ESG Audit and Assurance
Gleeds assists clients with a comprehensive set of issues to be assessed during the ESG due diligence process. We also help with navigating the sustainability taxonomies required to secure investment.
ESG due diligence examines the condition of a property from an environmental, social and governance perspective. The conclusions have a direct impact on purchase prices, capex requirements and possible clauses in the purchase contract. ESG due diligence complements the usual due diligence packages (legal, tax, financial and technical) for property investors.
ESG due diligence is becoming more common as investors and other financial market participants are required to be transparent about the inclusion of sustainability risks in their investments. Real estate companies are also incorporating sustainability criteria and targets into their strategies and business policies, triggering due diligence obligations.
Gleeds supports clients with a comprehensive set of ESG issues to be assessed during the due diligence process. The scope can also be supplemented with specific ESG targets or KPIs that our clients are considering as part of their own ESG strategies, providing a useful and tailored output to conduct a gap analysis and identify the key investment implications.
Taxonomy
A sustainability taxonomy is a classification system that helps investors assess whether an economic activity is environmentally and socially sustainable, meets robust sustainability standards, and is aligned with regulatory obligations to guide the transition to a low-carbon, inclusive economy.
At Gleeds, we help our clients navigate the requirements of the taxonomy to classify a building or portfolio according to the technical screening criteria defined for real estate activities. We clarify whether it is aligned and provide an action plan to achieve alignment if not.
Taxonomy systems aim to avoid greenwashing, and help investors make better-informed decisions on sustainability issues. They are developed in collaboration with financial regulators and relevant stakeholders and experts.
In the case of the EU Taxonomy, the technical screening criteria assess the impact of the project on six relevant environmental aspects:
- Climate change mitigation
- Climate change adaptation
- Transition to a circular economy
- Pollution prevention and control
- Protection and restoration of biodiversity and ecosystems
- Sustainable use of water and marine resources.
For an economic activity to be aligned with the EU Taxonomy, it must:
- Make a substantial contribution to one of the EU Taxonomy’s six environmental objectives.
- Do no significant harm to any of the other five objectives.
- Comply with the minimum social safeguards.
Sustainability & ESG Team
Dave Wakelin
Manchester, United Kingdom
Irene Torá Mouvet
Madrid, Spain
Lars Kruse
Singapore
Suzan Talley
Atlanta, United States
