The COVID-19 pandemic has exposed the intimate relationships between the environment and our daily lives. The green recovery brings an important opportunity to better connect environmentally positive measures with the goal of a more inclusive and healthier built environment.
Investing in buildings can create a fair, inclusive and resilient society. People and communities should be at the heart of climate change mitigation and adaptation. Buildings represents an enormous investment opportunity to improve health, quality of life and social resilience across all communities, with a specific focus on the most vulnerable groups.
The EEFIG Working Group on Multiple Benefits explored a number of thematic areas including,
- health and social benefits,
- ESG risks,
- sustainability rating tools and
- impact investing
with the purpose to encourage financial institutions, building owners and local authorities to scale up financing of building energy efficiency retrofits. Many financial institutions and building sector stakeholders today understand that energy efficient buildings can contribute to value preservation and reduced risks but still struggle to integrate multiple benefits in their existing decision-making practices.
Linking multiple benefits to ESG risk management or capturing broader policy objectives and social impact categories can facilitate the identification, measurement, monetisation, as well as explicit targeting of multiple benefits by financial institutions.
The working group concluded that financial institutions and policymakers should act on the following recommendations:
- Establish effective public-private cooperation focused on improving comfort, health and wellbeing for building tenants and owners and facilitate market-driven, economically self-sustainable one-stop-shops (OSS)
- Establish a fully developed social Taxonomy and avoid the creation of Taxonomy silos which might lead to burden shifting and split incentives.
- Develop standardised metrics and optimise data collection for capturing of and reporting against Multiple Benefits (with third party verification)
- Commit to tracking social and environmental impacts of financial products
- Use the impact measurement and management approach in assessing public investments into energy efficiency
- Showcase investment and business models reflecting the multiple benefits and positive value & risk implications of energy efficiency
- Promote energy efficiency investments among impact investors and communicating energy efficiency investments as impact investments if these simultaneously avoid harm and maximise benefits in all ESG dimensions, as well as contribute to creating solutions, significantly impacting society, environment, and the economy
- Publication date
- 5 July 2021