Making a net-zero pledge feels like a big step. It’s a public commitment on which you’re hanging your company’s reputation, and if you’re unclear exactly how your business will get there, you’re certainly not alone. The urgency of the climate crisis requires us all to learn on the job.
There are various toolkits and frameworks out there from organisations such as RICS and the GLA to help companies to hit net zero targets, but it’s a fragmented landscape and many organisations are surprised and alarmed to find there is little in the way of clear practical guidelines telling companies where to start.
I would suggest there are two places to begin: tech and people.
Decarbonisation technology and the creation of a green tech stack is a vital part of the puzzle, but before deciding what to buy or build, companies first need to determine where they are right now - and they can’t do that without data.
Building managements systems and information modelling help us understand peaks and troughs in energy usage, identify inefficiencies and expose wasted areas within buildings.
Similarly, thermal imaging enables us to carry out energy audits across our portfolios and identify areas of waste or underperformance.
Once we know where the gaps are, we can take action to fix them by retrofitting buildings, replacing appliances and energy systems, and driving collaborative solutions with occupiers.
Moving on to corporate governance, carbon accounting is a critical part of any real estate business’s decarbonisation strategy. Without it, it is difficult to move beyond asset or portfolio level, through the supply chain to business operations; that is, to understanding the carbon footprint of every single purchase made, from concrete to paperclips; every new contract tendered; and every single journey made by any member of staff.
Within any business, there’s a carbon cost to all decision-making, and while offsetting has a role to play with residual emissions, it is not a solution. Carbon accounting tools can help steer every staff member towards effective mitigation decisions and away from poor ones. That is why buy-in across an organisation is critical.
Technology can help, but it won’t make any difference without people who understand the importance of the goal and their personal role in making it happen. This needs to come from the top, with good governance, and disseminate down, with senior team members bearing a greater burden. Hiring a head of ESG is a good move, but this individual must be a driving force working in partnership with leaders, rather than relieving them of their responsibilities.
The reality of reaching net zero might well mean being more selective with contractors, declining to work with partners and suppliers who don’t comply, or making difficult decisions about procurement, finance and HR. None of this will be easy, and it will probably cost more.
But as the climate emergency intensifies, we should, by now, be aware that not doing anything is going to cost us much more, and that those who apply systems thinking to change their approach will benefit. Together the real estate sector is responsible for almost 40% of energy and process-related emissions globally, but that also means that the potential to effect real change is in our hands - and the best place for each of us to start is in our own back yard.
Ami Kotecha is co-founder at Amro Partners, board director at the UK Proptech Association and co-chair at ULI UK Product Innovation Council
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