SINGAPORE – CapitaLand Investment Limited (CLI) has retained its position as a component stock on the Dow Jones Sustainability World Index (DJSI World) and Dow Jones Sustainability Asia Pacific Index (DJSI Asia Pacific) after their annual review, the real estate investment firm said on Dec 11.
It is CapitaLand’s 12th consecutive year on DJSI World and its 15th on the DJSI Asia Pacific, and comes at a time when a growing number of investors and lenders are demanding that public companies be more socially and environmentally responsible.
The announcement also follows a profit guidance on Dec 8, in which CLI said it expects fair value losses on its portfolio of investment properties in China, Australia, Europe, the United Kingdom and the United States that would result in a “significant” decrease in net profit for the financial year ended Dec 30.
In its third quarter business update in November, CLI had identified dampening macro-economic sentiment together with persistent interest rate hikes and geopolitical tensions as the challenges posed to its business, but said operating profit and cash flows remained stable.
In its Dec 11 announcement, CLI chief sustainability officer Vinamra Srivastava noted that the company intends to maintain its current standards in achieving its sustainability goals despite macroeconomic and geopolitical challenges.
CLI’s continued inclusion in the DJSI has enabled the firm to qualify for sustainability-linked loans that are more attractively priced than traiditonal loans, he said.
For example, it will obtain interest rate savings from four sustainability-linked loans totalling $600 million that are pegged to its inclusion on DJSI.
As at Sept 30, CLI and its listed real estate investment trusts and other business trusts have partnered with 20 financial institutions to secure a total of $15.6 billion in sustainable financing.
“The savings from our sustainable financing instruments tied to our ESG performance are redeployed towards our decarbonisation strategies,” Mr Srivastava said.
The DJSI World and DJSI Asia Pacific comprise the top 10 per cent and top 20 per cent of the world’s largest companies, respectively, based on long-term economic, environmental and social criteria.
The indices are float-adjusted market capitalisation weighted indices that measure the performance of companies selected using environmental, social and governance (ESG) criteria.
As a result of this year’s review, Chinese tech firm Tencent Holdings, tobacco firm Philip Morris International and software company ServiceNow were added to the DJSI World Index, while three pharmaceutical companies, Novartis, AstraZeneca and Amgen were deleted.
Besides CLI, two other Singapore companies – infrastructure firm Keppel Corporation and commodities trader Wilmar International – are on the DJSI World.
Keppel and Wilmar – as well as ComfortDelGro, ST Engineering – are component stocks on the DJSI Asia Pacific.
Shares of CLI fell on Dec 11 after its profit warning. The stock was trading down 2.6 per cent at $3.02 at the midday break. The counter is down by 14.8 per cent to date this year as of its Dec 8 close.
