73 Annual Report 2024 MATERIAL RISKS KEY MITIGATING ACTIONS • Maintain a robust investment approval process including comprehensive due diligence supported by an inter-disciplinary internal team, and/or local independent consultants to advise on legal, tax, building design, quality, environmental, health & safety, security, and compliance with local laws and regulations. Independent valuation is conducted, where required. • Review hurdle rates and weighted average cost of capital annually based on relevant risk-adjusted input parameters that serve as investment benchmarks and make necessary adjustments accordingly. • Evaluate all investment and divestment proposals against a rigorous set of criteria which includes potential for growth in yield, rental sustainability and potential for value creation. • Rigorous review of key financial assumptions and key sensitivity analysis are undertaken. • Identify potential risks associated with proposed projects and issues that may affect smooth implementation or attainment of projected outcomes at the evaluation stage and devise action plans to mitigate such risks as early as possible. Independent risk assessment is also conducted for all investment projects above a stipulated investment value threshold. • Integrate sustainability in real estate life cycle from the earliest stage of our investment, redevelopment and divestment processes. • Board reviews and approves all major investment and divestment decisions. • Maintain a framework that proactively identifies the applicable laws, regulations and rules, assesses the regulatory and compliance risks, and embeds compliance risk mitigation measures into day-to-day operations. • Leverage in-house specialised teams in CLI such as legal, compliance and tax, and external consultants to provide advisory services and updates on changes to laws, regulations and rules. • Rely on CLI’s established group-wide policies and procedures to address the requirements of the applicable laws, regulations and rules such as Personal Data Protection Policy, Anti-Money Laundering and Countering the Financing of Terrorism Policy, Global Sanctions Compliance Policy and Tax Strategy. • Adopt e-learning modules to raise awareness and educate employees on ways to avoid or prevent non-compliant behaviour. • Deployment of capital into loss-making or below- target return investments due to wrong underwriting assumptions or poor execution. • Inadequate planning to identify suitable divestment opportunities. • Non-compliance with applicable laws, regulations and rules, relating to fund management, tax, data protection & privacy, financial crimes and sanctions in the major economies and key markets where CICT Group operates. • Inability to attract and retain talent and/or build organisational capabilities to support the achievement of CICT Group’s objectives. • Leverage learning and development programmes, along with internal and external talent pools to enhance the skills of our workforce and address capability gaps. • Conduct regular Employee Engagement Surveys to improve communication and the work environment, fostering a more positive and engaged workforce. Human Capital Investment and Divestment Regulatory and Compliance
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