With recent political movements drawing greater attention to the potential impacts of human activity on climate change and governments coming together to discuss ways to reduce and mitigate these impacts, it is no surprise that ESG issues are at the forefront of the minds of stakeholders in the property industry. Therefore, we believe it is in our and our investors’ best interests to be forward thinking regarding ESG issues.
This view is certainly not unique. On the funds side, 91% of fund managers who took part in the Global ESG Real Estate Investment Survey reported that they use sustainability disclosure frameworks (such as UN PRI or GRESB) to track various ESG indicators. On the government side, the UK government has recognised the broader issue, and, in June 2019, passed a law requiring net zero carbon emissions by 2050. Though limited steps have been taken to achieve this target to date, these are ambitious goals: in the UK the built environment is currently responsible for 40% of the total carbon footprint, and the UK Green Building Council notes that offices should reduce their energy consumption by 60% by 2050 to help the UK achieve net zero.