Climate resilience

At Vicinity, we understand the role we play in supporting more resilient cities and communities.

Our vision of reimagining destinations of the future, where people love to connect includes ensuring our centres are resilient – they must be prepared for, and able to support local communities during times of extreme weather events and remain open for trade for our retailers and consumers during extreme climate events.

Disclosure of Vicinity's climate related risks, opportunities and strategy below are informed by recommendations of the Financial Stability Board's Task Force on Climate-related Financial Disclosures (TCFD). 

Governance and strategy

Climate change has been identified as a material issue for our business and is formally acknowledged and included in Vicinity’s enterprise risk register.

Climate resilience is therefore a key focus of Vicinity’s Sustainability strategy, which was approved by our Board of Directors in 2016.  We have additionally made public our intention to address climate change via our Climate Policy.

Climate resilience is governed and managed as part of our broader sustainability governance framework.  More information on this is available here.   

Transitioning to low carbon smart assets is also a key focus of our Sustainability strategy, and as such, our Climate Policy includes a commitment to ‘significantly reduce our carbon footprint through establishment and implementation of a long term low carbon target’. More on our approach to climate change mitigation can be found in the Low carbon smart assets section.

Risk management

Climate change was identified as a material risk for Vicinity through the materiality review conducted in 2016, and was later included in our enterprise risk register, which is regularly monitored by our Executive Committee and the Board. 

Our enterprise, corporate and asset level risks are assessed, prioritised and managed using Vicinity’s Enterprise Risk Management Framework, which considers strategic, operational, reputational, compliance and financial risks for our business. It uses an impact/likelihood assessment matrix to prioritise business risks, including climate change.

The following table provides a summary of Vicinity’s climate risks and opportunities, including their expected impact on our business in terms of time horizon and financial impact.


Climate risks and opportunities for Vicinity

Risks and opportunities

Time of impact1

Financial impact (impact to our business, strategy and financial planning)




Physical risks



Increased severity of extreme weather events such as cyclones and floods

Medium term

Increased operating costs due to higher maintenance and repair costs from property damage 

Reduced income from reduction in competitiveness due to disruptions to site operations

Changes in precipitation patterns and extreme variability in weather patterns

Medium term

Increased operating costs due to maintenance and repair from property damage

Rising mean temperatures

Medium term

Increased operating cost due to stresses to building equipment (e.g. heating and cooling systems) and increase in energy demand and usage

Transition risks



Uncertainty in market signals

Short term

The policy and timing for the electricity market to transition to renewable energy for Australia to meet its Paris Agreement commitments will influence the rate and scale of electricity prices

Increased energy costs due to abrupt and unexpected changes to wholesale electricity markets




Resource efficiency



Improved efficiency of our assets

Short-medium term

Reduced operating costs from lower energy use in more energy efficient buildings

Increased value of assets due to high energy rated buildings

Energy source



On-site energy generation using less carbon intensive sources of energy


Lower operational costs through reduced exposure to grid electricity price increases

Returns on investment in onsite renewable energy generation

Reputational benefits leading to increased consumer visitation and retail sales




Implementation of measures to increase resilience and adapt to a changing climate

Short to medium term

Increased market valuation of assets through demonstrated enhanced resilience to climate impacts

Fewer financial losses due to climate and weather related disruptions to operations and damage to assets

Installation of onsite renewable energy


Increased reliability of electricity supply, particularly during extreme weather conditions, and reduced operating costs though resilience to electricity price fluctuations from grid-sourced electricity

  1. We define short term as 1-5 years, medium term as 6-15 years and long term as 15+ years.

For further details of our risks and opportunities, including estimated financial implications and our management method, please refer to our CDP Reports.


Adaptation and resilience

Since 2015 a program of work has been underway to improve our understanding of the potential risks and opportunities for our business, including at a corporate and asset level, relating to climate change. This included an initial high level risk assessment of the climate risks for each of our assets against projected long term Australian climate variables under certain climate change scenarios. 

During FY17 we commenced deeper dive assessments at our highest risk centres, including Whitsunday Plaza, which was significantly impacted by Cyclone Debbie in March 2017.  From this assessment, we have developed a climate resilience assessment checklist which will facilitate the roll out of detailed assessments across more of our centres in FY18. Furthermore, the assessment included identifying mitigation and resilience measures to enhance the adaptability of our assets.

In FY17 we also carried out a review of our major business practices to understand how climate risk is currently considered.  Following this review, we are working through a plan of activities to further embed climate risk considerations across our most prominent business decision making processes, including within the operations, development, investment management, capital transactions and emergency response and management parts of our organisation.

As part of our ongoing program of work to improve our understanding of the potential climate-related risks and opportunities for Vicinity, we will undertake further work in FY18 to better understand the financial impacts on our business under different climate scenarios.

Metrics and targets

We set annual energy use and carbon reduction targets, and have driven significant reductions in the carbon intensity of our portfolio, through our environment improvement program. To find out more about our performance, go to Sustainable Operations