Keppel pilots Vision 2030 transformation plan

It outlines plans to grow as an integrated business with sustainable solutions.

Keppel Corporation has unveiled its Vision 2030 roadmap that will drive the company’s long-term strategy and transformation as it refocuses into an integrated business, according to an announcement.

It plans to provide end-to-end solutions for sustainable urbanisation, with an asset management arm to fund growth and grant a platform for capital recycling. Keppel will focus on four key business areas, namely energy and environment, urban development, connectivity, and asset management.

It will also pursue strategic M&A opportunities to accelerate chosen growth engines as well as selective divestments to free up its balance sheet.

The statement wrote that Keppel plans to take a disciplined approach to capital allocation based on four criteria: contribution to the company’s long-term 15% return on equity target; scalability; potential for synergy and creation of new profit pools; and alignment with the firm’s ESG goals.

In addition, Keppel wants to focus on areas such as renewables, environmental solutions, nearshore floating infrastructure, connectivity solutions including green data centres, as well as integrated smart district development. It will also proactively activate its landbank to improve asset turns and returns whilst channeling some of the freed balance sheet to support new growth initiatives.

It also mulls to harness M1’s digital solutions and the impending 5G network to enhance its suite of offerings.

In its Sustainability Report 2019 published earlier this week, Keppel has identified climate action as a new material ESG issue that it would focus on, enhanced its tracking of GHG emissions to include Scope 3 emissions, and set new long-term targets to reduce waste and water consumption.

The preparation for Vision 2030 started in H1 2019, with a group of younger leaders across business units tasked to build their vision for the company, and then distilled into a multi-year strategic plan to drive long-term development with interim targets for 2025, the note concluded.