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A Law of Significance

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On Friday 19th June, the European Parliament adopted the Taxonomy Regulation. This could be the most significant piece of legislation which affects the treatment of sustainability risks by the European investment community. The Taxonomy is more than a system of classification of ESG risks and opportunities – its weight could make ripples around the global investment community.

Whilst ESG has been a niche investment class for the last couple of decades, the difference now is that Climate Change is seen as a mainstream investment risk. As Larry Flint said earlier this year, “Climate Risk is Investment Risk”. The members of the UN Asset-Owners Alliance, managing $4.7tn of assets, have committed to transition their portfolios to Net Zero Carbon by 2050. The world’s largest pension funds – GPIF, CalSTRS & USS – list climate change as their biggest ESG risk. This is not a niche regulation. It is expected to directly affect 7,000 listed companies and all issued fund-managed products. 

Whilst the Taxonomy’s main focus is on environmental issues – i.e. Climate Change Mitigation; Climate Change Adaptation; Sustainable & Protection of Water & Marine Resources; Transition to a Circulate Economy; Pollution Prevention & Control; and Protection & Restoration of Biodiversity & Ecosystems – it also has minimum social safeguards. Further legislation is expected to better regulate the social impact of investments so this Taxonomy is not the end in correcting existing market distortions.

The Taxonomy is important because it intervenes in how environmental investments are classified. It also sets our screening criteria and thresholds of significance. This is influential because it describes thresholds for a variety of activities. The thresholds are markers for what a ‘Significant Contribution’ is to tackling a particular challenge, like Climate Change Mitigation. It also sets in law thresholds for Do No Significant Harm (DNSH) so if you are investing to make a Significant Contribution to tackling Climate Change Mitigation you must also DNSH to Biodiversity.

For climate change mitigation, a 50%-55% reduction in emissions by 2030 is one criteria and net-zero by 2050 obviously. The weighty Technical Appendix, which accompanies the Taxonomy guidance, is more detailed and sets significance thresholds for a range of activities, including construction and the improvement of property:

  • “Acquisition and ownership: buildings built after 2021 are eligible if they meet the criteria for the ‘Construction of new buildings’, while buildings built before 2021 are eligible if their performance is comparable to the performance of the top 15% of the national stock, in terms of calculated Primary Energy Demand during the use phase. An additional requirement is applied only to large non-residential buildings (built both before and after 2021) to ensure efficient operations through energy management.
  • “Construction of new buildings: to be eligible, the design and construction of new buildings need to ensure a net primary energy demand that is at least 20% lower than the level mandated by national regulations. This is assessed through the calculated energy performance of the building, i.e. performance forecasted on the basis of modelling building physics under typical climatic and occupancy conditions.”

These criteria and thresholds are set out now and will be reviewed on 3-year cycle. You can expect them to ratchet up every 5 years so if you have long-term holds in your fund it is important to be aware of this process. The publication of this Taxonomy now is valuable because it can be built into due diligence processes and investment appraisals, including risks to income, growth and exit value. The start of 2022 is when this disclosure requirement will come into effect, but expect the preparation to start now. 

The Taxonomy Regulation builds on the Non-Financial Reporting Directive (NFRD) and the recent Regulation on the Disclosure of Sustainability Risks in Financial Services, which sets out high-level requirements for clear communication of these investment risks from March 2021. These are all key legal components of the European Green New Deal and the related Action Plan on Sustainable Finance.

Data is key to compliance with these regulations as these are measurable criteria. By investing over the next 12 months in the right data model and software platform will provide a competitive advantage. EVORA’s advisory team and our SIERA software platform can help real asset investors navigate their way through this emerging legislation, which is a key transition risk and opportunity as we move to a greener economy. 

Coincidentally, the 19th June is also Juneteenth, which is an internationally significant day for social equality. It marks the day on which the US Emancipation Proclamation was finally enforced in Texas in 1865. This brought to the end the abhorrent practice of “investment” in slaves as “property”, which directly affected three continents and has repercussions around the world up until the present day. 

Today’s Black Lives Matter movement is a tangible reminder of why ethical and environmental investment decisions made today do matter for generations. This has been true for slavery and will be true for our environmental and social governance now and in the near future. If we don’t get it right now, future generations may well look back on us and ask why we didn’t take more responsibility.

If you would like to attend a training session on EU Legislation and Taxonomy, please email training@evoraglobal.com where we can provide you with information on dates and times.

A 2050 target but no time to spare!

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By Lucy Curtis and Peter Willcocks

We are now in a critical period requiring rapid and urgent action to retrofit our buildings in a bid to address climate change. The Paris Agreement set a global imperative ¹ to restrict global warming to 2⁰C or below. To achieve this ambition, global greenhouse gas emissions need to reduce rapidly today with developed economies ultimately becoming Net Zero by 2050. We cannot afford to bide our time and cut emissions later.

Several policy drivers are now facilitating a step change in emissions reduction not within the next 30 years, but within the next 10 years. For example, under the European Green Deal, the EU Commission has recently furthered its ambition to reduce emissions by 50% by 2030 from 2005 levels. Also, the Energy Efficiency Directive (EED) aims to improve energy efficiency by at least 32.5% by 2030 with the Energy Performance of Buildings Directive (EPBD) setting out regulations to increase the rate and depth of building retrofit programs. Countries are also formulating long-term national strategies to achieve ‘Net Zero carbon’ targets by 2050 including mobilizing significant investment in innovation and sustainable economic activity such as renewable energy and decarbonization of the energy system.

Those leading the way in commercial real estate have signed the BBP’s Climate Change Commitment and will be disclosing plans to achieve Net Zero carbon by 2050 by the end of this year. ² It is today’s actions that will determine whether intermediate and long-term targets are achieved, but it is crucial that immediate action is coupled with longer term planning in order to minimize costs.

Risks & Opportunities

In the transition to a low-carbon economy, investment manager’s fiduciary responsibility will increasingly include assessment of how climate-related ‘transition’ risks, such as the legislative risks described above, will impact asset values. Such considerations will need to be included in future investment strategies and decision making. 

Buildings where energy and carbon performance is not improving in line with emission reduction targets may be exposed to “stranding” risks. These risks could include a reduced investor, market and tenant demand, and exposure to increasing energy costs and carbon pricing. As a result, these assets may require significant capital investment to meet stringent energy and carbon performance regulations.

The recommendations from the Taskforce for Climate Related Financial Disclosure (TCFD), that are currently progressing towards mandatory disclosure, will require investment managers to identify, assess and effectively manage these potentially material financial risks. But it’s not all about risks. TCFD will also require investment managers to identify opportunities as improving energy and carbon performance increasingly serves to enhance and preserve asset value and secure long-term income streams by minimizing associated costs.

To improve forward-looking decision making and aid financial planning, specific tools are becoming available such as the Carbon Risk Real Estate Monitor (CRREM) developed in partnership with institutional investors and industry bodies including GRESB. The CRREM tool provides country and property use emission intensity benchmarks that are aligned with global warming scenarios of 2⁰C or below. It projects current building emissions intensity, allowing for factors such as grid decarbonization, and assessment of low-carbon transition “stranding” risks where factors such as future carbon pricing can be analyzed under a number of scenarios. 

Data, data, data

Transition risks will increasingly be associated with whole building energy consumption and emissions intensity. To begin to assess risks, set targets to reduce building emissions and plan for Net Zero, the full picture of the current whole building energy consumption is needed. 

Existing assets will most likely include tenant-controlled areas, which pose challenges for data acquisition especially for those with difficult-to-reach tenants on FRI leases and long-term leases in core strategic assets. ³  In addition to leveraging green lease clauses, building good tenant relationships will be key to unlocking tenant data. The installation of AMRs and partnerships with data collection agencies, will both be crucial to circumvent the inherently inefficient process of collecting data manually from property managers.

The Future is Decided Now

With only two retrofit cycles left to 2050 ⁴, long-term initiatives must be carefully planned to ensure intermediate emission and energy reduction targets are met while aiming towards a Net Zero emissions future. 

Conducting this forward-looking assessment to meet these targets, and assessing the transition risks and opportunities at an asset level, may require changes in the process by which investment managers currently plan renovations and M&E upgrades across the asset hold period. However, by identifying the worst performing assets and implementing programs of Net Zero audits across portfolios, investment managers can begin to identify and plan the required measures to meet this ambition. It is also important to ensure sufficient depth of retrofit as opportunities arise within the retrofit cycle. Initiatives such as long-term Building Retrofit Passports, as proposed under the EPBD, will also help advance this agenda and assist in the planning process.

The usual practice of like-for-like replacements may no longer be sufficient but by making significant investments in energy efficiency and taking maximum advantage of retrofit opportunities in the short and medium-term, these costs can be minimized.

2050 may seem like a long time away, but investment managers need to act now to implement sustainability programs with the associated risks assessments and financial planning to ensure portfolios and investment strategies remain resilient as we transition to a low-carbon economy.

This article was originally published on GRESB Insights

¹ The international community convened in 2016 to sign the Paris Agreement, committing to limit global warming to well below 2°C and pursuing efforts to limit it to 1.5°C.
² http://www.betterbuildingspartnership.co.uk/node/877

³ http://www.betterbuildingspartnership.co.uk/sites/default/files/media/attachment/bbp-low-carbon-retrofit-toolkit.pdf

⁴ https://www.jll.co.uk/en/newsroom/jll-commits-to-making-net-zero-carbon-mainstream

EVORA delivers £373k savings in first year of M&T module

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Our SIERA Monitoring & Targeting (M&T) module had its first birthday earlier this year, so we decided to take the time to reflect back on all it has achieved in its first year.

Since the module’s release in February 2018, EVORA has begun driving energy efficiency at 51 assets across eleven clients via SIERA Energy M&T programmes. In the first twelve months, these programmes saved 4.1 million kilowatt hours of energy, equating to a cost saving of £373,00 and preventing 1,862 tonnes of carbon emissions.

The backstory

As our Managing Director Chris Bennett explains:

“We had sought an Energy Monitoring and Targeting platform to meet our specific requirements, but we struggled to identify a system that provided both the functional capability and practical approach we needed as energy consultants. Having developed our own sustainability management software, SIERA, it seemed a natural progression to develop our own M&T platform. The end product has given us the optimal tool to support in delivering energy efficiency in buildings and has gained widespread approval by the industry. At the same time, we now have an integrated sustainability and energy management platform, where one set of data both helps optimise energy efficiency, whilst feeding into external reporting requirements such as GRESB”.

Following a combined product development effort between our Consultancy and Software Development teams during 2017, EVORA began its first Monitoring & Targeting programmes in February 2018. We have since produced M&T reports in 3 languages, at a portfolio which now comprises 51 buildings; totalling approximately 6.7 million square feet. 11 clients across 6 countries are now optimising their buildings with the support of smart meter data and our expert consultants.

EVORA Global M&T statistics

How does it work?

Developed as a module within our holistic environmental data management software SIERA, M&T integrates directly with providers to pull smart meter data from the source and automatically acquire it on a real-time basis. This allows our expert consultants to feedback quickly on trends and anomalies, and to work with the site team to rectify issues and enhance performance, thereby maximising energy and cost savings.

EVORA Global M&T process
EVORA Monitoring and Targeting process

Successes

We have already seen significant improvements at a number of buildings. By deploying M&T programmes for AEW, EVORA have been able to reduce electricity consumption by 144,419 kWh at one of their largest assets in just 10 months, representing 18% of total electricity consumption and equating to savings of 41TCO2e of carbon emissions and £16k on utility costs.

Success has not only been seen on the site level; via a set of targeted M&T programmes EVORA has helped drive efficiency across whole portfolios. Working with JLL on a series of UK DWS multi-let assets, M&T programme has contributed to an approximate 8% energy saving; totalling a cost–saving of £58,000.

Building Manager Emma Swan said, “EVORA’s Monitoring & Targeting Programme is working really well at 60 Queen Victoria Street, and we have already identified several improvements within the current plant setup that will help us further drive down electricity consumption and increase our overall sustainability credentials within the building. The monthly call helps to focus our attention on what changes can be easily made and the SIERA platform allows us to monitor consumption in real–time.”.

Across the clients involved in the Monitoring & Targeting programme over the first year, a total of 4.1 million kWh of energy has been saved, equating to 1,862 tonnes of CO2 and approximately £373k saving of utility costs. We’re extremely proud of the service we have been able to provide and the impact we have been able to have. We will continue to strive to improve and enhance the module to further drive efficiencies.

To find out more about M&T, contact us and one of our expert consultants will be happy to help.

GRESB 2018: over, not done with!

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With GRESB over we talked to a number of staff across our business to get a view on experiences faced, whilst it was still fresh in the team’s mind.

Supporting the team for our busiest ever GRESB season.

Paul Sutcliffe – Director

I’ve lost count of the number of GRESB submissions I have supported over the years. I do know that this year at EVORA we supported around 70 submissions, from a broad array of clients (covering sector Number 1s through to first time participants). Our busiest ever GRESB season!

Whilst we represent a broad array of participants with different fund structures and objectives, we do see some common themes. Our clients universally want to ensure that:

  1. Sustainability policies and practices are effective and appropriate for their organisations
  2. Their GRESB submission correctly and accurately reflects their true sustainability position.

There is a clear recognition and acceptance that GRESB is a one size fits all approach. To use a sloppy analogy – sometimes the shoe fits perfectly, other times it’s a bit loose, sometimes too tight, but everyone can still walk in it.

With the GRESB deadline of 12 noon Eastern US time fast approaching, I prepared myself for some long nights. I needn’t have worried though. Our team and clients mobilised, focused, used SIERA (our sustainability software platform) and worked hard to get everything in on time. Final confirmation, of the last submission (for me) came from the last of my clients early on Saturday morning. I breathed a sigh of relief. I had a weekend to enjoy!

One last thing. GRESB has been able to galvanize the industry and drive forward the sustainability agenda. Our industry should work with this and in particular, reflect when the results come out in September. I am a strong believer that GRESB should be used to inform, not drive individual organisational ESG agendas.

Time flies when it’s your first GRESB year!

Katie Brown – Junior Sustainability Consultant

As this was my first year supporting GRESB, there was a lot to grasp and a lot to learn, fast! The time flew, and on reflection preparation is key. Some elements of the submission would have been extremely challenging and time intensive to complete without the help of our SIERA software. We would not have been able to support so many submissions without it. It was important to plan well and communicate early – time well invested should be reflected in an accurate (and higher) GRESB score.

Some elements of the submission would have been extremely challenging and time intensive to complete without the help of our SIERA software. We would not have been able to support so many submissions without it.

I have been impressed that despite the focus on environmental performance of assets forming a core element of the survey, there is a broad spectrum of the sustainability agenda covered, with attention also on social and governance topics including health and safety, management, policies, and supply chains, just to name a few! Also, the inclusion of the health and wellbeing module, and this year a new module on resilience, brings to the forefront important and emerging ESG trends.

The GRESB survey promotes much needed transparency of the sustainability efforts by businesses in the real estate sector, both as a benchmarking tool and providing greater visibility for investors, but also provides a great opportunity to guide and inform more ambitious and rigorous ESG strategies going forward.

It’s all about the data.

Nick Hogg – Associate Director (SIERA Software)

As those that have participated in the GRESB submission process will know, the amount of information and effort that can be required to provide a seemingly straight forward number in answering a GRESB question can be sometimes underestimated. The Performance Indicators is an aspect where this can challenge participants due to sheer quantum of data that might need to be handled across all the impact areas for an entity, not least with more participants submitting data at asset level.

Across all the submissions we were supporting on this year we found that SIERA handled over half a million datapoints through the Asset level interface alone. We have blogged before that GRESB have allowed the automated transfer of Performance Indicator (PI) data from sustainability management software systems, such as SIERA, directly into the GRESB portal for the last few years. We found this automated transfer of data through SIERA vital, not just in trying to make the complexity of reporting more efficient but essential in establishing a robust and transparent method of reporting asset level data.

Across all the submissions we were supporting on this year we found that SIERA handled over half a million datapoints through the Asset level interface alone.

We introduced additional functionality in SIERA this year to further automate the calculation of energy, GHG and water intensity and have plans to continue expansion of SIERA’s GRESB capability over the coming months.

Submissions are done, but it’s not over!

Louise Russell –  Senior Sustainability Consultant

This will have been my fourth year supporting GRESB clients. I support a variety of clients each at a different stage on their sustainability journey.  Existing clients who are already hot on sustainability continue to maintain leading positions principally due to their wider sustainability programmes which we support during the year. For them, GRESB is useful to benchmark the position of their various funds against peers and internally. However, GRESB is not the driver and broader sustainability as well as responsible investing is something that is taken very seriously.

For my clients that were newcomers to GRESB this was the first time that they as an organisation considered what sustainability means to them. Clients are often surprised by what is already in place within their organisations albeit via an unstructured approach. Where we assist is coordinating the various stakeholders to collate the responses. Whilst we never advise that a sustainability strategy should be GRESB driven it does act as a gateway for those approaching sustainability for the first time.

The key to this is starting early especially for those clients that report in calendar year, waiting until the results come out in September will only allow just over three months to December to make improvements before the GRESB reporting year is over.

Now that we are post-GRESB these same clients are looking to build on their existing processes, formalise their sustainability strategy and put in place a sustainability programme that will deliver an improved score in 2019. The key to this is starting early especially for those clients that report in calendar year, waiting until the results come out in September will only allow just over three months to December to make improvements before the GRESB reporting year is over.

If you have anymore questions about the content of this blog or GRESB in general, get in touch and our team of experts will be happy to help.

GRESB Premier PartnerAs a GRESB Real Estate Premier Partner, we are perfectly positioned to provide GRESB support. View our official Premier Partner profile.

We can work with you to complete the submission and understand your scoring, as well as develop a sustainability plan that will improve your future GRESB performance and align with your organisation’s key environmental objectives.

GRESB Support 2018

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GRESB reporting season for real estate and infrastructure participants is here again, and as a GRESB Premier Partner, EVORA is recognised as a leader in the provision of GRESB support, including training and strategic insight.

We have provided GRESB support for the last six years, and in 2017 we directly supported over 50 submissions from organisations that represent a cross section of the European property industry. We have helped clients get on the GRESB ladder and have equally supported clients to be market leaders.

We sit on a number of GRESB benchmark committees and our close working relationship with GRESB ensures that we are prepared and aware of future changes.

With our experience and expertise in this ever-emerging market sector, we ran a webinar last week with participants across Europe on our end to end service Titled “How to overcome GRESB challenges and achieve your best score”.

In this session we shared valuable insights and tips in a 5-point GRESB strategy, to increase awareness on how to get the best out of the reporting process and how you can align GRESB ratings with your long-term sustainability strategy.

Five point GRESB strategy

Our GRESB strategy covered an action plan for a seamless GRESB submission process. A quick recap is set out below.

  1. Plan your next GRESB submission in advance. Map out a plan on who to talk to, what to ask and which evidence you need to provide.
  2. Reduce the complexity of reporting by engaging in a streamlined process with your property managers. At EVORA, our consultants provide asset-level templates to property managers, to help in the collation of asset-based questions such as technical assessments, tenant engagement and efficiency measures.
  3. Improve scoring, where appropriate. Don’t miss out on easy points, discounting your reporting efforts by not meeting validation requirements. Read more here on our GRESB verification blog on how to ensure your response is accurate and acceptable by GRESB.
  4. Focus on data integrity and performance. Our proprietary software SIERA ensures that the process of data management is transparent, accurate and robust.
  5. Finally set actions for future success. GRESB addresses several key areas of an EMS within their survey such as management responsibilities, communication, training, objectives and, importantly, the results they are delivering. Developing an EMS therefore seems an appropriate approach to score well in GRESB. Find out here how a Plan-Do-Check-Act (EMS) approach can impact your GRESB score.

Final thoughts for GRESB success in 2018;

  • Start early / now!
  • Engage with internal colleagues and external stakeholders
  • Understand indicator intent and scoring requirements
  • Gather evidence and identify alignment to requirements
  • To make it easy on yourself and others – get in touch and our team of experts will be happy to help.

Request the webinar recording

GRESB Premier PartnerWe are perfectly positioned to provide GRESB support. View our official Premier Partner profile.

We can work with you to complete the submission and understand your scoring, as well as develop a sustainability plan that will improve your future GRESB performance and align with your organisation’s key environmental objectives.

GRESB Infrastructure Survey: What is it?

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EVORA is now entering its seventh year of helping entities produce GRESB Real Estate Survey submissions, and with each passing cycle we have accrued more expertise, expanded our client base, and become leaders in the field. Last year we provided comprehensive support to 26 funds and general support to many others, and this year the figure is set to get even higher as we gain greater recognition for our expertise.

But GRESB offers more than just the Real Estate Survey, and for 2018 we have expanded our scope of services to include the GRESB Infrastructure Survey.

What is the GRESB Infrastructure Survey?

Much like its real estate equivalent, the GRESB Infrastructure Survey is an investor-driven assessment of ESG (Environmental-Social-Governance) performance for entities.

Much of the content is also very similar, however the setup of the Infrastructure Survey is quite different from that of GRESB Real Estate, as it is broken down into two sub-surveys: 1) the Fund Assessment and 2) the Asset Assessment.

The Fund Assessment is a relatively small element of the overall survey, and focuses on ESG policies and principles, persons responsible for ESG issues, and the monitoring and mitigation of ESG risks, at the entity level.

Meanwhile, it is the Asset Assessment that is broken down into the familiar Management, Policy & Disclosure, Risks & Opportunities, Monitoring & EMS, Stakeholder Engagement, Performance Indicators, and Certification & Awards modules, albeit with differences in the questions themselves and the distribution of points compared to GRESB Real Estate. Additional content includes questions relating specifically to biodiversity and air pollutants in the Performance Indicators section, whilst there is for example less focus on certification.

An optional Resilience module has also been introduced for GRESB Real Estate and GRESB Infrastructure in 2018 – you can read more about it here.

Asset Assessments – Weighted Asset Average

You are free to submit a standalone Fund Assessment without asset-level evaluation if you wish. However, to get an overall GRESB Infrastructure score you must also complete the Asset Assessment for at least 25% of your portfolio (usually weighted by GAV). Furthermore, there is an advantage to completing Asset Assessments for as many assets as possible, as your scores are collated into a Weighted Asset Average (WAA) where assets that did not complete an Asset Assessment score zero.

Your WAA is worth 70% of the final GRESB score, with the Fund Assessment making up the other 30%. A simple example calculation is provided below:

GRESB Infrastructure Survey - WAA table

Combined with an example Fund Assessment score of 76, the overall GRESB score would be:

(56   x  70%)   +   (76  x   30%)   =   62

Which represents:

(WAA Score x Asset Assessment Weighting) + (Fund Score x Fund Assessment Weighting) = Overall Score

The GRESB Infrastructure Survey is comprehensive in its coverage of ESG content, whilst also allowing a wide range of infrastructure assets, from airports to schools to toll roads to windfarms, to be compared. ESG issues matter for all forms of built infrastructure, and GRESB provides an ideal platform to meet investor and public demand for improved sustainable performance.

If you think GRESB Infrastructure might be for you, then get in touch and our team of experts will be happy to help.

 

GRESB Premier PartnerAs a GRESB Real Estate Premier Partner, we are perfectly positioned to provide GRESB support. View our official Premier Partner profile.

We can work with you to complete the submission and understand your scoring, as well as develop a sustainability plan that will improve your future GRESB performance and align with your organisation’s key environmental objectives.

GRESB Verification: Why it’s important our Top Tips for success

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One of the more notable changes that GRESB has introduced for the 2018 survey is their approach for verifying participant’s answers.

Starting in 2018, GRESB (or more accurately, their parent company GBCI), will perform a deep dive (termed Validation Plus) on all participants for a subset of questions and indicators. Previously, the approach was to select 25% of participants for a detailed review of an entire response.

GRESB Verification – why do we need it?

The rationale for validating responses is simple to comprehend. If unchecked, there is a risk that some respondents may stretch the truth and overplay an entities performance and/or practices for ESG management. Checking all participants on the same subset of indicators creates a more level playing field, which should be to the benefit of sustainability leaders who can easily demonstrate and disclosure their performance. However, the check is still very light touch as, typically speaking, only one document needs to be uploaded to indicate how ESG is implemented / managed across a fund; one example of good practice may be the exception and not the rule for some.

[clickToTweet tweet=”Validation is not in place to trip people up or create unnecessary burden. It is an action that GRESB must take to ensure the ratings it gives to participants are credible.” quote=”Validation is not in place to trip people up or create unnecessary burden. It is an action that GRESB must take to ensure the ratings it gives to participants are credible.”]

Validation is not in place to trip people up or create unnecessary burden. It is an action that GRESB must take to ensure the ratings it gives to participants are credible. Why is this important? From the outset, GRESB has stated it is an investor driven organisation. If investors are being fed inaccurate information, then they may not be able to accurately identify good ESG strategies from mediocre or non-existent ones. Investor confidence will suffer as a result and GRESB will fizzle out.

It was fascinating to learn about Danone’s (the yoghurt people) announcement in their Financial report issued last month. In it they stated an agreement for “tying financing cost and environmental and social performance”. The interest paid on their €2billlion credit facility, syndicated by 12 international banks no less, would be impacted upwards or downwards on the basis of ESG performances, as measured by independent third parties.  Additional factors other than ESG are also considered.

WOW! Wouldn’t this raise the bar for GRESB submissions if an entities credit rating and / or credit facility was linked to the number of Green Stars GRESB issued each year!

GRESB verification – Top Tips

So how can you ensure your GRESB response is accurate and that evidence submitted is accepted by GRESB?

We set out below, our six top-tips.

  1. Read the guidance document – GRESB is transparent on the scoring requirements for each indicator. Participants should familiarise themselves with the guidance document to ensure they understand what is required for each response.
  2. Get advice – if you don’t have the time or inclination to read the 264 page guidance book, get expert help from EVORA. We have had visibility of 98 assessments so far and as such have significant experience. I’m looking forward to passing the century mark this year (and most probably the double hundred!)
  3. Focus on data integrity – the Performance Indicator section now carries the highest weighting of any section (termed Aspect by GRESB) at 25.6%. Asset level data is at the heart of this section and data transparency and accuracy is key. Look out for my colleague Chris Bennett’s blog on how SIERA delivers on data integrity.
  4. Communicate early– GRESB is a comprehensive multi-disciplinary survey. It is highly unlikely that one person will have the answer to all questions. Participants should be aware of internal and external stakeholders they need to involve in the process and communicate requirements to them early.
  5. Take time over evidence – sourcing evidence, signposting content via the Upload Template, and preparing / splitting / merging pdfs takes time. It is worthwhile taking the time to keep accurate records, as this can help deliver efficiencies for future years. It is also worthwhile taking time to ensure that signposting GRESB to relevant evidence is accurate. This includes hyperlinks and ‘deep link’. Broken links are the responsibility of the participant and will be interpreted as the absence of evidence.
  6. A global benchmark? Finally, your assessment response must be submitted in English. For a Global benchmark this seems a little harsh for the many non-English speaking participants and I know from experience that it is a major frustration. Uploaded evidence does not need to be translated entirely. However, a thorough summary of the content, sufficient to convey that each requirement has been met, should be provided in English. This will add time and /or cost for many participants.

Following my advice will ensure your ESG strategies are assessed accurately by GRESB. I have seen many responses (not completed by EVORA!) marked down for not following guidance.

We are hosting a webinar on 19th April titled How to overcome GRESB challenges and achieve your best score.  Join us to hear insights on how to save time, reduce complexity and align GRESB ratings with your sustainability strategy.

Click here for more details.

 

GRESB Premier PartnerAs a GRESB Real Estate Premier Partner, we are perfectly positioned to provide GRESB support. View our official Premier Partner profile.

We can work with you to complete the submission and understand your scoring, as well as develop a sustainability plan that will improve your future GRESB performance and align with your organisation’s key environmental objectives.

Changes to GRESB 2018 Real Estate Survey Part 2 – The Detail

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Last week, my colleague Paul Sutcliffe penned a blog briefly setting out the headline changes to the GRESB 2018 Real Estate Survey.  Having had a bit more time to digest these updates, below I provide a detailed look at how the survey has changed this year. I also outline some key practical considerations.

Unlike Paul’s blog, this one is very much aimed at those working closely with the GRESB RE survey. For those that fit this bill (btw, lucky you/us!), please do read on and don’t hesitate to get in touch if you would like to discuss any of these changes further.

Entity and reporting characteristics – Composition of the entity’s standing investments during the reporting period (RC5.1)

Change: It will no longer be possible to report in units. Rather all property types will need to report in sq. ft. or m2.  

EVORA comment: This may present a challenge to many respondents as for certain property types, floor area surveys are often not available (e.g. hotels, student accommodation and car parks). In some instances, there may be other sources of information that can be used. For buildings (i.e. not car parks), this can include the EPC certificate. In most cases an area is also likely to be stated on insurance documents. Where necessary, entities may need to make assumptions to convert units into areas. For this, we suggest looking to country-specific planning regulations, which may have minimum space requirements – e.g. for car parks.

Management – Inclusion of ESG factors in annual performance targets of employees (2017: Q6)

Change: An additional sub-question has been added to this indicator, asking whether performance against these targets have ‘financial’ and or ‘non-financial consequences’. The list of possible ‘employee’ types has also been reduced from nine down to four (remaining options: ‘All employees’; ’Board of Directors’; ‘Senior Management Team’; and, ‘Other’). A requirement for a supporting evidence upload has been added.

EVORA comment: According to the pre-release, the scoring of this question has not changed, suggesting that the new ‘financial’ / ‘non-financial consequences’ differentiation is for information only. Therefore, we do not anticipate this question causing additional stress for respondents compared with last year. However, this change does hint at a wider trend seen across the ESG industry towards favouring a link between sustainability performance and financial incentives. Perhaps this is something we will see GRESB adopt in future versions of the survey.

Policy and Disclosure – Policies in place that address governance issues (2017: Q9)

Change: The list of governance issues that could be covered by an entity’s policies has been expanded; new options include data protection & privacy, fiduciary duty, fraud, political contributions, and whistleblower protection. The number of points awarded to this question has increased, from 1 to 2 points.

EVORA comment: Our expectation is that for larger reporting organisations few if any of these options will present a significant challenge. However, for smaller investment houses we wonder if for one or more of these new selections it may be difficult to provide the necessary documentary evidence to demonstrate that such issues are covered by a formal policy. We note that the full question includes an extensive list of options and it is not necessary to select all in order to obtain full marks. For anyone with particular concerns, we suggest doing a gap analysis against the full question.

Policy and Disclosure – *NEW INDICATOR* – Monitoring diversity (i.e. C-suite, Board, Management Committee)

Change: A new indicator has been added that asks if and how respondents monitor diversity amongst its governance bodies. The indicator will not be scored and will be for reporting purposes only in 2018.

EVORA comment: As with the previous indicator, we anticipate that larger (particularly listed) respondents will already be doing some or all of this – e.g. for certain countries / organisations this may already be a legislative requirement (e.g. EU non-financial reporting directive). For other, likely smaller, entities this indicator may require additional work and raise questions around the sensitivity of this information. We recommend engaging the relevant stakeholders (e.g. C-suite, HR department) as early as possible to work through any sensitivities and, if determined appropriate, a strategy for collecting this information. It is worth noting that for GRESB the pattern is often that new questions are introduced as ‘optional’ or for ‘reporting purposes only’ in year one, but from year two or three, they often become scored.

Policy and Disclosure – *NEW INDICATOR* – Commitments to ESG leadership initiatives

Change: A new indicator has been added that asks which third-party standards or groups respondents are members of / signatories to (e.g. IIGCC, PRI, RE 100, science based targets, TCFD, UNGC). The indicator will not be scored and will be for reporting purposes only in 2018.

EVORA comment: We have mixed feelings about this indicator because as worthy as these initiatives are, we feel that many are more appropriate for larger organisations that typically have more resources available to manage membership/alignment to these schemes. As mentioned above, ‘reporting purposes only’ questions often become scored in subsequent years.

Please note: We have experience support client’s alignment to various such initiatives and would be very happy to provide you with a complementary briefing on the opportunities and challenges presented by each of these initiatives. Contact us.

Policy and Disclosure – *NEW INDICATOR* – Process for communicating ESG-related misconduct, penalties, incidents or accidents

Change: A new indicator has been added that asks if respondents have a process for communicating ESG-related misconduct, penalties, incidents or accidents and if so, which stakeholders are included in the process. The indicator will not be scored and will be for reporting purposes only in 2018. However, according to GRESB this information may be used “as criteria for the recognition of 2018 Sector Leaders”.

EVORA comment: We anticipate that this indicator will be acceptable to most respondents.

Risk and Opportunities – Asset-level environmental and/or social risk assessments of standing investments during the last three years (2017: Q15.2)

Change: This indicator now requires reporting of ‘percentage (%) portfolio covered’ for each type of risk assessment. This indicator also now requires reporting of the third-party standard to which risk assessments are aligned (e.g. ISO 31000). Responses will be scored according to the issues selected and their respective % portfolio coverage. The open text box will no longer be scored and alignment to a third-party standard will not be scored (only required for reporting purposes).

EVORA comment: We can understand the rationale for this change, however, we have concerns over the additional reporting burden this will present for entities with larger portfolios. We note that some options are likely to be easy to determine a % coverage e.g. ‘GHG emissions’ and ‘regulatory risk’. Conversely, other options may require asset-by-asset consideration, such as ‘contamination’ and ‘flood risk’.

Risk and Opportunities –  Implementation of measures during the last four years to improve waste management (2017: Q19)

Change: This indicator remains the same as last year, however, it will be scored (whereas last year it was for reporting purposes only). This indicator will attract a maximum of one point.

EVORA comment: We agree with the principle behind this update, which increases the importance of and therefore focus on implementation of waste management improvement measures. This brings waste and resource management in line with the energy and water versions of this question and further shifts the overall balance of GRESB towards measuring / incentivising green ‘walk’, as well as ‘talk’.

Stakeholder Engagement – Employee and tenant satisfaction surveys (2017: Q34.1 & Q37.1)

Change: An additional sub-question has been added to this indicator, asking if and what ‘quantitative metrics’ were included in the surveys (e.g. overall satisfaction score). This new sub-question will not be scored and will be for reporting purposes only in 2018.

EVORA comment: This is a logical evolution to this question and should be borne in mind by anyone designing a satisfaction survey. Ultimately, it should improve quantification of what has historically been a largely qualitative issue.

Stakeholder Engagement – Monitoring of compliance with sustainability-specific requirements in lease contracts (2017: Q39.2)

Change: An open text box has been added to enable GRESB to further validate the approach taken by respondents to monitoring compliance with green lease clauses. Last year, this question was for reporting purposes only; however, this year it will attract a maximum of one point.

EVORA comment: In our view, this is another logical evolution to the survey. However, we do note that the process behind tracking green leases may not provide sufficient information on the number, depth and strength of green clauses in place.

Stakeholder Engagement – *NEW INDICATOR* – Engaging with supply chains to ensure ESG requirements are met

Change: A new indicator has been added that asks if respondents engage with supply chains to ensure ESG requirements are met. If ‘yes’ is selected, respondents are asked to describe the process in an open text box. The indicator will not be scored and will be for reporting purposes only in 2018.

EVORA comment: We anticipate that this indicator will be acceptable to most respondents and note an overlap with a subsequent question on monitoring supply chain compliance with ESG requirements.

Stakeholder Engagement – *NEW INDICATOR* – Stakeholder grievance mechanism

Change: A new indicator has been added that asks if respondents have a formal process for stakeholders to communicate grievances. If ‘yes’ is selected, respondents are asked to select from a list of ‘characteristics’ of the grievance process (e.g. rights compatible, transparent) and stakeholders that the process applies to (e.g. community, contractors). The indicator will not be scored and will be for reporting purposes only in 2018.

EVORA comment: As with most of the other new indicators, we anticipate that larger respondents will already be doing some or all of this. For other, likely smaller, entities these processes are less likely to be formalised and therefore demonstrating compliance may require additional work.

Performance indicators – Landlord versus tenant data collection and coverage (2017: Q25.1 & 27.1)

Change: Although tenant energy/water consumption data is still requested, GRESB have committed to reducing the weighting it receives within the scoring and benchmarking of the ‘data coverage’ element of responses. Correspondingly, they will shift the emphasis onto data coverage of the landlord-controlled energy and water supplies.

EVORA comment: We fully support this update and have been lobbying GRESB on the issue for a while. For us it makes complete sense to focus scoring on what the landlord has control over, rather than their tenant activities, which they often have little ability to influence (particularly for certain property/portfolio types – e.g. industrial/logistics, FRIs).

Performance indicators – Like for like data coverage area (2017: Q25.1 & 27.1)

Change: Respondents will now have to report on the size of the ‘like for like’ portfolio reported within the energy and water consumption data tables.

EVORA comment: We support this update and note that this should not add additional reporting burden for those using a good asset-level data collection and validation software tool, such as SIERA.

Performance indicators – Like for like consumption trends (2017: Q25.1 & 27.1)

Change: The scoring of reported energy and water consumption trends for the ‘like for like’ portfolio has changed. Last year all three points available for this indicator were attributed to the direction and scale of the consumption trends. From this year, one point will be awarded for data availability and only two points attributed to the consumption trend.

EVORA comment: This change should provide investors with greater clarity on the proportion of the portfolio that is driving change. However, as the like-for-like consumption trend is the only truly ‘performance based’ indicator, in our view, stealing points from the consumption trend aspect and giving them to data coverage is not entirely progressive.

Performance indicators – Scope 3 emissions (2017: Q26.1)

Change: Reporting of Scope 3 greenhouse gas (GHG) emissions has become mandatory. In the context of GRESB, Scope 3 emissions include those associated with energy consumption in tenant areas and/or indirectly managed assets. From this year, Scope 3 emissions will be included in the scoring and benchmarking of responses, both in terms of data coverage and the ‘like for like’ consumption trend.

EVORA comment: We understand the principle behind this update, however we question the intention to score the Scope 3 like for like consumption trend, as well as data coverage. This is because, as mentioned above, generally tenant energy consumption and therefore GHG footprint is beyond the landlord’s control. As above, we note that this should not add additional reporting burden for those using a good asset-level data collection and validation software tool, such as SIERA.

Building Certifications – Green building certificates during design/construction/renovation or operation (2017: Q30.1 & 30.2)

Change: There is an expansion to the scope of these questions to include a requirement to provide certification levels/scores achieved (in addition to the overall schemes applied). This element will not be scored in 2018; it will be for reporting purposes only.

EVORA comment: We are supportive of this update and again, note that this should not add additional reporting burden for anyone using a good asset-level data collection and validation software tool, such as SIERA.

To find out how EVORA can help you to navigate GRESB, whether you are a first timer or an experienced respondent, then please get in touch.

 

GRESB Premier PartnerAs a GRESB Real Estate Premier Partner, we are perfectly positioned to provide GRESB support. View our official Premier Partner profile.

We can work with you to complete the submission and understand your scoring, as well as develop a sustainability plan that will improve your future GRESB performance and align with your organisation’s key environmental objectives.

 

Real Estate Sustainability: Planning for 2018

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The new year heralds new journeys for individuals and organisations as we seek to learn from experiences in 2017 and focus on opportunities that preserve and enhance ‘value’ in the myriad forms that it takes.

It is a tremendously exciting 2018 for EVORA and one that has started incredibly positively. We are looking to forward to working with existing and new clients as we implement best practice solutions that deliver value to their funds, assets and the environment.

Below I identify my predictions for 2018 across five topics. In addition, where risks are identified, I propose solutions, to mitigate and manage.

There are many more areas and topics that could be covered, and this reflects the rapid changes the industry is currently seeing. I’d love to hear your thoughts on my predictions plus any of your own.  I will commit to reviewing these predictions at the end of 2018, to see how things panned out.

GRESB: an evolution

The GRESB survey is in its ninth year and participation shows no sign of waning, particularly in the Real Estate assessments.

GRESB does not suit all fund strategies and our research demonstrates that Core funds, particularly those with a high percentage of directly managed (multi-let) assets, do perform better than those with Opportunistic strategies and / or a high percentage of indirectly managed (single-let) assets. Perhaps this is no surprise. Consequently, GRESB is reviewing the method in which is benchmarks and scores data availability for indirectly managed (single let assets).

[clickToTweet tweet=”Early adopters tend to perform better, as investment managers develop (and align) ESG strategies with GRESB criteria” quote=”Early adopters of GRESB tend to perform better, as investment managers develop (and align) their ESG strategies with GRESB criteria, particularly through the use of structured frameworks such as an Environmental Management System.”]

Early adopters of GRESB (with years of experience) also tend to perform better, as investment managers develop (and align) their ESG strategies with GRESB criteria, particularly through the use of structured frameworks such as an Environmental Management System.

To counter the above two points, GRESB has launched a Pre-Assessment module. This survey is designed for:

  • New investment products that are raising capital and / or undergoing initial investor due diligence;
  • Real estate strategies with opportunistic, short-hold or development focus;
  • Real estate vehicles beginning to incorporate ESG into their operations

I expect this ‘toe in the water’ approach will lead on to greater participation in the full survey, despite the fact that GRESB is now charging participants that complete the main and/or pre-assessment survey. This change will have limited impact for participants who are already members or those who pay for the benchmarking reports (which will be issued automatically as part of the service)

The final, encouraging point for 2018, is the increased engagement by GRESB with a wide range of stakeholders as they seek to shape survey components. This is an important facet to ensure that the survey remains relevant to market needs, whilst continuing to push ESG strategies to deliver meaningful performance improvement.

Prediction: Continued growth in the main Real Estate survey, with respondents in North America and Europe leading the field in terms of number of participants. As it is the first year of operation, I expect a small uptake in the Pre-Assessment, which will increase over time as investors and their managers gain awareness of this approach.

I expect the main GRESB survey to incorporate more Health & Wellbeing (H&WB) questions, possibly at the expense of the separate H&WB module. I expect ‘pilot indicators’ for the measurement of social value, H&WB impacts and potentially governance scorecards. Measurement of environmental impacts alone will not be sufficient as the sole indicator of performance for too much longer.

Debbie Hobbs, Head of Sustainability at Legal & General Real Assets will be speaking about measuring social value, alongside Sander Paul Van Tongeren, MD of GRESB, at our industry event on 7th February. Get in touch if you would like to attend.

Resolution: Continue to work proactively with both GRESB and our participant clients.  Last year we supported over 55 submissions.  We expect this to increase significantly in 2018.

Maintain and enhance our clients GRESB ratings through practical and value driven sustainability programmes, as appropriate to their investment strategy. In 2017, our client Hines achieved Sector Leader status and was rated the number 1 non-listed European fund.

Building certifications: more than just a tick-box exercise

Sustainability building certifications have been in operation for around 28 years following the launch of BREEAM in 1990. There are now numerous in-use and design/construction stage standards around the world. Schemes cover individual topics such as water and air quality, to comprehensive multi-themed sustainability / health and wellbeing  standards.

Whilst the use of these standards for new developments is fairly common-place (particularly in the office sector within major cities), the application for existing (in-use) buildings is less so. However, market drivers such as GRESB, who reward participants for holding certification, together with (future) policy standards and incentives for efficient retrofits have, in our experience, increased the interest for in-use schemes such as BREEAM In-Use and Fitwel. It is important that the application of these schemes leads to performance improvement rather than just a tick box exercise.

[clickToTweet tweet=”It’s important that the application of schemes leads to performance improvement rather than just a tick box exercise.” quote=”It is important that the application of these schemes leads to performance improvement rather than just a tick box exercise.”]

Prediction: Increased application of certification for standing investments through schemes such as BREEAM In-Use and Fitwel for major refurbishments.

I also predict more, but not many, WELL certifications for new developments. It will be interesting to see if WELL issue a ‘lighter’ certification route that has wider commercial application that the full WELL standard.

Resolution: Grow the number of EVORA employees that are accredited professionals for sustainability building certification schemes.

Support completion of health and wellbeing certifications through the recognised standards (WELL, Fitwel, RESET) that EVORA has expertise in.

MEES: you might feel the pinch come April

I am sure it is well known to most (but probably not all) real estate professionals, that as of 1st April 2018 landlords will no longer able to lease (via new leases and lease renewals) commercial or domestic space in buildings with an EPC lower than an E rating. Unless that is, a five year time-limited exemption applies and is registered on an Exemptions Register.

Previous studies have indicated as much as 20% of the market could be impacted. From our experience, a high proportion of ‘sub-standard’ EPCs (those lower than an E) have improved their ratings when reassessed by a trusted and competent EPC assessor. Many EPCs issued in 2008-09 were completed quickly using default setting for efficiency ratings. Whilst this was acceptable and legally compliant at the time, the resulting EPC typically did not reflect the state of the energy system in place.

That said, there will be a number of F and G rated units that may leave landlords scratching their heads on what to do, when to do it and crucially, IF they have to do anything at all – noting the relative ease that exemptions could be achieved, albeit with some resource implications to administer.

Prediction: Organisations that were slow to respond may feel the bite come April. I expect the regulation to be largely self-policing, via appointed solicitors, as is the case for the availability of an EPCs for lettings (and sales). However, I also expect enforcement (by local authorities) to be weak based on the relative ease of gaining an exemption and the convoluted nature of MEES guidance.

Resolution: Continue to utilise SIERA’s EPC profiling capabilities to assist clients to quantify the risk of MEES against Estimated Rental Value (ERV), lease and EPC expiry dates. We shall look ahead to the hard backstop of 2023 for existing leases.

Blockchain: new ways of working

Beyond cryptocurrencies such as Bitcoin, blockchain has the potential to revolutionise the method in which individuals and organisations digitally transact with one another in a secure and verified environment.

Blockchain came into operation ten years ago. It’s use beyond cryptocurrency is becoming clear (in property and sustainability) through applications such as:

  • Smart contracts – simplifying the retrieval of data through distributed ledgers
  • Governance – transparency is key to blockchain and it could increase the range of publicly available documentation.
  • Intelligent grids – facilitating the buying and selling of renewable energy generated by decentralized systems
  • Data management – countless possibilities for swiftly transferring secure and validated data

One final comment on blockchain (particularly mining of crypto-coins) that needs to be made, is how immensely energy inefficient it is. The process of using individual PCs to mine coins has led to Bitcoin alone having the annual energy footprint equivalent to Hungary, at the time of writing, and this is increasing on a daily basis as more ‘nodes’ are added to the blockchain. Bitcoin transactions require several thousand times the energy of other means, such as Visa transactions (source).

[clickToTweet tweet=”Process of using individual PCs to mine coins led to Bitcoin having the annual energy footprint equivalent to Hungary” quote=”The process of using individual PCs to mine coins has led to Bitcoin alone having the annual energy footprint equivalent to Hungary”]

Prediction: An exciting year where I expect Proptech companies to introduce new ways of working (more efficiently) through utilising blockchain applications. It is something that our SIERA team is busily exploring.

Resolution: Continue to track the emerging blockchain market (I will do this on a personal level to ensure I can understand what my software colleagues are talking about!)

Policy Landscape: hopeful for clearer messaging

A continued lack of clarity on future policy measures is one prediction that can (unfortunately) be confidently made for 2018. Through BREXIT and the fragility of global politics, uncertainty on the future of medium term policy instruments shall, I think, remain.

Long term achievements have been ratified by global leaders (minus one), however, specific programmes for achieving this for the building sector will not become clear until 2020. The UK government is yet to confirm the replacement to the CRC or ESOS  (carbon and energy assessment and reporting schemes) beyond 2019, although I do appreciate that consultations are ongoing.

Recent UK government publications such as the Industrial Strategy and 25 Year Environment Plan are welcomed. However, industry needs to understand how the government intends to act on these strategy papers, rather than see recognition that the points covered are important.

Prediction: 2018 is unlikely to herald the launch of forward-thinking and fit for purpose policies that will progress the sustainability agenda.  However, I am hopeful of a clearer message on the future of carbon reporting and disclosure requirements for organisations towards the end of the year.

Resolution: Continue to voice our concerns and aspirations for clear and forward thinking policy through participation in government / industry consultations and working groups.

Join us on 7th February for an industry event that that looks at planning for Real Estate sustainability in 2018 and beyond.

 

Working Smart, Working Fast: How Agile development and UX design are at the heart of SIERA

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Software is one of the greatest tools of the modern world, providing us with a variety of options for any job we have at hand. When you use a software product, you want it to help you with your task as seamlessly as possible, and to address the major struggles faced. You can then focus your efforts on the task at hand, rather than the tool which is supposed to be helping you with that task.

We are all consumers of software and appreciate good UX design (User Experience) when we see it. I am sure some of us here are quite fond of unlocking our phones using our fingerprint rather than the classic 4-digit code. It makes our tasks simpler, quicker and easier.

A good tool though, comes from putting a lot of thought and effort into making it as intuitive as possible. It is through Agile Development and careful User Experience design that we shape our software product, SIERA.

SIERA LOGO WEB LANDSCAPE

Read: 110 seconds to understand how SIERA Sustainability Software can help you

Agile Development

As part of developments within the industry, and the ways we work always growing and developing, SIERA is designed in a responsive and agile format, this is called Agile Development. Though we use an overall roadmap, the team works in such a way that we can adapt areas of our time, projects, workflow and focus, to match business and client needs. Working in two-week sprints, we open the discussion for any necessary changes to project or scope, and the opportunity to reflect on current workflow practices and focus areas, adapt them, or suggest improvements as a team where needed. A team will always be growing and developing.

[clickToTweet tweet=”@SIERAsoftware is designed in a responsive and agile format, this is called Agile Development. ” quote=”SIERA is designed in a responsive and agile format, this is called Agile Development. “]

User Experience Design

Through the entire process, User Experience design plays a part amongst every area of the team, and is done by every member of the team. A software team should always have at least one member who has UX (User Experience) design as part of their job role (that’s me), a person who has the time and skills to carefully think through UX design and how this is implemented into the system. However, it is not only down to that person, every member of the team and business should have the opportunity to contribute to how things should be built and experienced, as this brings in a pool of thoughts built upon the years of expertise each team member has built up.

Discussions should be live through the entire development of a piece of software, everyone is involved early on at the inception of a piece of development or new addition to the software, and then, though the design and specification should be set early on, anyone can share their thoughts throughout the process.

This will then form together a much more well-rounded, robust and effective tool.

EVORA Global SIERA Asset Electricity profile

A fresh pair of eyes

And so, it is often very useful to get a fresh pair of eyes, when someone else looks at the same tool as you, you will often find they view it from different perspectives. As Quality Assurance Tester on SIERA, and UX Designer, I can spend a lot of time staring at SIERA, and in many ways, get used to the way it is and how it functions, so when something could be improved, as is always the case with software, it becomes less noticeable. As to me, that’s just the way it is. That is where a fresh pair of eyes is key, though I can still view the product from a good perspective, I can’t see everything, and have often found that other members of the team will raise new ideas and thoughts on the current work flows, which is amazing. A UX designer should never be left alone.

We can’t do everything, but we CAN do everything we need to… (being realistic)

We can’t do absolutely everything in life, and we all know that, but we can do everything we need to. Well with software development it’s the same. We don’t have time to implement every idea we ever think of, because it’s simply impossible, however through being realistic and honest with our time, and careful thought and prioritisation, we can achieve everything we need to; first usually as an MVP…

I hear the term MVP a lot, so what is an MVP? An MVP is a Minimum Viable Product, this is a version of the product which meets all the minimum requirements of what needs to be delivered. This takes much skill and discernment to define, and varies greatly depending on the software purpose. For example, if something needs to be functional and readable so it can be delivered to the user, then that’s the MVP, but then if it won’t be released until it looks really sharp, then that is part of the MVP as well. Keeping an MVP in mind is a good way of ensuring there isn’t time spent creating unnecessary enhancements, which can be re-prioritised and added later.

EVORA Global SIERA EPC data

All these approaches form together to become the heart of SIERA’s robustness and effectiveness.

So, what exactly does this mean for our clients and product?

It means that SIERA can become the solution that will fill in the major gap in everyone’s workflow that is becoming a blocker, saving them time and effort, and addressing the long-term pain-points that users have been experiencing for years, then delivering these in the best way possible.

[clickToTweet tweet=”SIERA can become the solution that will fill the gap in everyone’s workflow, saving them time and effort.” quote=”SIERA can become the solution that will fill in the major gap in everyone’s workflow that is becoming a blocker, saving them time and effort”]

A good example of this is our Monitoring & Targeting system, with many companies looking for a solution to gather, store and display half hour data consumption for individual meters in an intuitive, clear and effective way, SIERA hit the market to fill in that gap. It did this through clear visual display, navigation and customisation, providing the basics of what was needed most.

Data can be compared against system overlays and user-defined overlays. The user can set operating hours for a meter, to visually differentiate when different amounts of energy should be used. The user can also set Alerts for their Meter, ensuring the user can tell when something has gone awry. All clearly displayed, as seen below.

EVORA Global SIERA Monitoring and Targeting module

As software users, users of our own product, and experienced veterans in the sustainability industry, we understand the importance of a good software and what it is this software needs to do. So, watch this space, SIERA is going to develop and evolve even more than it already has!

Have any questions about the specifics or want to find out more?
Get in touch!