Carmila : Green Bond Framework

Green Bond Framework

October 2022

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Table of Contents
I. Introduction..........................................................................................................................................................................	3
1.1	Description of Carmila.........................................................................................................................................................	3
Overview .....................................................................................................................................................................................	3
A strategic partnership with Carrefour .......................................................................................................................................	3
2022-26 Strategic and Financial Plan: Building Sustainable Growth ..........................................................................................	4
1.2	Sustainability: an integral part of Carmila group's strategy................................................................................................	5
CSR Governance..............................................................................................................................................................................	5
Ethics and respect for human rights ...............................................................................................................................................	6
Responsible value chain..................................................................................................................................................................	6
Here we Act: Carmila's responsible initiatives programme ............................................................................................................	7
Overall CSR performance ..............................................................................................................................................................	14
Sector-specific initiatives and charters supported by Carmila......................................................................................................	14
Sustainable finance initiatives ......................................................................................................................................................	15
II. Green Bond Framework..................................................................................................................................................	16
2.1 Rationale for issuing green bonds .....................................................................................................................................	16
2.2	Use of proceeds ...........................................................................................................................................................	17
2.3	Process for Evaluation and Selection of Projects ........................................................................................................	19
2.4	Management of Proceeds ............................................................................................................................................	20
2.5	Reporting ......................................................................................................................................................................	21
a) Reporting on the allocation of the proceeds (allocation report)....................................................................................	21
b) Reporting on the climate and environmental benefits (impact report).........................................................................	21
III. External Review...............................................................................................................................................................	22
3.1 Second Party Opinion.........................................................................................................................................................	22
3.2 Post-issuanceVerification..................................................................................................................................................	22
Disclaimer..............................................................................................................................................................................	23

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I. Introduction

1.1 Description of Carmila

Overview

Carmila operates and manages a network of 208 shopping centres adjoining Carrefour hypermarkets in France, Spain and Italy and is the third-largest listed owner of commercial property in continental Europe1. As of 30 June 2022, Carmila's portfolio was valued at €6.2 billion. Its centres are primarily located in medium-sized cities, where they are embedded in local communities and enhance and simplify everyday life for tenants and customers.

Carmila centres provide access to a responsible offering of everyday, useful products and services, while enabling retailers to respond to structural changes in retail by offering a differentiating, omnichannel customer experience.2

Carmila has worked hard to adapt the mix of retailers in its centres. This transformation has been driven by structural trends and local needs.

Carmila will continue to adapt the mix of its centres, with a further reduction in clothing and a shift towards more services, leisure, and innovative concepts.

Healthcare tenants in particular are now an established part of Carmila centres and we continued to rent new space to healthcare providers.

A strategic partnership with Carrefour

Carmila was founded by Carrefour and several large institutional investors in 2014 in

order to transform and enhance the value of shopping centres adjoining Carrefour hypermarkets. The company was listed on Euronext-Paris in 2017.

1. Company data
2. Appraisal values, including transfer taxes (all figures as of year end 2021)

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The strategic partnership with the Carrefour group is a major competitive advantage for Carmila. It enables Carmila to develop its strategy based on a privileged relationship with one of the world's leading food retailers, with a multi-format network of 13,000 stores in more than 30 countries. This partnership generates significant synergies with the Carrefour property ecosystem, notably facilitating the management of centres and the delivery of development projects.

2022-26 Strategic and Financial Plan: Building Sustainable Growth

In 2021, Carmila launched its new strategic and financial plan for 2022-2026. The plan describes Carmila's new ambition to build sustainable growth and invest in new business lines. It is Carmila's response to structural changes in

retail, which have gathered pace with the Covid crisis. The plan is based on three pillars:

• A new role for Carmila as an incubator and omnichannel platform
• Leadership in sustainability, notably through a new generation of development projects based on mixed-use and a commitment to reach "net zero" Scope 1 and Scope 2 emissions by 2030
• Investment in new business lines: digital infrastructure and new retail concepts

Carmila is accelerating the adaptation of its core business through a new approach to working with retailers. To meet changing customer expectations, Carmila centres are acting as incubators for new brands, concepts and temporary retail, with an offering based on modestly

Incubator and priced rents (€257 per sq.m. at end-2021). Carmila is also stepping up the development of

omnichannel its service platform with a particular focus on omnichannel, by combining them in the Carmila

platform for Services Hub, which was launched in 2021. retailers

Through partnerships with an ecosystem of start-ups, Carmila is also enhancing its service offering to retailers at every stage of the customer experience. These initiatives will support the omnichannel development of centres and retailers.

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	As part of its new strategy, Carmila's development pipeline has been completely redesigned
	with a new focus on mixed-use projects and environmental excellence. The five major
Leader in the	extension projects, representing €550 million of investments consist mostly of brownfield
sustainable	retail developments that also include housing, public parks, office space and renewable
transformation of	energy infrastructure.
local regions
	In partnership with Carrefour, Carmila has also identified a number of sites suitable for large-
	scale mixed use transformation projects that will completely change shopping centres'
	presence in the city. These currently 100% retail sites will become new neighborhoods, with
	homes, offices, local services and green spaces.
	Carmila is also working on a number of innovative development projects, the two most
	developed of which being Next Tower and Carmila Retail Development:
	∙ Through its subsidiary Next Tower, Carmila is working in partnership with Carrefour
	and major telecom operators to improve access to digital infrastructure in medium
	sized cities in France and Spain. Next Tower aims to develop a total of 470 sites for
	mobile towers and data centres by 2026. By, improving 4G and rolling out 5G, the
Breaking new	Next Tower project is helping to reduce the digital divide and is completely aligned
ground	with Carmila's objective of contributing to the sustainable transformation of local
	regions;

• Carmila Retail Development (CRD) makes early-stage venture capital investments to test new concepts and scale them up rapidly once they have demonstrated that they can be successful in shopping centres. By 2026, CRD is targeting a portfolio of 20 brands, representing more than 700 stores in both Carmila and third-party centres.

1.2 Sustainability: an integral part of Carmila group's strategy

CSR Governance

Board of Directors' CSR Committee

In 2020, Carmila's Board of Directors set up a CSR Committee to place environmental, social and societal issues at the heart of its initiatives. It is responsible for discussing, defining and assessing Carmila's general policies in the area of corporate social responsibility.

In particular, the CSR Committee is responsible for:

- examining Carmila's CSR commitments and positions, their alignment with stakeholder expectations, their roll- out, and ensuring that CSR matters are properly taken into account;

• assessing risks, identifying new opportunities, and analysing the impact of the CSR policy on financial performance;
• reviewing the Group's annual statement of non-financial performance;
• reviewing the summary of the ratings awarded to the Company by ratings agencies and non-financial analysts;
• identifying and discussing emerging CSR trends and verifying that the Company is well prepared for the challenges specific to its business and objectives.

CSR department

The CSR department, consisting of a director, a manager and a project manager, proposes the strategy and objectives for validation by Executive Management and the Board of Directors' CSR Committee. The CSR department is then responsible for the proper implementation of the strategy. It reports to Executive Management and leads all the CSR committees and networks.

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