Operations Sustainability
Over and above our financial performance, we are strategically focused on strengthening our business robustness so that we will continue to set new benchmarks and sustain our market leadership positions. We are committed to an effective risk management system that will help us respond promptly and positively to external volatility.

Keppel’s BrasFELS yard in Angra dois Reis, Brazil.

Managing risks and uncertainties Enterprise risk management (ERM) framework We have in place a risk management framework for the identification and management of risks with effective oversight by the Board of Directors. The Board is assisted by the Board Risk Committee, which provides guidance on risk management policies and processes, with senior management participation. The business units report risks and update the Board Risk Committee on processes with significant risks, and to the Board on issues of concern where appropriate.

Strategic, investment and operational/project risks are addressed. The impact of significant risks on the financial, operational and reputational aspects of businesses is assessed.

Risk evaluation and management processes include investment criteria, approval authority and limits, and expected returns. Risks are evaluated based on risk assessment criteria developed for the Group, and use of risk assessment templates.

Key risk indicators are used to enhance project progress reporting, and risk management incorporated in strategic planning. Standard methodology is adopted at all business levels within the Group.

Risk management processes are embedded into internal operational processes to ensure early detection of business and operational risks for effective management and control. Going forward, a key ERM focus will be on growing a riskcentric culture in the Group.

Preparing for external shocks and business crises
In a dynamic environment where new developments constantly challenge the status quo and impact base
parameters, scenario planning serves as a useful tool in the business process to enhance operational resilience. On-going scenario planning augments the existing risk management system and strengthens the Group’s strategic decision making processes.

In this respect, business units observe market trends and address the long-term impact of possible changes to our businesses. The perspectives drawn contribute to the robustness of our operational planning and execution.

Our Business Continuity Management (BCM) system ensures processes are in place for our businesses to
respond seamlessly to contingencies and minimise disruptions to operations.

Business continuity plans have also been developed for a pandemic flu outbreak scenario. Key activities include the setting up of pandemic flu committees, developing response plans, conducting pandemic flu outbreak simulation exercises and testing remote access procedures in office environments.

We constantly strengthen our ERM and BCM processes to incorporate changes in the business environment.
This enables the Group to achieve its growth targets and business objectives.

Health and safety in the workplace
Our Health, Safety and Environmental (HSE) initiatives and practices are critical factors supporting our operational excellence. Further details on the Group’s approach to safety are set out in the “Nurturing a safety culture” feature of this Annual Report.

Board Safety Committee
Clear emphasis is given by the Group on workplace safety. The Keppel Corporation Board Safety Committee reviews the effectiveness of the safety management system, provides a forum for discussion on workplace safety developments and best practices, and enhances safety awareness and culture within the Group. The Board and Senior Management are actively involved in efforts to inculcate a safety culture within the Group.

HSE at Keppel Offshore & Marine (Keppel O&M) HSE is a high priority, particularly in the offshore and marine industry, as Keppel O&M seeks to effectively manage projects and deliver products of immense scale and complexity, on time and within budget.

Keppel O&M is committed to ensuring that each worker returns home safely every day, harnessing employees’ Can Do! attitude to ignite a passion for excellence in the management of HSE.

Its yards also ensure that activities which may affect the environment are carried out in a thoughtful and
controlled manner.

The technology imperative
Further details on the Group’s technology focus are set out in the “Advancing technology, growing innovation” feature of this Annual Report.

Keppel Technology Advisory Panel (KTAP)
KTAP, established in 2004, provides strategic leadership in our R&D efforts. It also guides and challenges the robustness of initiatives in research, development, testing and commercialisation of our new products and services.

Technology sharing and industry development
Keppel O&M’s active engagement in industry forums and events not only keeps it abreast of latest technology and innovation, but also defines its pre-eminent role in shaping industry trends and contributing to the development of our offshore and marine industry.

At the Jackup Asia Conference & Exhibition 2006, Keppel O&M presented a paper on “Effective Use of a Rapid Penetration Management System to Minimise Risk”, prepared in collaboration with ENSCO Inc. This provided insight on how risks associated with jackup installation at punch-through sensitive sites could be effectively managed.

The fourth Keppel O&M Lecture.

Ocean Building and Ocean Towers have resource-efficient fittings.

In a lecture on “Offshore Deepwater: Deep and Getting Deeper – The Future of Deepwater Development & Singapore Inc Contribution” organised by National University of Singapore (NUS) Department of Civil Engineering, Keppel O&M shared insights on the direction of deepwater technology.

In 2006, the fourth Keppel Offshore & Marine Lecture was jointly organised by NUS and Keppel O&M under the auspices of the Keppel Professorship as a forum for exchange between academia and industry. Professor Torgeir Moan, leading expert in offshore and marine structures and the first NUS-Keppel Professor, spoke on the challenges of designing offshore production systems for operations in harsh ocean environments, delving into possible design approaches.

Apart from industry forums, Keppel fosters a technologysharing climate that allows business units to leverage applications or insights developed within the Group.

Environmentally-sustainable solutions
Green initiatives
Our environmental engineering business leverages its technological capabilities to provide innovative solutions in waste disposal, water treatment and power generation that address environmental concerns. Key drivers include the growing need for alternative resources, landfill pollution risks and land constraints, as well as declining water resource quality and availability, as industrialisation and urbanisation gather pace.

We aim to deliver green products and services incorporating environmental and safety best practices and processes, and work with suppliers with good environmental practices.

Planned initiatives include:

• Participation by Keppel Seghers in ISO:14000 environment management systems and standards
  certification process;
• Energy audits to improve efficiency and reduce greenhouse gas emissions, and property designs meeting Building and Construction Authority Green Mark award standards;
• Technological application for resource efficient products minimising effluent discharge such as Keppel Seghers’ flue gas treatment and wastewater treatment systems;
• Alternative renewable energy resources;
• Exploring opportunities for green technology investment and partnerships; and
• Cultivating green and workplace safety awareness through seminars, forums, newsletters and special events

We are involved with quality infrastructure projects aligned with environmental objectives in partnership with the local community, generating recurring income over the mid-to-long term. These include the Qatar Domestic Solid Waste Management Centre, the Tuas South Waste-to-Energy Plant and the Ulu Pandan NEWater Plant.

We will continue with our R&D efforts to stay ahead of the market and harness technology in developing customised environmental solutions.

Building strategic alliances
We are growing our market presence through strategic partnerships with industry leaders to provide state-of-the-art environmental solutions tailored to customers’ needs.

In 2006, Keppel Seghers entered into a strategic cooperation agreement with Passavant Impianti, a leader in water and sludge treatment in Italy, to address the sludge treatment market in Italy. Keppel Seghers also signed two MOUs on strategic partnership with China National Environmental Protection Corporation to address the biomass and sludge treatment market in China and Tianjin Teda Environmental Protection to jointly develop and invest in the Chinese environmental preservation market.

Spring City Golf & Lake Resort, Kunming, China.

Redefining quality live-work-play environments Keppel Land, as a developer of distinction, makes conscious efforts to create quality living and working spaces with enduring value for the community, combining aesthetics and functionality with a keen attention to the surroundings. Developments are carefully crafted to harmonise with the urban and natural landscape, making environmental preservation and enhancement of community life a design and construction priority. In so doing, Keppel Land meets the needs of the present without compromising resources for future generations.

World-class waterfront living
Keppel Land continues to carve its niche in luxury waterfront living, drawing upon the scenic beauty of our coastal surroundings, with masterpieces such as Keppel Bay and Marina Bay Financial Centre (MBFC). As part of Singapore’s global city remaking, Keppel Bay and MBFC provide unparalleled possibilities in urban live-work-play spaces with their distinctive waterfront heritage.

Preserving water, energy and ecological resources
Striking a balance between commercial objectives and environmental viability, Keppel Land practises value engineering and implements resource efficiency in its developments.

Developed for leading global businesses, One Raffles Quay (ORQ) is designed for maximum efficiency and flexibility. Its floor-to-ceiling windows maximise natural light and provide spectacular views. ORQ hosts a District Cooling Plant providing centralised and efficient air-conditioning for adjoining sites. To minimise the building’s weight and movements, an environment-friendly Innovative Hybrid Structural System comprising concrete core, perimeter concrete-filled steel tube columns, outrigger trusses and diaphragm floors was used in its construction.

An array of resource-efficient features was incorporated into ORQ, including devices optimising air-conditioning control and reducing energy consumption, energy efficient light fittings, motion sensors, recycling of condensate water for irrigation, and air flushing system to remove foul air.

At its commercial buildings, the use of water-flow control devices like thimbles and recycling condensate water from air-conditioning for irrigation has lowered water consumption, with Ocean Building and Ocean Towers seeing a 5% reduction in water usage.

Energy-saving measures such as the use of low-energy consumption light bulbs and timers as well as implementation of employee awareness programmes have also resulted in significant cost savings.

Melia Purosani Hotel in Yogyakarta, Indonesia, which achieved significant savings in electricity consumption and diesel usage, was the first hotel outside Bali to be awarded the prestigious Green Globe 21 Certificate, recognising its commitment to highest environmental standards.

At Spring City Golf & Lake Resort in Kunming, China, the use of hollow concrete blocks instead of clay bricks in the construction of its luxury villas not only reduces loading requirements but also acts as insulation air space in winter, reducing heating requirements. Use of solar heat in its staff dormitory further reduces energy costs.

Conscious efforts are taken to preserve biodiversity in the local environment. Our golf courses in China and Indonesia, for instance, are sculpted along the natural contours of the undulating landscape.

At Spring City Golf & Lake Resort, the natural and indigenous flora situated 2,000 metres above sea-level were carefully preserved during construction and thereafter. Original eucalyptus trees and wildflowers were relocated and replanted as the greens were carved out of the hills. Natural habitats of local fauna were painstakingly recreated to ensure the ecosystem remained balanced and intact.

The architecture of the Forest Course at Ria Bintan in Indonesia cleverly exploits existing natural contours, showcasing and opening wildlife corridors. The integrated design allows a “one-with-nature” theme to permeate the entire resort.

Creating homes close to nature, meticulous landscaping with an all-season mix of evergreens and deciduous trees and flora allows residents at The Seasons in Beijing to enjoy nature all-year round.

Special care has also been taken to prevent pollution to water bodies close to Keppel Land’s properties such as BG Junction, Sedona Suites, Spring City and Ria Bintan golf courses.