How Savills is acting more sustainably

Compared to three years ago, are building features that address sustainability or other social development goals (e.g. health, well-being, inclusivity) more sought-after by investors?

As investors place greater importance and prominence on ESG (Environmental Social Governance) and associated monitoring and reporting methodologies such as GRESB, and real estate fund managers strive for more performance in these areas within their assets, there’s an increased requirement for awareness and auditing on sustainability and social topics such as health and well-being and social value/impact. These result in an increase in building management/operational practices and features in these regard. There’s definitely been a seismic change in the past three years in increased understanding of, and demand for, social enablement within real estate, be it through ESG/sustainability, social value, health and well-being, place-making; essentially an increasingly people-centric approach is being taken encompassing all stakeholders: occupiers/customers, visitors, community, supply chain and service providers.

More generally, purpose investing (and divesting) is increasing and that should trickle down into building features; in particular there’s been significant increase in demand for impact funds supporting gender diversity and climate action, and this demand for socially-conscious investing will only signal changes in real estate and many other sectors.

What positives are you seeing being delivered in infrastructure/property development and management that are adding social value?

When a property management team find a cause they care about, they are able to add social value to their local area. Initiatives need to be site specific and chosen by the people who will deliver them, so the delivery is sustainable. One of our properties regularly provides cleaning/M&E support to a local school. A high profile building regularly has school visits, provides career mentoring and takes part in an art trail.  Charity and volunteering are good, but they shouldn’t be the ultimate goal and it is hoped that an increase in awareness of what social value is will help change the focus to more sustainable initiatives. For example, getting office workers to volunteer to paint a house is perhaps not the best approach, as they may not do a good job, whereas this could be a nice job for a local painter.

Social value should be sustainable and measurable over time, ensuring that the impact to the local community and society at large can be dynamically tracked and that the personal impact stories can be celebrated as long-lasting and sustained. Being able to quantify social value is proving to be an incredibly important lever for focusing all stakeholders on the impact and influence that is within their gift, however what we all really respond to are the human stories of success and hope behind the numbers. It is vital that this human dimension is retained whenever social value programmes are designed and implemented.

Which areas need more interventions from either government or professional advisors to influence clients to act more sustainably – specifically in office, retail and housing?

Greater policy support and incentives from government to enable businesses to design more socially impactful and sustainable employment and skills initiatives. The government should make social value a requirement for its contracts, not just a consideration. Professional advisors could provide social value training, so those responsible for delivery know what it is and what they can do to increase it. Managing Agents especially can utilise their buying power to raise the level of social contribution in the property supply chain through their service providers, many of which are already getting ahead on this due to the fact that social value in procurement being more prevalent in the awarding of public sector service contracts.

In the private sector and in real estate in particular social value measurement provides an invaluable connecting thread between strategy and on-the-ground operation. Awareness drives more participation and transparency in methodology enables measurement to drive specific measureable action. Understanding that some social measures may generate greater impacts to a local community than others will enable those with influence to put in place well designed and focussed programmes to address gaps in their contribution, and ultimately better meet the needs of society.