E-S-G: three small letters for a big ambition that will change the face of the real estate industry for good. Along the way, investors will find a new challenge with a much broader scope than just the color green. It's hard for those who make and break the French investment market to ignore the environmental, social and governance pillars. The truth is, by talking too much about the first of these pillars - no doubt due to an unbalanced weighting system and the absence of an appropriate reference framework - it's the other two that are suffering. But for how long? How long will S and G lag behind, well behind the E that seems to hide the forest?
Let's face it: the ESG revolution has already begun. Surgically, but permanently. Issues of health, mobility, comfort, accessibility and even services have taken over the social pillar, while questions of territorial impact and stakeholder relations can easily be placed behind the governance pillar familiar to fund managers. However, the absence of a sufficiently codified reading grid is preventing investors from making ESG a widespread commitment. Some are even suspected of indulging in widespread greenwashing practices to avoid having to commit to the other two areas. In any case, there is a growing imbalance between the environmental commitment of real estate investors on the one hand, and social and governance issues on the other. No doubt because the financial impact of these two pillars has yet to be measured. Probably because low-carbon pressure is overshadowing the rest of the ESG snapshot of investors and their assets.
As you can see, ESG is not limited to its first letter to save the IRR. At a time when the real estate industry seems to be entering a new cycle in its history, with the spectre of an economic recession looming, a new reading and analysis grid is being imposed on its investors. More and more French real estate companies seem to have integrated it into their software by taking the assertive path of the mission-driven company instilled by the 2019 Pacte law. In these circumstances, it would be good to remember that ESG has its origins in the concept of triple performance - the triple PPP - created in the 1990s: People, Planet, Profit. A triptych which, 30 years on, has never seemed so topical.