SM Prime : Sustainability Report

Together, We Rise

2021 Integrated Report

Together, We Rise.

We are pleased to report that SM Prime Holdings, Inc. (SM Prime) continued to stay thecourse towards heightened sustainability, social inclusivity, and property resiliency.

In response to periodic surges in COVID-19 cases, our management, employees, and businesspartners once again lived up to ensure the safety of every single person in our properties. In theaftermath of Typhoon Rai, we witnessed the ability of our investments in disaster resilience to protect our communities against climate-related calamities.

Throughout the year, we strived to maximize our properties' potential not only for economic growth but also as platforms for the greater public good. The spirit of unity and recovery resonates brightlyin all SM properties during these challenging times. In this same spirit of camaraderie and renewal,we present to you, our stakeholders, our Integrated Report for 2021.

ABOUT THE REPORT

(102-1, 102-50, 102-51, 102-52, 102-53, 102-54)

Welcome to Together, We Rise, SM Prime's IntegratedReport for 2021. This report covers our business strategy,It is also guided by relevant standards of the Sustainability

Accounting Standards Board (SASB), and the UN Globalperformance, and impact, and details how SM Prime createsCompact's principles on Human Rights, Labor, Environment,value for our investors and stakeholders over the short,and Anti-Corruption.

medium, and long-term through our various operating units.

As a champion of disaster resilience in the Philippines,

The report provides an overview of our value creation model- how we seek to create value for our shareholders bycontributing to national progress through investments andinterventions critical to the country's socio-economic growth.

SM Prime voluntarily reports climate-related financial risk disclosures in supportof the global Task Force on Climate-related Financial Disclosures (TCFD) and the Sendai Framework for Disaster Risk Reduction 2015-2030.

This report has been prepared in accordance with the GRIStandards: Core option. It follows the guiding principlesand requirements of the International Integrated Reporting

The online version of this report is available at the SM Primewebsitewww.smprime.com.

Framework, as well as the requirements set by thePhilippine Securities and Exchange Commission (SEC).

Contact Information

Your comments and insights are important. You maysend feedback on this report and matters on SM Prime'ssustainability performance [e-mail].

About SM Prime

Vision, Mission, What We Stand ForSustainability FrameworkJoint Message of the Chairperson and President

2 3 6

Leadership by ExampleOverview of Our BusinessSustainability Maturity PathStakeholder Engagement

10 14 20 22

How We Create Value

Value Creation at SM PrimeFinancial CapitalManufactured CapitalIntellectual Capital

28 30 35 40

Natural CapitalHuman Capital

43 52

Social and Relationship Capital 61

Corporate Governance

Corporate Governance 70

Risk and OpportunitiesBoard of Directors

81 88

Corporate Executives 92

Financial Report

Management's Discussion and Analysis 96

Statement of Management's Responsibility for Financial Statements

100

Report of the Audit CommitteeIndependent Auditor's Report

101 103

Financial Statements 106

Appendix 116

About SM Prime

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SM Prime Holdings (SM Prime) is the largest Philippine real estate developer by marketcapitalization and customer reach. It is one of the largest subsidiaries of SM Investments

Corporation (SMIC) and is recognized as the most successful mall operator and propertydeveloper in the Philippines.

SM Prime builds legacy communities based on its four core sustainable pillars:Economy, People, Environment, and Community. It is dedicated to generating valuesustainably through its diverse portfolio of companies and business segments: malls,residences, offices, and hotels and convention centers.

VisionMission

Tobuild and manageinnovative integratedproperty developmentsthat are catalysts for abetter quality of life.

We will serve the ever-changing needs and aspirations ofour customers, provide opportunities for the professionalgrowth of our employees, foster social responsibility in thecommunities we serve, enhance shareholder value for ourinvestors and ensure that everything we do safeguards ahealthy environment for future generations.

What We Stand For

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Sustainability Framework

SM Prime drives change by building and managing properties that spur commercial activity and local economic growth. However, given the scale of our operations and leading position in what remains a developing nation, we also recognize our broader responsibility to operate in a way that simultaneously preserves our natural resources while uplifting the quality of life in the communities we serve.

Our founding leader, Henry Sy, believed that "business growth and social development must go hand in hand." This guiding principle is now embedded in our Sustainability Framework, which addresses SM Prime's biggest challenge today - how to achieve a positive environmental footprint, improve the well-being of our communities, and ensure profitable growth simultaneously.

As a result, our sustainability programs and strategies align with our four-pillar framework of Economy, People, Environment, and Community.

We help boost our nation's economic growth by contributing to our country's gross domestic product (GDP) through our various businesses. We help create jobs and aim to create business platforms that bring under-represented groups into the local economy.

ECONOMY

ENVIRONMENT

We design, build and maintain properties with sustainability and disaster resilience in mind.

We conserve natural resources and strive to leave the least possible impact on our ecosystem.

We uplift the quality of life of communities by making quality education, inclusive healthcare, and food security more accessible to all.

We invest in our people's growth through professional development and wellness programs. We create and nurture safe and healthy working environments for all our employees.

PEOPLE

COMMUNITY

We have aligned our sustainability pillars with the principles governing the United Nations Sustainable Development Goals, the Task Force on Climate-related Financial Disclosures (TCFD), and the 2015-2030 Sendai Framework for Disaster Reduction.