69 IDENTIFYING OUR MATERIAL SUSTAINABILITY MATTERS SUSTAINABILITY STATEMENT Risk Management We set our goals and measures geared towards mitigating the potential financial implications of climate change. These include the processes used to identify, assess and manage risks and how these processes are integrated into our existing risk management. Physical Risk Reputation Transition Risk • Investors and tenants increasingly prioritise sustainable and climate-resilient properties. Failure to meet these expectations may lead to dissatisfaction and reputational damage. Opportunity to enhance the reputation of the REIT by being at the forefront of a climate-conscious service. Potential Impact Opportunities Acute Physical Risks Severe weather events or natural disasters may disrupt supply chains, damage infrastructure and threaten safety, impacting operational continuity. Taking proactive measures to address acute physical risks offers a chance to strengthen strategic resilience. Conducting comprehensive risk assessments, formulating emergency response plans and investing in resilient infrastructure can help alleviate immediate impacts. Chronic Prolonged environmental changes, such as rising temperatures and shifting precipitation patterns pose persistent challenges, potentially affecting infrastructure, resource availability and our worker’s health over the long term. Incorporating sustainable practices, making investments in energy-efficient technologies, and embracing climate-resilient infrastructure can help alleviate the long-term impacts. Potential Impact Climate Risk Identification Climate Risk Assessment Climate Risk Management •Climate-related risks are identified alongside other risks via the Enterprise Risk Management (“ERM”) Framework. • Potential climate-related risks are assessed based on their likelihood of occurrence and the impact on the business, if an adverse climate-related event occurs. • The Audit and Risk Management Committee reviews the risk updates by departments on a quarterly basis. • When necessary, the management implements action plans with specific timeframes for mitigation. •The Audit and Risk Management Committee regularly examines the internal control processes and the results of risk management. Metrics and targets Al-Salām REIT measures carbon emissions, energy and water usage, expressing carbon emissions in tCO₂e, electricity in kWh and water in m³. To assess greenhouse gas ("GHG"), energy and water intensity, we compute absolute values and normalise them by dividing against the floor space of our operations in m2. Additionally, we quantify the share of renewable energy generated by our solar panels within our total energy consumption in kWh. We track and disclose emissions under Scope 1 and Scope 2, continuously monitor GHG emissions across our operations as well as uphold consistent enhancement of TCFD disclosures to be consistent with all relevant recommendations and regulatory requirements. Opportunities
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