In the pursuit of 2050 global sustainability goals, the real estate sector emerges as a critical player, contributing nearly 40% to Switzerland’s total energy consumption. While energy efficiency is crucial, the complex real estate landscape demands a comprehensive approach. Traditional ESG labels, valuable but often favoring larger entities, leave substantial market segments unexplored. Larger funds have a natural advantage in accessing these labels due to their resource-intensive nature.
To bridge this gap, the Center for Risk Management at Lausanne (CRML) introduces groundbreaking Public Real Estate Sustainability Switzerland (PRESS) scores. These scores are systematic, comprehensive, public, and independent, aiming to democratize access to ESG insights and provide a forward-looking perspective.
Evolving from Surveys to Public Data
Previous reliance on surveys for ESG evaluations posed challenges, from data heterogeneity to confidentiality. Collaborating with Quanthome SA, we transitioned to a data-based approach, using building-level data and fund communications. This shift ensures a uniform ESG metrics assessment, enhancing transparency.
The move to public data ensures transparency and provides an up-to-date evaluation of ESG practices, empowering investors with the information needed for informed decision-making.
The Architecture of PRESS Scores
At the core of PRESS scores lies an integrated methodology, blending quantitative metrics with textual analysis for a comprehensive assessment. Quantitative metrics cover essential factors in environmental, social, and governance pillars, offering insights into sustainability management. Simultaneously, textual analysis, derived from annual reports, enriches the evaluation by capturing the narrative and commitment to sustainability, providing qualitative forward-looking insights.
This dynamic blend forms the bedrock of the PRESS scores system, ensuring a comprehensive yet easily digestible assessment for investors.
Navigating the Future with PRESS Scores
Emerging as a powerful tool in sustainable investing, PRESS scores provide deep insights into ESG performance and elevate market transparency. While currently confined to listed funds, the roadmap involves expanding coverage, refining the indicator set, and addressing challenges posed by climate change. PRESS scores set the stage for a more transparent, accountable, and sustainable future in the dynamic Swiss real estate market.
Developed by CRML researchers at HEC Lausanne (UNIL) and Quanthome SA, with financial support from Banque Cantonale Vaudoise and the University of Lausanne, they represent an essential tool for all players wishing to make informed decisions in the field of sustainable finance.
PRESS Scores and their results are freely available on crml.ch/pressscores, where they will be regularly updated.
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