Kicking off the EPRA Virtual Sustainability Summit on Thursday, 03rd December was the esteemed Jonathon Porritt, a successful author and environmental campaigner. It was a privilege for EPRA members to hear Porritt speak about the greatest challenges facing the environmental cause and how central the built environment can be for the solution.
It has been a difficult year for the climate cause, quipped Porritt, and despite the precipitous drop in emissions during the national lockdowns in the first quarter, there have been many setbacks, false-starts and delayed international conferences, such as COP26 which was projected to set out much stricter environmental commitments from the international community.
But, as Porritt noted, there is also reason for quiet optimism. China has decided to contribute to a hard edge target for net zero by 2060, the election of Joe Biden reaffirms the US’s commitment to combating climate change and the consumer demand for a more sustainable future does not appear to be dampened by the pandemic.
But what does this all mean for the property sector?
From Porritt‘s perspective, the property sector has a tremendous ability – and responsibility – to address the climate emergency, but no private sector industry will be able to move the needle as much as needed; instead this must come from governments.
In addition, there needs to be a renewed focus on retrofitting existing stock to become more efficient. It is sometimes easy to talk about new builds and their energy efficiency, but retrofitting is much more carbon friendly. Porritt was, however, quick to point out the unfortunate reality that retrofitting is sometimes the victim of politics, as large building and infrastructure projects are much more visible and attractive to politician’s keen on leaving a legacy.
Following Porritt’s keynote, the conference heard from Stefan Moser, Head of Unit, Energy Efficiency: buildings and products, DG ENER at the European Commission, on exactly this topic, and how the European Green Deal can address the recovery within the EU to include more renovation investment and upgrading existing stock. The challenges, according to Moser, are great, but also achievable if we work in a concerted way with clear direction from EU leadership.
The summit included multiple panel discussions focused on the importance, and in some cases overreliance, on the taxonomy of investment classifications in the environmental, social and corporate governance (ESG) realm. A back-and-forth debate on the importance that some investors are placing on taxonomy versus the actual positive impact some the reporting mechanism has had provided a great deal of food for thought for the attendees.
The conversations also touched on the balancing act that many investment companies are trying to walk between investing more in upgrading their properties to be more environmentally friendly and reducing dividends to pay for this. In many circumstances, the pressure from investors is so great to continue with dividend payments that it makes undertaking these investments a challenge.
Closing this year’s summit, Hassan Sabir, Director of Finance and Sustainability at EPRA pointed to the light at the end of the tunnel of 2020 and the optimism that the industry feels as it looks towards 2021. There are surely many challenges ahead, but with a concerted effort from governments and industries, we can all rise to overcome these hurdles and help to lead the continent in its green economic recovery.