The European Public Real Estate Association (EPRA) has launched Best Practice Recommendations for Sustainability Reporting in the listed property sector, as it aims to drive up standards in this crucial area and replicate successes already delivered via the EPRA BPR financial reporting.
Gareth Lewis, EPRA Finance Director said: "Although the listed sector is leading the way compared with the broader real estate sector, around two thirds of listed property companies in the EPRA European index are yet to disclose their sustainability performance.
"With the launch of these best practice guidelines, EPRA hope to lift standards in this area in the same way we've encouraged better transparency and established unified performance benchmarks in the industry's financial reporting."
He was speaking at EPRA's annual conference in London where the industry body also announced the creation of its Sustainability Reporting Awards. These are to be sponsored by Dutch pension fund manager APG, with the first results announced at next year's annual meeting in Berlin.
Lewis said that consultation with EPRA members had revealed that one of the main obstacles to uniform reporting on sustainability was the sheer range of data disclosure possible in the real estate sector that make for an extremely confusing situation for both companies and investors.
However, with a gradual consensus now emerging on priority key performance indicators, such as greenhouse gas emissions, it had become possible for EPRA to build best practice recommendations (BPR) around these areas of agreement.
The BPR were developed by the EPRA Sustainability Reporting Committee with help from consultants Jones Lang LaSalle. They are comprised of the EPRA Sustainability Performance Measures, which outline the key metrics against which companies should report in terms of absolute (total) performance and intensity of use for:
- Greenhouse gas emissions
Core recommendations within the BPR also cover segmentation by country or asset type, like-for-like analysis and defining landlord and tenant responsibilities and boundaries under different scenarios.
Warren Austin of UK property company Hammerson and Chairman of EPRA's Sustainability Reporting Committee said: "The process EPRA adopted of intensive and direct consultation with property companies and investors was sometimes difficult and frustrating.
"However, the beauty of this approach is that we have now arrived at a position where we have the implicit 'buy-in' from a large proportion of the European listed sector and are well placed to replicate the successes of the financial BPR in raising the quality and consistency of sustainability reporting for the European real estate sector."
Source: Bellier Financial