Our approach to managing climate-related risks

Higher temperatures and a reduction in rainfall due to climate change factors will constrain water resources in the southern and eastern parts of Africa, increasing the frequency and intensity of droughts. Over the past couple of years, Australia has experienced the spread of fires across all states, with some being the most devastating on record. While these extreme weather conditions have the potential to damage our assets and disrupt business operations, they also impact the economy in general, and weak economic growth impacts the number of vehicles we are able to sell.

We consider our climate-related risks in alignment with the recommendations formulated by the Task Force on Climate-related Financial Disclosures (TCFD), and have identified the following key climate change-related risks.

Physical risks
Physical risks
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Linked directly to climate change impacts such as extreme weather events.

Our climate change-related risks
  • Changing weather patterns and the associated damage to property and assets, and business disruption.
Transition risks
Transition risks
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Linked to expected policy changes in moving towards a low-carbon economy.

Our climate change-related risks
  • Access to finance is increasingly linked to a company‚Äôs climate-related risks.
  • Capital to invest in long-term solutions that optimise resource consumption.
  • Emissions taxes.
  • Foreign regulations impacting exports.
  • Changing demand for goods.
  • Increased prices for goods and services.
Reputational risks
Reputational risks
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Linked to insufficient action in curbing greenhouse gas (GHG) emissions.

Our climate change-related risks
  • Changing public perceptions and expectations.
Actions taken to mitigate our climate-related risks
  • Updated our Group risk framework to specifically highlight climate-related risks.
  • Expanded the mandate of the social, ethics and sustainability (SES) committee to include oversight of ESG-related matters.
  • Incorporated climate-related key performance indicators (KPIs) in management incentives for F2022.
  • Increased our investment in projects to reduce our environmental footprint.
  • Incorporated carbon taxes and compliance into our tax compliance function.
  • Identified opportunities to expand our ESG reporting to include TCFD in addition to reporting against the requirements of the FTSE4GOOD and CDP.
  • Started to monitor shifts in OEM manufacturing to lower internal combustion engines, EVs and hybrid vehicles.

Aligned to the TCFD recommendations, we will submit a formal risk assessment of the risks noted above to the SES committee on a quarterly basis. The submission will include risk impacts, our responses and relevant KPIs.