Fulya Kocak, Nareit senior vice president of ESG Issues, answers some of our questions about Nareit’s 2021 REIT Industry ESG Report , released last month.
How would you summarize the 2021 REIT Industry ESG Report?
Fulya: The report looks at various aspects of ESG – environmental stewardship, social responsibility, and governance of ESG efforts – and its increasingly important role in long-term decision making among our members.
Were there any results in the report that surprised or impressed you?
The growth in ESG reporting among REITs* has been significant. When we first started this report in 2018, the percentage of REITs reporting on ESG was 43%. In 2019 it rose to 71%, and in 2020 it jumped to 97%.
Do you believe REITs will continue to place increasing importance on ESG issues moving forward?
Absolutely! REITs are taking concrete steps to implement ESG and sustainability policies in their long-term business planning. In fact, 77% of the REITs that participated in our survey reported that ESG risks and opportunities, such as health and safety, climate change, and regulatory compliance, are integrated into their strategic and financial planning.
Any final thoughts?
The events of 2020 have led to an increased focus on the ‘S’ of ESG. The COVID-19 pandemic and heightened social consciousness have made it clear to REIT leaders that it is imperative for them to take meaningful and tangible steps regarding diversity, equity, inclusion, and investing in human capital.
I recommend reviewing the report’s case studies for examples of these actions being taken by REITs in a variety of sectors.
* REITs with an equity market cap under $5 billion