Environment, Social, Governance

ESG – Environment, Social, Governance

Sustainability, taking into account ESG aspects (environment, social and governance) and their further development, has been a fundamental part of the business strategy since RLI Investors was founded. For us, this means striking a balance between the interests of investors on the one hand and the needs of our employees, tenants and partners and the environment on the other. We endeavour to embed ESG best practices in our processes for real estate investments and real estate management. Through our commitment to responsible and sustainable investment and management of logistics properties, we would like to offer our investors an improved risk-adjusted return and show our tenants that we respect their needs and implement them in a manner that meets their interests.

How we handle ESG (environment, social, governance) factors at portfolio level

Central goal:
Significant reduction in the energy consumption of the real estate portfolios managed by RLI Investors.

Advantages of sustainable real estate investment approach for investors and society:

  • Selection of promising investment locations
  • Reduction of the ecological footprint by
    • measures to reduce energy consumption
    • further CO2 reduction with the help of environmentally compatible energy sources
  • Continuing improvement in building quality
  • Focus on tenant retention and recruiting
  • Another perspective when making investment decisions
  • Gain of reputation
  • Sustainability filter identifies risks that are often neglected in traditional financial analysis, such as emerging environmental regulations, inefficient use of scarce resources, poor corporate governance structures
  • Sustainability = long-term risk minimization
  • Benchmarking via GRESB (Governance Real Estate Benchmark)

GRESB Rating

GRESB (Governance Real Estate Benchmark) is the leading evaluation system for measuring the sustainability performance of real estate companies and real estate funds. The so-called GRESB score is created by weighting seven different aspects, which contributes significantly to the transparency of the real estate industry in sustainability issues.

Grafik Leistungsindikatoren GRESB_englisch

RLI Investors appreciates the GRESB process for several reasons. On the one hand, the analytical approach is unique. The capital market environment of the real estate industry, such as PRI (Principles for Responsible Investment) or the performance potential of individual properties, such as LEED or BREEAM, is not assessed, but rather funds and the company. The sustainability performance of the individual properties is queried in order to assess them and then aggregate them at portfolio level.

On the other hand, GRESB bundles three essential competencies in one system: evaluation, measurement and benchmark. Using so-called score cards, participants get to know how they are positioned compared to their competitors and thus create transparency and orientation. The score cards can be used excellently for communication of the respective sustainability performance. Investors receive all essential information at a glance and can quickly and easily assess both the valued real estate companies and the fund products.

Who becomes and remains a “Green Star”?

The aim of our participation in the GRESB rating is to become a so-called “Green Star”. To do this, the valued properties and funds must achieve a convincing overall result. In addition, the competitors are compared in a peer group. GRESB demands are increasing from year to year, thereby driving the trend that sustainability aspects and their further development become a fundamental component of the business strategy of leading real estate companies.


Outlook:
RLI Investors will participate in the GRESB rating in 2020 with the “RLI Logistics Fund – Germany I”. The rating for the “RLI Logistics Fund – Germany II” will follow.

Success factors for ESG-compliant real estate investments

Products

Reporting

  • Creating transparency
  • Reporting standards and data exchange
  • Benchmark and industry standards, e.g. GRESB

How we handle ESG (environment, social, governance) factors at management level

Through various measures, RLI Investors is already making a positive social contribution within the framework of our corporate responsibility strategy. We strive to constantly develop these further and to adapt them to the needs of our employees and further stakeholders.

Examples:

  • We live flat hierarchies in our team.
  • The selection of qualified employees and organic growth is part of the strategy.
  • A fair payment as recognition of performance and increased motivation is a matter of course for us.
  • Promotion through further training in the respective specialist areas opens up prospects.
  • We reward independent work through monetary participation in corporate success.
  • Open feedback culture is an important part of our cooperation.
  • We support the reconciliation of leisure, family and work through home office days and flexible working hours.
  • Since 2018, our shareholder Umut Ertan has been working intensively with its own capital to reduce CO² emissions. With the Swiss Capital Global Impact Fund he founded the first pure impact investor in the German-speaking area. The lead investment in Sinn Power, the world’s leading company in the field of conversion of marine energy (www.sinnpower.com), is considered a beacon investment.

Contact

Do you have any questions about our ESG (environment, social, governance) strategy? Please feel free to contact us at sustainability@rli-investors.com.

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Translation Priorities: Optional.