Cromwell European REIT - Annual Report 2021

The Manager also considers managing sustainability risks (including environmental, social and governance factors) as part of its responsibilities. In this regard, the Board has established a Sustainability Committee (“SC”) in December 2021 and delegated to the SC the general oversight on sustainability issues and sustainability reporting. The SC is composed of all five Board members, four of whom are non-executive Directors (including the Chair of the SC) with a majority being independent. The SC’s terms of reference set out, inter alia, the roles and responsibilities of the SC and include its purview over matters relating to the ESG framework, ESG targets, the sustainability reporting framework and CEREIT’s policies, practices and performance on its material ESG factors which are significant and contribute to CEREIT’s performance, business activities, and reputation as a corporate citizen. CEREIT’s ESG programme is set out in summary in the short-form sustainability report on pages 190 and 191 of this Annual Report and in detail in the Sustainability Report FY 2021 which will be published no later than five months after the end of financial year. The Manager is a wholly-owned subsidiary of Cromwell Property Group (CEREIT's Sponsor), which holds approximately 27.9% interest in CEREIT as at 31 December 2021. The Sponsor is a real estate investor and global real estate fund manager, listed on the ASX with operations in 14 countries, with a vested interest in the long-term performance of CEREIT. The Sponsor’s significant unitholding in CEREIT demonstrates its commitment to CEREIT and as a result, the Sponsor’s interests are aligned with those of other Unitholders. THE MANAGER’S CORPORATE GOVERNANCE CULTURE The Manager aspires to the highest standards of corporate governance. The Manager is committed to continuous improvement in corporate governance. It has developed and, on an ongoing basis, maintains a roster of transparent policies and practices that provide a firm foundation for a trusted and respected business enterprise and meet the specific business needs of CEREIT. The Manager remains focused on complying with the substance and spirit of the principles and provisions of the Code while achieving operational excellence and delivering CEREIT’s long-term strategic objectives. The Board of Directors is responsible for the overall corporate governance of the Manager, including establishing goals for Management and monitoring the achievement of these goals. This underscores their importance to the Manager. The Manager has received accolades from the investment community for excellence in corporate governance. More details can be found in the Investor Relations section and the Sustainability section on pages 52 to 57 and pages 190 and 191 of this Annual Report. This corporate governance report sets out the corporate governance practices for FY 2021 with reference to the principles of the Code. For FY 2021, CEREIT has complied with the principles and provisions of the Code in all material aspects and to the extent that there are any deviations from the Code, the Manager will provide explanations for such a deviation and the details of the alternative practices which have been adopted by CEREIT, which are consistent with the intent of the relevant principle of the Code. (A) BOARD MATTERS Principle 1: The Board’s Conduct of Affairs The company is headed by an effective Board which is collectively responsible and works with Management for the long-term success of the company. The Board is collectively responsible for the long- term success of CEREIT and to protect and enhance Unitholder value. The Board recognises that each of the Directors is a fiduciary and should act objectively in the best interests of the Unitholders and hold Management accountable for performance. The Directors are collectively and individually obliged to act honestly and with diligence, and in the best interests of CEREIT at all times. The Board puts in place a code of business conduct (please refer to pages 181 and 182 of this Annual Report), sets appropriate tone- from-the-top and desired organisational culture, and ensures proper accountability within the Manager. The Manager requires its Directors to disclose their interests in transactions and any conflicts of interests. The Directors recuse themselves from any discussions and decisions concerning matters in which they may be in a conflict-of-interest situation. The Board is satisfied that no conflict of interests was required to be disclosed by any Director in FY 2021. The Board is tasked to oversee the relationship between CEREIT, the Unitholders and the Manager and also CROMWELL EUROPEAN REIT 153 ANNUAL REPORT 2021