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2020 GRESB Real Estate Results Europe

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2020 GRESB Real Estate Results Europe - November 24

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2020 GRESB Real Estate Results Europe

  1. 1. 1 REAL ESTATE EMEA Hosted by: Industry supporters:
  2. 2. 2 PROGRAM • Welcome & Introduction| Josien Piek, Head of EMEA, GRESB; Ed Gabbitas, Director, EVORA • GRESB Real Estate Results & Trends | Kevin Kirby, Associate, Real Estate, GRESB • Panel Discussion 1: Asset level data / CRREM • Moderator: Erik Landry, Climate Change Specialist, GRESB • Dan Grandage, Head of ESG, Private Markets & Real Estate, Aberdeen Standard Investments • Dirk Brounen, Professor of Real Estate Economics, Tilburg University (CRREM) • Hans J. Vrensen, CFA, CRE, Managing Director, Head of Research & Strategy, AEW • Panel Discussion 2: Technology • Moderator: Philippa Gill, Director, EVORA • Charlotte Jacques, Head of Sustainability, Schroders • Emily Hamilton, Head of ESG, Savills Investment Management • Bas Blokpoel, Director, IT & Analytics, GRESB • Presentation: EU Disclosure Regulation • Bahar Celik, Professional Standards Associate, INREV • Closing | Josien Piek, Head of EMEA, GRESB
  3. 3. 3 Investor-Led Growth
  4. 4. 4 Participation +22%
  5. 5. 5 Participation
  6. 6. 6 Participation 1,229 +96 k USD 4.8 tn Breakdown by region
  7. 7. 7 2020 RESULTS
  8. 8. 8 GRESB Model Regional scores comparison Asia Oceania MANAGEMENT PERFORMANCE
  9. 9. 9 GRESB Model Country Scores Comparison
  10. 10. 10 Impact of Change Contribution analysis EU Global
  11. 11. 11 Performance Indicators
  12. 12. 13 KEY ESG TRENDS
  13. 13. 14 Resilience & Regulation 121 238 412 Americas Europe Asia Oceania % participants 13% 24% 34% 2018 2019 2020
  14. 14. 15 Net Zero Transition Towards a carbon positive built environment
  15. 15. 16 Embodied Carbon 31% of European Development entities assess Embodied carbon on at least 1 project completed during the last 3 years
  16. 16. 17 WHAT’S NEXT?
  17. 17. 18 Granularity Reliability Quality control Error detection Normalisation Asset-level benchmarking Scoring of true performance Local and global targets Data Availability Performance Insights Benchmarking 2.0 Data Quality From data availability to scoring performance outcomes Transitioning to Performance • Granularity • Reliability • Quality control • Error detection • Normalisation • Asset-level benchmarking • Scoring performance outcomes • Local, regional and global targets
  18. 18. 19 Stronger governance Rooted into deeper industry involvement and collective effort for transparency Independent standard setter Mission driven Investor led By industry, for industry Formalised by year-end Independent benchmarking organisation Future B-Corp Mission driven ….. GRESB Foundation GRESB BV
  19. 19. 20 Industry collaboration Collective problems require collective action • Impact of COVID on building performance – December 2020 • Industry working group Data Providers • Industry working group Institutional Investors • Roadmap for defining, measuring and benchmarking performance – Q1 2021 • Assessment and benchmarking methodology for Residential portfolios – Q1 2021 • Integration of Climate Risk and Resilience into the GRESB Assessments – Q1 2021
  20. 20. 21 SECTOR LEADERS
  21. 21. 22 Sector Leaders – Europe
  22. 22. 23 Panel 1: Asset level data & CRREM
  23. 23. 24 Panel 2: Technology
  24. 24. 25 Presentation: EU Regulation
  25. 25. 26 REAL ESTATE EMEA Hosted by: Industry supporters:
  26. 26. Bahar Yay Celik INREV 2020 GRESB Results Event 24 November 2020 Effects on the Real Estate Industry ESG DISCLOSURE REGULATION / SFDR
  27. 27. Key EU Legislative Initiatives for Asset Managers 28 1. Disclosure Regulation ((EU) 2019/2088) • also known as SFDR or the ESG Regulation • Applies from Mar 2021 • Delay to final RTS publication and RTS compliance (likely end Jan 2022) 2. Taxonomy Regulation ((EU) 2020/852): •Applies from Jan 2022/2023 •Level 2 pending 5. MiFID II Organisation Regulation(amending Regulation (EU) 2017/565/EU) / MIFID Delegated Directive (amending Regulation (EU) 2017/593/EU) 4. AIFMD Level 2 Delegated Regulation (amending Regulation (EU) 231/2013/EU) •Applies 12 months after coming into force (expected to apply Q3/Q4 2021) 3. Others: Low Carbon Benchmarks EU Climate Transition Benchmarks, EU Paris- aligned benchmarks. Delegated legislation integrating sustainability to local regulation (e.g. in UK TCFD) 6. Voluntary ESG Disclosure/Reporting UN PRI, UN SDGs, Impact Management Project, PRI’s report on fiduciary duties, other principles, frameworks, codes, practices (GRESB, INREV, GRI, CDP)
  28. 28. Who is impacted? 29 EU Disclosure Regulation (SFDR) EU firms and those wanting to market funds in the EU Financial market participants (FMPs): AIFMs, investment firms carrying out portfolio management etc. Financial advisers (FAs): Firms authorised under MiFID to give investment advice and credit institutions in relation to a wide range of financial products
  29. 29. SFDR – Principal Obligations • Publish information on the integration of sustainability risks policies in the investment decision-making process • Publish and maintain where they consider principal adverse impact of investment decisions on sustainability factors (Comply or explain.), a statement on DD policies • Publish details of how remuneration policies are consistent with integration of sustainability risks • All products: How sustainability risk is integrated into investment decisions • Product classification and DNSH principal: • Sustainable Investment (Article 9) • ESG Product (Article 8) • Non-ESG/Sustainable Investment • Disclosure Elements for where the information must be published : • Website, Pre-Contractual, Periodic 30 Entity Level Obligations Product Specific Obligations
  30. 30. Principle Adverse Impact Template Climate and Environment GHG Emissions (1) Carbon Emissions  (2) Carbon Footprint  (3) Carbon Intensity  (4) Solid Fossil Fuel Sector Exposure -Emissions of Inorganic Pollutants -Air Pollutants - Ozone Depletion Substances -Investments without Carbon Emission Reduction Initiatives Energy Performance (5) Non- renewable Energy Cons. (6) Non- renewable Energy Breakdown (7) Energy Intensity (8) Energy Intensity Per Sector Biodiversity 1.(9) Biodiversity and Ecosystem Preservation 2.(10) Natural Species and Protected Areas 3.(11) Deforestation -Land degradation, desertification, soil sealing -Investments without sustainable land/forestry/agri.  -Investments without sustainable oceans/seas practices -Securities not certified as green Water 1.(12) Water Emissions 2.(13) Exposure to Areas of High- Water Stress 3.(14) Untreated Discharged Wastewater Waste 1.(15) Hazardous Waste Ratio 2.(16) Non- Recycled Waste Ratio -Water consumed -Water recycled and reused -Investments without water management initiatives Social, Employee and Governance Social & Employee Matters 1.(17) Implementation of ILO Conventions 2.(18) Gender Pay Gap 3.(19) Excessive CEO Pay Ratio 4.(20) Board Gender Diversity 5.(21) Insufficient Whistle- blower Protection 6.(22) Workplace Accident Prevention -Number/rate of accidents, injuries, fatalities, frequency -Number of days lost for injuries, accidents, fatalities, illness -Incidents of discrimination -Securities not certified as social Human Rights 1.(23) Human Rights Policy 2.(24) HR Due Diligence 3.(25) Preventing Human Trafficking 4.(26) Child Labour 5.(27) Forced or compulsory labour 6.(28) Severe Human Rights Issues and Incidents 7.(29) Exposure to controversial weapons Anti-Corruption & Anti- Bribery 1.(30) Anti-Corruption and Anti- Bribery Policies 2.(31) Insufficient action to address anti-corruption breaches 3.(32) Violation of anti- corruption laws -Supplier code of conduct -Grievance/complaints handling mechanism -Lack of separation of CEO and Chair functions on the boards of investee companies 31 MandatoryOpt-in
  31. 31. SFDR - Timeline Dec 2020 Mar 2021 June 2021 Jan 2022 Dec 2022 32 Formal Application of SFDR (Level 1) RTS (Level 2) will become available at a later stage Expected deadline for RTS (Level 2) compliance Final RTS (before delay) RTS effective (before delay) Entity Level – Principle Adverse Impact Statement Annual reporting for Article 8 & 9 products Product Level - Adverse impact statement
  32. 32. Going Forward • Regulator • Need more alignment between different disclosure requirements in EU legislation (Taxonomy) • Clarification on product types, “do no significantly harm” principle • Industry • Act now! How does the regulation apply to you across your business? • Engage with your investors and other stakeholders • Importance of an integrated approach with governance, policy and risk issues 33
  33. 33. 34 Q&A INREV Professional Standards professional.standards@inrev.org

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