Strategy continued Resilience of the organisation’s strategy, taking into consideration different climate-related scenarios, including a 2°C or lower scenario
Our net zero carbon pathway is aligned with targets for a 1.5°C scenario. In achieving these targets, we will simultaneously be managing several transition and physical climate risks material to the business. Having conducted comprehensive business and portfolio climate risk assessments across the IPCC’s RCP 4.5 and RCP 8.5 scenarios, we have a clear understanding of our material climate- related risks and opportunities. This knowledge has enabled us to proactively implement management, mitigation and adaptation measures to improve our resilience and act early to harness opportunities. Our chosen scenarios align with industry best practice and cover the most likely range of average global temperature rise in the coming decades. The RCP 4.5 climate scenario is characterised by significant policy action and market forces to decarbonise and meet the Paris Agreement. Our resilience to risks presented by the low-carbon transition is being secured by implementing our net zero carbon pathway and related activities described in this TCFD disclosure. The RCP 8.5 scenario is characterised by significant changes in weather patterns and severe physical hazards. Our resilience against risks associated with this high emissions scenario is being secured by embedding stringent mitigation measures to support climate adaptation and resilience across each stage of the property life cycle and our proactive approach to assessing and managing risks. Analysing these distinct climate scenarios has enabled us to understand the wide scope of climate-related risks and opportunities and inform actions to support our resilience. RCP 4.5 Low emissions scenario Transition 1.7–3.2°C by 2100 Our scenarios
Lower emissions scenario where there is increasing policy action to meet the Paris Agreement. Transition risks dominate.
Economic Substantial regulatory and market pressure to decarbonise and associated costs to meet these demands. RCP 8.5 High emissions scenario Transition Higher emissions, business-as-usual scenario where policy action is negligible and warming rises drastically. Physical risks dominate.
Environmental Less physical risk, although a 2°C warming still presents substantial physical climate risks.
3.2–5.4°C by 2100
Economic Permanently stunted GDP growth and severe economic and social shifts.
Environmental Chronic changes to weather patterns and ecosystems causing severe impacts on a global scale.
Picton Property Income Limited Annual Report 2023
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