens • Total patronage of more than 1.95 billion Sun Kwai Hing Gardens The City Unlimited: Fairmont House • 2 rail projects completed in 2016; MTR is now present in all 18 districts in Hong Kong for the first time Kornhill / Kornhill Gardens Sustainabilty Report 2016 Fortress Metro Tower • 2 rail projects totally 43 km under construction Hongway Garden / Infinitus Plaza About this report Perfect Mount Gardens New Jade Garden Southorn Garden Scope of this report MTR system and properties Heng Fa Chuen / Heng Fa Villa / Paradise Mall Park Towers About MTR corporation Shenzhen Felicity Garden
Lo Wu Tierra Verde / Maritime Square Beijing Value chain, materiality and Intercity Through Tung Chung Crescent / Citygate / Novotel Citygate / Train Route Map Seaview Crescent / Coastal Skyline / Caribbean Coast stakeholder engagement Shanghai Central Park / Island Harbourview / Park Avenue / u g* o in zh Harbour Green / Bank of China Centre / HSBC Centre / q g o Lok Ma Chau a an Beijing Line h u Z G Olympian City One / Olympian City Two Sheung Shui Shanghai Line n n a a The Waterfront / Sorrento / The Harbourside / The Arch / u sh g o g Guangdong Line F n o D HONG KONG SAR Elements / The Cullinan / The Harbourview Place / Chairman’s Message Kwu Tung Fanling * Due to the redevelopment of railway control point at Zhaoqing, W Hong Kong / International Commerce Centre / services to/from Zhaoqing will be suspended from 16 April 2017 until further notice. The Ritz-Carlton, Hong Kong One International Finance Centre / Two International CEO Letter Finance Centre / IFC Mall / Four Seasons Hotel / Four Seasons Place Tai Wo Central Heights / The Grandiose / The Wings / PopCorn 1 / Long Yuen Long Safety Ping 48 PopCorn 2 / Crowne Plaza Hong Kong Kowloon East / 41 47 Holiday Inn Express Hong Kong Kowloon East / Vega Suites Kam Sheung Tai Po Market Road 33 Residence Oasis / The Lane Customers 49 Tin Shui Wai No.8 Clear Water Bay Road / Choi Hung Park & Ride 36 50 Ma On Shan Wu Kai Sha Metro Town Hung Shui Kiu New Territories Heng On Royal Ascot / Plaza Ascot University Tai Community Siu Hong Shui Ocean Walk Hang 30 39 Sun Tuen Mun Centre / Sun Tuen Mun Shopping Centre 27 Hanford Garden / Hanford Plaza 35 Environment Tuen Mun 29 Racecourse* Citylink Plaza Shek Mun Fo Tan MTR Hung Hom Building / Hung Hom Station Carpark
31 City One Tuen Mun South Trackside Villas Staff 28 Sha Tin The Capitol / Le Prestige / Hemera Tsuen Wan Tai Wo Hau Sha 05 Tin Kwai Hing Wai The Palazzo 45 07 38 Lake Silver Supply Chain Tsuen Wan West 40 CheTemple Kung Festival City 06 37 Kwai Fong The Riverpark 18 Tai Wai Hin Keng Century Gateway Tsing Yi Mei Foo Financial and Economic Lok Fu Wong Tai Sin Lai King Kowloon Diamond Hill The Austin / Grand Austin Lai Chi Kok Tong Choi Wan Cheung Sha Wan City Point AsiaWorld-Expo DisneylandResort 25 Sham Choi Shun Tin Performance 46 Shui Po Kowloon Hung Sunny Bay Shek Sau Mau Ping Property Developments Under Construction / Nam Kip Mei Po Tat Po Lam Airport Prince Kowloon Planning Cheong Edward Kai Tak Bay 24 Mong Mong 01 Hang Hau Corporate Governance 20 Kok East To 04 Kok Kwa LOHAS Park Packages Wan Cable Car 44 Ma Ngau Tau Kok Yau Tau 19 Olympic Ma Ho Tai Wai Station Ngong Ping 360 Tei Wai Tung Tung Man Kwun Tong 23 Tin Chung Chung Tin Wing Stop East 42 Lam Tin Building Our Future Tseung Tung 21 Yau Tong Austin Whampoa Kwan O Wong Chuk Hang Station Packages Chung Jordan Tiu West Kowloon Tsim Hung 26 Keng West Sha Hom Leng Ho Man Tin Station Packages Tsui 32 Kowloon 10 Mainland of China and Lantau Island Terminus West Rail Line Property Developments (As East Tsim Sha Tsui Fortress Hill ay 09 34 22 w h Sai Ying Pun e t Agent for the Relevant Subsidiaries of KCRC) s or LOHAS Park Hong KongTamar au N 11 C y 17 International Business Exhibition a North B Point 12 16 02 Quarry Bay Tai Koo Century Gateway Tin 15 HKU Sheung Wan KennedyTown Hau Tsuen Wan West Station (TW5) Bayside / Central 14 Sai Wan Ho Wan Chai Tsuen Wan West Station (TW5) Cityside / Performance Metrics 03 CausewayBay Shau Kei Wan 08 Admiralty Heng Fa Chuen THE PAVILIA BAY / City Point Hong Kong Island 13 Cullinan West
Chai Wan The Spectra / Long Ping Station (South) Queen Mary Hospital Yuen Long Station Cyberport Tin Wan Aberdeen Wah Fu Kam Sheung Road Station Packages 43 Pat Heung Maintenance Centre Wong Ocean Chuk Park Hang Lei Tung
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MENU In 2016, our share of total franchised public transport boardings in Hong Kong Hong Kong Rail Network was 48.4%, which has reduced marginally from the year before. Domestic Services refer to ten main commuter lines: Kwun Tong, Introduction Tsuen Wan, Island, South Island (East), Tung Chung, Tseung Kwan O, FRANCHISED PUBLIC TRANSPORT BOARDINGS IN East Rail, West Rail, Ma On Shan and Disneyland Resort lines. HONG KONG (%) The City Unlimited: Sustainabilty Report 2016 Cross-boundary Service refers to our service running to/from Hong MTR Buses Green minibus Trams and ferries Kong and Shenzhen via Lo Wu or Lok Ma Chau on the East Rail Line. About this report 2.5% 2.4% 13.9% 13.9% Scope of this report Airport Express refers to the direct service linking Hong Kong 48.5% 48.4% About MTR corporation International Airport and Hong Kong Station in the Central Value chain, materiality and business hub. stakeholder engagement Light Rail and Bus refers to the Light Rail network in the 2015 2016 northwestern New Territories and feeder bus services to/from many Chairman’s Message MTR stations in the New Territories.
CEO Letter Intercity refers to three through train routes to/from cities in the 35.1% 35.3% Safety Mainland of China, namely Beijing, Shanghai and Guangdong. Customers TOTAL PATRONAGE FOR HONG KONG TRANSPORT OPERATIONS (MILLIONS) Community Environment Intercity Light Rail and Bus Airport Express Cross-boundary P13DomesticP13 Services Staff Service 3.7 Supply Chain 4.1 226.7 229.1 Financial and Economic 15.7 16.1 Performance 114.2 113.3 Corporate Governance Building Our Future Mainland of China and International Business Performance Metrics
1577.5 1586.5 2015 2016 13 2015201520162016 WEBSITE
MENU The Kwun Tong Line Extension (KTE), which extends the existing line to connect Yau Ma Tei with the Whampoa area, opened on 23 October LEARN MORE... 2016. And on 28 December 2016, we opened the South Island Line (East) Express Rail Link Introduction (SIL(E)) as the first metro service to the Southern District, extending from Admiralty to the southern part of Hong Kong Island and reaching an On 30 November 2015, the Company announced that it had entered estimated population of 350,000 residents and working commuters. into the “XRL Agreement” with the HKSAR Government. The XRL The City Unlimited: Agreement, which includes a proposal to resolve the additional Sustainabilty Report 2016 Both of these projects were financed by the Rail plus Property model. Read funding for the Express Rail Link Project, was approved by the About this report more about the considerations for the existing and future communities Company’s independent shareholders on 1 February 2016 with Scope of this report along these two lines in the Community section. 99.83% voting in favour. On 11 March 2016, the HKSAR Legislative Council also approved the additional funding requirement, About MTR corporation Two new lines are currently under construction which, together with the whereupon the XRL Agreement has become unconditional and Value chain, materiality and KTE and SIL(E) and the Island Line Extension to Western District that was comes into full force. stakeholder engagement opened in 2014, will expand route length of our rail network in Hong Kong by about 25% to meet the future transportation needs of the people of Hong Kong. Chairman’s Message We recognise that in order to continue to connect and grow communities CEO Letter in parts of Hong Kong that are currently underserved by an efficient mass transportation system, we must continue to explore new opportunities to Safety Hong Kong Network Expansion Projects (and Completion Status of Rail Projects in 2016) expand our network. Customers Express Rail Link — A 26km high-speed cross-boundary rail service Community connecting Hong Kong with Shenzhen, Guangzhou and the high- speed rail network in the Mainland of China. At year end, completion Environment had reached 87%. Staff Shatin to Central Link — The 17-km Shatin to Central Link connects Supply Chain existing railway lines to form an East West Corridor and a North South Corridor. The lines will provide much needed new links across Financial and Economic the New Territories as well as a new cross-harbour connection, Performance serving an estimated residential and working population of 640,000 in 2021. At year end, completion had reached 68% overall. Corporate Governance Building Our Future Mainland of China and International Business Performance Metrics
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MENU Hong Kong Station Commercial Business Hong Kong Property Business
• 1,392 MTR Shops for passenger convenience • 96,066 residential units; and Introduction • 22,485 advertising units at stations, and 23,747 units on trains • 758,427 m2 of commercial and office space under management • Enhanced mobile service through 4G access at all stations • Investment portfolio: The City Unlimited: • Speed up the upgrade and installation of mobile phone and WiFi system Sustainabilty Report 2016 » 212,538 m2 of retail properties About this report » 54,677 m2 of lettable office space and other uses To make the most of our railway assets, we operate related businesses Scope of this report 2 such as leasing retail space and advertising in trains and stations, and » 120,620 m of GFA to be added over the next 5 years About MTR corporation fixed and mobile telecommunications services. Value chain, materiality and In Hong Kong, we work with leading property developers to build properties stakeholder engagement As at 31 December 2016, there were 1,392 shops inside stations covering above or near our stations. We have a portfolio of investment properties 57,151 square metres of retail space, an increase of 913 square metres comprising shopping malls and office space and other uses. from 2015. Chairman’s Message The Company also manages a portfolio of residential properties, office CEO Letter space and commercial space. As of the end of 2016, we had 96,066 LEARN MORE... residential units, and 758,427 square metres of commercial and office Safety space under management. We are enhancing the assets of our existing More information about MTR Shops and Malls. shopping centre portfolio while making significant additions. These projects Customers will add a total of about 120,620 square metres (gross floor area, “GFA”) to Community the existing retail portfolio, increasing by approximately 40%. For our telecommunications services business, the installation of a new Environment mobile phone network offering increased data capacity and more 4G Over the past three years, a number of new property development projects have been tendered out. Upon completion, they will add approximately Staff services has made good process. The project is scheduled for completion in 2018. We have also worked with a telecom operator to upgrade WiFi 18,000 residential units to support the community’s housing needs. More Supply Chain equipment to provide enhanced service. details of these projects and expansion of our shopping centre portfolio are available in Building Our Future. Financial and Economic Performance LEARN MORE... Corporate Governance More information about MTR Properties is available on our Building Our Future corporate website. Mainland of China and International Business Performance Metrics
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MENU Consultancy Services and Other Businesses Mainland of China and International Business We offer worldwide consultancy and contracting services on railway Outside of Hong Kong, we invest selectively in rail-related projects, planning, design management, system integration and assurance, including property developments, which we believe will generate Introduction project management, construction management, railway operations sustainable returns within clear risk parameters. and maintenance, and non-fare revenue business. In recent years our The City Unlimited: consultancy business has provided services in cities across Asia, Australia Currently our subsidiaries and associates are involved in building, Sustainabilty Report 2016 and the Middle East. operating and maintaining mass transit railway systems and providing About this report related services in the Mainland of China, the United Kingdom, Sweden and Australia. In the Mainland of China, subsidiaries and associates are Scope of this report DID YOU KNOW? also involved in the leasing of retail space, providing estate management About MTR corporation services and developing properties. We served as technical consultant to Metro Barra for the Rio Metro Value chain, materiality and Line 4, which was opened in 2016 as a key infrastructure project for stakeholder engagement The total number of passengers carried by our subsidiaries and associates the 2016 Olympic Games in Rio de Janeiro, Brazil. We also previously in six cities outside of Hong Kong reached approximately 1.8 billion in 2016. assisted Metro Rio for Metro Rio Lines 1 and 2. Chairman’s Message More information about our consultancy services can be found on In 2016 we saw our overseas operations progress well: our corporate website. CEO Letter • Australia: our consortium is implementing the Operations, Trains and Systems Contract for Australia’s largest public transport project, Safety the Sydney Metro Northwest, our first international Public-Private- We are engaged in other businesses in Hong Kong, including the Ngong Partnership (“PPP”) project Customers Ping 360 cable car service and associated theme village, named as one • Beijing: The North Section of Beijing Metro Line 16 opened on 31 of the “Ten Amazing Cable Car Rides Around the World” by the UK’s Community December 2016. Daily Telegraph newspaper in 2014. For the first time, we are including Environment performance metrics of relevant sustainability issues from Ngong Ping 360. • Hangzhou: Maintained excellent safety and operational performance We are also engaged in the Octopus card payment system, which is outside during the G20 Summit and was highly regarded by the municipal Staff the scope of this report as we do not have operational control of the government. Company. Supply Chain • Sweden: Took over the Stockholm commuter rail (Stockholms pendeltåg) on 11 December 2016. Financial and Economic Performance LEARN MORE... • Shenzhen: The first batch of sold units, in the low-rise buildings above the depot, were handed over to buyers in December 2016. Corporate Governance Find out more about Ngong Ping 360 cable car and the theme village on their website Building Our Future Mainland of China and International Business Performance Metrics
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Introduction SWEDEN MAINLAND OF CHINA Stockholm Metro Beijing Metro Line 4, Daxing Line, The City Unlimited: • Operated by MTR Tunnelbanan AB* Beijing Metro Line 14 and 16 (Phase 1) Sustainabilty Report 2016 • Rolling stock maintenance by MTR Tech AB* • Operated by Beijing MTR Corporation About this report Stockholm Limited# MTR Express intercity train service Scope of this report • Operated by MTR Express (Sweden) AB* London About MTR corporation Beijing Hangzhou Metro Line 1 and extension Stockholm commuter rail • Operated by Hangzhou MTR Value chain, materiality and (Stockholms pendeltåg) Hangzhou Corporation Limited# stakeholder engagement • Took over in December 2016 Shenzhen • Operated by MTR Pendeltågen AB* • Rolling stock maintenance by Emtrain AB# Shenzhen Metro Line 4 (Longhua Line) Chairman’s Message • Operated by MTR Corporation (Shenzhen) Limited* CEO Letter UNITED KINGDOM AUSTRALIA Safety Sydney Metro Northwest TfL Rail / Elizabeth Line • Operation will commence in 2019 • Operated by MTR Corporation Customers • Operated by Metro Trains Sydney Pty. Limited# (Crossrail) Limited* Community Sydney London Overground Melbourne’s Metropolitan Rail Service Melbourne • Until November 2016 Environment • Operated by Metro Trains Melbourne Pty. Limited# • Operated by London Overground Staff Rail Operations Limited# * 100% owned subsidiary of MTR Corporation # Supply Chain Joint Venture/Consortium of which MTR Corporation is a shareholder Financial and Economic Performance Please refer to Mainland of China and International Business for an Corporate Governance introduction to the sustainability approach and performance of the railway operations conducted by our subsidiaries outside of Hong Kong. More Building Our Future information about our future plans outside of Hong Kong is available in Building Our Future. Mainland of China and International Business Performance Metrics
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