The principles have been drafted to provide clear direction towards achieving best practice for all those involved in the built environment, including developers, investors, advisors, lenders and occupiers.
The framework is the result of an 18-month long consultation and exploration of the issues affecting the whole sector, including climate change, social impact, health and wellbeing, diversity and inclusion, accountability and transparency, and data collection. It also encourages all market participants to strike a fair and reasonable balance between profits and wider impacts of their activity.
Bill Hughes, Chair of the Property Industry Alliance and Head of Real Assets at Legal & General Investment Management, explains:
“Now more than ever any business that does not recognise the crucial importance of behaving in a socially and environmentally responsible manner will not be sustainable over the long term. Those involved with the built environment have a huge collective responsibility and opportunity to drive real change. While many in our sector are making significant strides forward and having a really positive impact with their ESG policies, there remains a lot of debate and a lack of clear direction as to what best practice looks like, particularly for those who are less well resourced, which leads to fragmented efforts. This framework will support real estate market participants of all sizes in aligning their decisions with a high ESG standard and help them assess their businesses and progress.
“We have a duty to our communities, our people and our shareholders to self-reflect, to ask ourselves the tough questions and to behave in the right manner in recognition of the fundamental role that we play in society, as well as to ensure our future relevance.”
The eight organisations that make up the PIA are: the Association of Real Estate Funds (AREF); the British Council for Offices (BCO); the British Property Federation (BPF); the Commercial Real Estate Finance Council (CREFC) Europe; the Investment Property Forum (IPF), Revo, the Royal Institution of Chartered Surveyors (RICS) and the Urban Land Institute (ULI UK). Members of all organisations will be strongly encouraged to follow the new principles, with uptake and progress overseen by each body.
The eight principles will be printed in full tomorrow.