Last week I had the opportunity to discuss how to avoid greenwashing in real estate. On the panel was:
- Jessica Pilz, Global Head of ESG, Fiera Real Estate,
- Katie Whipp, Head of Innovation & Strategy at Trustek and
- Iona Silverman, Partner at Freeths LLP.
The event was moderated by Alex Dunn, Research Manager at the Cromwell Property Group. It was sponsored by RE: Women and The Society of Property Researchers, and hosted by Freeths.
It was a really rich discussion. I raised a number of points I wanted to touch on here.
The role of data
First, and nothing new to anyone who’s seen me speak before – I stressed the importance of data in how to avoid greenwashing. And with that, it’s important to be clear about the accuracy of the data. I also stressed the need for it to be open, transparent, and externally verifiable. This of course is more difficult in considering the various ‘S’ elements of ESG, but not impossible.
I also stressed the importance of not making commitments before understanding what they mean for the business. For instance, making a commitment to net zero requires understanding where a company is now in terms of a baseline and having a plan, or a road map, with clear and measurable targets that can be assessed against.
I likened making a net zero commitment with no baseline and plan to that of saying ‘I want to lose 10 kgs’, but I have no idea what I weigh, and I’ll keep doing what I’m doing. You can see where I’m going to here in that a commitment is simply words. It can only be made meaningful with appropriate targets and a plan of action which is then taken forward.
Where it goes wrong
There are a number of ways in which greenwashing can arise. This can include:
- Through omission – for example a company saying they’ve recycled say 10 tonnes of waste without mention of the 100 tonnes of waste they produce;
- Deliberately mislabelling – for example, saying a product is sustainable when it isn’t;
- Ignoring issues – for instance, where there are issues with supply chains which pose a material risk, and where problems arise and aren’t addressed;
- Lying; and
- Failing to act at senior and Board levels when issues have been flagged, but not acted on. There’s a really interesting interview with Desiree Fixler who blew the whistle on DWS – read here.
How to get it right
And there are ways to get this right. While not necessarily a comprehensive list, key components include:
- A clear strategy, underpinned by meaningful targets and metrics, where commitments are also timeframes; and
- Accountability and transparency across the business; and
- The willingness to act at the C-Suite and Board level when issues have arisen/ been flagged.
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