C&W Perspectives

As Environmental, Social and Governance (ESG) programmes continue to be increasingly adopted in the UK, companies are having to adjust to handling new types of non- financial information to inform their business decisions A cross the world, the importance of the availability of good quality, reliable data against set metrics has risen significantly over the past decade. Modern day buildings are generating a constant flow of data and information that is becoming easier to capture and analyse. There is considerable value to be gained and risk to be mitigated by understanding how your portfolios and properties are performing. As Environmental, Social and Governance (ESG) programmes continue to be increasingly adopted in the UK, companies are having to adjust to handling new types of non-financial information to inform their business decisions. Some of which have resulted in step-change for businesses used to gathering just economic information. In fact, our buildings are now producing so much data across so many metrics that it’s essential we have the correct systems and processes to ensure we’re extracting sense from the numbers and helping us to perform well. Sustainability and ESG metrics can assist an organisation to understand their exposure to risks such as volatile energy prices, exposure to climate risks, over-consumption of energy, water or waste, poor productivity levels, staff retention levels or more accurate forecasting and return on investment. Having access to performance data is important but we also need to utilise it to ensure we are getting best value or to reduce our exposure in the marketplace. For example, non- domestic energy prices alone rose 7% between 2017 and 2018 1 , putting increased strain on the bottom line. In Birmingham, the new HSBC building completed in 2018 is the first to be constructed to LEED Gold standards. The building includes a large percentage of recycled materials in the glazing and in the steel work; is fitted with highly efficient LED lighting and only utilises timber from sustainable sources – as certified by the Forest Stewardship Council. The result will be a highly efficient building, with reduced energy consumption and a high level of mitigation against market cost volatility. It will also deliver reduced waste generation and increase use of renewable and low carbon power. Across our regions, access to wider sustainability metrics and data – such as transport emissions, recycling rates and environmental certifications – is growing as efficiencies are being found in automation of data and the availability of platforms. Increasingly this data is being used to inform and answer questions from investors about wider non- financial performance. Driving sustainability & wellbeing LEAD STORY 1 BEIS (2018) Gas & Electricity Prices in the Non- Domestic Sector, https://www.gov.uk/government/ statistical-data-sets/gas-and-electricity-prices-in- the-non-domestic-sector PERSPECTIVES 04 LEAD STORY