Leadership statements
FORWARD
THINKING
Chairman, Stephen Johns
Goodman seeks to develop a resilient business that is Here for Good. The success of the Group in FY23 is the result of our long-term vision and the consistent execution of our global strategy which includes achievements across a range of Environmental, Social, Governance (ESG) initiatives.
Sustainability remains a critical component of our business strategy and goes beyond compliance – it is highly important for all our stakeholders. Our customers, capital partners and securityholders all have an expectation that our developments are designed to optimise energy and water use, generate their own renewable energy and, where possible, promote health and wellbeing. Likewise, our own people, both those who work for us today and employees we seek to attract in the future, share this expectation.
In addition to the strong financial performance, Goodman has made significant progress against our sustainability targets and remains focused on delivering on, or ahead of, our 2030 ESG targets. Throughout this report you will see a range of programs and initiatives that have been developed to make a tangible positive impact across all areas of Environmental, Social and Governance.
Goodman has made significant progress against our sustainability targets and remains focused on delivering on, or ahead of, our 2030 ESG targets.
This year’s report covers key themes that continue to influence our business such as strategic resilience, asset quality, optimising operations, and connectivity to customers and investors. The Group takes a pragmatic approach and focuses on creating tangible solutions that are aligned to, and will contribute towards, our 2030 Sustainability Strategy.
Goodman’s values of sustainability, innovation, integrity and determination are the guiding principles supporting our people and the execution of our strategy. We seek to build diverse teams with the appropriate mix of skills and gender that support the business requirements for who we are today and who we strive to be in the future. To assist in this, we have development and leadership programs to train and recruit for specialised skills, along with our Long Term Incentive Plan (LTIP) to incentivise our people and create alignment with the interests of Securityholders.
Sustainability governance
To oversee the environmental aspect of the ESG function, in October 2022 the Board established a Sustainability and Innovation Committee which has been focused on initiatives and investments that support sustainable developments including energy generation and storage solutions. It also assesses the impact and opportunities that emerging technologies such as artificial intelligence are expected to have on Goodman, our customers; and more broadly, the way people will live, work and consume.
The social and governance areas are overseen by the Boards, Audit, Risk and Compliance Committee and the Remuneration and Nomination Committee.
Our sustainability-linked remuneration targets in the LTIP promote the integration of sustainability within the core business.
Board appointments
To meet the changing nature of our strategic drivers and match our geographic focus, we have continued to evolve and create a contemporary and diverse Board whose members bring together a broad global skill set. In line with the Board’s diversity target of 40/40/20 for non-executive directors, Board appointments over the past 18 months have seen four out of five positions be filled by females and three out of five by Directors based outside of Australia, reflecting the global nature of Goodman’s business.
Following the appointment of Hilary Spann and Vanessa Liu in 2022, both of whom are based in the US, during 2023 we have appointed three new Directors:
- Belinda Robson, based in Australia, was appointed in March and brings over 30 years’ experience in retail and commercial funds management
- George Zoghbi, also based in Australia, was appointed in April. He is the CEO of Arnott’s Group and brings extensive international consumer packaged goods and supply chain experience
- Kitty Chung, based in Hong Kong SAR, was appointed in July and has over 35 years’ audit and business advisory experience.
Phillip Pryke noted his intention to retire from the Goodman Board during his term at last year’s Annual General Meeting and he has now confirmed he will step down in the first half of 2024. Since his appointment to the Board in 2010 he has served on various Board committees, including as Chair of the Remuneration Committee and more recently as a member of the Sustainability and Innovation Committee. On behalf of the Board, I would like to thank Phil for his significant contribution over the last 13 years.
Moving forward
As we move forward, we are determined to deliver on our 2030 Sustainability Strategy. Our objective is to create a lasting impact that not only improves our business but also leaves a positive and enduring legacy for our stakeholders and the broader communities where we operate.
Yours sincerely,
Stephen Johns
Independent Chairman
Our objective is to create a lasting impact that not only improves our business but also leaves a positive and enduring legacy.
STRATEGIC
RESILIENCE
Greg Goodman, Group CEO
Guided by our 2030 Sustainability Strategy, ESG is integrated throughout Goodman as we continue building a resilient and sustainable business for the long-term. It’s embedded in our values, investment strategy and key performance indicators for executive remuneration.
As a supplier of essential infrastructure to the digital economy – resilience is key. Resilience of our properties, our business and the communities we operate in means we can be here for the long term.
We acknowledge that as one of the world’s largest owners, developers and managers of industrial property and data centres, with an $81 billion portfolio and $13 billion of developments underway, the way we operate has long-term impacts on the environment and communities. Especially given the close proximity of our properties to consumers as a result of our urban infill strategy.
Our strategy therefore includes practical measures to reduce this impact, and in FY23 we continued to take action across a range of ESG activities. We’re making solid progress against our targets which you can read more about throughout this report.
As a supplier of essential infrastructure to the digital economy – resilience is key.
Business resilience
Despite the global macro-economic uncertainty, Goodman has focused on remaining resilient and the long-term structural drivers for our business remain sound. These are fuelled by the digital economy, the need for more productive and sustainable assets, and limited supply in our markets. This has contributed to the strong performance for the Group this year, and a positive outlook for the year ahead.
Climate resilience
Goodman is taking steps to improve our climate resilience by expanding our risk assessments program to cover New Zealand, Hong Kong SAR, Mainland China and Continental Europe – in addition to the work previously completed in Australia.
Sustainable properties
Key to building resilience is developing sustainable properties. When we say sustainable properties, we are incorporating sustainable design features to optimise efficiency and minimise impact, throughout site selection, property design, development, operation and redevelopment.
Our sites are selected to be close to consumers and key transport infrastructure, which can help reduce transport emissions for our customers’ operations, and maximise value for our investors.
We then work to incorporate sustainable design features that prioritise efficiency, reduce carbon emissions, optimise energy and water, increase renewable electricity, and incorporate health and wellbeing features for our customers. These steps are moving us in the right direction to help minimise our impact, and create high-quality assets that are servicing our customers and the wider economy. Importantly our focus on infill locations means a significant proportion of our redevelopments occur on brownfield sites, reducing biodiversity impacts and generally increasing circularity.
Our focus on infill locations means a significant proportion of our redevelopments occur on brownfields sites.
Our commitment to sustainable properties extends to our stabilised portfolio, retrofitting with sustainability features. These investments not only make sense for the environment, but increase the long-term viability of the properties – making them more attractive to customers who have their own sustainability requirements and targets to meet.
Key highlights this year include reaching around 75% of our 2025 solar PV target, tracking our carbon emissions in line with our targets validated by the Science Based Targets initiative, and achieving key green building certifications around the world – including the first 6 Green Star Design ratings achieved for an industrial development in New Zealand.
Ambitious yet pragmatic
We have a pragmatic approach to achieving our ambitious targets. We’re four years into our 2030 Sustainability Strategy, and we’ve made significant progress with more to come.
We continuously review our targets and update them where necessary. A key example of this was our community commitment through the Goodman Foundation. During the year, the Foundation contributed $10 million in cash, plus another $0.8 million in employee fundraising and in-kind contributions. This takes our total investment to $42.4 million, close to reaching our 2030 target of $50 million ahead of time. Given the growing need for community support since 2019, we will be increasing our 2030 target next year to $100 million – more than doubling our investment in the communities where we operate.
On the horizon
At Goodman we continually look for ways to optimise, innovate and create sustainable growth for our stakeholders. Our teams around the world stay on top of emerging issues and contribute to the future direction of the business. Right now, we’re focusing on sourcing lower carbon materials, managing increasing power supply demand, increasing our use of renewable electricity and delivering assets that support human health and value natural capital. Mindful of incoming reporting standards, we’re also working to align our disclosures with the changing requirements.
The challenging market environment is set to continue for the near term however we have the strategy, capital and people in place to remain resilient. I’d like to thank our people, customers, investors, and all other stakeholders for their continued support and contribution.
Sincerely,
Greg Goodman
Group Chief Executive Officer
