The globe’s leading institutional real estate investors join forces to cut the ESG data spaghetti

The globe’s leading institutional real estate investors join forces to cut the ESG data spaghetti

A group of the largest and leading real estate investors are joining forces to break down the systemic barriers that hinder adequate climate risk management in the industry. A key obstacle is a lack of access to comparable and  high-quality financial material climate data.

A wide range of certifications and industry standards exist, each using different data points and definitions. Many of these frameworks bundle all ESG aspects into a single score, making it difficult for investors to compare metrics and integrate them into investment analysis.

In addition, the ever-growing ESG reporting burden is increasing costs and preventing managers from focusing on value creation. It’s time to cut through this complexity and collectively agree, as a global industry, upon meaningful, investor-relevant metrics—enabling better pricing of brown discounts and green premiums.

Leading investors and investment managers including APG, ATP, BouwInvest, CBRE IM, HOOPP, MN, PGGM, Savills IM, Schroders, Urban Partners have joined forces in this new workstream of the Global Real Estate Engagement Network (GREEN). Members are both new and existing members of GREEN and Leaders of the Urban Future (LOTUF), which recently announced they have joined forces. The goal is to establish a limited set of financially material metrics and definitions that investors and managers actively use—or plan to use once available—in disclosing and assessing risks and opportunities within their portfolios.

Only with backing of the full global real estate industry can we cut this data spaghetti and the group therefore calls for other investors, industry bodies, and standard setting organizations to join this effort. Already many industry bodies and stakeholders have offered their support and GREEN calls for all other stakeholders not yet involved to collaborate and support this effort.

This new workstream is open to direct and indirect institutional investors and investment managers and complements GREEN’s existing work in which indirect investors engage with listed and non-listed real estate funds and companies to assess and improve their climate-risk management performance.

Quote investors and other stakeholders

APG:

Derk Welling, Senior Portfolio Manager Responsible Investments Real Estate at APG: “As a long-term real estate investor, we recognize the importance of reliable, comparable, and financially material sustainability data. Without standardized metrics, effectively managing climate risks and making responsible investment decisions remains a challenge. At the same time, the growing sustainability reporting burden in the real estate sector diverts valuable resources away from value creation. That is why we fully support this joint effort within GREEN. Only through collaboration can we enhance transparency, reduce the reporting burden and contribute to a more sustainable and resilient real estate sector.”

ATP:

Peter Hebin Bruun, Head of ESG at ATP Real Estate: “ATP previously participated in the LOTUF initiative, which outlined a common understanding of what good ESG performance looks like for real estate across the globe. Such an understanding is key to further strengthening the agenda’s role in adding insights and value to our portfolios. GREEN has the potential to be a strong platform for further enhancing the common understanding and sharing of best practices on target setting and tracking of progress as well as overcoming the data challenges that many real estate investors face today.”

Bouwinvest:

Sabrina Boshuizen, ESG manager International Investments at Bouwinvest: “At Bouwinvest, we believe that long-term financial outperformance is driven by ESG integration—where sustainability drives both risk- as return profiles. Standardised, high-quality ESG data is essential to compare portfolios, steer capital effectively, and increase transparency across the real estate sector. As an investor that has been actively engaged from an early stage in shaping, standardising and improving ESG data practices, our participation in the systemic workstream is a natural continuation of our commitment in raising the bar. We believe that collective action is essential for the industry to accelerate decarbonisation while generating sustainable financial value for investors.”

CBRE Investment Management:

Robbie Epsom, Head of EMEA Sustainability at CBRE Investment Management: “Achieving true progress in decarbonising the real estate sector hinges on aligning sustainability metrics, particularly those legislative metrics used by investors, lenders, and valuers. Initiatives like GREEN and the Systemic Workstream are vital in fostering this crucial industry alignment. We must work with industry bodies such as INREV and ULI and build upon existing frameworks, such as the IIGCC-coordinated ARESI initiative, which has already made significant strides in addressing ambiguity in existing Climate Transition Risk metrics in the European market. By ensuring these efforts are considered and integrated, we can streamline our collective approach and accelerate the transition to a more resilient and future-proofed real estate market.”

HOOPP (Healthcare of Ontario Pension Plan):

Eric Plesman, Senior Managing Director & Head of Global Real Estate at Healthcare of Ontario Pension Plan (HOOPP): “At HOOPP, we are acutely focused on the connection between emissions performance, climate risk, and asset value. Having previously engaged in the LOTUF initiative, we strongly believe that additional industry engagement and collective action are required to underpin the low-carbon real estate market. We believe GREEN will provide the platform to continue this engagement and organize like-minded investors around a common goal: decarbonizing global real estate portfolios while driving strong risk-adjusted returns.”

MN:

Peter van den Tol, Senior Advisor Impact Investing & Responsible Investing in Real Assets at MN: “At MN, sustainability is a core part of our strategy to build resilient real estate portfolios that benefit both people and the planet. Managing climate risks and making informed decisions starts with consistent and transparent sustainability data. This data is crucial for aligning our portfolios with climate goals while ensuring long-term value creation. We believe that collaboration across the industry is key to accelerating the decarbonization of the real estate sector. That’s why MN is committed to working with other leading investors and investment managers to harmonize climate metrics, reduce reporting burdens, and foster transparency. We look forward to contributing to the systemic workstream of GREEN and extending our collective efforts.”

PGGM:

Andrea Palmer, Responsible Investment Lead at PGGM: “At PGGM, sustainability is central to our strategy for building real estate portfolios that contribute positively to both society and the environment. Effectively managing climate risks and making sound investment decisions starts with access to reliable and transparent climate risk data. These insights allow us to align our investments with global climate ambitions while delivering long-term value for our clients. We believe that industry-wide collaboration is essential to accelerating the transition to a low-carbon real estate sector. That is why PGGM is committed to working with like-minded investors and investment managers to promote transparency and consistency across financially material climate metrics. We look forward to advancing collective efforts through initiatives like GREEN, driving meaningful progress toward a sustainable future.”

Savills Investment Management:

Emily Hamilton, Chief Sustainability Officer at Savills Investment Management: “Savills Investment Management  is focused on decarbonising its real estate portfolio on behalf of our clients. Our portfolio includes low-carbon assets that have shown strong demand from tenants, and we have seen a positive trend in liquidity for these assets, particularly in terms of quicker leasing and short void periods. We strongly believe that industry collaboration and engagement is essential if the real estate industry is going to decarbonise real estate with the pace and scale that is required. GREEN’s network of like-minded investors and now investment managers is an exciting collaboration that we are proud to support.”

Schroders:

Tom Walker, Co-Head of Global Listed Real Assets at Schroders: “We recognise the critical challenges the real estate investment industry faces in obtaining comparable, high-quality, and financially material climate data. We’re proud to be part of this important initiative, collaborating with leading industry players to develop standardised metrics. This collective effort is essential for effectively managing climate risks, enhancing transparency, and driving sustainable value creation across global real estate portfolios.”

Urban Partners:

Mikkel Bülow-Lehnsby, Executive Chairman and Co-Founder of Urban Partners: “Quantifying the effect climate change poses on our investments is something Urban Partners sees as paramount to both short and long-term success. We need to become much better at better measuring the effects, which in turn, requires us to move away from proxies or non-standardized metrics, towards a set of commonly understood metrics that works across the value chain. Whether it is carbon risk exposure from a regulatory point of view or sourcing edge, tenant demand or financing upside from a value pool point of view. We are therefore very pleased to see the efforts of LOTUF being carried forward by GREEN. We need each other to materially nudge our ecosystem with one collective voice to change our sector for the better.”