Nuturing well-connected, prosperous and supported communities in and around our buildings

Investing in communities

We continue to invest in the communities in which we operate. In FY18 we contributed over $1 million in community investment through employee volunteering programs, in-kind support and corporate donations.

Supporting our major charity partners

During the year we supported a range of not-for-profit charities and community groups through in-kind volunteering and monetary donations, across social issues that align with Dexus, including:

  • Family and children’s health, via the Sydney Children’s Hospital Foundation and The Cancer Council 
  • Animal welfare, via the RSPCA 
  • Homeless, via Orange Sky Laundry and the Property Industry Foundation (PIF)
  • Environment, via Landcare

In August we celebrated our annual Dexus Diamond Week, with employees across the country lending a hand to sell raffle tickets for our main charity, the Sydney Children's Hospital Foundation, or spending time supporting community groups and charities of their choice.

Sixty of our team members volunteered to sell raffle tickets in our office lobbies, raising $9,608 for the Sydney Children's Hospital Foundation. Funds raised went towards the Australasian Centre for Personalised Cystic Fibrosis Medicine to fast-track research aimed at finding a cure.

To end the week, some of our Sydney staff attended the Sydney Children’s Hospital Foundation premier fundraising Diamond Event. Dexus was a major partner of the event, contributing to the $605,000 in total raised on the evening.

Continuing our focus on children’s health, this year we launched a landmark community fundraising program, ‘Big Change for small change”.

Through generous community donations at our retail centres around Australia, we raised over $50,000 for local hospitals to support a range of paediatric service and children’s health care initiatives. Read more in the case study on page 28.

Delivering FY18 strong communities commitments

 = Achieved   = Not Achieved  = Underway                                        

Commitment Status FY18 achievements
Extend our contribution to the community by introducing a nationwide community program across 10 managed shopping centres to raise funds for local children’s health services/hospitals Expanded our contribution to the community through the nationwide Big Change for small change charity event, raising substantial funds for children's health services
Update our assessment of supply chain risks and incorporate within procurement and monitoring processes relating to our supply chain partners Completed a review of our supply chain practices by working with key procurement stakeholders to help further align CR&S requirements and ambitions into procurement activities

Volunteering and fundraising

Each year we enable our people to contribute to the community through the provision of one day’s paid volunteering leave.

In FY18 Dexus volunteered a total of 878 hours with 198 of our people taking part in a volunteering event.

In addition to supporting Dexus Diamond Week and our ‘Big Change for small change’ campaigns, people across Dexus donated their time to several other community causes.

In Sydney, we partnered with Landcare, with volunteers working with the National Parks and Wildlife Service staff at Bradleys Head in Sydney Harbour National Park, learning about conservation and assisting with weeding and planting of native flora.

For the third year running, the team at QV Melbourne assisted in the garden at the Collingwood Children’s Farm, a working farm providing educational, and interactive farm experiences for children.

Our health enthusiasts donated their time by running, cycling, and swimming to support research for cancer across events including the Balmoral Cancer Challenge, Balmoral Burn and PIF’s Chain Reaction ride.

In December, staff at 10 Eagle Street and 12 Creek Street in Brisbane teamed up with Foodbank Queensland to conduct a "12 Days of Christmas Foodbank Can Drive".

Dexus provided all participating customers a personalised Santa sack to fill over 12 business days. Cans and non-perishable items were donated to Foodbank to give to those in need.

Customers filled their sacks many times over in an amazing show of generosity. On top of this, we also received over $1,000 in cash donations.

Sharing the Christmas spirit, we held our annual Christmas auction in which corporate gifts are donated by staff for internal auction, with over $7,000 raised for the Sydney Children’s Hospital.

Volunteers lending a hand at Foodbank, providing hunger relief
Volunteers assisting Landcare at Bradleys Head in Sydney
Volunteers assisting the Oasis drop-in centre with lunch preparation and service during Dexus Diamond Week  
Creating a sense of community from an early age Beauty with a purpose: flower charity auctions

480 Queen Street in Brisbane partnered with Foodbank, Australia's largest hunger relief organisation, to help their efforts in Queensland.

Dexus engaged with customers at 480 Queen Street including our littlest from Guardian Early Learning, who enthusiastically leant a hand delivering what they had collected to concierge.

Non-perishable food and long-life products as well as cash donations were collected through Concierge and included pasta, rice, tins of soup, tea and honey.

Customers including HWL Ebsworth Lawyers, BHP, PwC Australia, Guardian Early Learning and First Class Fitness leant their support to Foodbank.

Dexus has found a way to re-purpose the flower arrangements it displays in the foyers of its office buildings.
Every Friday the flower arrangements from the concierge desks in Dexus office buildings are placed in a building community auction, with all proceeds going to nominated charities around Australia.

Leveraging the Workspace Dexus online portals, customers within each building are invited to bid.

Across the year customers in more than 20 Dexus managed properties raised over $42,000. Proceeds were donated to support charities including local children’s hospitals, The Cancer Council, and Orange Sky Laundry – a laundry service for people living rough.

Big Change for small change' making a difference to the lives of sick children

In what is believed to be a first for an Australian property group, Dexus managed shopping centres raised funds to support the lives of young families and children by supporting local hospitals and children's wards in their local communities.

The ‘Big Change for small change’ campaign was rolled out across 10 Dexus retail centres in September 2017, with each centre hosting a one-day community event.

Each centre was transformed for Big Change for small change with special offers from retailers and a program of free entertainment and community events.

There was an outstanding response from our partners and stakeholders including retailers, local community groups, and suppliers, together contributing over $380,000 in-kind value.

A volunteer network of 398 people supported the collection of donations on the day including Rotary, Apex, Lions Clubs, Surf Lifesaving Club, Childcare Groups, Schools, Specsavers and the Commonwealth Bank.

Dexus Centre  Partner hospital
Smithfield Centre, Cairns Far North Queensland Hospital Fund
Willows Centre, Townsville Townsville Hospital Fund
Tweed City Shopping Centre Tweed Heads Hospital
Beenleigh Marketplace Logan Hospital
Deepwater Plaza Woy Woy            Gosford and Wyong Hospitals
Plumpton Marketplace Mount Druitt Hospital
Sturt Mall, Wagga Wagga Wagga Wagga Rural Referral Hospital
Shepparton Marketplace GV Health Hospital
QV Melbourne Royal Children's Hospital
Carillon City, Perth Perth Children's Hospital

Big Change for small change captured the hearts and minds of each local trade area, with the very best in community support on display at each participating shopping centre.

Over $50,000 was raised towards local hospitals, supporting a range of paediatric services and children’s health care initiatives, such as the revitalisation of a children’s garden in Mount Druitt Hospital through to the purchase of a new electronic bed for the children’s ward at GV Health Hospital, in Shepparton.

The response from our retailers, local community organisations and media partners has been overwhelming. Our focus at Dexus is to deliver localised retail experiences through our centres every day, and with the support of our local community partners, we aim to create big change for small change.

Ben Hughes, National Retail Marketing Manager, Dexus

Community investment statistics

 

Ethical supply chain sourcing

Our products and services suppliers form another important community for Dexus.

We completed an assessment of our supply chain risks to understand the inherent upstream environmental, social and governance risk ‘hot spots’ across the product categories within our property life cycle.

In addition, we commenced additional due diligence activities to assess modern slavery risks across our supply chain.

Following this, we are piloting enhancements to how we integrate management of environmental and social sustainability issues into our procurement and supply chain monitoring project lifecycle.

Sustainable procurement

FY18 procurement activity focused on securing energy supply with new contracts across the national electricity market (NEM) and the separate Western Australia market.

For NSW, ACT and Victorian properties, we adopted a progressive purchase structure for FY20 & FY21 to introduce flexibility in timing of electricity purchases to access market price declines.

We also renewed our small market natural gas supply, leveraging our scale to access best market rates to deliver a forecast $422,000 reduction in operating costs, in conjunction with a fuel switching initiative at 123 Albert Street, Brisbane.

In Western Australia, we renegotiated electricity and natural gas supplies, adding newly acquired and co-owned properties to increase our scale, delivering forecast reductions of $730,000.

During the year we initiated a new strategy for delivering capital works across office properties, adopting a ‘single select’ approach with a preferred Integrated Service Provider, reducing delivery costs and project timeframes. Refer to the adjacent case study for further details.

In addition, we sourced a strategic partner to deliver ‘virtual engineer’ building analytics across our managed retail portfolio, expanding on the analytics capability we already have across the office portfolio.

Integrated Service Providers deliver capital works efficiencies

Dexus has implemented an Integrated Service Provider (ISP) project partnering strategy for capital projects relating to periodic on-floor landlord and building relevance works.

We aim to facilitate shorter construction programs and eliminate procurement inefficiencies to both Dexus and contractors due to excessive tendering and negotiations on repeated projects offering similar scopes.

The ISP model is a partnership with innovative contractors across a precinct of buildings, applying a collaborative commercial arrangement for design and construction services. Typical scopes of work include commercial office demolition and on-floor refurbishment services, landlord’s works, floor splits and office suite strategies, and other minor projects.

Pre-approved contractors are appointed as an ISP to undertake landlord and building relevance works across a precinct of buildings.

ISPs are engaged on long-term contracts adopting a pre-agreed rate schedule with the ability to extend based on successful performance.

Each project or proportion of works is undertaken in accordance with a master ISP building works contract, and specified via a streamlined work order approach, which details the project work, practical completion date and defects liability period.

Through this strategy, Dexus is progressively procuring suitable partners across multiple building precincts, to reduce delivery costs, achieve quicker project delivery timeframes, and streamline management.

Supplier screening

Dexus adopts a long-term approach to managing and maintaining supplier relationships through a robust set of business procedures which guide supplier screening, selection and engagement. A suite of policies, principles and performance standards underpin the ethical and supply chain approach.

We screen suppliers on their sustainability track record and management systems during the procurement process. We informally collect data from external sources to assist with validating suppliers’ credentials with regard to impact on the environment, society and how they manage their staff.

During FY18 we reviewed our preferred supplier panel, resulting in minor adjustments. Through our tender evaluation scoring process, we screened potential suppliers across economic and business criteria as well as environmental and social sustainability practices including alignment of corporate culture, and their track record for workplace health and safety.

Dexus is committed to working with contractors and service providers who maintain the highest ethical, safety and quality standards.

As part of this commitment, we have developed an Embargo Policy which formalises our approach for identifying contractors and service providers for which we have no appetite to deal with.

We now maintain an ongoing Embargo List of suppliers that fail to meet Dexus’s business, safety or ethical behaviour requirements and will not engage with that contractor or service provider until the issues of concern have been appropriately addressed.

Engaging with suppliers

Throughout FY18 Dexus continued to engage with suppliers via regular meetings and reporting and conducted over 1,100 inspections/spot checks to review service delivery, monitor performance against contract deliverables and key performance indicators.

Through our 2018 supply chain self-assessment, we engaged with our preferred supplier panel members and other critical suppliers to understand their approaches to the issues to evaluate the effectiveness of our sustainable procurement policies and supplier relationship management practices.

The survey comprised 35 key suppliers representing approximately 32% of Dexus’s non-statutory supply chain spend.

A comprehensive insight into their relationship with Dexus was sought through 360-degree feedback on how they manage their own sustainability risks and those for their most significant suppliers. The feedback confirms that Dexus is embedding deeper, longer term relationships with suppliers. From the survey responses, two-thirds of suppliers indicated a relationship with Dexus of five years or more, with a further 31% maintaining a relationship of between one and four years.

Supplier satisfaction with their Dexus relationship continues to improve, with 82% indicating they are very satisfied with their relationship.

Suppliers told us that they are most satisfied with how we communicate, the assignment of roles and responsibilities and our ability to address delivery issues. Areas for improvement include enhancing supplier training, including how we articulate our sustainability goals within projects, and feedback mechanisms.

In other feedback , 94% of respondents strongly viewed their business as a valued Dexus partner, and 85% strongly agreed that Dexus is a fair company to conduct business with.

To read more about our procurement and supply due diligence and assessment practices, refer to the Supply Chain disclosure of management approach.

Tackling supply chain sustainability risks

In this year’s supplier self-assessment, we queried our partners on two key topics – modern slavey and climate change.

Taking action on modern slavery

Following the United Kingdom’s lead, Australia’s Commonwealth and New South Wales governments are introducing legislation to combat modern slavery, which comprises practices such as human trafficking, slavery, forced labour, child labour and slavery-like practices.

Dexus will be obligated under proposed thresholds in NSW and Federal Acts and will be required to prepare an annual Modern Slavery Statement within six months from the end of their financial year.

Annual Modern Slavery Statements are likely to include the following mandatory criteria:

  1. Business structure, operations and supply chains
  2. Potential modern slavery risks present in the entity’s operations and supply chains
  3. Actions taken to address these risks 
  4. Reporting on how businesses assess the effectiveness of their actions

Aside from reporting obligations as a procurer of goods and services across our own supply chain, Dexus is also a supply chain partner for customers and investors, and we anticipate further downstream engagement on how we are tackling this issue.

Dexus is collaborating with industry peers via the Property Council of Australia to co-create and pilot a common modern slavery due diligence questionnaire for suppliers to provide information on their labour management practices.

A common approach will reduce the reporting burden on suppliers and reduce compliance costs for Dexus and other pilot organisations. We expect the platform to be available from early 2019.

This follows due diligence conducted over the year on our own supply chain to identify, evaluate and control supply chain risks.

Within our 2018 supplier assessment, we learned from 14 key suppliers representing almost 20% of our supply chain spend that they will have direct modern slavery reporting obligations. Most suppliers stated they are aware of the legislation and believed they are well positioned or ready to comply.

This will assist Dexus to work collaboratively to investigate beyond our direct suppliers, as we work to trace our supply chain back to source inputs where possible.

We continue to monitor suppliers’ ‘country of origin’ and have identified a minor number of suppliers that have disclosed that they operate in, or that procure products and services, from countries with poor human rights policies or track record. Suppliers agreed that international supply chains present the greatest risk of modern slavery.

As the chart opposite shows, capital works and cleaning remain a key focus for Dexus due to their large spend, extensive migrant labour, use of sub-contractors and product sourcing. In line with our commitment to outcomes-based reporting, we are increasing our scrutiny of cleaners’ waste handling practices and downstream waste processing.

For further information refer to Dexus’s Supply Chain Disclosure of Management Approach.

Assessing climate change hotspots

Building on our focus on energy and climate, we have reviewed climate-change related risks across our suppliers.

Access to reliable, affordable energy remains a high priority, and water scarcity has emerged as a risk, most notably by Red Energy to generate hydroelectricity.

Service providers also highlighted chronic climate-related impacts of temperature increase and extreme heat, which will lead to adverse health impacts.

Larger service providers in the areas of energy, cleaning, construction and facilities management have established plans to reduce their vulnerability to the impacts of climate change.

Suppliers are also investing to leverage climate-related opportunities through new products and services that will benefit Dexus’s goals to achieve net zero emissions by 2030.

Strong communities - performance data

Volunteering and donations

  FY14 FY15 FY16 FY17 FY18
Equivalent funds donated or raised      
Corporate donations ($)  139,344 241,053 180,842 214,052 296,078
Employee volunteering activities ($) 50,044 65,806 89,779 75,191 74,858
In-kinds support ($) 470,055 712,295 532,646 437,258 626,596
Total ($) 659,444 1,019,154 803,268 726,501 997,532
Hours volunteered          
Dexus volunteering program 589 792 1,049 853 878
Commentary and methodology

Charitable donations - Activities comprise:

  • ¬≠Financial contributions to nominated charities
  • Direct financial contributions to nominated charities and not-for-profit organisations plus proceeds from through fundraising events held by charitable organisations within Dexus-managed buildings and shopping centres
  • Community sponsorships, advertising and promotions
  • A dollar-for-dollar matching program
  • The value of goods purchased for charity events and appeals

In-kind support - Dexus offers in-kind support to not-for-profit organisations or community groups to support their cause/fundraising activities and includes the provision of goods or services and the value of space provided in the building at no charge.

Volunteering - Employee volunteering activities include:

  • ¬≠Volunteering leave taken in company time by Dexus employees to undertake community work
  • Participation on charity committees/boards where the individual is acting in the capacity as a Dexus employee

Volunteer hours are calculated as the total full time equivalent hours worked by employees in nominated community and charitable activities.

Supply chain

Procurement and supply chain monitoring FY15 FY16 FY17 FY18
Critical suppliers - 131 113 111
Critical suppliers % of operational spend (%) - 37% 42% 45%
Supplier Net Promoter Score - - - +67
Supplier assessment and monitoring        
Supplier engagement assessment response rate (%) 22% - 38% 35%
Assessment coverage of operational spend (%) - 19% 14% 26%
Contractor monitoring spot checks conducted - 441 919 1,190
Contractor monitoring coverage of operational spend (%) - 13%1 36% 39%
  1. Tracking commenced during reporting year.
Commentary and methodology

Dexus defines a critical supplier as one whose services are required daily for the normal operation of a building. Critical suppliers are retained on a centralised Preferred Supplier List.