Frasers Hospitality Trust : ESG Report 2023

A member of Frasers Property Group

ESG Report 2023

2 Frasers Hospitality Trust

Sustainability

Contents

1. Board Statement
2. The Year at a Glance
3. Buidling a Resilient Future: Our Approach to ESG

10 Acting Progressively Risk-based Management

Responsible Investment

Resilient Properties

19 Consuming Responsibly Energy and Carbon

Water

Waste

23 Focusing on People Diversity, Equity and Inclusion Skills and Leadership Health and Well-being Community Connectedness

30 About This Report

Independent Assurance Statement GRI Content Index

Glossary

A glossary of the abbreviations used in this report:

ARCC	: Audit, Risk, and Compliance Committee
BCA	: Building and Construction Authority
Board	: Board of Directors
BREEAM	: Building Research Establishment
	Environmental Assessment Method
CEO	: Chief Executive Officer
DEI	: Diversity, Equity and Inclusion
ESG	: Environmental, Social and Governance
FHT	: Frasers Hospitality Trust
The Sponsor	: Frasers Property Limited
The Group	: Frasers Property and its subsidiaries
Framework	: ESG Framework
FY	: Financial Year Ended 30 September
GHG	: Greenhouse Gas
GRI	: Global Reporting Initiative
MAS	: Monetary Authority of Singapore
NABERS	: National Australian Built Environment
	Rating System
REITAS	: REIT Association of Singapore
SIAS	: Securities Investors Association
	(Singapore)
SSC	: Sustainability Steering Committee
TCFD	: Task Force on Climate-related
	Financial Disclosures
tCO2e	: Tonnes of CO2 equivalent
YoY	: Year-on-year

Board Statement

Dear Stakeholders,

Recognising the imperative to embrace sustainability and being rooted in our Group-wide Purpose of

• Inspiring experiences, creating places for good.
• we have committed to drive actions across our sustainability commitments while enhancing the resilience of our portfolio of quality assets.

Frasers Hospitality Trust's (FHT) FY2023 Environmental, Social and Governance (ESG) Report provides an overview of our sustainability performance and efforts throughout the year. This report signifies our accountability and transparency to our stakeholders as we strive to improve our operations and create long- term value through the three pillars of Frasers Property Limited (the Sponsor) Sustainability Framework - Acting Progressively, Consuming Responsibly and Focusing on People.

In FY2023, all our properties in the UK completed their BREEAM (Building Research Establishment Environmental Assessment Method) assessment and are awaiting their certification awards. Our Australia and Malaysia properties will be undergoing their green certifications in FY2024.

During the year, we continued with our decarbonisation efforts as well as undertook several initiatives to reduce the energy and water consumption and waste generation across our properties where possible. These initiatives were aligned with our Sponsor's goal of being a net-zero carbon corporation by 2050.

Testament to our continued efforts, we are proud to have achieved a score of 82 and a 4-Star Rating in the 2023 GRESB Real Estate Assessment, marking this the third consecutive year that we have attained

ESG Report 2023

3

improvements in our score and rating. We also maintained our third-place ranking in the 'Asia Pacific Hotel - Listed' category under the Assessment. This achievement is significant as stakeholders are able to benchmark FHT's performance against its global real estate peers in the same sector.

In line with our sustainability roadmap, we continue to align this year's sustainability disclosures with the Task Force on Climate-related Financial Disclosures (TCFD) recommendations.

As the global tourism and hospitality industry continues with its recovery from the pandemic, it is important that we continue to embrace innovation and forge deeper partnerships to deliver on our sustainability commitments. We are grateful for the invaluable support of our stakeholders, who have enabled us to chart the path ahead to a greener future.

The Board of Directors will continue to fulfil its duties in determining, monitoring and managing our material ESG issues, providing strategic directions on sustainability as well as overseeing the standards and management processes needed to meet our sustainability objectives.

We look forward to progressing on this journey together.

Board of Directors

Frasers Hospitality Asset Management Pte. Ltd.

REIT Manager of Frasers Hospitality Real Estate

Investment Trust

Frasers Hospitality Trust Management Pte. Ltd. Trustee-Manager of Frasers Hospitality Business Trust

4 Frasers Hospitality Trust

Sustainability

The Year at A Glance

ACTING

PROGRESSIVELY

CONSUMING

RESPONSIBLY

• FHT achieved a score and rating of 82 and 4-star respectively in the 2023 GRESB Real Estate Assessment, with an improved score and rating for the third consecutive year. We maintained a third-place ranking (out of 7) in the "Asia Pacific Hotel - Listed" category.
• InterContinental Singapore retained the Building and Construction Authority (BCA) Green Mark GoldPLUS certification.
• Our properties in Australia scored an average 3.5-Star Water rating (that is between average and good) and 3-Star Energy rating (average) in the National Australian Built Environment Rating System (NABERS) assessment.
• In FY2023, we established our interim decarbonisation roadmap for 2030, in line with our goal of achieving net-zero carbon emissions by 2050. We also completed a climate risk assessment to identify FHT's physical and transitional risks.
• Fraser Suites Queens Gate London, Park International London, Fraser Place Canary Wharf London, Fraser Suites Edinburgh, Fraser Suites Glasgow are all powered by 100% renewable energy.
• The Westin Kuala Lumpur has also subscribed to green energy in FY2023.
• 2.6% year-to-year decrease in energy consumed per occupied room night.
• Expanded Scope 3 disclosure to cover natural gas consumption at tenanted areas and employee commuting.
• Collected 419 tonnes of waste for recycling, a 17.6% increase compared to FY2022.

FOCUSING ON PEOPLE

• The REIT Manager's senior management and employee base has 40% and 67% female representation, respectively. During FY2023, employees of the REIT Manager underwent an average of 23 learning hours per staff.
• In FY2023, all properties managed by Frasers Hospitality, a strategic business unit of the Sponsor, achieved a positive guest review score of 63.9% (FY2022: 63.3%) and a performance score of 81.4% (FY2022: 80.8%).

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5

Building A Resilient Future:

Our Approach to ESG

EMBEDDING ESG WITHIN OUR CORE

As a global hospitality REIT, FHT acknowledges its duty to operate in a responsible manner. Our goal is to contribute to the environmental and social well-being of the communities where we operate in, while creating long-term shared value for our stakeholders.

Our ESG strategy aligns with our Sponsor's ESG Framework (the Framework) which comprises three core pillars: Acting Progressively, Consuming Responsibly and Focusing on People. We prioritise ESG-related focus areas within these key pillars that are most relevant for our hospitality business and operations.

PILLARS

ACTING

CONSUMING

FOCUSING ON

PROGRESSIVELY

RESPONSIBLY

PEOPLE

FOCUS AREAS

Innovation

Materials & Supply Chain

Community Connectedness

Fostering an innovation culture

Achieving the sustainable

Considering social value

that creates value and strengthens

management and efficient use of

principles for communities

our competitive edge

materials along the supply chain

Health & Well-being

Resilient Properties

Biodiversity

Ensuring healthy and balanced work

Strengthening the resilience and

Enhancing the environment and

and community environments

climate adaptive capacity

ecosystem through our developments

Diversity, Equity & Inclusion

Risk-based Management

Energy & Carbon

Empowering and promoting the social

Comprehensive assessment

Increasing substantially energy

inclusion of all, irrespective of age,

to address environmental,

efficiency and renewable energy used

sex, disability, race, ethnicity, origin,

health and safety risks

Waste

religion or economic or other status

Responsible Investment

Reducing substantially waste

Skills & Leadership

Incorporating social, environment

generation through prevention,

Developing skills and leadership

and governance criteria in

reduction, recycling and reuse

programmes that support

the evaluation process

productive activities, creativity

Water

and innovation to deliver high-

Increasing substantially water

value products and services

efficiency and the recycling and

safe reuse of water discharged

6 Frasers Hospitality Trust

Sustainability

OUR SUSTAINABILITY ROADMAP

To implement our strategy, we have established a sustainability roadmap, with annual targets to guide our overall sustainability approach and key initiatives for the year. These targets contribute to the overarching long- term goals set out by our Sponsor.

In FY2023, our Sponsor refreshed its Group ESG goals following a benchmark exercise and a review of the progress against targets announced in FY2021. The refresh took in a range of considerations including a market review of global sustainability trends, a FY2022 stakeholder survey exercise, and evolving regulatory requirements. The refreshed goals are as follows:

• Achieve net-zero carbon emissions across Scopes 1, 2 and 3 by 2050.
• Install 215 MW of renewable energy capacity on properties by 2030.
• Deploy group-wide climate risk analytics platform to identify, assess and manage climate-related risks by FY2024.
• Have 100% by gross floor area of new development projects, and 85% by gross floor area of owned and asset-managed properties, be either green-certified or pursuing green certification by 2030.
• Engage 75% of suppliers by spend on Responsible Sourcing Policy by FY2025.
• Develop a framework to assess and prioritise biodiversity risks and opportunities by FY2025.

MANAGING SUSTAINABILITY

GRI 2-9,2-12,2-13,2-14

Ensuring transparency and accountability as part of our sustainability approach is a tenet of good governance and demonstrates our efforts to build trust with stakeholders. FHT has put in place a sustainability governance structure to align its sustainability

goals with its business strategy and integrate ESG considerations into its long-term plans and operations.

We collaborate closely with our Sponsor on a cohesive governance approach. This alignment extends to

our shared sustainability agenda, guided by the Group Sustainability Steering Committee (SSC). This committee, consisting of Chief Executive Officers (CEOs) from business units in the Group as well as other senior management, convenes six times annually to steer Group-wide sustainability strategies, and monitor sustainability performance across key metrics and endorse action plans throughout the Group. The SSC is supported by the Group Sustainability Team, which fosters close collaboration with FHT in ensuring alignment between the Group and FHT, crafting ESG action plans and monitoring advancements.

Within FHT, the Board provides strategic oversight and guidance on the identification, management and monitoring of material ESG factors, through the Audit, Risk, and Compliance Committee (ARCC). Focused on environmental risk oversight, the FHT Sustainability Steering Committee, led by the CEO and Head of Finance, ensures diligent monitoring. FHT also has a dedicated Sustainability Task Force,

comprising department heads from Asset Management, Finance, Investment, and Investor Relations, to drive its sustainability strategy. The Sustainability Task Force assumes the responsibility of developing FHT's sustainability framework and targets, along with formulating specific strategies, staff engagement plans, and resource allocation to execute these initiatives. The monitoring of property-level sustainability performance and indicators is entrusted to the Asset Management team and the General Managers of its hotels and serviced residences.

PARTICIPATION IN ASSOCIATIONS AND ALIGNMENT WITH RECOGNISED STANDARDS GRI 2-28

FHT, whether independently or through its Sponsor, maintains active involvement in local and international efforts within the real estate sector. By collaborating with industry bodies, we leverage our insights and knowledge to drive meaningful change. We support and engage with various industry associations and global movements and these partnerships play a pivotal role in fulfilling our sustainability commitments.

REIT ASSOCIATION OF SINGAPORE (REITAS)

REITAS serves as the representative advocate for Singapore's REIT sector, facilitating member engagement in policy consultations. REITAS supports the growth of the sector by improving transparency and governance for investor decision-making, and collaborating with regulators for industry-friendly policies. FHT plays an active role as a member of REITAS, participating in industry events organised by the association as well as relevant surveys initiated by the regulators which seek to gather feedback from the sector. FHT, through its Sponsor, is also represented on REITAS' Sustainability Taskforce.

As part of Frasers Property Group, we are aligned with sectoral, national, and international platforms to elevate standards and scale up best practices. These include:

• GRESB Real Estate Assessment
• Property Council of Australia
• Science Based Targets initiative
• TCFD
• United Nations Global Compact
• United Nations Women's Empowerment Principles
• Urban Land Institute Singapore
• Tripartite Alliance on Fair Employment Practices
• Net Zero Carbon Buildings Commitment of the World Green Building Council
• Singapore Green Nation Pledge by Ministry of Sustainability and the Environment

STAKEHOLDER ENGAGEMENT

GRI 2-29

An important element of FHT's approach to sustainability is engaging our stakeholders and addressing their concerns to the best of our abilities. We value our stakeholders' views and work to integrate their feedback into our practices to improve our sustainability performance.

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Our stakeholders are identified and prioritised based on the impact that our operations have on them, their knowledge of the sector and FHT, and their importance to the success of our business.

We typically engage our stakeholders throughout the year via a variety of communication channels. Our goal for all our stakeholder engagement initiatives is to better understand stakeholder needs while seeking collaborative ways to achieve shared objectives.

Key Stakeholders	Key Topics of Concern	Mode and Frequency of Engagement
Customers and	•	Customer satisfaction	Throughout the year:
Guests	•	Quality of facilities and services	•	Bilateral communications
		•	Health and safety	•	Guest satisfaction surveys
				•	Events
Investment	•	Financial and portfolio performance	•	Quarterly business updates, financial results briefings and
Community and	•	Business strategy and outlook		earnings calls
Stapled	•	Acquisitions and divestments	•	Annual General Meeting
Securityholders	•	Asset enhancement initiatives
		•	Capital and risk management	Throughout the year:
		•	Corporate governance	•	Investor conferences and non-deal roadshows
				•	Bilateral communications via emails, calls, company visits
					and site visits
				•	Corporate website
Hotel and Serviced		• Asset management and enhancement	• Monthly ESG performance data collection and review
Residence		initiatives
Operators	•	Business opportunities	Throughout the year:
		•	Property maintenance programmes	•	Regular site meetings
		•	ESG practices	•	Discussions via calls and emails
Employees	•	Employee development and retention	Annual
		•	Employee satisfaction	•	Performance appraisals
		•	Occupational health and safety	•	Employee culture or pulse survey
		•	Impact on the environment	•	Group-wide Health and Safety Month and Environment
		•	Employee well-being		Month
		•	Organisation updates	Throughout the year:
				•	Training, including courses and orientation programme for
					new staff
				•	Team bonding activities as well as sports, volunteering and
					other events
				•	Internal communications via emails, intranet, newsletters
					and townhall meetings
Suppliers and	•	Appropriate cost and budgeting	As and when requested:
Business Partners	•	Adherence to terms and conditions of	•	Quotations, proposals and tenders
			purchasing policies	•	Regular meetings
		•	Responsible sourcing practices	•	Discussions via calls and email
Local Community	•	Social and community initiatives	Throughout the year:
		•	Business impact on the environment and	•	Community engagement activities
			society
Media	•	Financial and operational performance	Throughout the year:
		•	FHT's latest developments, including	•	Media releases
			acquisitions, equity fund raising, and
			divestments
Regulators and	•	Regulatory compliance	Throughout the year:
Non-governmental	•	Regulatory and industry updates and	•	Briefings, discussions and consultations
Organisations		trends	•	Participation in relevant industry associations
		•	Corporate governance	•	Participation in relevant industry surveys which seek to
					gather feedback from market participants

8 Frasers Hospitality Trust

Sustainability

MATERIALITY ASSESSMENT

GRI 3-1,3-2

We regularly review and assess how the changing landscape that we operate in affects our material ESG topics, our business and stakeholders. In FY2022, our Sponsor conducted a review of FHT's material topics to determine if any new topics had emerged, or whether

there had been a shift in the importance and impact of existing topics. The review process comprised a global market review of relevant key sustainability trends as well as surveys and interviews with internal and external stakeholders. These findings were analysed and shared with the REIT Manager. After consolidating all feedback, we finalised the list of material sustainability topics for FHT.

Group Sustainability	Corresponding United Nations Sustainable
Framework Pillars	Development Goals	Material Topics

ACTING PROGRESSIVELY

Economic Performance

Anti-corruption

CONSUMING RESPONSIBLY

Energy and Greenhouse Gas (GHG) Emissions Management

Water Management

Waste Management

FOCUSING ON						Customer Experience
PEOPLE

Talent Recruitment

and Retention

Employee Well-being and

Empowerment

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This continual updating of our sustainability management and accompanying policies ensures that our strategy remains relevant, as we seek to address evolving risks and opportunities.

The following table elaborates the significance of our material topics, the relevant United Nations Sustainable Development Goals and areas where we have made an impact through our business relationships.

		Material Factor Boundaries
Corresponding Group		FHT/ REIT	Suppliers/
Focus Areas	Rationale	Manager	Contractors Properties
Risk-based Management,	Our strategic objective is to manage and expand
Responsible Investment,	our portfolio, within our risk capacity and appetite,
Resilient Properties	to deliver long-term growth in distribution and net
	asset value to our Stapled Securityholders.
Risk-based Management	The foundation of our reputation lies in ethical
	and fair dealings. We maintain high standards of
	governance and accountability to earn the trust and
	confidence of our stakeholders.
Energy & Carbon	Considering that energy consumption is one of the
	largest environmental impact that our operations
	generate, we continue to actively monitor and
	manage energy consumption at our properties.
Water	Water is a limited natural resource. It is essential
	for us to manage our consumption to reduce
	unnecessary usage.
Waste	As the operations of our properties generate
	various types of waste, proper waste management
	is key in preventing adverse impact on the local
	environment and public health.
Community Connectedness	Customer experience is a vital aspect in
	determining the success of our business. It is
	our utmost priority to meet and exceed the
	expectations of our customers and guests.
Skills & Leadership	It is important that the REIT Manager has the
	capacity to manage and expand FHT's portfolio
	to create value for our stakeholders. We seek to
	attract, develop and retain the right people who are
	the cornerstone of our success.

Diversity, Equity & Inclusion (DEI) Employees are at the heart of hospitality operations. It is vital to ensure our hotel and serviced residence operators value staff well- being by providing a conducive and safe working environment. In turn, a motivated workforce can better deliver positive, memorable experiences to our customers and guests.

10 Frasers Hospitality Trust

Sustainability

Acting Progressively

FHT is dedicated to integrating ESG factors into its business choices, maintaining utmost integrity through established governance systems to address risks and opportunities. This is accomplished through robust policies that underpin our sustainability strategy and strengthen our business resilience. We actively strive to uphold responsible practices throughout our operations, continually evaluating our performance by benchmarking our properties against reputable green building certification schemes.

OUR PROGRESS

Focus Area

Our Goals

Our Progress in FY2023

Risk-Based	• To establish holistic overarching
Management	internal policies to govern and
	guide the senior management on
	the focus areas.

• Continued to roll out our Responsible Sourcing Policy, with 50% of the REIT Manager's suppliers acknowledging the policy.

Responsible	• To kickstart the process for green	• Our properties in Australia scored an average 3.5-Star for
Investment	building certifications in FY2021 and	Water rating (between Average and Good) and 3-Star for
	achieve green certifications for at	Energy rating (Average) for their NABERS assessment.
	least 85% of the portfolio by 2024.	• InterContinental Singapore holds BCA Green Mark GoldPLUS
		certification.
		• Five out of six of our UK properties are accredited under the
		Green Tourism Scheme.
		• Notable improvement at the 2023 GRESB Real Estate
		Assessment with a 4-Star rating and a higher score of 82
		which led FHT to maintain its third-place ranking in the 'Asia
		Pacific Hotel - Listed' category.
Resilient	• To carry out climate risk assessment	• Our climate risk and climate 'value at-risk'portfolio-level
Properties	and implement asset-level	assessment is still ongoing. We are also developing an action
	adaptation and mitigation plans in	plan to address and mitigate key physical and transition risks.
	alignment with the TCFD framework
	by 2024.	• Aligned our climate reporting more closely to the TCFD
		framework.

RISK-BASED MANAGEMENT

OUR APPROACH

GRI 3-3

In view of our global portfolio, we are keenly aware of the various ESG and economic risks that our operations are exposed to.

We recognise the importance of upholding the highest standards of integrity and have established a robust governance framework to ensure regulatory compliance. Our Code of Business Conduct, which applies to all employees and leadership, sets out our

stand on ethics and compliance with ESG factors and is made available to other stakeholders.

We work with our Board and the Sponsor to implement effective internal controls across our business. Our Board ARCC supervises the audit procedures, supporting the Board in evaluating the quality and reliability of the accounting, auditing, internal controls and the REIT Manager's corporate governance practices. This includes an audit conducted by the Sponsor's internal audit team, which focuses on the REIT Manager's adequacy of internal controls, risk management and corporate governance practices. Audit findings and recommendations are then used to guide the Board and future management decisions.