Ascendas REIT - Annual Report 2021

Enterprise Risk Management Material Risks Key Mitigating Actions Opportunities Economic • Exposure to event risks, such as political leadership uncertainties / changes, trade wars, economic downturns and sudden changes in real estate related regulations in major economies and key markets. • Actively monitor macroeconomic trends, policies and regulatory changes in key markets. • Diversify our portfolio across asset classes and geographies in accordance with Board-approved mandates. • Focus on markets where the Ascendas Reit Group has operational scale and the underlying economic fundamentals are more robust. • Access investment opportunities in developed markets with stable / robust economic fundamentals to enhance portfolio diversification to withstand unexpected economic shocks. Financial • Exposure to financial risks involving liquidity, foreign currency and interest rates and their volatility. • Disciplined approach to financial management and a well-balanced portfolio. • Actively monitor Ascendas Reit Group’s debt maturity profile, operating cash flows and the availability of funding to ensure that there are sufficient liquid reserves, in the form of cash and banking facilities, to finance Ascendas Reit Group’s operations. • Access to various sources of funds fromboth banks and capital markets to minimise over-reliance on single source of funds for any funding or refinancing requirements. • Actively review and maintain an optimal mix of fixed and floating rate borrowings. • Adopt natural hedging where possible by borrowing in the same currency as the revenue stream generated from our investments; limit certain financial risk exposures using various forms of financial instruments (e.g. interest rate swaps and cross-currency swaps). • For more details, please refer to the Financial Risk Management section on page 235. • Managing our financial risks well gives confidence to our stakeholders (e.g. investors, service providers, customers). • Increasing our investments in green buildings / assets enables Ascendas Reit to tap on green financial instruments. Annual Report 2021 151