EMERGING RISK LANDSCAPE Amid a rapidly evolving global landscape, the Group adopts a robust process to monitor, assess and manage emerging risks to enhance organisational resilience and support sustainable growth. Emerging Risk Key Mitigation Actions Geoeconomic Confrontation The growing geoeconomic competition, demographic shifts, and climate-related pressures are creating a volatile global environment. These developments may affect trade flows, supply chains, construction costs, financing conditions, and investor sentiment, which could indirectly impact the Group’s project timelines, operational performance, and financial results. • Strengthen supply chain resilience strategy through diversification of material suppliers across geographies, supported by long-term vendor contracts and buffer stock for critical materials to mitigate supply, economic and demographic risks. • Maintain financial and operational flexibility through prudent capital and liquidity management, supported by adequate time buffers to withstand disruptions and uncertainties. Generative AI Generative AI developments and adoption may introduce indirect market, operational, regulatory, and reputational risks, including increased market volatility, shifting stakeholder expectations, biased or erroneous outputs, data privacy or compliance breaches, and over-reliance on AI, which could adversely impact the Group’s operations, financial performance, and strategic priorities. • Establish a comprehensive AI Governance and Security Framework to govern the responsible adoption and use of generative AI technologies and to oversee AI-related risks. This enforces responsible AI use, strong data protection, and ensures that all AI systems, including those supporting smart building technologies and operational automation, are deployed securely, ethically, and in compliance with regulatory requirements. • Monitor AI-related developments and periodically review its business and digital strategies to remain responsive to potential indirect impacts. • Explore and adopt AI responsibly in targeted areas (e.g. AntiMoney Laundering/ Know Your Customer) to improve speed, accuracy, and efficiency. Governance and risk management frameworks are applied to ensure that any adoption is compliant and aligned with the Group’s operational and strategic objectives. Climate – Extreme Weather Events Climate change is accelerating globally, driving more frequent extreme weather events, rising temperatures and long-term shifts in environmental conditions. These developments are increasing physical, transition and regulatory risks for the Group, given the critical role that resource efficiency and resilient infrastructure play in supporting operations. • Monitor and manage risk exposures through robust oversight processes supported by key risk and performance indicators, ensuring alignment with the Group’s risk appetite and tolerance levels. • Enhance climate resilience and preparedness by maintaining and routinely testing the Business Continuity Plan and conducting climate scenario analysis that considers pandemic risks and emerging net-zero regulations across key markets. CONTINUED REVIEW & ENHANCEMENT OF ERM FRAMEWORKS The Group is committed to continually enhancing its risk management framework, incorporating lessons learned from past experiences and adapting to emerging risks. This ensures that the Group’s approach remains dynamic and responsive to the ever-changing risk environment. 1 2 3 ANNUAL REPORT 2025 | 69
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