ESG Priorities in Focus

Although there were no big regional differences in the ESG initiatives that companies are focused on, differences between occupiers and investors were evident.

Occupiers are focused on a more diverse set of ESG initiatives than investors. In addition to the top-three initiatives, 53% of occupiers cite “reducing air, water or land pollution” and 62% cite “improving social mobility, social justice, equality and/or diversity” as very important. The range of ESG initiatives cited by occupiers demonstrates commitment not only to environmental causes but also to bettering employees and society.

Additional ESG initiatives that are most important for investors include reducing any association with companies that are socially controversial (57%), reflecting their priority to reduce overall risk and preserve asset value in any way possible.

Figure 3: Major ESG initiatives within organizational goals

Source: CBRE Global ESG Survey, November 2022.

Net-zero goals
creating urgency

65% of respondents say
their companies have made
a public net-zero pledge.

Sixty-five percent of respondents reported that their companies have made a public net-zero pledge, making it no surprise that reducing greenhouse gas emissions is most often cited as part of organizational goals. Occupiers plan to achieve their targets more quickly than investors, aided by the fact that lease terms are generally shorter than the average holding period for investors.

Half of occupier respondents said they are establishing science-based targets (SBTs) versus 39% of investors. The Science-Based Targets initiative (SBTi) has developed an ambitious guide for companies to reduce greenhouse gas emissions. Setting SBTs aligns with what the latest climate science deems necessary to meet the goals of the Paris Agreement, which seeks to limit global warming to no more than 1.5°C above pre-industrial levels.

Figure 4: Which of the following commitments has your company made to reduce greenhouse gas emissions?

Source: CBRE Global ESG Survey, November 2022.

Figure 5: If you have a public net-zero pledge, which year have you set for achieving it?

Source: CBRE Global ESG Survey, November 2022.

Tracking emissions
not uniform

56% of respondents categorize
their emissions into scopes.

The Greenhouse Gas Protocol has established a widely adopted framework to measure and manage greenhouse gas emissions, categorized by “scopes.” Most occupiers (62%) and investors (53%) say they use these categories. More than half of occupiers categorize emissions into scopes 1 or 2, which are emissions that the company can most directly control. Less than 40% categorize emissions into scope 3, which are more difficult to measure. Not all companies that have made public net-zero pledges categorize their emissions into scopes, suggesting that further best practices could be adopted to truly commit to reaching net zero.

Figure 6: What categories or “scopes” of emissions does your organization track?

Source: CBRE Global ESG Survey, November 2022.

¹ “Decarbonizing Commercial Real Estate” CBRE, Nov. 11, 2022.

Although government regulation and higher energy prices are contributing external factors, one internal factor—company ethics, values or purpose—remains the main driver behind ESG priorities (63%). Customer or shareholder demand for more ethical investment or products and compliance with government regulations or targets round out the top three drivers for occupiers and investors.

For investors, the fourth and fifth biggest drivers are reducing risk and protecting profitability. This suggests investors also see ESG commitments as a means to achieve better performance and maintain profit and returns.

Occupiers, on the other hand, cite employee well-being and enhanced brand image or reputation as their fourth and fifth biggest drivers, respectively. Improving employee well-being was almost three times as important for occupiers than investors. Occupiers see opportunities in ESG strategies to attract and retain customers and a quality workforce.

Figure 7: What are the three main drivers of your organization’s stated ESG goals?

Source: CBRE Global ESG Survey, November 2022.