Targets and Results 2021/22

The Company has identified three key long-term sustainability priorities. To achieve these priorities, over 2020/2021 we set out 9 objectives 29 independently set targets to challenge delivery of the identified priorities, and to enable us to effectively manage the ESG issues which are material to our business.

Social – A customer-focused and flexible landlord

• Provide outstanding customer service by being an approachable, responsive and proactive landlord

  Target	Deadline	Progress
  Carry out a occupier survey in 2020/21, including questions on key sustainability issues	March 2021	Achieved

• Seek to ensure that our assets support modern workplace requirements and continue to engage our existing customers

  Target	Deadline	Progress
  Implement a follow up action plan based on the findings of the 2020/21 occupier survey	March 2021	Achieved
  Organise a mental health first aid training session for site teams and invite occupiers	March 2021	Achieved

• Identify opportunities to support the resilience of local communities around our assets, co-creating places where people and business can thrive

  Target	Deadline	Progress
  Continue to support identified charity partners throughout the year. In light of COVID-19, consider how McKay can work with charity partners to help solve challenges created by the pandemic and ehance local community health and economic resilience going forward	March 2021	Achieved
  In relevant tender exercises, require suppliers to provide a Living Wage option	March 2021	Achieved

• Invest in digital infrastructure that enables our customers to be better connected, more productive and have a lower environmental impact

  Target	Deadline	Progress
  Document the McKay approach and standards for digital infrastructure and smart building technologies across the portfolio, to share with existing and potential tenants	March 2021	Achieved

Environment – Low carbon, resource efficient and healthy buildings

• Actively participate in the transition towards a low carbon economy by increasing our assets' energy efficiency, generating and procuring renewable sources of energy and providing infrastructure for electric vehicles

  Target	Deadline	Progress
  Ensure the electricity procured for any new asset acquired in the 2020/21 period is shifted to a renewable electricity tariff by the end of the year, to maintain McKay's 100% zero carbon electricity procurement status	March 2021	Achieved
  Electricity: Achieve a year-on-year 4% reduction in like-for-like landlord controlled electricity consumption and work towards 20% reduction in carbon emissions by FY2024/5 from FY2019/20	March 2021	Achieved
  Gas: Achieve a year-on-year 4% reduction in like-for-like landlord controlled gas consumption and work towards 20% reduction in carbon emissions by FY2024/5 from FY2019/20	March 2021	Achieved
  Develop a long term approach for decarbonising new developments and further reducing the carbon footprints of existing assets	March 2021	Achieved
  Review all EPC ratings, energy efficiency measures, and climate adaptation measures across the portfolio, and develop upgrade plans where needed	March 2021	Achieved
  Identify a development/refurbishment project (if a suitable opportunity arises) where McKay could seek to achieve net zero carbon (as a pilot) before 2022	March 2021	Achieved
  Continue to ensure that all new developments and major refurbishments achieve minimum BREEAM Excellent and an EPC rating of at least B	March 2021	Achieved
  Conduct a feasibility study for installing electric vehicle charging infrastructure at selected assets	March 2021	Achieved

• Pursue a circular approach to resource use that reduces construction and fit-out costs, increases the flexibility of our buildings, benefits local communities, reduces operational costs and reduces environmental impacts from waste

  Target	Deadline	Progress
  Waste: Increase the recycling rate for the portfolio by 5% across properties for which the Group has management control, and work towards a 25% increase by 2024/25 from FY 19/20	March 2021	Achieved
  Water: Achieve a year-on-year 4% reduction in like-for-like landlord controlled water consumption, and work towards 20% reduction by FY2024/5 from FY2019/20	March 2021	Not Achieved
  Proceed with the implementation of water saving technologies in a minimum of two assets	March 2021	Achieved

• Put health at the forefront of our property development and management strategy to help our customers’ businesses prosper and the people using our buildings to feel fit and well

  Target	Deadline	Progress
  Install indoor environmental quality sensors in a trial space to monitor the performance both of the space and of the sensors	March 2021	Achieved
  Undertake a post occupancy evaluation at a suitable asset, to identify the extent to which occupier experience matches with the design intent	March 2021	Achieved
  McKay employees to tour an exemplary environmentally sustainable and healthy building, for inspiration and knowledge-building	March 2021	Not Achieved

Governance – A progressive and transparent business

• Protect and enhance the value of our assets and future-proof our business by anticipating and responding to evolving environmental and social trends

  Target	Deadline	Progress
  Review all asset websites and asset profiles on the corporate website to ensure that sustainability and health and wellbeing features are appropriately incorporated	March 2021	Achieved
  Risk Sub-Committee to review the corporate risk register quarterly, including key climate risks	March 2021	Achieved
  Organise a CPD session for employees on climate risk	March 2021	Achieved
  Develop a checklist of climate adaptation measures to review for relevance for each asset development/ refurbishment plan	March 2021	Achieved

• Monitor and report transparently on our sustainable business performance by using KPIs linked to each of our focus areas, and maintain our position in GRESB. Communicate clearly and directly with our stakeholders and maintain our culture of sound corporate governance

  Target	Deadline	Progress
  Continue reporting to the Global Real Estate Sustainability Benchmark and maintain performance relative to 2019	March 2021	Achieved
  Aim to increase data coverage across all aspects, with a particular focus on tenant energy, GHG emissions and water data	March 2021	Achieved
  Further align future reporting to the TCFD framework, agreeing new metrics to report on in 2020/21 as our approach to climate risk management evolves during this financial year	March 2021	Achieved

The Company has three focus areas with ten objectives and 29 targets to enable us to effectively manage the ESG issues which are material to our business.

Environment – Low carbon, resource efficient and healthy buildings

• Actively participate in the transition towards a low carbon economy by increasing our assets' energy efficiency, generating and procuring renewable sources of energy and providing infrastructure for electric vehicles

  Target	Deadline	Progress
  Ensure the electricity procured for any new asset acquired in the 2019/20 period is shifted to a renewable electricity tariff by the end of the year, to maintain McKay’s 100% zero carbon electricity procurement status	March 2020	Achieved
  Achieve a year-on-year 4% reduction in like-for-like landlord controlled electricity and gas consumption and work towards a 20% reduction in carbon emissions by FY2024/5 from FY2019/20	March 2020	On track
  Proceed with the implementation of new energy saving technologies in a minimum of one asset	March 2020	Achieved
  Secure approval for the implementation of PV panels on at least one new development or major refurbishment, following the results of the Renewable Energy Strategy Review	March 2020	Achieved
  Continue to ensure that all new developments and major refurbishments achieve minimum BREEAM Excellent and an EPC rating of at least B	March 2020	Achieved
  Define and approve an ambitious 2030 carbon reduction target and action plan to achieve this through a combination of energy efficiency measures, on-site renewables and purchase of green energy tariffs	March 2020	On track
  Identify a development/refurbishment project (if a suitable opportunity arises) where McKay could seek to achieve net zero carbon (as a pilot) before 2022	March 2020	Not applicable

• Pursue a circular approach to resource use that reduces construction and fit-out costs, increases the flexibility of our buildings, benefits local communities, reduces operational costs and reduces environmental impacts from waste

  Target	Deadline	Progress
  Increase the recycling rate across all properties for which the Group has management control to at least 52% by 31 March 2020, in line with ‘Good Practice’ in office assets according to the latest available Real Estate Environmental Benchmark (REEB)	March 2020	Not Achieved
  Implement the recommendations of the waste review at assets where McKay has management control	March 2020	Achieved
  Organise at least one CDP session on the circular economy to provide information and inspiration to employees on this topic	March 2020	Achieved
  Achieve a year-on-year 4% reduction in like-for-like landlord controlled water consumption, and work towards 20% reduction by FY2024/5 from FY2019/20	March 2020	Not Achieved
  Proceed with the implementation of new water saving technologies in a minimum of two assets	March 2020	Achieved

• Put health at the forefront of our property development and management strategy to help our customers’ businesses prosper and the people using our buildings to feel fit and well

  Target	Deadline	Progress
  Undertake a gap analysis of a selection of current assets’ health and wellbeing features against good practice references, aiming to define a minimum standard for health and wellbeing that can be applied to all assets (by type), aligned to an appropriate certification standard (e.g., WELL or Fitwel)	March 2020	Achieved
  Undertake a post occupancy evaluation at a suitable asset, to identify the extent to which occupier experience matches with the design intent	March 2020	Achieved
  Develop questions to be included within the next occupier survey, to ask more specifically about occupiers’ perceptions of their demised area and common parts building areas in relation to health and wellbeing	March 2020	Achieved
  Organise at least one tour of an exemplary sustainable building for health and wellbeing, to inform and inspire employees	March 2020	In progress

Social – A customer-focused and flexible landlord

• Provide outstanding customer service by being an approachable, responsive and proactive landlord

  Target	Deadline	Progress
  Create and implement a follow up action plan in response to the 2019 customer survey	March 2020	Achieved
  Implement the building awards/competition to encourage uptake of sustainability practices amongst our customers	March 2020	Achieved

• Seek to ensure that our assets support modern workplace requirements and continue to engage our existing customers

  Target	Deadline	Progress
  Develop questions to be included within the next customer survey, to ask more specifically about customers’ needs and expectations with regards to building-related features and amenities to support diversity and inclusivity	March 2020	Achieved

• Invest in digital infrastructure that enables our customers to be better connected, more productive and have a lower environmental impact

  Target	Deadline	Progress
  Undertake a gap analysis of a selection of current assets’ digital infrastructure provision against good practice references, aiming to define a minimum standard for digital infrastructure provision for different asset types, and to trial smart technology in one property	March 2020	Achieved

Governance – A progressive and transparent business

• Protect and enhance the value of our assets and future-proof our business by anticipating and responding to evolving environmental and social trends

  Target	Deadline	Progress
  Continue to ensure that sustainability and health and wellbeing is integrated into asset marketing and communications, including asset websites and asset profiles on the corporate website	March 2020	Achieved
  Create asset-level sustainability scorecards which can be used to track asset performance, with this performance data also used in asset marketing	March 2020	Achieved
  Review and update McKay’s acquisitions and developments checklists in line with the sustainability trends and material issues identified through the 2018/19 strategy review	March 2020	Achieved
  Define the brief for a review of the portfolio (and local transport links) against key climate risk criteria – looking out to 2030	March 2020	Achieved

• Communicate clearly and directly with our stakeholders and maintain our culture of sound corporate governance

  Target	Deadline	Progress
  As part of McKay’s re-branding, integrate our new sustainability vision into our value proposition and corporate website content	March 2020	Achieved

• Identify opportunities to support the resilience of local communities around our assets, co-creating places where people and business can thrive

  Target	Deadline	Progress
  Over a two-year period, identify key locations and a shortlist of projects/charities focused on community resilience which McKay could support	March 2020	Achieved

• Monitor and report transparently on our sustainable business performance by using KPIs linked to each of our focus areas, and maintain our position in GRESB

  Target	Deadline	Progress
  Maintain or enhance GRESB performance relative to 2018	March 2020	Achieved
  Take forward the recommendations of the gap analysis undertaken against the requirements of The TaskForce on Climate-related Financial Disclosures (TCFD)	March 2020	Achieved
  Aim to increase environmental data coverage with a focus on tenant energy, GHG emissions and water data, in line with GRESB requirements	March 2020	Achieved

Up to the financial year ending 31 March 2019, the Group’s sustainability targets were aligned to the three focus areas of our previous sustainability strategy. Our progress against these targets is shown in the tables below.

• Managing Sustainable Buildings

  Target	Deadline	Progress
  Electricity consumption: Achieve a 12% reduction in like-for-like landlord controlled electricity consumption relative to a 2015/16 baseline.	March 2019	Achieved
  Gas consumption: Achieve a 12% annual reduction in like-for-like landlord controlled gas consumption (adjusted for heating degree days) relative to a 2015/16 baseline.	March 2019	Achieved
  Carbon emissions: Achieve a 12% reduction in like-for-like landlord controlled carbon emissions, against a 2015/16 baseline.	March 2019	Achieved
  Water consumption: Achieve a 9% reduction in like-for-like landlord controlled water consumption, against a 2015/16 baseline.	March 2019	Achieved
  Waste: Maintain 100% of operational waste diverted from landfill for landlord managed portfolio.	March 2019	Achieved
  Waste: Increase the recycling rate across all properties for which the Group has management control to 48% by March 2019, in line with 'Good Practice' according to the Real Estate Environmental Benchmark (REEB).	March 2019	Not achieved
  Pilot an innovative energy-saving technology at one of the Group’s major energy consuming assets.	March 2019	Achieved
  Pilot an innovative water-saving technology at one of the Group’s major water consuming assets.	March 2019	Achieved
  Continue to review EPC risk associated with new purchases and create improvement plans for any asset with an E rating or below, to bring it up to at least a D.	March 2019	Achieved
  Roll out phase two of the Group's Renewable Energy Review Strategy, which will involve conducting detailed studies into the feasibility of incorporating solar PV panels at five properties, and then select at least one property at which to take forward an installation subject to commercial viability.	March 2019	Achieved
  Continue to ensure compliance with the Group’s Responsible Procurement Policy through the agreed annual auditing process.	March 2019	Achieved

• Creating Sustainable Buildings

  Target	Deadline	Progress
  Continue to monitor the compliance of contractors with McKay's Sustainability Requirements for Development and Refurbishment Projects, ensuring that sustainability is consistently integrated as part of the tendering process.	March 2019	Achieved
  Ensure all new developments and major refurbishments achieve minimum BREEAM Excellent and an EPC rating of at least B.	March 2019	Achieved
  Follow up on the results and recommendations of the post-occupancy evaluation of Prospero, Redhill, to ensure that all aspects of operational performance meet design intent.	March 2019	Achieved

• Engaging Stakeholders

  Target	Deadline	Progress
  Maintain or enhance GRESB performance relative to 2017.	March 2019	Achieved
  Hold a minimum of three sustainability related CPD sessions to increase awareness of key issues amongst employees.	March 2019	Achieved
  Continue to organise annual sustainable building tours to inform and inspire employees.	March 2019	Achieved
  Include information about asset’s sustainability, including energy efficiency and health and wellbeing features, within marketing materials, highlighting their benefits to occupiers.	March 2019	Achieved
  Introduce building awards/competition to encourage uptake of sustainability practices amongst tenants.	March 2019	In progress

Up to the financial year ending 31 March 2018, the Group’s sustainability targets were aligned to the three focus areas of our previous sustainability strategy. Our progress against these targets is shown in the tables below.

• Managing Sustainable Buildings

  Target	Deadline	Progress
  Electricity consumption: In 2017/18 achieve a 4% reduction in like-for-like landlord controlled consumption relative to a 2016/17 baseline.	March 2018	Achieved
  Gas consumption: In 2017/18 achieve a 4% annual reduction in like-for-like landlord controlled consumption (adjusted for heating degree days) relative to a 2016/17 baseline.	March 2018	Achieved
  Carbon emissions: In 2017/18 achieve a 4% annual reduction in like-for-like landlord controlled emissions relative to a 2016/17 baseline.	March 2018	Achieved
  Water consumption: In 2017/18 achieve a 3% reduction in like-for-like landlord controlled consumption against a 2016/17 baseline. Achieve a 12% reduction by the end of March 2020 relative to a 2015/16 baseline.	March 2018	Achieved
  Waste: Maintain 100% of operational waste diverted from landfill for landlord managed portfolio.	March 2018	Achieved
  Waste: In 2017/18 increase recycling rate across all properties for which the Group has management control to 44%.	March 2018	Not achieved
  Continue to implement energy and water efficiency measures at the Group’s major energy and water consuming assets.	March 2018	Achieved
  Continue to review EPC risk associated with new purchases and prioritise improvement works for any asset with an E rating or lower. Also consider D rated assets.	March 2018	Achieved
  Explore the feasibility of incorporating on-site renewable energy at a minimum of one of McKay Securities’ operational assets.	March 2018	Achieved
  Conduct a review of major operational material spend categories and investigate establishing minimum sustainability procurement requirements based on the results	March 2018	Achieved

• Creating Sustainable Buildings

  Target	Deadline	Progress
  Continue to monitor the compliance of contractors with development sustainability requirements and ensure that sustainability is consistently integrated as part of the tendering process.	March 2018	Achieved
  Ensure all new developments and major refurbishments achieve minimum BREEAM Excellent and an EPC rating of at least B.	March 2018	Achieved
  Include information about assets' sustainability and health and wellbeing features within marketing materials, highlighting their benefits for occupiers.	March 2018	Achieved
  Pilot a post-occupancy sustainability assessment of either 9 Greyfriars, Reading or Prospero, Redhill with one tenant who has been in place for a minimum of six months.	March 2018	Achieved

• Engaging Stakeholders

  Target	Deadline	Progress
  Maintain or enhance GRESB performance relative to 2016.	March 2018	Achieved
  Hold a minimum of three sustainability related CPD sessions to increase awareness of key issues amongst employees.	March 2018	Achieved
  Continue to organise annual sustainable building tours to inform and inspire employees.	March 2018	Achieved
  Develop and publish stakeholder engagement policy.	March 2018	Achieved
  Introduce building awards/competition to encourage uptake of sustainability practices.	March 2018	In Progress

Up to the financial year ending 31 March 2017, the Group’s sustainability targets were aligned to the three focus areas of our previous sustainability strategy. Our progress against these targets is shown in the tables below.

• Managing Sustainable Buildings

  Target	Deadline	Progress
  Electricity consumption: 1 Year Target – achieve a 4% annual reduction in like-for-like landlord controlled consumption by the end of March 2017, relative to a 2015/16 baseline.	March 2017	Not achieved
  Gas consumption: 1 Year Target – achieve a 4% annual reduction in like-for-like landlord controlled consumption (adjusted for heating degree days) by the end of March 2017, relative to a 2015/16 baseline.	March 2017	Achieved
  Carbon emissions: 1 Year Target – achieve a 4% annual reduction in like-for-like landlord controlled emissions by the end of March 2017, relative to a 2015/16 baseline.	March 2017	Achieved
  Water consumption: 1 Year Target – achieve a 3% reduction in like-for-like landlord controlled consumption by the end of March 2017 against a 2015/16 baseline.	March 2017	Achieved
  Waste: Maintain 100% of operational waste diverted from landfill for landlord managed portfolio.	March 2017	Achieved
  Waste: 1 year Target – increase recycling rate to 41% for managed waste by March 2017, across all properties for which the Group has management control.	March 2017	Partially achieved
  Waste: Engage with occupiers to facilitate improved resource recycling rates.	March 2017	Achieved
  Continue to implement energy and water efficiency measures at the Group’s major energy and water consuming assets.	March 2017	Achieved
  For landlord procured energy, investigate the cost of switching 100% to a low carbon energy tariff.	March 2017	Achieved
  Where there is landlord access to energy, water and waste data (either through landlord-controlled utility purchase, smart meters or occupier willingness to share data), monitor environmental performance of new developments and major refurbishments once in operation.	March 2017	N/A
  Implement occupier fit-out guidance to encourage retention of sustainability benefits of the base build in operation.	March 2017	Achieved
  Engage with occupiers who have green lease clauses to ensure their effectiveness.	March 2017	Achieved
  Continue to review EPC risk associated with new purchases and identify improvement works for any assets with an E rating or lower.	March 2017	Achieved

• Creating Sustainable Buildings

  Target	Deadline	Progress
  Install smart meters at all new developments and major refurbishments starting on site from April 2016.A minimum requirement for BREEAM Very Good and an EPC C will be set on all new developments and major refurbishments	March 2017	Achieved
  Continue to monitor the compliance of contractors with development sustainability requirements, and continue to trial the collection of construction-related environmental data from at least one development project in 2016/17.	March 2017	Achieved
  Ensure all new developments and major refurbishments achieve minimum BREEAM Very Good and an EPC rating of at least C.	March 2017	Achieved
  Pilot a post-occupancy assessment of the performance of one building which includes a review of sustainability performance.	March 2017	N/A

• Engaging Stakeholders

  Target	Deadline	Progress
  Maintain or enhance GRESB performance relative to 2015.	March 2017	Achieved
  Provide sustainability training for employees, including annual sustainable building tours.	March 2017	Achieved
  Develop and implement an action plan based on outcome of recent customer satisfaction survey.	March 2017	Achieved

Up to the financial year ending 31 March 2016, the Group’s sustainability targets were aligned to the three focus areas of our previous sustainability strategy. Our progress against these targets is shown in the tables below.

• Managing Sustainable Buildings

  Target	Deadline	Progress
  Continue to deliver an energy and water reduction programme at our major energy and water consuming properties	2016	Achieved
  Maintain 100% waste diverted from landfill	2016	Achieved
  Achieve a 6% reduction in like-for-like landlord controlled electricity consumption by the end of March 2016 against a 2013/14 baseline	2016	Achieved
  Achieve a 6% reduction in like-for-like landlord controlled gas consumption (adjusted for heating degree days) by the end of March 2016 against a 2013/14 baseline	2016	Achieved
  Achieve a 6% reduction in like-for-like landlord controlled carbon emissions by the end of March 2016 against a 2013/14 baseline	2016	Achieved
  Achieve a 5% reduction in like-for-like landlord controlled water consumption by the end of March 2016 against a 2013/14 baseline	2016	Achieved
  Develop green lease clauses for incorporation into all new leases from 1st January 2016 onwards (including provision to prevent tenants negatively impacting the EPC)	2016	Achieved
  Develop tenant fit-out guidance to encourage retention of sustainability benefits of the base build in operation	2016	Achieved
  Review EPC risk associated with new purchases and plan out improvement works as necessary	2016	Achieved

• Creating Sustainable Buildings

  Target	Deadline	Progress
  A minimum requirement for BREEAM Very Good and an EPC C will be set on all new developments and major refurbishments	2016	Ongoing
  Investigate the opportunities and costs (feasibility) of achieving zero carbon for a new development	2016	Achieved
  Monitor the compliance of contractors with development sustainability requirements and trial the collection of environmental performance data from one construction site	2016	In progress
  Pilot a post-occupancy assessment of the performance of one building which includes a review of sustainability performance	2017	N/A

• Engaging Stakeholders

  Target	Deadline	Progress
  Develop and roll out a tenant satisfaction survey, to include sustainability questions	2016	Achieved
  Improve the Group’s GRESB score relative to 2014	2016	Achieved
  Organise green building tours for employees to build sustainability awareness	2016	Achieved

Up to the financial year ending 31 March 2015, the Group’s sustainability targets were aligned to the three focus areas of our previous sustainability strategy. Our progress against these targets is shown in the tables below.

• Managing Sustainable Buildings

  Target	Deadline	Progress
  Put in place an energy and water reduction programme for at least 4 of the major energy and water consuming properties	2015	Achieved
  Establish a baseline for waste data at all relevant properties, against which to set future targets	2015	Achieved
  Ensure that new marketing collateral for properties for sale or rent incorporates all relevant sustainability information	2015	Achieved
  Develop targeted tenant sustainability communications	2015	Achieved
  Review those properties which have 2008/9 dated EPCs rated D or E and put in place appropriate plans for any high risk properties identified	2016	Achieved
  Implement practical EPC improvement plans for high risk properties	2016	Achieved
  Achieve a 6% reduction in like-for-like landlord controlled electricity consumption by the end of March 2016 against a 2013/14 baseline	2016	In progress
  Achieve a 6% reduction in like-for-like landlord controlled gas consumption (adjusted for heating degree days) by the end of March 2016 against a 2013/14 baseline	2016	In progress
  Achieve a 6% reduction in like-for-like landlord controlled carbon emissions by the end of March 2016 against a 2013/14 baseline	2016	In progress
  Achieve a 5% reduction in like-for-like landlord controlled water consumption by the end of March 2016 against a 2013/14 baseline	2016	In progress

• Creating Sustainable Buildings

  Target	Deadline	Progress
  A minimum requirement for BREEAM Very Good will be set on all new developments and major refurbishments	2015	Achieved
  Develop project-specific sustainability requirements for contractors, in line with BREEAM requirements and incorporate into relevant building contracts	2015	Achieved
  Develop project-specific sustainability requirements for contractors, in line with BREEAM requirements and incorporate into relevant building contracts	2015	Working towards

• Engaging Stakeholders

  Target	Deadline	Progress
  Publish an update on progress with the implementation of the sustainability strategy in the Annual Report and Accounts	2015	Achieved
  Participate in the Global Real Estate Sustainability Benchmark	2015	Achieved
  Build sustainability awareness amongst employees and occupiers through tailored communications and activities	2015	Achieved