Nuturing well-connected, prosperous and supported communities in and around our buildings
Building strong communities
We continue to invest in the communities in which we operate. In FY17 we contributed a total of $726,501 in community investment through employee volunteering programs, in-kind support and corporate donations.
This year we continued our support for the Sydney Children’s Hospital Foundation through Dexus Diamond Week, along with other community charities.
We are proud to support these and other charitable organisations that focus on the health and wellbeing of our communities.
Our products and services suppliers form another important community for Dexus. In FY17 we reviewed our strategic procurement strategy, and moving forward we aim to better leverage our size and scale to procure smarter with a long term view.
We commenced an assessment of our supply chain risks to understand the inherent upstream environmental, social and governance ‘hot spot’ supply commodities within our property life cycle.
We will progress the findings of this assessment in FY18, with the aim of providing greater engagement with suppliers and transparency to Dexus via enhancements to tendering, contracting and supply chain monitoring.
Delivering FY17 strong communities commitments
= Achieved = Not Achieved = Underway
|Introduce a coordinated approach to community related services across the Dexus office platform through the appointment of Community Managers across the Group’s office portfolio and the development of a community engagement strategy.||Appointed 23 Community Managers who facilitated the development and execution of a range of engagement initiatives that align to our Workspace Dexus experience including health and wellness classes, building events and activities.|
|Position Dexus retail centres to be the ‘hub of the community’ through engagement with local community organisations and embedding community partnerships into key promotional activities.||Over $500,000 was invested across the retail portfolio connecting to local communities, through volunteering, in-kind spaces, donations, sponsorships, events and activations. Placing the community at the heart of what we do.|
|Improve the entertainment and leisure facilities at three Dexus managed shopping centres to reaffirm their position as community hubs.||Enhancements were made at number of retail hubs including Tweed City, Smithfield Shopping Centre and Southgate Melbourne.|
|Implement a group procurement strategy and review supply chain risks to create shared value with key suppliers.||Completed a strategic review of procurement including supply chain risks. Implemented a global best practice model with key suppliers including scoping, contracting, sourcing and reporting to ensure performance, efficiency and governance.|
Supporting our local communities
During the year we supported a range of not-for-profit charities and community groups through in-kind volunteering and monetary donations.
Once again we supported our main charity, the Sydney Children’s Hospital Foundation by hosting our annual Dexus Diamond Week. In addition to our direct donation:
- We activated our Sydney CBD lobbies to raise funds for the hospital and raise awareness of their main Emergency Room fundraising event
- Our volunteers cooked and served up a BBQ for the 300 hospital staff, visitors, patients and families
- Teams cooked meals for families and children staying at Ronald McDonald House Randwick
Dexus is a member of the Property Industry Foundation and supported the ‘Tour de PIF’ cycling events in Sydney and Melbourne to raise funds to address the serious and persistent problem of youth homelessness.
We donated use of our building foyer space to charity fundraising events including Oxfam, Salvation Army Red Shield Appeal, the Cancer Council’s Daffodil Day and the RSPCA.
Across our managed retail centres, we sponsored local community groups including local PCYCs, Rotary, surf lifesaving clubs, and other sports associations. Through our redevelopment activities we facilitated construction jobs and boosted retail employment through new retailers opening on site.
In March, Cyclone Debbie hit the Queensland coast, bringing damaging winds and floodwaters, and affecting communities around Beenleigh Marketplace and Tweed City Shopping Centre.
Beenleigh Marketplace and Tweed City proudly supported the community with a Flood Donation Drive. Shoppers dropped off non-perishable food items so food support boxes could be donated to those in need in the local community.
Hundreds of boxes were donated to the community during this time of hardship.
|Connecting with community to reuse and recycle office de-fit waste|
Waste from office de-fits predominantly ends up in landfill, creating emissions harmful to the environment and high disposal costs.
To reduce the harmful effects of waste to landfill on the environment and drive down costs, Dexus rolled out waste management strategies across our portfolio, setting an 80% diversion from landfill target for de-fit projects by 2020.
Dexus collaborated with charities and other users to repurpose de-fit and increased the diversion rate from landfill across eight projects in FY17.
Dexus donated items from office de-fits at 12 Creek Street, Brisbane to local and international not-for-profit organisations including:
|Boosting local employment within our communities|
We continue to evolve and transform our retail destinations, so they remain relevant and engaging to the local communities for future generations. In doing so, our activity assists local communities by providing locals with job opportunities.
Throughout FY17 Dexus progressed significant retail developments including:
Each retail development presents a local employment boost throughout the construction period.
Upon project completion many retail employment opportunities are also created, supporting the communities’ local economy and future prosperity.
Key outcomes include:
Each year we enable our people to contribute to the community through the provision of one day’s paid volunteering leave.
In FY17 Dexus volunteered a total of 853 hours with 199 of our employees taking part in a volunteering event.
In Sydney, Dexus employees volunteered to assist preparing and serving lunches at The Station, a refuge in the Sydney CBD that provides a range of services for people who are having difficulty attaining and sustaining adequate and secure accommodation, improving their health, personal autonomy and dignity.
Members of our Melbourne team put their DIY skills to the test for the Lighthouse Foundation, helping to upkeep the foundation’s residential homes.
In Brisbane, our team participated in the Mater Hospital’s ‘climb for cancer’, powering their way up 810 stairs to raise funds for ovarian and prostate cancer research.
The retail team at Smithfield, Cairns supported environmental initiatives, volunteering for Tangaroa Blue; a not-for-profit organisation dedicated to the removal and prevention of marine debris. The team at QV Melbourne helped out in the garden at the Collingwood Children’s Farm, a working farm providing educational, interactive farm experience for children.
For further information on our community investment program refer to Dexus’s disclosures on management approach for Customers and Community.
Supply chain management
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 completed a number of key procurement activities in FY17.
We renegotiated our major electricity contract to secure forward supply. We aggregated our portfolio to maximise market leverage and will reduce ongoing administration by consolidating our suppliers. We locked in energy rates in prior to the 2016/17 summer, avoiding the highly volatile peak electricity prices seen thus far in 2017. We have also streamlined the administration of our transient, vacant tenancy accounts.
During the year we consolidated our Building Maintenance Unit (BMU) service providers across Queensland and Victoria. In addition to saving $28,000 against FY17 budget, we enhanced services and increased provider management and transparency, while reducing administration costs and establishing consistent service delivery across portfolios.
We have also re-contracted for fixed telephone line services, leveraging our scale and capitalising on market movement to renegotiate improved pricing, while instituting a readily scalable arrangement to accommodate future property acquisitions.
As 480 Queen Street Brisbane was handed over to Dexus from the builder post development, we finalised service agreements for ongoing mechanical and lift maintenance, and handyman services, integrating the property within our service platform.
Focusing on occupant comfort and wellbeing, we contracted for NABERS Indoor Environment ratings and indoor air quality services nationally. This agreement leverages synergies with our existing indoor air quality services, providing cost efficiencies, consistent practice and service delivery.
Moving forward we will:
- Increase customer assurance via enhanced monitoring of indoor building environment
- Facilitate benchmarking of asset indoor environment performance across our portfolio
During FY17 we sourced landscaping services for our NSW Industrial portfolio, rationalising services with a single provider to increase service consistency and provide greater value for money.
The successful service provider demonstrated their alignment with Dexus’s sustainability requirements regarding implementing ‘green’ maintenance methods including reduced water and energy use, improved management and recycling of waste, safe and efficient use of toxic and harmful chemicals, and implementing safe work methods to maintain safety for their staff and building occupants.
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 it manages its staff. At present we do not apply formal criteria or screening tool to assist with this process.
During FY17 we reviewed our preferred supplier panel, resulting in minor adjustments.
Enhancing procurement and supply chain management processes
As a signatory to the United Nations Principles of Responsible Investment, we are committed to managing our supply chain in a responsible way which takes into consideration human rights, as well as environmental, social and economic factors in our purchasing decisions.
In FY17 we commenced implementing enhancements to our procurement strategy developed during the prior year. This strategy enables us to leverage scale, and take a medium to long term view for procuring services. Enhancements include tools and systems to improve productivity, transparency and decision making, as well as further integration of corporate responsibility and sustainability drivers in procurement and supply chain monitoring activities.
During the year we updated our view of supply chain sustainability risks to refresh our understanding of the supply categories that present the most critical environmental and social risk to Dexus. With our new perspective, we can embed tailored sustainability criteria within future tenders and contracts, and work with our suppliers to improve monitoring and reporting. We have committed to implementing actions during FY18.
Engaging with suppliers
During the year we continued to engage with suppliers via regular meetings, reporting and inspections/spot checks to review service delivery, monitor performance against contract deliverables and key performance indicators.
Through our 2017 supply chain engagement survey, we engaged with our preferred supplier panel members to understand their approaches to the issues to evaluate the effectiveness of our sustainable procurement policies and supplier relationship management practices.
We surveyed 30 key suppliers representing approximately 14% of Dexus’s supply chain spend, to gain a comprehensive insight into their relationship with Dexus through 360 degree feedback, their key risks and mitigation measures, how they manage their most significant suppliers, and potential new opportunities of collaboration.
From the survey responses, 68% of suppliers indicated a relationship with Dexus of five years or more with a further 32% maintaining a relationship of between one and four years. Compared with our prior survey, we are embedding deeper, longer term relationships with suppliers.
With regards to the relationship, 63% of suppliers were very satisfied with their relationship with Dexus, up from 50% from the prior survey.
Suppliers also indicated the financial criticality of their relationship with Dexus, with 36% stating that their services to Dexus contributed less than 5% of total revenue. In 75% of cases, suppliers relied on Dexus for less than 20% of their revenue.
Supply chain risk profiling
Within our engagement survey, we asked suppliers to nominate their key economic, social and environmental risks and describe their mitigation actions. The chart below maps the top risks identified by suppliers in terms of risk severity and likelihood. The size of the bubble indicates the frequency that the risk is mentioned.
Insight into our suppliers’ key risks allow Dexus to:
- Understand upstream risks that may affect the continuity or quality of services provided
- Analyse and evaluate our inherent risk and identify potential risk mitigation strategies
- Include the assessment of key risks into procurement and supply chain monitoring
- Gain insight into the risk management capabilities of the group’s diverse range of suppliers
Economic related risks are most prevalent with suppliers concerned about their competitors and maintaining their business continuity.
Health and safety continues to be a key risk while workforce labour standards has emerged as a common issue since our previous survey.
Environmental risks have emerged since our previous survey, with climate change and risks from extreme weather events featuring. These risks align with Dexus’s own strategic risks.
To mitigate these risks our supply chain partners are focusing on:
- Client satisfaction and performance to meet our needs
- Cost and quality management to maintain continuity and competitiveness
- Working smarter by using technology to assist field personnel
- Investing in their staff to develop and retain them
- Effective communication
- Implementing certified systems for workplace safety, environmental management, risk management
For further information refer to Dexus’s Supply Chain Disclosure of Management Approach (DMA).
Strong communities - performance data
Volunteering and donations
|Equivalent funds donated or raised|
|Corporate donations ($)||123,366||139,344||241,053||180,842||214,052|
|Employee volunteering activities ($)||80,623||50,044||65,806||89,779||75,191|
|In-kinds support ($)||573,777||470,055||712,295||532,646||437,258|
|Dexus volunteering program||978||589||792||1,049||853|
Commentary and methodology
Charitable donations - Activities comprise:
- Financial contributions to nominated charities
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
- 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.