Green profits from property

Leading fund managers watch company footprints

The financial returns from property portfolios are directly related to environmental performance. That’s the resounding message from a survey of unlisted UK and European property funds.

Nine out of ten property fund managers said they sought advice from environmental consultants on the environmental performance of companies within the fund, and 95% believed there to be a link between environmental performance and financial return.

But the survey, by global asset management business Aviva Investors and the Environment Agency Pension Fund, revealed that reporting of carbon emissions data by property funds remains weak.

Although buildings are responsible for almost half of the UK’s carbon emissions, nearly 60% of fund managers admitted taking no action to collect emissions data. But opinion in the sector is changing, says Will Dawson, Senior Sustainability Advisor at Forum for the Future. “Funds are recognising the value of sustainability, and there is a growing recognition that better data is needed to make sound investment decisions.” Richard Jones, Managing Director of UK real estate at Aviva, agrees. Funds must “disclose, monitor and report environmental performance to investors” to encourage reduction in carbon emissions in line with UK and EU targets, he said.
– Sophie Blakemore

10 December 2009

Sophie Blakemore

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