ESG tests property investors’ consensus on tax policy

Complying with ESG policy can add complexity to corporate tax strategy and PwC tax partner Richard van der Linden explained that the lack of consensus in this area is one of the challenges for real estate investors and asset managers.

“A lot of primarily institutional investors are actually quite advanced in defining what they think is a way of behaviour,” van der Linden said.

But asset managers are then expected to implement this policy.

“If you’re an asset manager and you have multiple investors, maybe hundreds of them, it’s quite a challenge to bring the views of all stakeholders together in a strategy that serves everybody,” van der Linden told Real Asset Insight’s Richard Betts.

A good starting point is to gather an overview of published guidelines. Much has been produced by both public sector and non-governmental organisations. Notable among them is INREV (the European Association for Investors in Non-Listed Real Estate Vehicles), whose tax committee has produced a tax code of conduct.

The INREV tax code of conduct can help the real estate business by functioning as a standard for those that want to take on this topic and who want to see what others in the business are doing.

Van der Linden also pointed out that the way a company communicates its policy to stakeholders is also important, including to the public, which is broadly a stakeholder.

Click on the video above to watch the full interview or listen to the podcast below.