Navigating ESG regulations and standards within the real estate industry, while meeting bespoke investor requests, is challenging. To drive progress in real estate capital markets and combat climate change, clarity is vital for investor decision making. ULI, INREV and the PRI, in close collaboration with the project steering committee, and supported by PwC, embarked on a journey to map and compare global ESG regulations, standards, and certifications, assessing their environmental, social and governance components.

Environmental and social challenges present arguably the greatest risks facing our societies globally. From climate change, biodiversity loss and water scarcity, to social inequity in various forms, the scale of the challenge is immense. The built environment has an important contribution to make in addressing these social and environmental challenges, with buildings responsible for nearly 40% of global GHG emissions.1In addition, half of energy and raw material consumption and one-third of total water consumption can be attributed to the construction and real estate industry.

Alongside the development of the industry over the past two decades, we have seen a growing importance of sustainability, initially focused on governance and environmental issues, and social impact gaining ground in recent years.

In the absence of regulation and uniform definitions, the industry started to develop its own frameworks, standards, and certifications. Initially focused on building level with sustainability certifications assessing building construction standards, this was soon followed by ESG benchmarks such as GRESB and industry standards such as EPRA and INREV.

In the meantime, following on from the global financial crisis and increasing concerns related to climate change, regulations across different countries and regions have stepped up and more are expected soon.

As a result, it has become increasingly difficult to navigate the various mandatory regulations and voluntary standards, especially when taking into consideration the bespoke requests from investors on top of the standards. For real estate capital markets to operate effectively and sustainably and enhance the speed at which progress is made to mitigate climate change and adjust to the challenges, greater clarity is needed to ensure information is ‘decision useful’ for investors.

In response to these challenges, ULI, INREV and PRI in close collaboration with the project steering committee, and supported by PwC, embarked on a journey to map and compare the most important global ESG related regulations, standards and certifications and assess each of them in relation to the E, S and G components.

Through member and industry knowledge sharing and best practices, this report offers guidance on how to potentially navigate and use existing regulations, standards and certifications in the field of ESG.

We hope this report will enhance the understanding of the current landscape and future direction of ESG related reporting standards and regulations and building certifications, supporting individual managers and investors in setting an ESG strategy in close alignment with their company’s business strategy.