When assessing the existing ESG rules set out in the EU disclosure and taxonomy regulation for the real estate sector, one particular question springs to mind: Does the current regulatory framework actually work?

The answer is complex. Fundamentally, the ESG provisions are an important step in the right direction. That is beyond doubt. Without the ESG regulations, not enough would happen for the real estate sector to help the European Union become carbon neutral by 2050. All parties, however, are clearly aware that the existing provisions on ESG leave room for improvement.

The sector has done too little over the past few decades and has largely neglected the need to address climate change. Now, it is high time to make up lost ground. But there are problems with the regulations. Several elements of various directives do not really fit together. This especially applies to their time sequence. The Sustainable Finance Disclosure Regulation (SFDR), for example, which aims t