Businesses in Hong Kong will need to significantly reduce their carbon emissions over the next few years to ensure the city can meet its Paris Agreement targets. 

And as a large proportion of Hong Kong’s emissions come from buildings, it is particularly important that the property and construction sectors take action.

Swire Properties was among the first developers in Hong Kong to establish science-based decarbonisation targets, Raymond Yau, General Manager, Technical Services and Sustainable Development, explained at a Chamber seminar on 22 July.  

As part of its decarbonisation journey, the company reviewed its global assets to ascertain the risks that climate change poses, for example, extreme weather events such as hurricanes hitting its assets in Florida. 

“A lot of our investors will be interested to know what solutions we have to these issues,” Lau said.

So it has taken a proactive approach by integrating sustainability into every facet of the business, even including the topic in annual staff appraisals. 

Swire Properties is now using lower carbon cement substitutes and increasing the percentage of recycled steel in its projects. “This will fundamentally reduce the embodied carbon and our overall emissions,” Yau said. Embodied carbon refers to the carbon used in the construction, maintaining and decommissioning of buildings. 

In the past decade, the company has also reviewed its properties’ use of air-con and other energy, he explained. “We have already dealt with the ‘low-hanging fruit’ of changing the chillers and fans. What is left now is more challenging work to achieve the targets.” This next stage will involve investing in technology, such as big data analytics and AI, to become more efficient.

Besides reviewing its own emissions, Swire Properties is also working with its partners such as electricity providers, transportation and distribution, and tenants.  Over a 50-year life cycle of a typical shopping mall, tenants are responsible for the majority of the carbon emissions, Yau said. While this is outside the company’s control, it is working with its tenants to help them reduce their power consumption. 

Simon Ng, Director of Policy and Research at the Business Environment Council (BEC), hailed Swire Properties’ efforts as a “showcase of business leadership and commitment.” 

Ng introduced BEC as a corporate membership organization that helps businesses reduce their environmental impact. BEC launched its Low Carbon Charter last year, which provides companies with a framework for setting carbon reduction targets. 

“Corporates are part of the problem, but also potentially part of the solution,” he said. “There are various ways to accomplish this daunting task.”

Climate change is posing considerable risks to business – for example 2018’s Typhoon Mangkhut had an estimated cost of $4.6 billion, Ng said. “The physical risk is easier to understand,” he said, but businesses must also consider transitional risk. 

“As we transition to tighter regulation and higher standards, businesses that fail to do this in a timely manner will face risks, including impact on their reputation. Nowadays, you cannot get away with saying you do not care about climate change.”

But there are also business opportunities from a sustainable approach, he said, with the most obvious one being cost savings from lower energy bills. 

While companies can reduce their emissions without measuring their progress, Ng believes it is better to set targets, to understand how your carbon reduction as a company contributes to your sector’s decarbonisation, and to Hong Kong’s progress overall. “I think target setting is really important. You can’t manage what you don’t measure.”

Ng added that companies that sign up for BEC’s Low Carbon Charter will find it is an ongoing process with regular progress checks. “It is not just about signing a piece of paper; it is a serious commitment.”