EG has adopted an ESG Policy which mandates the consideration of ESG issues throughout the investment management process. The includes incorporating responsible investment principles in the acquisition, management and the disposal of assets. EG accordingly undertakes comprehensive asset due diligence to ensure that key ESG risks and opportunities can be identified and managed. For example, EG has developed an in-house risk management software (PRISMS) and bespoke due diligence checklist to systematically identify risks and opportunities which will not only affect the financial performance of the asset but will also have ESG impacts.
EG’s due diligence checklist has a comprehensive ESG section with 14 questions covering a range of ESG risks and considerations. These questions consider, amongst other items, the environmental impacts of the asset and how initiatives can be undertaken to improve energy, water and waste efficiency. Consideration is also given to climate change risk. Social considerations are also assessed which often includes profiling tenants and "quality of place". EG's PRISMS software similarly allows for a systematic approach to undertaking asset due diligence and monitoring of asset risks over time. EG reports on these ESG issues in investment proposals and then provides ESG updates to investors in quarterly reports.
After the acquisition of an asset, EG continues to identify and manage ESG risks and considerations on an ongoing basis. EG incorporates where applicable, National Australian Built Environment Rating System (NABERS) ratings, performance monitoring, lifecycle assessments of plant and equipment, site specific OH&S risk assessments etc. in the active management of assets.
EG also manages the HISOT Fund, an ethical investment fund that focuses on improving the energy efficiency of property assets to at least 4.5 stars under the NABERS. NABERS is Australia’s building performance rating which is used to measure a building’s energy efficiency, carbon emissions, water consumption and waste production.
As a signatory to the UNPRI, EG reports annually on its adherence to the six principles of responsible investment across the business. The UNPRI are a voluntary and aspirational framework for incorporating environmental, social and corporate governance into decision-making.
EG is also currently in the process of joining the Global Real Estate Sustainability Benchmark (GRESB) and is working with a GRESB consultant to further integrate ESG consideration into its investment management processes.
Finally, EG is currently working with an independent environmental-systems specialist to codify our Responsible Investment policy. Our external consultant has been tasked with identifying best-practice industry standards and incorporating these into EG’s policy.