GOVERNANCE
INTRODUCTION
ESG OBJECTIVES AND STRATEGY
ENVIRONMENTAL
SOCIAL
APPENDICES
64
Category
Mitigation
SOCIAL RISKS
Physical Security and Terrorism
Due to the high-profile nature of our office buildings, particularly the Empire State Building, we have identified physical security and terrorism as a potential social risk. Mitigation strategies employed by ESRT include a Director of Security at the Empire State Building, formal crisis management plans, in-person electronic surveillance at all entry points, active shooter trainings for employees and tenants, and Terrorism Reinsurance Act coverage that covers nuclear, biological, chemical, and radiological weapon attacks. We perform annual Indoor IAQ testing at all commercial buildings to evaluate exposure and risks to human health. All IAQ tests are reviewed to ensure that contaminants remain below the most stringent acceptable levels. For any assets that do not meet our performance thresholds, actions are taken to address and remediate issues. We have deployed active bipolar ionization air purification technology across three million square feet of our portfolio properties. We require all of our partners, suppliers, and vendors to adhere to our standards as set forth in our Vendor Code of Conduct, which covers topics such as compliance with law, including human rights and labor standards. We continually monitor our labor practices, including our relationships with unions, for compliance with law and best practice under the guidance of expert outside counsel and advisors. Since all of our operations are in the United States, particularly in the GNMYA, we believe the risk of exposure through our operations or those of our primary suppliers to human trafficking and child and/or forced labor are low. We have firewall and penetration testing, cybersecurity insurance, internal employee trainings on safeguarding information, a Director of Information Security dedicated to cybersecurity, cybertraining modules, and a continual assessment of new cybersecurity tools. Quarterly Enterprise Risk Assessments and ongoing reviews of policy, legal, technology, market, and reputational risks identify short-, medium-, and long-term transition risks. We evaluate energy and climate legislation in regions and cities where we operate, including evaluating the compliance status of legislation concerning our carbon footprint and measuring the financial impact of energy and climate legislation, including the NYC Climate Mobilization Act and LL97. Our Chairman, President, and CEO and our SVP, Director of Energy, Sustainability, and ESG lead the NYC Climate Mobilization Act Working Group and other relevant working groups to define and understand energy/ carbon regulation transition risks that could impact the organization. We regularly consult with expert outside counsel and advisors as well. Advanced optimization and machine learning technologies, battery storage, renewable energy, lighting and controls, building management systems, equipment, and tenant plug loads and controls are evaluated to mitigate technology risks related to capital investments in low-carbon technology. We evaluate abrupt or unexpected changes in energy costs and market perceptions by investors. We plan long-term contracts for certainty, predictability, and risk mitigation on utility pricing.
Human Health
Human and Labor Rights
Cybersecurity
TRANSITION RISKS
Comprehensive
Policy Energy and Climate Legislation
Technology Capital Investments in Low-Carbon Technology
Market Abrupt/Unexpected Changes in Energy Costs
EMPIRE STATE REALTY TRUST: 2022 SUSTAINABILITY REPORT
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