PROPERTY TRANSACTION GUIDE

UN launches toolkit to boost responsible global property investment

Guardian, Monday, 24th August 2009

RESPONSIBLE investment is fast moving up the agenda for many institutional property investors around the world. However, many remain uncertain about how best to implement the practicalities of Responsible Property Investment (RPI).

To advance RPI thinking and practice globally, the Property Working Group (PWG) of the United Nations Environment Programme Finance Initiative (UNEP FI) has launched the first in a series of toolkits aimed at helping investors understand and apply the principles of RPI.

UNEP FI is a strategic public-private partnership between UNEP and the global financial sector. UNEP works with over 170 financial institutions - banks, insurers and investment firms, to understand the impacts of environmental, social and governance issues on financial performance and sustainable development. UNEP FI is the oldest and largest partnership between the UN and the global financial sector, and promotes the adoption of best environmental and sustainability practice at all levels of financial institution operations.

Core members include Aviva Investors, AXA Real Estate Investment Managers, Caisse des D?p?ts (Co-Chair), British Columbia Investment Management Corp., F&C REIT Asset Management, Hermes Real Estate, Infrastructure Leasing & Financial Services, Innovest Strategic Value Advisors (now a part of RiskMetrics Group), Mitsubishi UFJ Trust & Banking Corp., Mn Services, PRUPIM (Co-Chair), The Sumitomo Trust & Banking Co., Limited, WestLB AG. The observer members are California Public Employees' Retirement System (CalPERS), Cherokee Investment Partners, Hammerson, Investa Property Group, Land Securities, Lend Lease Advisory Academic Institution: University of Arizona Partner Organisations: Principles for Responsible Investment, UNEP Sustainable Buildings & Construction Initiative

Professor Paul McNamara, Co-Chair of the UNEP FI Property Working Group and Head of Research at PRUPIM commented: "It is becoming increasingly clear that there is a growing willingness among property investors to take action and address material ESG issues, such as climate change, which property ownership and management raise.

However, for many, the question is 'Where do I start - and how?' These toolkits are designed to show investors how best to apply RPI principles across all aspects of the investment process."

The first toolkit - 'Committing and Engaging'- uses case study material to identify the seven main steps organisations need to take to lay down a solid foundation to institutionalise RPI. These steps include understanding the meaning and value of RPI for an organisation, identifying material risks and opportunities, managing and measuring success, and collaborating with stakeholders to develop and mainstream RPI practices.

"Commercial property investment and development is a team game where everyone needs to play their part. This is true for responsible investment across all asset classes. This series of toolkits is a blueprint for investors on how to act responsibly and, benefit from the financial, reputational and competitive rewards of proactively addressing ESG risks and opportunities in their property assets," said Paul Clements-Hunt, Head of UNEP FI.

The PWG defines RPI as "property investment or management strategies that go beyond compliance with minimum legal requirements in order to address environmental, social and governance issues. The 'Committing and Engaging' toolkit has been published by the PWG in partnership with the Responsible Property Investment Centre, a joint project of the Boston College Institute for Responsible Investment and the University of Arizona.