Look, we get it. There are still plenty of conversations on the role of ESG in real estate and the field certainly still has its detractors. Recent research from PwC illustrates the state of affairs clearly: In a survey of over 300 asset managers and other investors, 81 percent of respondents said they are hesitant to take return losses of over 1 percent in the name of ESG, but almost 80 percent said ESG was an important factor in their decision making. Here’s another important bullet point: only approximately a third of investors say the current state of ESG reporting they’re seeing is good enough to allow them to make decisions. This is why we focused our newest white paper solely on ways to measure your apartment portfolio’s ESG efforts.
Check out the full white paper to get all of our conclusions but here are a couple of the top insights you should be aware of.
ESG performance without good measuring is a massive waste
Doing good across the three fronts of ESG is inherently a great thing for people, planet, and stakeholders alike. However, if you go to the effort to make ESG improvements like developing a property with highly efficient fixtures or implementing a value mapping exercise, but then don’t properly measure and report your efforts, you’ll be missing out on massive benefits. From a branding, fundraising and leasing perspective, your efforts are only as good as your reach is. If you don’t guide your ESG efforts with data while making them clear and highly visible, what business benefits will you be receiving?
“Most of us understand dollars saved more than less transparent figures like percentages or kilowatt hours.”
Make things easy to understand (for renters)
When you’re operating a multifamily property, your clients are hundreds or thousands of individual people, each with their own levels of interest in sustainability and ESG practices – even if they don’t call it that. Make things easy to understand for them by contextualizing numbers, such as energy saved by your dual-pane windows, in terms they can understand. Most of us understand dollars saved more than less transparent figures like percentages or kilowatt hours.
Start with a goal in mind
What are you hoping to achieve with your ESG efforts? As we say in the report:
“If your company’s goal is to simply tread water when it comes to ESG, going all-in on measurement is not likely necessary. Instead, developing an ESG plan that focuses on broad strokes and showcasing efforts and impacts might be enough. On the other hand, if there are specific ESG outcomes you are looking to achieve, the type of measurement needed might need to be much more specific and detailed.”
We can’t suggest exactly what that level of measurement and effort needed should be for your firm. It could be a specific certification, or a dashboard to help with management, or simply knowing you’re performing well. Whatever it is, be purposeful about it.
These are just a few of the conclusions from our newest white paper. Get all the rest of the insights here and check out our other ESG insights as well, like us exposing that actually most of the people don’t even know what ESG is!