December 2021
CIC has not carried out any audit mission for nor commissioned any consultancy services with Zenith Integrated Modular Limited and there is no established relationship (financial or others) between CIC and Zenith Integrated Modular Limited.
The opinion provided herein is an independent opinion on the sustainability credentials and management of the financial instrument, based on the information made available to CIC. CIC has neither interviewed any of the Zenith Integrated Modular Limited’s employees, nor performed any on-site assessment and tests to check the accuracy of the information provided by Zenith Integrated Modular Limited. The accuracy, comprehensiveness and trustworthiness of the information collected rests with Zenith Integrated Modular Limited. CIC, in providing this opinion, has not certified the effectiveness, the quality or the irreversibility of the assets to be financed by the sustainable financing instrument. Zenith Integrated Modular Limited is fully responsible for attesting the compliance with its commitments defined in its policies, for their implementation and monitoring. The opinion delivered by CIC neither focuses on the financial performance of Zenith Integrated Modular Limited, nor on the effective allocation of its proceeds. CIC is not liable for the consequences arising if third parties use this opinion either to make investment decisions or to make any kind of business transaction.
The opinion provided by CIC on Zenith Integrated Modular Limited can only be used by Zenith Integrated Modular Limited and the Financial Institution. The distribution and publication are at the discretion of Zenith Integrated Modular Limited, subject to CIC’s approval.
| Application no. | SFCS-APPLY-2021-005 |
|---|---|
| Certificate no. | SFCS-2021-019 |
| Date of application | 2021.11.26 |
| Company name | Zenith Integrated Modular Limited |
| Business registration no. | 73271026 |
| Company profile | External Façade Design and Built Contracting Services, including design, procurement & fabrication and installation of custom-made Aluminum Doors, Windows, Curtain Wall, Stainless Steel, Aluminum Cladding and Modular Integrated Construction (MiC). |
| Sustainable financing instrument | Green Loan |
| Application level | Project Level |
Zenith Integrated Modular Limited has confirmed the proceeds will be used for the specified Project Categories that meet the eligibility criteria stated:
| Project Categories | Renewable Energy |
| Eligibility Criteria | Construction, installation or maintenance of the renewable energy system |
| Project Categories | Sustainable Water and Wastewater Management |
| Eligibility Criteria | Construction and maintenance of infrastructure for water |
| Project Categories | Circular Economy Adapted Products, Production Technologies and Processes |
| Eligibility Criteria | Design and production of components, products and assets that support the circular economy |
Zenith Integrated Modular Limited has confirmed that the selected Project Categories and Eligibility Criteria are in line with the following internationally recognized frameworks across financial markets:
Frameworks
Zenith Integrated Modular Limited has also confirmed the following purposes of the proceeds:
Purpose of financing
Zenith Integrated Modular Limited has identified the below project(s) as eligible green projects which meet the eligible criteria:
| Project name | Design and Build of PM’s Site Office and JV’s Site Office using MiC method for the development of Lok Ma Chau Loop – Main Works Package 1 |
| Location | Lok Ma Chau Loop (LMCL) |
| Project description | Construct a Project Manger’s site accommodation (135m x 14m x 3 storey) and a Contractor’s site accommodation ( 48m x 14m x 3 storey) using Modular Integrated Construction (MiC) Method in the development project of the Hong Kong-Shenzhen Innovation and Technology Park at Lok Ma Chau Loop using – Main Works Package 1 |
| Highlights of green elements and estimated environmental impact | • MiC construction method • Vertical Green Wall • Solar Panel System • Fog Harvesting Water System |
Renewable Energy
According to the project specification (Ref.: Development of LMCL: Main Works Package 1 Contract), a solar energy system will be installed on the roof of the office. Based on the building design, the system can generate 200kW energy to the site office.
The above practices and performance fulfil the technical requirements of the Scheme.
Sustainable Water and Wastewater Management
4 numbers of vertical green walls and the associated automatic irrigation system shall be constructed according to the project specification. The fog harvesting system harvests fog water from the atmosphere with low power consumption and generates 100-150L freshwater per day per generator. It can supply sufficient water to the green wall and green roof without additional water supply facilities.
Apart from conserving water resources, the green wall contributes to other environmental benefits, including purifying the surrounding air of the office, and reducing the ambient noise and temperature, thus reducing the use of air-conditioning. It also provides better workplace well-being for the project manager and workers.
The above practices and performance fulfil the technical requirements of the Scheme.
Circular Economy Adapted Products, Production Technologies and Processes
According to the project specification, the building shall be designed and constructed using an approved proprietary brand prefabricated MiC system.
Zenith confirmed that its MiC system which has over 15 years lifespan allows the deconstruction and reuse of the piece parts. Therefore, the MiC pieces can be reused in future projects after the end of captioned project end (7-8 years).
The above practices and performance fulfil the technical requirements of the Scheme.
To ensure that the projects financed by the sustainable financing instrument meet the eligible criteria, Zenith Integrated Modular Limited has established an evaluation and selection process with the following key elements:
Evaluation and selection
The evaluation and selection process will be conducted by an internal governance body which comprises cross-functional representatives, including the project team and the finance team. Zenith has formulated internal Purchases and Payables Policies and Procedure to guide the procurement activities associated with the captioned project.
For materials that are qualified in the inspection, the warehouse/ site staff will input the data in the accounting system and the stock-in transaction should be reviewed by the Finance Manager.
We consider that the applicant has well-defined internal checking procedures for project evaluation and selection.
Zenith Integrated Modular Limited has provided information regarding the internal governance process through which the company can track allocation of funds towards green projects. Zenith Integrated Modular Limited will establish a register of funds to contain the following information:
Information
Pending the full allocation of the proceeds, Zenith Integrated Modular Limited intends to hold and/or invest the balance of proceeds not yet allocated in accordance with Zenith’s Purchases and Payables Policies and Procedure
The proceeds will be allocated to the general account of the applicant which is a new account for this project. Besides, proceeds will be tracked by a systematic accounting system, including the above information of the proceeds.
CFO of Zenith is accountable for the internal governance of proceeds management and the project team will submit project progress report to the Finance department for review if applicable.
Zenith Integrated Modular Limited is committed to transparent reporting and will publish information as part of the project progress report within one year from the date of issuance of each sustainable financing instrument and annually thereafter until the full allocation of the proceeds. The report will consist of information on the allocation of the proceeds and the environmental impacts of the projects.
Allocation Report
In terms of impact reporting, Zenith Integrated Modular Limited will report on relevant environmental metrics of the projects to which the proceeds have been allocated in line with the technical requirements.
| Project Categories | Renewable Energy |
| Metrics | •Annual GHG emission reduced/ avoided in tonnes CO2e •Total installed capacity of renewable energy in MWh • Annual renewable energy generation in MWh |
| Methodologies | CIC SFCS Technical Requirements |
| Project Categories | Sustainable Water and Wastewater Management |
| Metrics | •Reduction in water use consumption (m3 per year) • Annual volume of wastewater treated or avoided (m3 per year) • Annual amount of sewage sludge that is treated and disposed of |
| Methodologies | CIC SFCS Technical Requirements |
| Project Categories | Circular Economy Adapted Products, Production Technologies and Processes |
| Metrics | •Increase in components, products or assets with circular design as a •result of the project in valorised amount, in percentage of the total product portfolio, and/or absolute amount in tonnes p.a. •The extended warranty period compared to the market standard in year, or the expected extension of lifetime in years (compared to the equivalent linear product’s expected lifetime) • The percentage of single use products replaced by products designed and produced for reuse |
| Methodologies | CIC SFCS Technical Requirements |
We confirmed that Zenith has committed to continue to perform allocation and impact reporting on an annual basis through project progress report.
| Use of proceeds | Compliant |
|---|---|
| Project evaluation and selection | Compliant |
| Management of proceeds | Compliant |
| Reporting | Compliant |
Based on the above assessment, we recommend to approve the application (Application no.: SFCS-APPLY-2021-005, Certificate no.: SFCS-2021-019) of the CIC Sustainable Finance Certification Scheme with validity from 16-12-2021 to 15-12-2023 .