Sustainable real estate: an ongoing ESG transformation

The real estate sector faces the challenge of changing the way it operates in order to make a significant contribution to reducing emissions. Nearly 40% of all CO2 emissions come from this industry, with 70% caused by building operations and 30% by construction work. Given the need for change, there is sometimes uncertainty, especially among players who find it difficult to reconcile their real estate expertise with ESG requirements.

The latest report, “Sustainable Real Estate: An Ongoing ESG Transformation” by Forvis Mazars, examines the transition from a CSR vision to an ESG strategy in a time of uncertainty. With insights from 15 stakeholders, the report highlights the importance of shared knowledge for implementing ESG strategies in the real estate business environment. It also highlights the measures taken by various industries that contribute to regulatory compliance and overcoming daily challenges.

Key findings:

Introduction of an ESG framework

The implementation of an ESG framework in real estate and construction companies as well as among operators is already an unavoidable priority today. Companies are encouraged to adapt their business models to ensure that ESG plays a central role.

The introduction of an ESG framework and a corresponding strategy may be time-consuming, but it is essential for a successful economic future as a real estate company.

Michael Dessulemoustier, Partner at Forvis Mazars in Austria

Regulations

Regulations are key to progress in the real estate sector. Affected companies must not only mitigate external effects, but also adapt to climate change.

Regulation—especially tax law—is an effective control mechanism that can motivate the industry to change its behavior.

Florian Schmidl, Partner at Forvis Mazars in Austria

Tools

The installation of data collection devices is essential when data is missing or insufficient to achieve the company's goals for the sustainable improvement of its facilities.

Given the scope and importance of the data, tools and instruments are essential. As in financial reporting, automated data collection must also be the goal in sustainability reporting in order to achieve reliable data quality and availability.

Matthias Kranister, Partner at Forvis Mazars IT Services

How can Forvis Mazars help?

From the outset, Forvis Mazars accompanies its clients in their sustainable transformation and supports them in developing a tailor-made implementation strategy to achieve greater added value. We advise real estate companies along the entire value chain on ESG issues. Our clients range from real estate owners, users, and developers, construction companies, tourism and leisure facilities, to real estate funds, investment managers, and social housing providers. Thanks to our international partnership and comprehensive industry knowledge, we can offer customized services and provide our clients with an individualized approach to their sustainable transformation.

Our services include:

• Support in conducting materiality analyses, ESRS-GAP analyses, and stakeholder surveys
• Definition and implementation of an ESG strategy
• Conducting a climate risk analysis and developing strategies to reduce emissions
• Integration of a circular economy approach
• Establishment of internal controls and risk management
• Support in complying with legal requirements and assistance in setting up reporting in accordance with CSRD
• Review of sustainability statements