Sustainability in the real estate industry: How digitalisation helped to make ESG reporting possible
15. September 2021
Sustainable concepts linked to new ESG regulations are an increasingly frequent part of the corporate world. The requirements incumbent upon political and business stakeholders are changing with greater dynamism and complexity: increased regulations, fiercer competition and values are in a constant state of flux. As a result, the demands related to the development, management and administration of real estate assets are also changing. Data is the basis from which companies will remain fit for the future.
The ESG criteria devised by the United Nations has got things moving in the real estate industry. These are composed of Environmental, Social and Governance components and serve as a gauge to measure a company’s sustainability-related activities and commitment to social responsibility. Drooms’ survey* covering the trends, needs and challenges across the real estate asset management sector in Europe confirms that greater importance is attached to sustainability in our industry. According to the survey, at an average of 36 per cent, sustainability is a major priority for European real estate experts. In the UK and Germany, the topic ranks highest in importance with 43 and 42 percent respectively.
ESG criteria and the resulting disclosure requirements are based on a large amount of data. A well-maintained data structure is required in order to use reliable information for ESG reporting. To do this, the relevant data must be collected, structured, stored in databases and updated regularly. New technologies that map all stages of the asset management process on one platform are essential to this. According to Drooms’ survey, there is room for improvement in the real estate industry across Europe. Nearly half of all respondents admitted lacking knowledge about existing technologies. Now, however, the industry is set to ramp up investments in innovative technologies, with the aim of complying with the requirements: around 80 per cent of European real estate experts believe that an increased budget for new technologies over the next couple of years is likely or highly likely. Around 70 per cent of the respondents claimed that real estate companies benefit most from increased efficiency on the back of greater data control.
The survey makes it clear that digitalisation and sustainable asset management processes are right at the top of the agenda for real estate experts. The digitalisation of documents leads not only to faster and improved business processes, but also paves the way towards greater transparency and sustainability in the field of asset management.
*The survey was carried out on a quantitative basis via an online questionnaire comprising of eight questions. Customers and interested parties in Europe were invited to take part in the survey by email in March 2021. In total, 255 real estate experts responded to the survey.