The push for sustainability: With pressure from investors, investment managers continue to develop their environmental, social and governance standards. How are those shaping up and what does the future hold for sustainable strategies?
In recent years, environmental, social and governance (ESG) factors have played an increasing role across the entire investment management landscape, including real estate.
Dan Grandage, head of ESG, real estate, at Aberdeen Standard Investments, describes the recent surge. “It’s really stepped up in the last 12 to 18 months,” he says. “Certainly, the environmental side is fundamental to today’s investments, but in real estate it has moved right to the top of the agenda. The level of detail our investors are demanding has grown too, from figures on energy use, to how we plan to make improvements. And they are increasingly conscious of the social side — what we’re adding to the community, and how we look to improve the wellbeing of our tenants.”
ESG is, of course, not a new phenomenon for the industry, with various companies offering some form of responsible property investment over the last decade. However, the refinement of its terms, adopting the ESG