Despite continued progress on climate risk management, access to transparent and comparable climate data remains a priority for investors

Despite continued progress on climate risk management, access transparent and comparable climate data remains a priority for investors

GREEN’s 2025 engagement report shows continued progress in climate risk management across the real estate sector, despite ongoing political uncertainty and policy backtracking. The report highlights both broader industry developments and the impact of direct investor engagement with companies.

Improved disclosure across the sector

Across the industry, disclosure on climate related risks and strategy continued to improve. One notable development is the increased disclosure of physical climate risks, such as flooding and heat stress. In 2025, 54% of the world’s largest listed real estate companies disclosed the high-level conclusions of their physical risk assessments, up from 44% in 2024. Disclosure of embodied carbon emissions also increased significantly, rising from 37% to 49%. In addition, more companies are now setting greenhouse gas reduction targets that include Scope 3 emissions, such as tenant energy use. In 2025, 47% of the largest listed companies had targets covering Scope 3 emissions, compared to 41% with a broader net zero commitment. Target setting that includes Scope 3 emissions remains important, as some of the largest sources of emissions in real estate, such as tenant energy use and embodied carbon from development and redevelopment, typically fall under this emission category.

Progress remains uneven

At the same time, progress remains uneven. Limited improvement was observed in areas such as the disclosure of adaptation measures to improve asset resilience to physical risks, asset level decarbonization plans, and expected capital expenditures needed to achieve climate targets. While transparency is gradually improving, important data gaps remain. For example, more than half of the largest listed companies now disclose the overall conclusions of their physical risk assessments, but only 23% disclose how much of their portfolio is exposed to different levels of climate risk. Similarly, while 81% of companies disclose asset locations, which allows some investors to conduct their own physical risk assessments, only 6% provide insight into adaptation strategies and just 2% report on concrete adaptation measures already implemented.

Engagement with listed and non-listed real estate companies

GREEN members engaged with 61 real estate companies and funds globally in 2025, including 36 listed companies and 25 non-listed funds. These engaged companies represent around 40% of the total AuM of the FTSE EPRA Nareit Developed index and a significant market share of the non-listed managers. Among these engaged companies, the strongest improvements were seen in climate risk disclosure, including how companies assess and report risks such as flooding, heat stress, or transition risks linked to decarbonization. Improvements were also seen in implementation planning, particularly in the development of portfolio decarbonization strategies and the actions needed to deliver on them.

The need for decision useful climate data

Overall, the report shows that engagement continues to support measurable progress, while also underlining the need for more transparent, comparable, and decision useful data for investors. To help address these challenges, GREEN works on improving transparency and consistency in the climate risk metrics most relevant to investors through its systemic workstream.