About This Report

Assessing Priority Sustainability Topics

Swire Pacific’s materiality assessment determines the topics that we manage through our sustainability strategy and those we cover in our annual sustainability disclosures. The assessment identifies and evaluates the sustainability topics most important to our business at the time of the assessment, and in the near future. We define and assess materiality in line with Hong Kong Financial Reporting Standards (HKFRS) Sustainability Disclosure Standards which are based on International Financial Reporting Standards (IFRS) Sustainability Disclosure Standards.

Given the mitigations in place, no sustainability-related risks, including physical or transition climate risks, have been identified which would have a material effect on the Group’s financial position, cash flows, or access to capital for the financial year ended 31st December 2025 or over the short- to medium-term. Climate change has been identified as the only financially material risk to Cathay Pacific in the medium to long term, prior to the implementation of planned mitigation measures. As data is less reliable for the long-term we will continue to monitor and assess how our exposure to long-term sustainability-related risks may change.

What We Do

Our materiality assessment process considers the actual and potential impacts and dependencies of our operating companies which may pose sustainability risks to our business. These potential risks are routinely assessed as part of our enterprise risk management process. Our assessment has four key phases; identify, assess, evaluate, and validate. We review the assessment annually. Identified potential risks are included on Group and operating company risk registers and assessed as part of a quarterly Group-wide risk review.

Materiality process	Description
1. Identify	To identify potentially relevant topics, we consider those topics identified by the Sustainability Accounting Standards Board (SASB) for our industries, conduct research covering megatrends and policy developments, and consider topics of interest to our investors and those included by sustainability ratings agencies when assessing our Group. All topics identified will relate to those included in the Group's ESG risk universe which provides a common language for comparing risks across our operating companies. Our most recent identification process resulted in an initial list of 25 topics.
2. Assess	To understand how identified topics could be relevant to Swire Pacific, we consider how our operating companies interact and engage with their stakeholders and the environment, either through their business activities, or targeted engagement on sustainability. We review the outputs of climate and nature risk assessments at the Group level and for our operating companies, both of which align with the Group’s enterprise risk management (ERM) process for assessing risks. Refer to ESG Risk Management for more information on our approach to assessing climate risk. Refer to our Sustainability Report 2024 and those of our operating companies for details of recent engagement activities.
3. Evaluate	In this phase we evaluate whether the topics present significant risks and opportunities to our businesses. This phase is embedded as part of the regular ERM process at Group and operating company level, and considers plausible worst-case scenarios and how they may onset over the short- medium- and long-term. Senior representatives from Group and operating company key functions such as sustainability, risk, finance, legal, and procurement attend workshops to determine the actual or potential impacts of the risks or opportunities presented by each topic to each operating company. We use the six dimensions of our ERM framework; financial, disruption, reputation, regulatory, human and strategic. Risk functions determine each operating company’s vulnerability to the impacts of each topic, taking account of the level of controls needed to manage the potential impacts, our readiness to respond and the degree to which we can control the impacts. Operating company assessments are collated at the Group level where we consider any additional ESG risks relevant to our business.
4. Validate	Results from each workshop are validated by those with strategic leadership responsibilities at each operating company, and then presented at the Swire Group Sustainability Committee, which determines the extent to which the risks and opportunities are financially material to Swire Pacific. The Board provides final endorsement for the specific topics to be disclosed in our financial and sustainability reports.

Our Priority Topics

Our priority topics are those that require effective management to minimise any potential negative impacts that could in turn pose business risks to the Group. As a diversified conglomerate these topics are common to our core operating companies and are relevant at the Group level.

Our approach to managing strategic topics is described under Swire Pacific SD 2050. This includes measures to mitigate potential negative impacts, areas where we create value for our stakeholders, and matters that may influence the decisions of our investors and providers of capital. Additional topics of relevance to stakeholders of the Group are addressed in Our Approach and Other ESG Disclosures.

The table below shows our priority topics, their definitions and the identified value chain location of potential impacts and dependencies.

⬤ Environmental ⬤ Social ⬤ Governance

Topic	Topic definition	Potential impact			In this report
		Upstream	Own operations	Downstream
STRATEGIC TOPICS
Climate change mitigation	The reduction of carbon emissions by improving energy efficiency of both direct and indirect energy use and emissions produced in our operations, production processes, transport, and through the use of and investment in renewable energy sources.	⬤	⬤	⬤	SD 2050 - Climate
Climate change resilience	The ability to prepare for and recover from physical and transition climate impacts.	⬤	⬤		SD 2050 - Climate
Natural capital and resource use	The relationship our business has through its impact and dependency on natural capital, the stock of renewable and non-renewable natural resources, such as plants, animals, air, water, soils and minerals, and the ecosystem services they provide.	⬤	⬤	⬤	SD 2050 - Water SD 2050 - Waste Other ESG Disclosures - Nature
Waste management and circularity	The implementation of a systematic and life-cycle approach to identify, manage, reduce, and responsibly dispose of or recycle effluents and waste, at all stages of sourcing, production, sale, use and end-of-life; including food and packaging, as well as efforts to reduce effluents from operations and manufacturing facilities.	⬤	⬤	⬤	SD 2050 - Waste
Water management	To stimulate water conservation within our sphere of influence and contribute to water positivity through the implementation of a systematic approach to conserve, reduce use of, and reuse water in our operations and supply chain.	⬤	⬤	⬤	SD 2050 - Water
STRATEGIC TOPICS
Diversity, equity and inclusion	A commitment to a workforce free of unlawful discrimination involving any distinction, exclusion, or preference that has the effect of nullifying equality of treatment or opportunity; and our efforts to ensure that the Group's workforce (at all levels, including the Board) reflects our business strategy and the diversity (in gender and age) of the workforce pool in our countries of operation.	⬤	⬤		SD 2050 - People
Employee wellbeing	The part of an employee’s overall well-being (physical and psychological) that they perceive to be determined primarily by work and can be influenced by workplace interventions.		⬤		SD 2050 - People
Local communities	Process of diversification and enhancement of economic and social activity on a local scale in a territory where the Group is operating or sourcing materials, including direct or indirect generation of employment resulting from our Group's activities and investing in local development of education and environmental preservation.	⬤	⬤	⬤	SD 2050 - Communities
OTHER ESG TOPICS
Business ethics and anti-corruption	Commitment to comply with relevant laws, regulations, standards, and ethical business practices that apply to the organisation including: promoting competitive behaviour; preventing anti-competitive practices; cooperation with regulatory authorities; working against corruption, extortion, and bribery.	⬤	⬤		About Swire Pacific - Our Approach
Cybersecurity, privacy and data protection	Mitigation, response, and reporting measures on matters involving cybersecurity and incidents. Approaches to the way employee and consumer data is collected, used, stored in a secure manner.		⬤	⬤	About Swire Pacific - ESG Risk Management
Labour practices and human rights	Labour standards in working hours and conditions, wages, compensation and benefits, freedom of association and right for workers to negotiate contracts with their employers, and humane treatment of direct employees.		⬤		Other ESG Disclosures - Talent Management
Product quality and safety	Products should be safe for consumers and manufactured in a way that meets appropriate quality assurance standards and applicable regulations.		⬤	⬤	Other ESG Disclosures - Customers
Responsible lobbying	Efforts to uphold high ethical standards and ensure transparency in lobbying activities.		⬤		About Swire Pacific - Our Approach
Responsible sourcing	Processes for sourcing external supplies, including supplier relationships and evaluation of suppliers' environmental and social practices.	⬤			Other ESG Disclosures - Supply Chain
Sustainability governance	Corporate level sustainability governance with board level and executive oversight, and defined roles and responsibilities to manage sustainability related matters, including through dedicated functions and teams.		⬤		About Swire Pacific - Our Approach About Swire Pacific - ESG Risk Management
Talent recruitment and retention	Providing opportunities to promote professional growth and learning among new and existing employees, and matching employee skills with the needs of the business, to remain an employer of choice and retain key talent.		⬤		Other ESG Disclosures - Training and Development

Reporting Overview Stakeholder Engagement