ESG: a pathway for greener companies
As we announced last Thursday our first speaker, for The Green Real Estate 2022, Trey Archer from GRESB will focus his speech on « The importance of ESG compliance in the race to Net Zero ». To better understand this subject let us introduce the ESG principles and its impact in the building sector.
ESG for Environmental, Social, and corporate Governance is a framework integrated to an organization’s strategy for sustainability awareness. In fact, the company expands its objectives to a new environmental criterion for example including policies about climate change.
Environmental, Social, and corporate Governance
Environmental: The company develops its strategy around climate change awareness by decarbonizing their activities, reducing waste production, and advocating energy efficiency.
Social: The company integrates higher human rights standards by prohibiting and preventing about child labor and promoting work health and safety. It also involves an inclusive employment of local, young and disabled people and especially an equal employment of men and women.
Governance: The company has specific rules for the stakeholder’s responsibilities in its governance. This policy is important for the company in order to assure employees commitment and the smooth running of the business for the long-term strategy.
Why are ESG important for a company?
ESG allows a company to attract investors and create a good public relations story by building a strong corporate image and promoting employee’s wellbeing and company environmental awareness.
This way, ESG helps investors to evaluate the risk of investing money or a loan into a company or a specific project.
To sum up, it has been proven that these companies have higher financial growth and employee productivity, better public image and employee health, cost reductions and would attract more investment.
How to measure ESG performance?
Integrated to a company, ESG can be measured with carbon emissions, air and water pollution, deforestation, waste management to prove the corporate investment in sustainability. Unfortunately, there are no standardized tools for the moment to measure ESG performances.
In fact, there are no official set standards to measure them but companies like GRESB offer assessments on ESG performances to help companies evaluate their sustainability best practices.
Indeed, ESG metrics are important to measure the company’s performance and growth in environmental, social and governance matters.
Are ESG important in the Building Sector?
In the building sector, ESG is characterized on the environmental side by material selection, water consumption, use of innovative technologies, waste management and circular design. For the social, they must care about the community impact for transportation and the accessibility for example disability. To finish on governance, it’s important to benefit from stakeholder engagement.
Although, companies tend to build buildings before considering ESG metrics. In order to improve the building performance taking into account ESG metrics from the conception and design of the building is important. For example, they can reduce embodied carbon, pursue health initiatives and install solar panels, by creating resilient and circular designs buildings.
If you want to learn more about ESG in the building sector we will be pleased to welcome you at our upcoming event The Green Real Estate: Beyond Net Zero where our speaker Trey Archer will share the implementation process, criteria, and benefits of assessing your building assets and the pathway towards net zero with GRESB.