Savills ESG Aug 2023: Climate Resilience, Risks and Reporting
Cities are collaborating with governments, industries, and the public to address climate change through innovative solutions like Singapore’s carbon pricing scheme. Decarbonisation and adaptation have synergies in promoting sustainable development. Property owners should assess climate risks for resilience, identifying direct and indirect impacts. Sustainability reporting is becoming mandatory, improving ESG data transparency and influencing industry practices.
Climate resilience: real estate and carbon
Major cities focusing on climate resilience and emissions cuts. New Savills report shows 70% of emissions come from cities. Governments must lead on revising building codes to encourage retrofitting and renewable energy. Innovations such as Singapore’s carbon pricing scheme incentivise reducing emissions. Council-run programmes educate public and fund green building upgrades. With political and cross-industry collaboration, cities can cut emissions whilst boosting resilience to climate risks. Integrating resilience strategies with robust emissions targets are crucial for sustainable development. Working together means cities can decrease warming contributions whilst shielding communities — decarbonisation and adaptation have synergies.
What can real estate owners do to begin assessing physical climate risks?
As physical climate risks pose growing threats to real estate, Savills experts suggest property owners undertake risk assessments to improve resilience. Assessing location-specific hazards under climate scenarios helps identify direct impacts like building damage from flood/storms and indirect impacts such as reduced demand. Combining exposure data with asset vulnerability details provides a portfolio risk understanding. While modeling challenges exist, the process supports strategic mitigation and adaptation planning. Contact Savills sustainability specialists for climate risk expertise and best practices when evaluating resilience against long-term climate change threats.
Changes to sustainability reporting
As sustainability reporting evolves from voluntary to mandatory under new regulations like the CSRD and TCFD, Savills experts explain this will lead to improvements in ESG data transparency and comparability. With the EU frameworks, requirements will extend beyond direct corporate impacts to benefit investors. Improving supply chain carbon reporting will influence industry practices in Asia Pacific manufacturing and logistics sectors. While better informing decisions, there will also be cost challenges in obtaining quality data. Overall, mandatory reporting acts as an enabler for improvement; systematically enhancing strategy, performance management and continual review based on disclosure and analysis.
