SUSTAINABILITY STATEMENT SECTION 3 43 Al-`Aqar Healthcare REIT | Annual Report 2024 ASSESSING OUR MATERIALITY MATTERS INCORPORATING CLIMATE STRATEGIES The REIT enhances stakeholder insight into environmental impact and resilience strategies by transparently disclosing our climate-related risks and opportunities, enabling informed decision-making and supporting prudent capital allocation. Governance Recognising the impact of climate change on REIT operations, the Manager has incorporated climate considerations into our decisionmaking processes. These initiatives are guided by the Board and endorsed by the BSC and SMC. Strategy Al-`Aqar has identified transition and physical risks related to climate change, as well as their impacts on operations, and related opportunities. Transition Risks, Potential Impacts and Opportunities Board of Directors Management • The Board provides strategic oversight concerning the sustainability strategies, policies and performance of the REIT, which includes considerations related to climate issues. • The Board is responsible for approving ESG KPIs, which encompass climate-related metrics. • The Sustainability Management Committee (“SMC”) proposes sustainability strategies and initiatives to the Board, including those related to climate concerns. • The Sustainability Committee evaluates and supervises the implementation of sustainability initiatives and performance, which encompasses climate-related considerations. Opportunities Potential Impact Transition Risks POLICY AND LEGAL Future implementation of carbon taxes or other carbon pricing mechanisms • Potential expenses arising from penalties and fines. Potential cost savings from operational efficiency, including reduced energy consumption and optimised resource utilisation TECHNOLOGY Challenges in adopting new technologies and low-carbon operating processes • Adopting new technologies in healthcare facilities for energy efficiency or renewable energy sources may require investments and pose risks associated with technology changes. Investing in energy-efficient technologies and practices can lead to cost savings and reduce our carbon footprint.
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