Pension funds launch network to accelerate ESG in real estate

A group of major pension funds and asset managers in the Netherlands have joined forces to launch the ‘Global Real Estate Engagement Network’, a platform that aims to accelerate sustainability in the country’s real estate sector. 

As it stands, the real estate sector is responsible for approximately 30% to 40% of worldwide energy consumption and greenhouse gas emissions. At the same time, research shows that the sector faces a major (untapped) potential to improve its carbon footprint through the decarbonisation of building assets, operations and processes.

The ambition of GREEN is two-fold. At the core, “GREEN aims to accelerate sustainability in the real estate sector and contribute to the Paris-agreement,” reads a statement on the coalition’s website. All six founding members – the pension funds of industry groups Detailhandel (retailers) and Schilders (painters) and corporates Achmea, Philips, Nedlloyd and TNO – have committed to supporting this objective.

By working together, real estate portfolio owners of network members will be able to share knowledge and best practices, and receive guidance on how they can better incorporate ESG in their investment processes. The process is being advised on and supported by three partners firms – all specialists at the intersection of real estate and sustainability. 

Finance Ideas is a consulting firm that specialises in three topics: healthcare, social housing, and ESG in the investment sector. Almazara is a real estate consultancy that advises institutional investors on policy and transaction support. Vert Asset Management is a US-headquartered ESG asset manager. 

Leveraging their combined muscle, the consortium will take a frontrunning role in advancing the ESG agenda in the real estate sector, among others through research, benchmarks against science-based targets, policy development and lobbying in politics and key industry forums.

GREEN’s second main objective is to help member companies improve their risk management, with a focus on climate risk and financial risk. “Investors that fail to address ESG in their investment strategies run growing financial risks,” states the coalitions website.

As explained by Frans Dooren from Nedlloyd Pensioenfonds, “We joined this initiative to further develop our active ownership activities, to contribute to adequate financial climate risk management by the real estate funds we invest in and reduce the negative impact of our investments.”