EU Sustainable Finance Disclosure Regulation (2019/2088) (the "Disclosure Regulation")
Prologisas AIFM1 ("Prologis"), makes the following disclosures in accordance with Articles 3(1), 4(1)a and 5 of the Disclosure Regulation.
Sustainability risk policies
Prologis considers that sustainability risks are relevant to the returns of the funds under management and has therefore implemented a policy in respect of the integration of such sustainability risks in its investment decision making-process. Further information on the manner in which sustainability risks are integrated into investment decisions is provided below.
A sustainability risk means "an environmental, social or governance event or condition that, if it occurs, could cause an actual or potential material negative impact on the value of the investment." For Prologis, sustainability risks are risks which, if they were to crystallise, would cause a material negative impact on the value of the portfolios of its funds.
Before any investment decisions are made on behalf of any funds that Prologis manages, it will, together with the relevant fund management and portfolio management team, complete a comprehensive risk management process to identify the material risks associated with each proposed investment, which includes all relevant sustainability risks. This assessment is incorporated within the memo submitted to the Investment Committee.
The investment committee assesses all the identified risks alongside other relevant factors set out in the proposal and with regard to the relevant fund's investment policy and objectives. Throughout the entire process, relevant sustainability risks are identified and assessed using the same process as is applied to other relevant risks affecting the funds and investments made on their behalf. More detail on the integration of sustainability risks in the investment process is described in the sustainability risk policy.
Consideration of principal adverse impacts on sustainability factors
Prologis considers the potential principal adverse impacts (PAI) of its investment decisions on environmental, social and employee matters, respect for human rights, anti-corruption and anti-bribery matters by means of assessing potential PAI during the due diligence process before investment decisions are made.
In particular, this is done through ESG due diligence assessment of the real estate asset’s energy efficiency standards, GHG emissions and environmental footprint.
As of financial year 2023, information on such potential PAI will be reported on in the annual sustainability report and the annual report of the funds under management which will be made available to investors as well as on the Prologis website.
Prologis’ environmental stewardship, social responsibility and governance efforts aim at monitoring potential PAI of its real estate assets, with planned actions to avoid or reduce potential PAI. This includes the promotion of sustainability of logistics real estate. As part of the sustainability program, Prologis strives to help customers reduce their operating costs, while minimising their environmental footprint. Prologis reviews its portfolio and makes investments to improve the efficiency of its buildings. Prologis considers sustainable design features such as solar panels, air-tight building construction, intelligent lighting, land remediation programs and absorbent solar walls to promote environmental sustainability of its portfolio and seek to improve older less sustainable buildings with more efficient upgrades.
Finally, Prologis and the funds under management adhere to internationally recognised standards for due diligence and reporting and already transparently track progress and report results against these. Notably, Prologis reports corporate carbon emissions through the Carbon Disclosure Project (CDP), and responds to other reputable ESG surveys including the Dow Jones Sustainability Index (DJSI) and the Global Real Estate Sustainability Benchmark (GRESB). At the corporate level, Prologis also produces an annual sustainability report in accordance with Global Reporting Initiative (GRI) Standards. Third-party assurance of this report ensures the quality and transparency of the data.
Prologis pays its employees a combination of fixed remuneration (salary and benefits) and variable remuneration (including bonus). Variable remuneration for relevant employees takes into account compliance with all policies and procedures, including those relating to the integration of sustainability risks on the investment decision making process. In this regard, Prologis’ remuneration policies do not encourage risk-taking which is inconsistent with its internal risk limits or with the risk profile of the funds that Prologis manages, including regarding sustainability risks. Prologis Proxy Statement
- Luxembourg: Prologis Management II S.à r.l. (a European Alternative Investment Fund Manager) for Prologis European Logistics Fund, FDR PELF and FDR PCCLF;
- US: Prologis LP (a non-EU AIFM) for Prologis Targeted U.S. Logistics Holdings, Prologis Targeted U.S. Logistics Holdings II and Prologis Targeted U.S. Logistics Fund;
- Singapore: Prologis Fund Management Pte. Ltd. (a non-EU AIFM) for Prologis China Core Logistics Fund.