The long-term approach is illustrated by the inclusion in its asset management strategy to build long-term customer relationships and to limit the number of property transactions in the company’s operations. The company’s policy is to abstain from maximising rent levels at all points of time in favour of signing leases of a longer duration with solvent ten- ants. This reduces the risk of vacancies, while leading to lower costs for letting premises and adapting premises to tenant needs.
The company is dependent on highly skilled and professional employees. For this reason, it is important that the company is an attractive employer that can attract and has the ability to retain highly skilled personnel in the long term.
Overall, the company’s strategies are designed to ensure that Sagax’s operations generate a long-term sustainable return and strong cash flows. Sagax’s sustainability activities are thus a natural part of the com- pany’s business model and help to achieve the company’s goals. Regarding information about Sagax’s performance, position and earnings, refer to the 2022 Annual Report.
Sagax’s sustainability activities are based on clear internal communication and division of responsibilities.
GOVERNANCE OF SUSTAINABILITY ACTIVITIES
The planning, governance and monitoring of sustainability activities follow the company’s organisational structure with well-defined delegation of responsibilities and authorities. This sustainability work is supported by policies, guidelines, overall objectives, external laws, rules and regu- lations. The Board of Directors is ultimately responsible for sustainability and annually adopts the sustainability policy.
Sagax regards the precautionary approach of the Swedish Environmental Code and laws and regulations as minimum requirements. Sagax follows the UN Global Compact’s principles, which encompass human rights, labour, environment and anti-corruption.
An analysis has previously been performed of the UN’s 17 Sustainable Development Goals (SDGs) from Agenda 2030 to which Sagax’s operations can contribute. It is assessed that the sustainability activities that can contribute to primarily achieving the targets in the following SDG: ■ Good health and well-being (Goal 3).
■ Affordable and clean energy (Goal 7).
■ Decent work and economic growth (Goal 8). ■ Sustainable cities and communities (Goal 11).
■ Responsible consumption and production (Goal 12). ■ Climate action (Goal 13).
■ Peace, justice and strong institutions (Goal 16).
RISK MANAGEMENT
Environmental-policy decisions could also affect Sagax, for example, in the form of higher taxes or necessary investments. In addition, the com- pany’s operations, earnings and financial position could be affected by higher environmental requirements from supervisory authorities, inves- tors, tenants or other stakeholders.
The company’s long-term supply of capital and capital costs could be negatively affected if Sagax’s sustainability activities do not meet market requirements. There is also the risk of additional costs for investments in the property portfolio due to, for example, changes in legislation or changed customer behaviour. In addition, Sagax’s property portfolio could experience the effects of climate change, such as an elevated risk of flooding. Other risks include risk of corruption, environmental pollution or higher energy costs. Furthermore, Sagax is exposed to risks related to non-compliance with Sagax’s Code of Conduct among suppliers.
Sagax’s handling of environmental and climate risks and other risks and the company’s risk management are described in more detail on pages 50-53. Sagax’s reporting according to TCFD is on pages 160-161.
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