LEED and ZCB - Delivering on ESG ambitions through certification

Delivering on ESG ambitions through certification

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By Mark Hutchinson, VP of Green Building & Innovation, Canada Green Building Council

Over the last decade, awareness of Environmental, Social, and Governance (ESG) criteria and the added value they provide building portfolios has grown. Increasingly, building owners and managers incorporate ESG criteria into their investment decisions in recognition of the potential for capital appreciation. Beyond the investor’s viewpoint, a comprehensive sustainability strategy can also benefit occupants and the community by creating welcoming spaces that are healthier and minimize environmental impacts.

The path to adopting ESG criteria is not always clear but guidance from established green building programs like Zero Carbon Building (ZCB) and Leadership in Energy and Environmental Design (LEED®) can pave the way to a successful ESG strategy. Importantly, these pathways offer thirdparty certification validating the performance achieved while providing transparency and accountability for investors and other stakeholders. BUILDING ON THE PAST Carbon is a cornerstone of ESG. The ZCB standards offer a comprehensive and rigorous approach to reducing both operational carbon from energy use and embodied carbon from building materials. The ZCB standards provide ambitious but flexible requirements for both design (new construction or retrofit) and operations. Participation in the program is growing rapidly with over 218 projects to date, sending a clear market signal that ZCB aligns well with carbon reduction targets established in corporate ESG objectives.

The latest LEED rating systems for design and operations also evaluate operational and embodied carbon, rewarding different levels of performance. LEED also considers other sources of carbon emissions such as transportation and waste, recognizing that the “E” in ESG doesn’t only cover carbon. A range of other environmental impacts, such as water efficiency and preservation of habitat, are also important. Because LEED addresses sustainability in a holistic manner, it makes a great guide for establishing ESG criteria.

Real estate portfolio owners can use ZCB and LEED to manage and futureproof their assets and adapt to new realities. Combining the holistic nature of LEED with the targeted carbon focus of ZCB certification ensures that projects work toward the important goal of zero carbon while meeting other critical ESG commitments. The criteria and benchmarks these voluntary certifications establish, combined with the transparency and accountability of third-party validation, simplify and strengthen reporting on ESG objectives, making it easier for investors to evaluate asset value.

1. Local 144 – Plumbers’ Union Head Office and Training Facility. As the first LEED BD+C Platinum-certified industrial building in Canada, and winner of the CAGBC 2022 Award for New Construction, the Local 144 facility in Pointe-aux-Trembles, QC, showcases how sustainability and green building practices can provide healthy, comfortable and efficient work spaces. Photo: Claude Dagenais, twohumans. 2. The Roam Transit Operations and Training Centre in Banff, and winner of the CAGBC 2022 Award for Zero Carbon, integrates low-carbon technologies including ultra-efficient mechanical systems, a super-insulated building envelope, district heating, a biomass waste-to-energy operation, solar photovoltaics, and electric bus charging. Photo: PCL Construction