Case study: How Kerry Properties promotes sustainability across its supply chain
Kerry Properties is a world-class property company with significant investments in mainland China and Hong Kong, focused on developing high-quality residential, commercial and mixed-use developments in prime locations. Kerry Properties cooperates with its suppliers and contractors to enhance their environmental and social performance Tweet This!, also ensuring suppliers’ compliance with laws and regulations.
This case study is based on the 2020 Sustainability Report by Kerry Properties, prepared in accordance with the GRI Standards, that can be found at this link. Through all case studies we aim to demonstrate what CSR/ ESG/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.
Abstract
Kerry Properties sees its procurement practices seriously, to make sure that its standards for sustainability not only apply to its internal practices but also extend to its suppliers and third parties it partners with, including architects, designers, consultants, service providers and contractors. In order to promote sustainability across its supply chain Kerry Properties took action to:
- evaluate suppliers
- promote sustainable procurement
- engage suppliers
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With this case study you will see:
- Which are the most important impacts (material issues) Kerry Properties has identified;
- How Kerry Properties proceeded with stakeholder engagement, and
- What actions were taken by Kerry Properties to promote sustainability across its supply chain
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What are the material issues the company has identified?
In its 2020 Sustainability Report Kerry Properties identified a range of material issues, such as service and product quality, customer well-being, health and safety, energy efficiency and GHG emissions, water consumption and conservation. Among these, promoting sustainability across its supply chain stands out as a key material issue for Kerry Properties.
Stakeholder engagement in accordance with the GRI Standards
The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:
Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.
Key stakeholder groups Kerry Properties engages with:
| Stakeholder Group | Method of engagement |
| Investors and Shareholders
| · Annual/Special General Meetings · Annual and interim results announcements · Announcements and circulars · Annual and interim reports · Sustainability reports · Company websites · Investor visits/briefings · Response to investor surveys and benchmarking exercises · Press and analysts’ conferences · Roadshows and investors’ conferences |
| Customers and Tenants
| · Customer satisfaction surveys · Customer service hotlines · Community events · Club and membership activities · Social media and company websites · Corporate publications · Mobile applications for tenants |
| Government and Industry Associations | · Regular meetings · Public consultation · Conferences, forums and seminars |
| Academia
| · Research studies · Student partnership programmes · Event venue sponsorships · Seminars |
| Media
| · Press conferences and releases · Media briefings · Feedback and response to enquiries |
| NGOs
| · Focus groups · Partnership programmes · Award schemes and charters · Sponsorships and donations · Conferences and seminars |
| Employees
| · Orientation and training sessions · Team building activities · Recreational and volunteering activities · Lunch with senior management · Communication enhancement via latest information technologies · Employee Innovation Committee and sustainability taskforces · Staff magazine “Art of Services” · Employee opinion surveys · Annual performance appraisal · Mobile Intranet and emails · Newsletters |
| Suppliers and Contractors
| · Surveys and meetings · Supplier enquiry hotline · Green Construction Site Award · Kerry Project — Community Caring Scheme · Safety briefings · Tendering and procurement processes |
| Local Communities
| · Public/community events · Community initiatives · Corporate volunteer team and employee volunteering activities · Company websites |
How stakeholder engagement was made to identify material issues
To identify and prioritise material topics Kerry Properties engaged with its stakeholders through surveys (3,097 invitations sent with 1,982 responses received), focus groups (9 focus groups with 53 participants) and in-depth interviews (11 interviews with 13 participants).
What actions were taken by Kerry Properties to promote sustainability across its supply chain?
In its 2020 Sustainability Report Kerry Properties reports that it took the following actions for promoting sustainability across its supply chain:
- Evaluating suppliers
- Kerry Properties proactively encourages parties along its supply chain to follow ethical business practices. The “Vendor Code of Conduct”, which forbids forced labour, slave labour and child labour governs how Kerry Properties manages and monitors vendors, while its service provider evaluation helps Kerry Properties screen any third parties it onboards in carrying out its business. All building contractors, for example, are required to obtain ISO 14001 and ISO 45001 accreditations on Environmental Management System and Occupational Health and Safety Management System respectively.
- Promoting sustainable procurement
- Kerry Properties’ “Sustainable Procurement Policy” defines how it integrates sustainability principles into the procurement process. It serves to expand Kerry Properties’ standards for sustainability from its own operations to those of its supply chain partners. Kerry Properties has set high expectations for its partners such that the adverse environmental and social impacts of any products and services that it procures are minimised. Regarding environmental considerations in the procurement process for property management and property development, Kerry Properties’ “Green Procurement Manual” outlines requirements on environment-specific credentials of products that are used in its business activities. Requirements are intended to encourage the use of products that are, for example, recyclable and energy-efficient. Internal and external audits help validate Kerry Properties’ procurement practices enforcement against specifications in this manual. The specifications are reviewed and continuously improved according to updates made by industry standards. In 2020, Kerry Properties accomplished new goals it had set, including the launch of its “Sustainable Procurement Manual”. The “Sustainable Procurement Manual” was developed in line with ISO 20400:2017 Sustainable Procurement – Guidance and built upon Kerry Properties’ existing “Green Procurement Manual” to cover a broader scope of socio-economic considerations. Furthermore, Kerry Properties updated the specifications in the “Green Procurement Manual” for its property management and head office: the scope of items targeted was expanded from 50 to 60.
- Engaging suppliers
- Kerry Properties regularly engages with its partners to strengthen its relationship with them and the commitment to sustainability in its supply chain. Under its Kerry Project – Community Caring Scheme, Kerry Properties collaborates on events relating to various sustainability themes. For example, in partnership with a Hong Kong social enterprise, Kerry Properties hosted a total of eight workshops from October through December 2020 across four different property development teams to make dignity bibs for the elderly. More than 80 handmade bibs were donated to a local elderly care centre. The Green Construction Site Award was launched in 2013, with the aim of sharing environmental best practices through yearly, interactive activities centred around different themes. Kerry Properties adopts creative approaches, such as unconventional events, to stimulate awareness and spread its message in an engaging manner.
Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?
The GRI Standards addressed in this case are:
1) Disclosure 308-1 New suppliers that were screened using environmental criteria
2) Disclosure 414-1 New suppliers that were screened using social criteria
Disclosure 308-1 New suppliers that were screened using environmental criteria does not correspond to any SDG.
Disclosure 414-1 New suppliers that were screened using social criteria corresponds to:
- Sustainable Development Goal (SDG) 5: Gender Equality
- Targets: 5.2
- Sustainable Development Goal (SDG) 8: Decent Work and Economic Growth
- Targets: 8.8
- Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
- Targets: 16.1
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References:
This case study is based on published information by Kerry Properties, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original please revert to the following link:
https://www.kerryprops.com/srreport/2020/pdf/en/KPL_SR2020_EN.pdf
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