DEFINING ESG – WHY IT SHOULD BE ON THE REALTOR® RADAR
In 2021, NAR released its inaugural ESG+R Sustainability Report. The new report highlights the association's top sustainability accomplishments in 2021 within four categories: environment, social, governance, and resilience.
INVESTORS AND CONSUMERS – notably the younger generations – have, in recent years, shown interest in putting their money where their values are.
Ryan Frazier, CEO of Frazier Global, a Colorado-based management consulting and environmental, social, governance (ESG) advisory business.
ESG has become one more acronym among the hundreds we use in the world of real estate. Yet, what is ESG, exactly? Further, how will ESG grow to impact real estate?
Nasdaq veteran board member Betsy Atkins makes a compelling argument as to why ESG initiatives can unlock competitive value, opining that “companies that recognize the importance of adapting to changing socioeconomic and environmental conditions are better able to identify strategic opportunities and meet competitive challenges. Proactive and integrated ESG policies can widen a company's competitive moat relative to other industry players.”
ESG, or Environmental, Social, and Governance, is a set of standards for a company or practitioner’s operations that investors (or consumers) use to screen potential investments. Environmental criteria measure how that company or practitioner perform as a steward of nature. Social criteria examine how it manages relationships with employees, suppliers, customers, and the communities where it operates. Governance refers to policies around leadership, executive pay, audits, internal controls, and shareholder rights. In short, ESG evaluates if a company, organization, or practitioner is operating sustainably. Globally, sustainability is rated as an important purchase criterion for 60% of consumers. “Sustainability is the evolution of long-term value creation for people, planet, and the economy. If sustainability is the journey, then ESG is how we measure progress,” said
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REAL ESTATE IS PAYING ATTENTION “We must integrate a culture of sustainability throughout our association and industry. By building a resilient real estate market today, we can create healthy, vibrant, and diverse communities for generations to come,” said 2022 NAR President Leslie Rouda Smith. In 2021, the National Association of REALTORS®(NAR) released its inaugural ESG+R Sustainability Report. The new report highlights the association's top sustainability accomplishments in 2021 within four cat-
