How can you measure the environmental impact of your real estate portfolio?

The first thing is to define the boundaries and scope. Consider all the buildings that you own. The areas having major GHG impact are electricity / energy use, water use, waste generation etc.

To define the scope of measurement, you should look for material environmental issues, i.e. the ones where you have a significant impact or that represent large risks. Some common environmental issues for real estate include energy usage, carbon emissions (including embodied carbon), water consumption, air quality, land use change... You can also look at your peers to get an idea of the common topics in your industry.

While the usual suspects like GRI, ISSB or CDP provide good guidance on what to measure, real estate players often use industry specific standards and frameworks. Many jurisdiction will have a rating system like LEED, GreenMark or use GRESB as a way to benchmark against the rest of the industry.

In the European Union, there is a set of mandatory requirements while legislators provide instructions, i.e., the EU Taxonomy Compass, which is helpful to check which sustainability conditions are applicable to Real estate.  

Data collection is typically where it gets messy. While more modern building will be fitted with sensors that capture most of the data and send it to a building management system (BMS), a lot of data collection gaps still remain (especially in older buildings). Preparing a robust data management plan will ensure you have visibility on what to collect, who is responsible for it and where the information can be found. Don't forget to train your data owners as many of them might not be familiar with environmental impact assessment and need to understand the data your are looking for.

One yaluable approach is to use scientific CREEM decarbonization pathways and measure the actual contribution to e.g. the 1.5 target of a building. I can recommend the XDC real estate explorer of right to understand the impact of your building and the whole portfolio as well as identifying measures to align your buildings to 1.5 degree target

Here are 2 golden rules of reporting: - Transparency ! Boundaries, exclusions, methodologies, emission factors: provide contextual info that will help the audience understand the quality of your inventory. - No cherry picking ! Providing percentage of reductions without the absolute numbers or excluding categories of emissions that are more significant: don't distor thr picture otherwise this exercise is pointless.

Consider existing and future regulations in the built environment sector. Some governments have started a battle against buildings that have poor efficiency and may require you to attain certain energy performance.