Charting the Course of ESG: Shifting from Commitments to Concrete Actions, Exploring Perspectives, Progress, and Future Priorities in the Realm of ESG
Since its emergence, the collection of environmental, social and governance factors under the acronym of ESG has garnered widespread interest and support.
Catherine Lucchesi, director of ESG for Comunidad Partners and a member of MIC, which helped in partnership with the MIC on its new impact framework, agrees on the importance to identify data-driven and research-based measures and set ESG standards aligned with investor outcomes and values. “ESG should be more than a ‘one-shot’ focus. It’s more than cleaning up the environment, though that’s important. It’s a three-pronged data-driven strategy to improve the lives of residents while maximizing investor returns,” says Lucchesi.
MIC’s ongoing process process involves working with investors and property owners to create standard metrics.
“We aim to have everyone at least talking about the same metric,” says Simpson. “We continue to get feedback on how we can refine our framework. It’s an ongoing process. We’re in the process of working with investors who are building out their due diligence with some of these principles and property owners who are putting together their impact strategies with these principles. This is the start of alignment around these metrics. And that’s the first part of it.”
Lucchesi adds, “There is interest across the multifamily [sector] to address sustainability in all areas, from construction to operations, to fairness in hiring and leasing practices, to integrating health and wellness into building and amenity design. There are still some areas that have room for improvement, though. Workforce renters are a majority across multifamily in the United States, yet it remains an undersupplied sector of the nation’s housing market relative to the incredible demand. The economic fundamentals behind these opportunities are incredibly strong and totally in line with social impact programs.”
Comunidad’s internal ESG framework tracks around 65 ESG key performance indicators, which drive its strategy and implementation. The framework is built around impact measures that relate to six key outcomes for its communities. The model provides a dynamic picture to its asset management team of how Comunidad properties are performing in line with the ESG goals within its portfolio and to investors.