Launched today by the Better Buildings Partnership, the Climate Change Commitment has been signed by 23 of its members, covering over £300bn AUM and +11,000 commercial properties globally, and responsible for over 1.2 million tonnes of carbon emissions per annum.
The commitment was developed in response to a Better Buildings Partnership dinner attended by CEOs and CIOs from the real estate investment industry earlier in the year, who were addressed by eminent Climate Change Scientist Professor Chris Rapley. These senior industry leaders agreed that property owners need to take urgent, collective action to respond to the challenges of climate change and address the risks it poses to their investment portfolios.
The Commitment highlights the need for buildings to be net zero carbon by 2050 and commits signatories to publicly publish their own pathways to achieving this by the end of 2020. These pathways will cover new and existing buildings, both operational carbon and embodied carbon, and critically, include the impact of the energy consumed by the buildings' occupiers.
Signatories will also report annually on the progress against their pathways and disclose the energy performance of their portfolios, demonstrating a clear intention to improve transparency within the market.
Sarah Ratcliffe, CEO at Better Buildings Partnership, said "The significance of this commitment cannot be under-estimated - the signatories have over £300bn AUM spanning diverse UK, European and global portfolios. These senior leaders have acknowledged the scale and urgency of action on climate change that is required, have committed to delivering net zero carbon portfolios, to improving transparency and driving market transformation. The BBP is proud to count these industry leaders as its members and looks forward to working with them to make net zero carbon buildings a reality."
Beyond the requirements of the signatories, the commitment highlights the need for unprecedented collaboration across the industry and calls on all stakeholders to step up to the challenge of delivering net zero carbon buildings. All commercial property owners are being encouraged to sign up to the Commitment. The BBP will be supporting its members and developing guidance for the wider industry to help address the practical challenges associated with delivering the Commitment. It will also be working with a wide range of organisations across the industry to encourage greater consistency, transparency and action.
David Paine and Pertti Vanhanen, Global Co-Heads of Real Estate, Aberdeen Standard Investments, said "It is essential that buildings play their part in delivering the net-zero economies required to tackle climate change. With approximately 1,600 real estate assets under our management globally, Aberdeen Standard Investments has a significant role to play. Acting now to establish the necessary pathways will future-proof our portfolios and protect and enhance investment performance for our clients. We are delighted to make this bold commitment alongside many of our peers and look forward to working with our stakeholders to meet the net-zero challenge."
Chris Oglesby, Chief Executive at Bruntwood, said "Following our pledge last year to be Net Zero Carbon in our new buildings by 2030, we are delighted to reaffirm this commitment today as part of the first group of BBP members who are dedicated to meeting the Energy Use Intensity targets set out.
We have actions in place to reduce our energy demand and improve our energy efficiency already, and are committed to driving this further and faster through collaborations with our customers and partners who are disrupting this market and driving innovation in this space.
We are facing a global climate crisis and more needs to be done to make a real, scaleable, collective change, so today we ask our customers and partners within our thriving cities to join this commitment."
John Garwood, Managing Director and Company Secretary Canary Wharf Group plc said “Canary Wharf Group aspires to be a net zero carbon business, but we recognise that this can only be achieved through leadership, collaboration and action across the whole built environment. In signing this commitment, we hope to send a message that we need to act decisively and we need to act together.”
Jessica Hardman, DWS Head of Real Estate Group, UK & Ireland said “We are pleased to be part of the BBP net zero commitment for our Europe real estate portfolio. At DWS, reducing the carbon impact in our investments is a key priority for the business. The real estate industry needs to work together to create methods and implement the pathway for net carbon within our investment processes and investment decisions. We look forward to continuing the dialogue with our peers and the BBP to achieve this.”
Toby Courtauld, Chief Executive at Great Portland Estates plc, said “We are pleased to sign this ground-breaking Climate Change Commitment from the Better Buildings Partnership and look forward to collaborating with the other signatories as we tackle the growing risks of climate change in our respective portfolios.”
James Raynor, London Estate Executive Director – Grosvenor Britain & Ireland said “Collaboration and innovation across our industry and along supply chains is the only way we will meet the challenge of designing, constructing and operating net zero carbon buildings at scale. This commitment demonstrates the willingness of the real estate industry to meet the challenge head on and improve transparency to drive real change.”
Louise Ellison, Head of Sustainability at Hammerson said “The BBP has always focused on enabling industry collaboration to deliver more sustainable outcomes. The Climate Change Commitment is an excellent example of this approach in action and, with so much support already, has the capacity to deliver lasting, valuable impact in the fight against climate change. I am delighted that Hammerson have been able to support the development of the Commitment and join with such an influential group of signatories to this important initiative.”
Chris Taylor, Head of Private Markets at Hermes Investment Management, said “We face a climate crisis that requires an urgent and unified response. By bringing together many commercial property owners, and in holding them accountable for the energy performance of their portfolios, this Commitment has the potential to make a real, tangible difference to the way that we, as an industry, address the pressing issue of climate change.”
Amanda Campbell, Corporate Affairs and Sustainability Director for intu, said “Everybody has a crucial role to play in helping to tackle climate change. One of the ways that intu is doing this is by signing up to the Better Buildings Partnership.
We have a strong track record of reducing our operational carbon, having reduced our carbon intensity by 64 per cent since 2010 and are on track to half our 2010 energy consumption in the next few years.
However, there is a lot more for us to do. How we design, build and develop our centres, as well as the energy consumed by our customers has a substantial carbon footprint. How we combat this will form part of our pathway to net zero carbon which I look forward to sharing soon. This ambitious commitment introduces an exciting phase in our sustainability journey.”
Caroline Hill, Head of Sustainability, Public Affairs and Health, Safety & Security at Landsec, said “I am delighted that Landsec has signed the BBP’s climate change commitment. Decarbonising our economy is critical and the built environment has a strong role to play on this agenda. At Landsec we’ve developed a plan for achieving net zero buildings, and the collaboration and support we gain from the BBP will be a key enabler in achieving our ambitions”
Alan Tripp, Head of UK at LaSalle Investment Management, said “I am delighted to be able to offer LaSalle’s support for this Commitment in the UK. Sustainability is at the heart of our investment process and our corporate ethos so it is great to see the industry coming together to reduce this threat going forward.”
Bill Hughes, Head of LGIM Real Assets, said “Avoiding climate catastrophe is our greatest global priority. LGIM Real Assets is committed to being at the leading edge of the sustainability agenda, recognising that our business activities result in both direct and indirect environmental impacts. Our commitment to deliver net zero across our real estate portfolio by 2050 is testament to our dedication to deliver a greener built environment.”
Victoria Quinlan, Managing Director – Investment Management at Lendlease Europe, said “Climate change poses significant risks to businesses and society. In committing to a net zero carbon pathway, Lendlease Europe acknowledges the urgency of tackling this challenge and the ambitious trajectory we need to take to deliver a zero carbon future. Each and every one of us has an important role to play. We look forward to collaborating across the industry to address this critical challenge.”
John Willcock, Director at Low Carbon Workplace, said “Low Carbon Workplace is dedicated to reducing environmental impact in UK commercial property through high-performance, sustainable, and outstanding refurbished offices. We are proud of our achievements to date but recognise we all need to go further. Joining The BBP Climate Change Commitment along with other industry leaders highlights our desire to work together to meet these challenges head-on.”
Tony Brown, Head of M&G Real Estate, said “M&G Real Estate are committed to achieving net zero carbon by 2050 across our global portfolio. The whole real estate market must come on this journey with us if we are to limit the worst impacts of climate change. We therefore fully support the BBP members commitment and the signal this provides to all in the real estate sector to deliver the transition to a low-carbon economy. Making significant progress against our 25% energy reduction target for 2025, we have already driven down the energy intensity of our global real estate portfolio by 23% since 2013. We now need to further challenge ourselves and everyone we work with on how over the next 30 years we can transition all our assets to be net zero, enabling us to deliver a cleaner, greener world for all.”
Mike Sales, CEO at Nuveen Real Estate, said “Nuveen Real Estate is proud to commit to delivering net zero carbon buildings. This is a necessary step for the industry in order to tackle the climate crisis and it builds on our existing commitment to a 30% reduction in energy intensity by 2030 across our portfolio. This will deliver outperformance for our clients as net zero carbon buildings will be protected from obsolescence and will remain relevant in tomorrow’s world. We call on our peers and the wider real estate industry to also step up to this challenge.”
Duncan Owen, Global Head of Real Estate at Schroder Real Estate Investment Management, said “The Net Zero Commitment is a call to everyone across the industry to move their focus and innovate at all stages of the building lifecycle to ensure buildings are efficient and resource conscious. Buildings serve people and we must embrace the environmental and social changes in the world to ensure real estate continues to deliver for society and positively impacts the built environment.”
Ben Brakes, Group Sustainability Manager at SEGRO, said “The case to support action on climate change is both an economic as well as a moral one and the time has come to take a broader approach to reducing our collective carbon footprints. We should be able to achieve this relatively easily with conscious forward planning; by working out what is material to our businesses and what we can influence; by having a science-based approach to measurement; and through effective management control. It gives us a better chance of success if these efforts are underpinned by initiatives such as the BBP’s Climate Change Commitment to ensure that we’re all pulling in the same direction.”
Graeme Craig, Director of Commercial Development at Transport for London (TfL), said: “As well as being responsible for more than 30 million journeys every day, we're also one of London's largest landowners, with a programme to deliver 10,000 homes across the city now well underway. The Mayor has set ambitious aims for London to be a zero-carbon city by 2050 and we are pleased to add our name to this important commitment to tackle climate change and help make a real difference for future generations.”
Karen Jamison, Head of Sustainability at Workspace, said “By working as a collective, we can have a greater impact by sharing best practice and tackling challenges together – we hope more companies will follow suit. Our challenge is that the majority of our portfolio of 62 flexible office assets across London are historic or older buildings. However, we are committed to net zero carbon by 2050 and have already made great strides in retrofitting our assets as part of our proactive investment, refurbishment and redevelopment programme.
Our customers, who range from start-ups to established brands, and investors are increasingly asking us about our resilience to climate change, so it is important that we are transparent with our stakeholders on what we intend to do to protect the environment for future generations. Whilst greening buildings is the right thing to do for future generations, it is also becoming a commercial imperative and those not taking sustainability seriously will be left behind.”