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Operating within the large-scale retail segment of the real estate sector with a portfolio verging on 2 billion euros and with a leading position on the Italian market, we feel we need to play our role responsibly.

On the one hand, the thought of our already valid portfolio in terms of sustainability is comforting: we are convinced that if we had not had clear principles to follow in the economic-financial, corporate and environmental fields we would not have been able to achieve the healthy and consistent growth that IGD has accomplished and continues to accomplish since it was first listed.

On the other hand, the fact of having reached these targets does not exempt us from thinking about how to evolve and continually strengthen our “sustainable” business approach. Only in this way can we face the growing complexity that the external scenario offers us, regarding both the aspects connected to the important size that our business has reached and the unmistakable discontinuity in consumptions that the economic crisis has caused. Indeed we compete with this complexity every day: we operate in different contexts – in 11 regions in Italy and in 13 cities in Romania – and we communicate daily with a large number of people, including, for example, approximately 1,150 tenants that rent spaces in our shopping centres. With regard to the changes produced by the crisis, we said: understanding correctly the altered needs of our end customers in this difficult period of recovery from the recession will be a crucial factor for success.

More generally, we are witnessing profound changes in all the areas in which our stakeholders can be found. We can feel the urgency with which our society strives to see more regulated, transparent and “responsible” procurement processes in companies. We understand the new expectations of workers in terms of suitably enhancing their commitment and talent, in terms of equal rights and of making family life and work life coexist. Lastly, we are aware of how focused institutional investors are – and not only the ethical or “green” ones – on the systems of governance and the social and environmental performance of listed companies.

We have therefore felt the need to provide our endeavours with a method, a standard and precise targets: this first Sustainability Report is the result.

First of all we have mapped our stakeholders in order to understand towards whom we are responsible and for what. This has led us to identify six distinct areas of interest bearers: those who work in IGD, the tenants that represent our business counter-parts, our suppliers, shopping centre visitors and local communities and finally, the financial community represented by our shareholders, our debt capital financers and the specialised press. Lastly, we have put the environment into a specifically dedicated area.

For each area we have defined guidelines to help us communicate with that particular stakeholder category. Then we have identified and calculated several performance indicators, which enable us to measure the significant impact of our business. As this is our first Sustainability Report, the data refers to 2010: starting from next year we will be able to verify the evolution of our performance, but not only this, as we will also be able to verify the extent to which we have met our improvement targets that we have committed ourselves to achieving; targets that we have set both for the short and medium term.

We believe that all the targets that we have set for the future represent a great challenge for us. Even though we are just at the beginning of this path of sustainability, this Report being the first step, we count on being able to take advantage of the fact that not only have we established clear and correct relations with our stakeholders but we have also always listened to them and have often involved them in our decisions.

A lot of companies, for example are committed, within the scope of their business, to respecting the territory within which they operate: for us this is not enough. We believe we must enter into the communities, analyse them, understand their needs and, by creating or restyling a specific shopping centre, offer an effective response. We realise that the presence of our centres alters the landscape, the traffic and the local life: it produces an environmental and social change. We are in daily contact with the local authorities, with the consumer associations and with the traders’ associations, because we believe that just the fact of managing to create an attractive proposal in terms of products and services for the end customers in the specificity of each individual territory, can ensure interesting returns for the tenants and, in the end, recurring positive results for IGD.

In 2010 we launched a new Group marketing plan, the synthesis of which can be found in its payoff: “IGD, spaces to be lived in”. Our shopping centre sets out to be attractive under different profiles and not only in response to consumer needs and for a varied public in terms of interests and ages groups. The plan unites a series of retail initiatives with those of a social-cultural nature. This common identity, however, is always then developed to take into account the characteristics of the local area.

Similarly, as far as the organisation of a determined merchandising mix and tenant mix to be included in a specific mall are concerned, we never “drop” a predefined ideal combination onto an area: we try and reflect on the consumer types of the local inhabitants and to represent what the local retailers have to offer.

IGD has come through the most important economic-financial crisis of the last few decades closing 2010 with record results in terms of revenues, operating margins and profits that the Board of Directors proposed to distribute to IGD’s shareholders. The investment plan has never halted: over the last two years IGD’s portfolio has expanded with the addition of six new shopping centres, and, as shown in the 2009-2013 Strategic Plan, IGD is still committed to further growth, not only in terms of its real estate portfolio, but also in terms of gaining higher profitability, with a forecasted portfolio yield at the expiry of the plan of between 6.4% and 6.5%. Invest “responsibly” means, in fact, to have enough returns to be able to recompense our shareholders and financers: in order to do this we must be able to count on revenue flows from rents coming from tenants that are capable of sustaining those rents throughout the economic cycle.

In IGD, profitable growth and the ability to maintain a healthy economic-portfolio situation even during the crisis has been, and in the future will remain, possible because the strategic plan targets form part of a path of sustainability. In 2010, for example, when facing an enduring weakness in household consumptions, IGD defined a policy of temporary discounts to help tenants that were valid but with momentary difficulties and it followed a prudential control of facility management costs: a decision dictated by the desire to reconcile IGD’s own plans with its business counter-parts’ economic state of health.

Lastly, we hope that this Sustainability Report is carefully read by all of you so that you can understand our endeavours better and help us achieve the targets we have set. We would like to ask you, therefore, to provide us with your comments so that this Report can become a further incentive for a constructive dialogue with our stakeholders.

We are extremely grateful to all of you for your contribution in having helped IGD achieve the aforementioned targets: we would like to thank our employees who with everything they do every day, determine what IGD is for others. We would like to thank our shopping centre customers, tenants, investors, financers and suppliers who every day believe in us and continue to work together with us.

You can count on our commitment to remain faithful to our responsible approach and to achieve the targets stated in our strategic plan, which can guarantee us a solid economic-financial profile. We will try to understand better and better the needs of our stakeholders and we will make every effort once again in 2011 to meet those needs to the widest extent possible.

We will work together to make IGD, which we believe today is already a great company, into an even better one.

The Chairman - Gilberto Coffari

The Chief Executive Officer - Claudio Albertini