pg. 93 Sustainability Statement Integrated Annual Report 2025 SUSTAINABILITY STATEMENT CLIMATE CHANGE AND DECARBONISATION CLIMATE GOVERNANCE Risk Area Risk Rating Risk Tolerance Level ESG Governance Weakness is a risk if ESG considerations are not adequately integrated into Board and management decision-making processes. Effective governance of climate-related risks and opportunities is a key priority for the Board, reflecting its commitment to long-term resilience and value creation. Through strategic oversight, the Board ensures that climate considerations are embedded in decision-making, while management actively assesses and addresses climate-related challenges to protect and enhance the REIT’s assets. Al-Salām REIT adopts a top-down approach to managing sustainability-related initiatives and concerns. The Board maintains oversight of the REIT’s sustainability agenda, ensuring that all sustainability and climate-related initiatives, risks, and opportunities align with overarching targets. The management, including the SMC, advises the Board on climate initiatives and strategies while monitoring and overseeing their implementation in daily operations. The SMC is also tasked with consolidating performance data and benchmarking progress against KPIs and targets, developing climate strategies that are unique to each operational site, periodically reporting findings to the Board and suggesting implementations to ensure continuous alignment with climate objectives, and acting as a bridge of communication between the Board and the operational level. Under the management, operation-level personnel, including the departments, project owners, leaders, and service providers, are responsible for implementing climate initiatives from the management and Board levels, collecting progress and data on risks and potential issues to provide management with the data necessary to devise and adapt climate strategies. Board of Directors Board Sustainability Committee Departments/ Project Owners/ Leaders Service Providers Sustainability Management Committee (Management & Property Managers) • Provides strategic oversight over the Manager overall sustainability agenda, policies, strategies, and ESG performance • Ultimate statutory and fiduciary responsibility for decision-making relating to the functions and duties of the Committee • Assists the Board in fulfilling its oversight responsibilities in relation to the REIT’s objectives, policies, and practices with respect to sustainability and compliance with statutory requirements • Regularly improves, develops, executes, monitors and audits sustainability targets, polices, practices, working principles, and management systems • Reports to the BSC on material sustainability matters on a quarterly basis • Reviews the relevant policies and frameworks and makes recommendations to the Board on the Manager’s policy and performance in relation to the environment, health, safety, and community • Executes ESG initiatives and reports to the SMC • Assesses the effectiveness, monitors, and maintains the records of implemented sustainable initiatives Roles and Responsibilities Through this strong top-down governance approach, the REIT is well-equipped to manage climate-related risks while seizing related opportunities, enhancing both operational resilience and long-term sustainability outcomes. In the future, the REIT is planning on conducting annual climate training for its Board members to ensure the REIT’s strategic direction and oversight controls remain flexible to evolving climate change developments. The REIT’s approach ultimately positions the REIT to be prepared in mitigating all climate risks, enhancing its climate resilience and its long-term operational sustainability.
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