RICS Sustainability Report 2023: more progress required to achieve carbon net zero goal

The Royal Institution of Chartered Surveyors (RICS) has published its global sustainability report for 2023. The report provides a global benchmark for issues of climate, carbon and sustainability practice. 

The 2023 report suggests the industry is not making enough progress to reach the carbon net zero goal by 2050. The report shows that although there is a global desire for green building certification, there is a trend toward window dressing rather than a real desire for change as other factors are seen as less important or too expensive.

The report indicates that green buildings are seen by tenants as the "landlord's problem", and is therefore not being prioritised by some occupiers. Of course, this depends on the tenant, there is good collaboration between some landlord and tenants including in the charity sector.

The report suggests that government policy may be playing a critical role in driving this trend in Europe, pointing to the Energy Performance of Buildings Directive and the Renovation Wave. These policies aim to reduce carbon emissions and energy consumption across the building sector substantially by 2030 in order to be fully climate neutral by 2050. All new buildings must become zero emission buildings by 2028, or 2026 for public buildings.

Similar to last year's report, sustainability features in properties can be seen to impact rents and capital values. However, in Europe only 16% of respondents said there was a significant impact on rental prices, and 27% said there was a significant impact on capital values.

In Europe and the UK, energy efficiency, reducing energy consumption and fossil fuel use is an essential aspect for investors and believed to be a high priority for occupiers. Green building certification is also considered to be an essential quality for investors, although less important for occupiers.

The report suggests that adoption of global standards, such as Whole Life Carbon Assessments for the built environment to assess and reduce emissions over the life cycle of built assets, could have a significant impact on helping the industry to reach net zero by 2050. The International Cost Management Standard is also highlighted as a useful too that can be used to make crucial decisions in the early stages of a project.

Education and training programmes will need to be developed to assist professionals to apply the latest standards and tools, we will provide further commentary in due course but if you have any questions in the meantime please get in touch.