This post is part of our “Meet the Experts” series. Read about our ESG Advisory Services to learn how Measurabl can help you accelerate your ESG efforts.
With more than a decade of ESG and sustainability consulting experience, Mark joined Measurabl to help launch the company’s new ESG Advisory Services, which provides ESG strategy, reporting, and action planning services to real estate owners and operators. Prior to joining Measurabl, Mark spent more than five years at Lord Green Strategies as a green building consultant and head of creative services. Mark was also an environmental and social scientist at ERM, Inc.’s impact assessment and planning department for four years before focusing on sustainability in commercial real estate.
We talked with Mark to get his thoughts on the industry’s challenges and his approach to helping solve them. Check out this Q&A and get to know Mark:
In your opinion, what is generally the state of ESG strategies in the real estate sector?
I believe we’ve reached a very crucial point in the evolution of ESG strategies in the real estate sector. Regulatory drivers in Europe and the looming SEC rulings regarding climate risks have accelerated the adoption of sustainable business practices across industry sectors. In real estate, this has led to real estate investment firms essentially overhauling their corporate governance practices. From tying executive compensation to ESG initiatives and increasing workforce gender diversity to integrating more stringent due diligence procedures into acquisition activities, ESG strategies are being integrated in meaningful ways.
How mature is the real estate industry, and what remains to be done?
Well, if we’re talking about the industry adoption of ESG and its related product solutions, I believe we’re still in the early majority stage of the adoption curve. The real estate sector has been relatively slow to digitize many vital areas of ESG performance. That being said, proper data management is an essential component of a successful ESG strategy. When Measurabl entered the scene a decade ago, its innovative ESG platform helped bring ESG-related data into the 21st century.
Several consequential mergers and acquisitions in our industry occurred in 2022, signaling that companies specializing in ESG products and services in the real estate sector may have reached the shakeout phase of our industry’s life cycle. It’ll be interesting to see how the next few years will play out as companies consolidate and grow. Measurabl is certainly well-positioned to maintain its industry leader status.
How do you build an ESG strategic framework that is future-proofed to transcend the ever-changing economic and regulatory realities?
An ESG strategic framework is essentially a comprehensive set of corporate best practices that benefits not only the company, but society and the planet. To build a resilient and future-proof ESG strategy, ESG must be integrated across the company’s value chain. ESG factors must be baked into virtually every action a company and its employees make. From board diversity to health and well-being of building occupants to energy consumption and greenhouse gas emissions, there are so many areas of ESG to focus on and improve upon.
The keys to transcending these ever-changing and rapidly evolving economic and regulatory realities are commitment, communication, and compliance.
- Show commitment by aligning with industry and corporate best practices. This could include committing to establishing science-based targets, aligning with the UN Sustainable Development Goals, and cultivating a strong health and well-being program for employees.
- Communicate your ESG commitments from both the top down and the bottom up by developing and implementing a comprehensive set of ESG policies and programs that allow for ESG accountability throughout the organization. Regularly review priorities through materiality assessments and stakeholder engagement strategies. The ability to pivot towards initiatives that are most impactful to the company and its stakeholders is a crucial component of a future-program ESG program.
- Lastly, comply and prepare to comply with any relevant regulatory bodies by implementing a transparent ESG program that aligns with industry best practices.
What would you say are the key ways that ESG and climate risk can impact financial returns?
In the real estate sector, investment management can essentially and succinctly be boiled down to the management of risks. When considering which risks to prioritize, financial risks and environmental impact risks have historically been the two separate categories that investors use to inform their decisions. ESG considerations are essentially a set of measurable criteria used for identifying and mitigating various impact risks such as climate change.
When we talk about the ESG performance of an asset, specifically its exposure to climate risk, we look at a range of performance indicators. From integrating climate change scenario analysis outcomes into investment strategies to developing climate resilience implementation plans for assets with higher exposure to climate-related risks, ESG strategies related to climate risks have become a primary focus and priority in the real estate sector. By using recommendations set by various reporting frameworks such as TCFD (Taskforce on Climate-related Financial Disclosures), real estate owners and operators have the guidance and information needed to appropriately focus on climate change considerations that are material to investors and other financial stakeholders.
What would you say are the three most important things to keep in mind when creating an ESG strategy?
The cornerstone of any successful ESG program is data. When developing an organization-wide ESG strategy, proper data management systems must be in place to measure, report, and act in alignment with established reduction targets. Another foundational component of many ESG programs is an effective and transparent stakeholder engagement process. There are many forms of stakeholder engagement programs, however the materiality assessment is foundational. This exercise allows companies to incorporate stakeholder feedback into their ESG strategy through prioritization of efforts across material topics. Lastly, clear and transparent communication through various reporting frameworks and disclosure systems, whether that is a standalone ESG report or a public filing, is an essential component of building a comprehensive ESG strategy.
How do you support Measurabl clients on their ESG journey?
At Measurabl, our ESG Advisory Services program has three pillars or focus areas: ESG Strategy, ESG Reporting, and ESG Action Planning. We view these three focus areas as cyclical, and our consultative approach largely depends on where our clients are on their ESG journey. For customers who are just starting out, we tend to focus on ESG strategy development. This may start with a materiality assessment and a broader ESG gap analysis. The gap analysis provides our clients with a comprehensive report on their current ESG efforts in relation to their industry peers and corporate best practices. For clients with a well-established ESG strategy, we may emphasize our ESG Reporting and ESG Action Planning services. For ESG reporting, this includes guidance on reporting strategy, identifying appropriate reporting frameworks and disclosures for alignment, and advising on KPI computation methodologies. For ESG action planning, we create strategic roadmaps and action plans around decarbonization and climate risk mitigation, in alignment with their public commitments and targets.
ESG continues to evolve rapidly in scale and complexity, so it’s important for us as advisors to offer our clients solutions that are custom-tailored to their needs. From navigating the alphabet soup of ESG reporting to identifying climate risk mitigation projects at the property-level, careful thought and the programmatic processing of information is essential.
What excites you about Measurabl’s place in the market today?
Since its inception, Measurabl has stood out to me as a leader in ESG in the real estate sector. A decade later, this sentiment holds true. I’m excited that we are delivering meter-to-market ESG products and services for our customers that are unmatched in the industry.
As the world’s most widely adopted real estate ESG platform, Measurabl has positioned itself as a leader in the data revolution of the real estate sector. This in and of itself is exciting, but I am even more excited by where Measurabl is headed. With the acquisition of Hatch Data and WegoWise along with the launch of Professional Services, 2022 was a monumental year for our company. Our ESG platform has become far-reaching, servicing real estate firms at the portfolio and company level all the way down to the utility meter level.
What will be the most fun part of your new role?
The most fun part of my new role as ESG Advisor is working with our clients to assist in the creation and expansion of their ESG efforts. To see sustainability projects come to fruition based on our recommendations and guidance is a deeply rewarding experience. Also, I’d be remiss if I didn’t mention Measurabl’s company culture. I have been a fan of Measurabl for many years, so having the opportunity to become a member of this stellar team has been a source of great joy in my life and career.
The experts at Measurabl are ready to help elevate your ESG program. Learn more about Measurabl’s ESG Advisory Services.