Sustainability Report 2010

Project Management and Editorial: Streeter Strategic Ltd Design: CoDesign Ltd Photography: Leong Ka Tai Contents

About this Report 01 Vision Misson Values (VMV)

Vision From the 02 Chief Executive Officer We aim to be a globally recognised leader that connects and grows communities with caring service Global Organisation 04 Mission

• Enhance customers’ quality of life and anticipate their needs Risk 06 • Actively engage in communities we serve

• Foster a company culture that staff can learn, grow and take pride in

• Provide sustainable returns to investors Engagement 14 • Set ourselves new standards through innovation and continuous improvement

• Grow in Hong Kong, Mainland of China and capture opportunities in Europe by extending our core competencies Low Carbon Future 25

Values Performance Metrics 31 + Performance against Excellent Service Mutual Respect Value Creation Enterprising Spirit Quantitative Safety Targets 2010 We are committed to We work in an open We create profits We have the courage + Maturity Matrix of BS 8900:2006 proactively provide team environment through efficient to question the Guidance for Managing safe, efficient and based on trust, joint execution, continuous status quo to seek Sustainable Development caring service valued commitment and improvement improvement, by customers. respect. and innovation in proactively taking + Financial Performance delivering products initiatives and having We listen and respect and services valued the resourcefulness to + Economic Contribution the views of the by customers. overcome obstacles community and other + Independent Assurance Report and reach new stakeholders. horizons. + Responding to Stakeholder Expectations

+ CoMET Benchmarking Results 2009

+ Definitions

+ Hong Kong Operating Network with Future Extensions Report Cover Story

The West Island Line is a shared vision between company and community. The active dialogue on understanding and respecting expectations has shaped how this and our other future rail projects will serve and grow with local communities.

Collaboration is the operative word behind our dialogue. It reflects awareness of aspirations and genuine response to issues. It requires listening and visibility of action.

It is not just in the regular town hall meetings, but in the on-site presence and daily interaction with residents that assures the vision is alive and well.

Community walkway outside construction works for West Island Line About this Report From the Chief Executive Officer Global Organisation Risk Engagement Low Carbon Future Performance Metrics 01 ) for a www.mtr.com.hk/sustainability In structuring this report, applied we have AccountAbilitythe AA1000 Principles of materiality, inclusivity and responsiveness as articulated through our Sustainable Competitive Advantage model. The processes within this model give rise to the systematic identification, prioritisation and management of both corporate risks and stakeholders expectations and perceptions. Refer our to website ( more detailed discussion of the model’s architecture and its processes that demonstrate how these principles are incorporated. This report covers the priority organisational and business-unit challenges recognised during the year. give insightWe they why to are material ourto sustainable development and how we are responding and to managing the impacts. illustrate We our response and resilience at the workplace or at stakeholder interface with the inclusion of several frontline stories throughout the report. The Priority Sustainability Business Risks and table Performance on page 2010 captures our broader13 organisational sustainability risks, while discussion across the report identifies the material risks within business units. The sustainability website gives further in-depth discussion of these and other significant issues and our effortsto manage them. PricewaterhouseCoopers (PwC) has been commissioned provide to an independent assurance report on selected quantitative data that confirms progress key of performance indicators. Their report is on page of this report. 35 Under the Global Reporting Initiative (GRI) framework, we apply the self-assessed A+ G3 Content Indexlevel. is located The 2010 on our sustainability website facilitate to access of more extensive and relevant documents from within the company. We valueWe your feedback and comments about our sustainability report and overall sustainability journey. Scope of Report of Scope Discussion within this reportprincipally covers activities in Hong Kong, our major business centre. Information concerning our global and mainland China operations is presented where stated. Reporting performance and achievements is limited in these external markets due the to early operational phases of projects, in particular in mainland China, and the to management autonomy allocated our to subsidiaries or concessions. While the well-established many governance and management systems continue provide to a solid foundation for organisational development and business intelligence manage to change, discussion of current actions in terms of risk management and stakeholder engagement demonstrates the inherent resilience of systems and our ability take to timely and appropriate action. this end, we share ourTo management thinking and give insight into the many decisions and initiatives we are taking that determine our future as a successful commercial enterprise, while maintaining our social contract and license operate. to Theperformance metrics cited throughout this document are our report card on how well progressed we have on the sustainabilityjourney. This report is published inform to our industry colleagues, our constituent stakeholders and the professional many groups and NGOs that we engage with on sustainability. view We discussion as a starting point for the sustainability dialoguecontinuedandthesharing best of practices. discussion This year, widened to a broadercover community inclusion and the long-term impact we are creating as we expand our operational footprint, both in Hong Kong and external markets. Questions or comments can be addressed directly to our Sustainability Development Manager, [email protected] or through our sustainability website. About this About Report In this 2010 report, we present 2010 this In oursustainability journey thein context of the social and public policy changes ourin business environment and the critical challenges these find present. We it most focusrelevant on to how we anticipating,are responding and communicatingto with stakeholders the in wake of the sharp rise social in and environmental expectations in Hong also explore Kong. We the changing profile risk of the organisation and the challenges we face managing in them. From the Chief Executive Officer

We marked 2010 as a year of strong most projects, we are on the whole performance in our rail and property making good progress and leveraging businesses, confirming our resilience as a competencies appropriately. social asset and commercial entity. Positive economic momentum in both Hong Success, however, does not come without Kong and mainland China has supported uncertainties. In Hong Kong, we have gains and our growth in these markets. In faced a year of shifting public policy and, Europe and Australia, our expertise and more importantly, highly vocal assertion competencies in rail operations continue of societal aspirations. These events to improve concession performance. As weigh significantly on our social contract, well, steady progress has been made with prompting close scrutiny on how we our five new rail projects in Hong Kong, engage and manage our business. Our with construction under way in two, while challenge is to respond to these changing three are in advanced stages of planning circumstances and to be seen doing so. and approval. This report tables the most significant Our mainland China and international