AREF ESG & Impact Investing Committee aims to work with AREF members to promote and raise awareness of ESG & impact investing best practice across the real estate fund management sector.
The property investment industry is playing an ever more prominent role in people’s lives in many ways.
- Property has always played an important part in investment portfolios, historically as a diversifier against equities and bonds, but in recent years its role as a provider of income in a low-interest-rate, low-bond-yield world has come to the fore. As a major consumer of energy and emitter of carbon dioxide, property has a prominent role to play in combating climate change.
- With reduced access to mortgage finance and home ownership since the Global Financial Crisis, and with the consequent growth in long term renting and the expansion of the PRS sector in the UK, customers of property fund managers are no longer just companies. An increasing number are individuals and families living in their long term homes.
- As technology changes the way that real estate is used, be it homeworking affecting the amount and layout of office space used, or on-line shopping radically changing the high street, the industry is instrumental in reshaping these parts of our built environment.
For these and other reasons investors are increasingly scrutinising the social and environmental impact of investments independently of their financial performance. Indeed this can be a deciding factor in an investment choice. AREF and its members have been actively involved in these issues for a long time.
- The AREF Code addresses the G in ESG and more recently, a lot of effort has been focussed on the E. In 2020 AREF became a GRESB Industry Partner, which allows us to collaborate more closely to improve sustainability best practices in real assets. It gives AREF members access to global networking through events and training sessions, to data and research collaboration, and the ability to provide input into the development of the GRESB assessment process.
- AREF's ESG & SII Committee is monitoring the success of mandatory TCFD reporting and looking at how occupier engagement can be improved in relation to ESG reporting.
- The ESG Committee is also looking at how we can assess social impact better, although property has so many different kinds of impact on the environment and on people’s lives that it is difficult, if not impossible, to encapsulate this in a single measure. This work will be ongoing.