The collaboration between the two leading built environment organisations seeks to accelerate progress on decarbonising the construction and real estate sector, which is responsible for 40% of Europe’s total energy consumption.
The EU Taxonomy is a key part of the EU Sustainable Finance policy reform package. It establishes a framework to facilitate sustainable investment, essentially providing a catalogue of sustainable economic activities.
However, as the Taxonomy is the first of its kind and has no precedent, its complexity is leading to confusion in the market. Even the Platform on Sustainable Finance observed misalignment of and interpretive issues with reporting requirements, as well as regulatory and data gaps, leaving room for interpretation as to how to comply with the EU Taxonomy.
EPRA and WorldGBC’s collaboration will help the construction and real estate sectors navigate the implications of the EU Taxonomy, providing resources such as factsheets on national requirements to meet key EU Taxonomy criteria.
The collaboration brings together EPRA’s 280 members, representing over €790 billion of real estate assets, and WorldGBC’s European Regional Network of over 20 national Green Building Councils (GBCs), which represent around 5,000 members and eight regional partners. The joint initiative aims to disseminate knowledge and increase the flows of capital that are EU Taxonomy-aligned.
This joint collaboration reinforces EPRA’s ongoing commitment to guiding its members through emerging sustainability challenges and reporting requirements. For over a decade, EPRA has actively worked on establishing common ESG metrics, culminating in the “EPRA Sustainability Best Practices Recommendations (sBPR) Guidelines,” which supports listed real estate (LRE) companies in meeting the growing expectations from the market alongside European regulatory requirements. EPRA’s sBPR Guidelines are regularly updated, with the 4th version anticipated for release in 2024 to align fully with the European Sustainability Reporting Standards (ESRS). In 2022, EPRA collaborated with select members to draft guidelines for its members on implementing the EU Taxonomy.
The WorldGBC network is leading the way to instilling sustainable finance across the building and construction industry. As well as chairing the team working on criteria for Construction and Real Estate of the EU Platform on Sustainable Finance, WorldGBC launched the Sustainable Finance Taskforce in 2023 to scale up finance for the transition to a sustainable built environment. A key strategy at the heart of this work is fostering strategic collaboration and direct exchange between leaders and stakeholders across the built environment and finance sector.
The collaboration will address the following topics:
- “Nearly zero energy building” (NZEB) definitions: What the EU Taxonomy criterion of ‘NZEB -10%’ means in practice and how this can be calculated in different EU Member States.
- National Energy Performance Certificate (EPC) methodologies: Shedding light on “EPC level A” buildings, which are classified as sustainable in the EU Taxonomy when acquiring or owning buildings, however builds on divergent EPC methodologies.
- Definition of a “major renovation”: Clarifying national requirements of “major” or “deep” renovations and how EU Member States’ address building demolition.
Cristina Gamboa, CEO, WorldGBC:
“Green Building Councils (GBCs) are at the forefront of enabling sustainable finance in the building sector, implementing crucial strategies such as providing green building certifications used in ESG frameworks. Our network is mobilised to continue accelerating streamlined and robust ESG and sustainability reporting of built assets. Several European GBCs have already aligned their certification schemes to the EU Taxonomy criteria.
“This new partnership with EPRA is a testament to the expertise of European GBCs. The resources and guidance we will produce together can support thousands of companies, which are already grappling with the complexity of this new reporting framework.“
Dominique Moerenhout, CEO, EPRA:
“The listed real estate sector in Europe has supported public disclosure of environmental, social and governance (ESG) data as fundamental component of a sustainable approach to real estate. EPRA’s commitment is communicated not only through its Sustainability Best Practice Recommendations (EPRA sBPR) but also by the continuous work on enabling the sector to apply the EU Taxonomy by issuing its EU Taxonomy Guidelines.
The EU Taxonomy was developed as a tool to drive capital to transform Europe’s economy and it can therefore help listed property companies access green finance. Our partnership with the World Green Buildings Council demonstrates how deeply EPRA commits to serving its members and to ensuring a sound support to the use of EU Taxonomy to battle climate change.”
