Cushman & Wakefield report examines market drivers and pathways to meaningful climate action for the real estate industry
HONG KONG SAR – Media OutReach – November 4, 2021 – Real estate sector has important role to play in addressing implications of climate change following thought-provoking assessment of climate risk by Intergovernmental Panel of Experts on climate change (IPCC) of the UN and before the next COP26 summit in Glasgow. In his recently published report entitled Climate risk in Asia-Pacific: real state of emergency, Cushman & Wakefield examines the current state of climate risk and its impacts on real estate, market drivers and pathways to meaningful climate action in the region, as well as how real estate companies can navigate their journey to change. reduction of emissions and management of climate risks.
The sixth assessment report (AR6) of the UN’s Intergovernmental Panel on Climate Change (IPCC) released in August 2021 highlighted worsening climate change, calling for faster reductions in carbon emissions to avoid potentially catastrophic impacts on the planet. The UN called the report a “code red” and climate experts said it had indeed put forward the risks that were to come in 30 years, just 10 years.
“What the AR6 has told us is that extreme weather events and the regulations and litigation that go with them are going to happen much sooner than expected, and that’s a red flag,” said Rebecca Jinks, Head of Sustainability, Australia at Cushman & Wakefield. “Although the report says global warming of at least 1.5 degrees Celsius is inevitable, if the world strives to quickly reduce emissions and reach net zero by 2050, it may limit a new global warming. “
According to the report, the built environment requires around 40% of the materials mined globally, while demolition and construction waste is the largest waste stream in many countries. Building and construction are responsible for 39% of global carbon emissions, with operational emissions accounting for 28%. The remaining 11% comes from intrinsic carbon emissions, or the initial carbon associated with building materials and processes throughout the building lifecycle and value chain. Reducing carbon emissions associated with the real estate industry is therefore crucial throughout the entire life cycle of the property, from initial planning and investment to construction operations, renovation and final demolition.
The real estate industry in the Asia-Pacific region still has the incentive to act, as many of the world’s most emitting economies reside in this region. Governments and the private sector across the Asia-Pacific region are also working to mitigate the causes and effects of climate change, with the real estate sector crossing this divide.
The financial and non-financial risks of climate change are also increasing sharply, driving the demand for sustainability due diligence and mitigation planning among real estate investors. While new buildings generally perform better in terms of sustainability, most buildings in Asia-Pacific economies are aging. However, fewer emissions are needed to modernize the existing fleet, which presents significant overall opportunities for reducing emissions.
According to Alton Wong, Co-Head of the Sustainable Development Services Platform, Greater China, Cushman & Wakefield: “Large pension funds are pressuring developers and owners to adopt strong ESG principles to attract their investments. In addition, the government and local authorities in China are encouraging owners and developers to approach the sustainability of properties, both from a development and operational perspective.
Cushman & Wakefield has seen a significant increase in inquiries from investors and owners for assistance in integrating ESG due diligence into existing processes to assess existing or potential investments. To respond to these requests, the firm has adopted the following approach to support its clients in their journey through climate change related to financial and non-financial risk management:
- Identify and manage: Portfolio ESG materiality assessment or climate change due diligence review to identify risks and opportunities.
- To watch: Regular reporting of the ESG dashboard and performance indicators.
- Scenario analysis: Portfolio and asset level scenario analysis and mitigation planning.
- Manage risks: Support the development of plans to mitigate risks or issues associated with materiality and scenario analysis.
- Report and disclose: Regular and annual reports on ESG performance measures, including frameworks such as GRESB and CDP.
Cushman & Wakefield is also committed to achieving cutting-edge science goals and achieving net zero emissions across its entire value chain by 2050. They will focus their efforts on its headquarters and operations by committing to reduce absolute perimeters 1 and 2 based on the market. 50% GHG emissions by 2030 from a base year 2019. The company’s science goals will not only reduce the absolute GHG emissions from its business activities, but will also include the facilities it manages for on behalf of its clients, some of the largest real estate owners and occupants in the world.
By leading by example, the company is committed to working with its customers (representing 70% of emissions in its scope 3 value chain) to set their own scientific objectives by 2025. In particular, around 99% of emissions from Cushman & Wakefield come from the facilities it manages. on behalf of its clients, and the firm is committed to realizing its vision of a sustainable future that extends beyond its own corporate footprint.
In addition, by 2050, the company is committed to achieving net zero emissions across its entire value chain, encompassing all direct and indirect business elements that contribute to GHG emissions (scopes 1, 2 and 3 ). This target was promised as part of the Race to Zero campaign and SBTi’s commercial ambition for the 1.5 ° C pathway, initiatives using climate science frameworks to achieve net zero in a global effort. aimed at avoiding the most catastrophic impacts of climate change.
Click here to download Climate risk in Asia-Pacific: a real state of emergency.
About Cushman & Wakefield
Cushman & Wakefield (NYSE: CWK) is a leading global real estate services company delivering exceptional value to real estate occupants and owners. Cushman & Wakefield is one of the largest real estate services companies in the world, with approximately 50,000 employees in more than 400 offices and 60 countries. In Greater China, a network of 22 offices serves local markets in the region, gaining recognition and winning numerous awards for its peak performance. The company achieved global revenue of $ 7.8 billion In 2020 in basic services, including appraisal, consultancy, project and development services, capital markets, project and occupancy services, industry and logistics, retail and others. To learn more, visit www.cushmanwakefield.com or follow @CushWake on Twitter.
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