Role of Green Building Certifications in Telling Your ESG Story

By Kavya Dhir, G&A Institute Sustainability Analyst

With climate change at the forefront of today’s environmental, social, and governance (ESG) discussion, and corporate ESG disclosures in focus, companies are being held more accountable for their overall environmental impact.

These impacts include the carbon footprint of their operations — such as office space, business travel, and packaging of consumer goods.

For office buildings, third-party certifications such as the WELL Building Standard (WELL) managed by the International Well Building Institute (IWBI), and, Leadership in Energy and Environmental Design (LEED) managed through the US Green Building Council (USGBC), have ushered in a new era of sustainability transparency and accountability.

Green building standards have served as a foundation for more than two decades to make buildings become more energy efficient, less polluting, and healthier for their inhabitants. The USGBC was created in 1993 in the boardroom of the American Institute of Architects (AIA), with representatives from over 60 corporations and organizations.

Today, investment firms and property businesses are raising the bar for “green.” This includes increased greenhouse gas emission reduction targets and supply chain management regulations. Further, these organizations and individual assets are being expected to back up their ambitions with real-world performance data.

Green building standards should be promoted by real estate professionals to work to ensure that the advantages are widely recognized and implemented.

What is a Green Building?
According to the World Green Building Council (WGBC), the definition of a green building is: “a building that, in its design, construction or operation, reduces or eliminates negative impacts, and can create positive impacts, on our climate and natural environment.”

Here is a brief overview of the ESG issues that are involved:

Environmental – Energy, water, and material are three essential environmental components that have a significant influence on the natural environment over the lifespan of any construction.

According to the WGBC definition, the ultimate goal is not just to optimize resource use so that harmful impacts are reduced, but also to ensure that the building itself contributes positively to the natural environment.

Examples of positive impacts are if a building use recycled and reusable materials, has a greywater system that collects and uses rainwater, or has solar panels which feed excess energy back to the grid.

The societal pressure to adapt to meet the goals of The Paris Agreement on climate change has grown considerably. There is also pressure on the construction and real estate sectors to contribute significantly. In the future, making a good contribution to climate protection would include adhering to tight requirements including reducing the net primary energy need in the planning and construction of new buildings by 20% as compared to the ‘lowest energy level.’

Social A building is designed for occupants; therefore, it must consider their health, comfort, and safety. In office buildings, asking building management if they have engaged in any Indoor Air Quality (IAQ) certifications is a simple way to determine whether the facility has inadequate air quality which may trigger headaches, respiratory irritation, nausea, and allergies. Natural lighting has physiological effects that may be measured. The synchronization of the body’s internal clock – known as circadian rhythm, can be aided by exposure to adequate quantities of natural sunshine.

Governance – Facility managers must design metrics to monitor the health of a building in order to demonstrate effective governance in building operations, maintenance, and management. Furthermore, construction companies and operational managers should be obliged to set quantifiable objectives and demonstrate efforts in advancing the industry toward a beneficial influence on the environment to quantify how a building may do better.

To be considered to be really “green,” a building must serve as a link between people and nature. The ESG of buildings described above aren’t designed to oversimplify the industry’s complexity; rather, they’re meant to raise awareness and start dialogues about acceptable reporting standards. Investors are becoming more demanding in terms of accurate, transparent, and timely account of asset-level performance. The future of ESG reporting in real estate development will move far above entity-level disclosures.

About the Author

Kavya Dhir is a G&A Institute Sustainability Analyst.  Her role consists of conducting materiality assessments, gap analysis and benchmarking research. A researcher and a lifelong learner at heart, Kavya is a LEED GA, WELL AP and holds a bachelor’s degree in Civil engineering and a MSc. In Design and Energy Conservation.

She is involved with many organizations, including ASHRAE, U.S Green Building Council, UN Green (R)evolution and ISHRAE.

She is an optimist who looks towards a future in which our built-environment and energy production exist in harmony with us and the natural world.  Kavya has experience with projects which integrate concepts of net-zero energy and carbon, high performance HVAC and healthy buildings, and general sustainability early in the building design process.

Kavya is committed to accelerating the transition to a more sustainable environment with a continual focus on establishing the integrated bottom line: environmental stewardship, economic inclusion, and social equity.

REFERENCES

Contributor, G. (2021, June 21). Synergies Between LEED, WELL Certifications And ESG Programs. Facility Executive Magazine. https://facilityexecutive.com/2021/06/synergies-between-leed-well-certifications-and-esg-programs/

Dolya, A., Romanin, P., Weise, D., Lupia, F. P., Villani, L. A., & Hemmige, H. (2022, January 11). Boosting ESG Performance in Today’s Energy Supply Chains. BCG Global. https://www.bcg.com/publications/2022/boosting-esg-performance-framework

A Performance-Based Future for Real Asset ESG Reporting. (2019, February 28). GRESB. https://gresb.com/nl-en/2019/02/28/a-performance-based-future-for-real-asset-esg-reporting/

What is green building? (2020). World Green Building Council. https://www.worldgbc.org/what-green-building

Why Sustainability Must Be Centered On Environmental Justice

Part 2 – Companies Doing it Right

By Gia Hoa Lam, G&A Institute Analyst-Intern

Sustainability and environmental justice are interdependent. In the same manner as sustainability solutions, environmental justice solutions are specific to a company’s unique operations and community, encompassing a wide range of environmental, social, and economic considerations. Following are a few examples of companies that are incorporating environmental justice in their ESG and sustainability programs.

These companies combine their business goals with equity goals in a manner that reinforces one another. This way, environmental justice and sustainability become defined by the opportunity to expand and innovate rather than solely focus on risk mitigation and compliance.

Timberland

Timberland has been in partnership with the Smallholder Farmers Alliance (SFA) of Haiti for over 12 years. Haiti is one of the most deforested countries in the world, with an estimated 1.5% tree cover (by comparison, the Dominican Republic has 48% tree cover and U.S. cities have an average of 27% tree cover).

This deforestation has major ramifications for Haiti’s biodiversity, vulnerability to natural disaster, and economic potential. Through its partnership with SFA, Timberland has planted over 7.5 million trees and supported programs to train local farmers.

The cooperative model has led to a 50% increase in farmer income and 40% increase in crop yield. With the help of Timberland, cotton has been re-introduced to the island with potential of becoming a major export. Timberland is seeking to expand the program and gain additional support from parent company VF Corporation.

Timberland, in supporting Haitians, is practicing environmental restoration and economic development. Timberland also supports the work of several NGOs focused on supporting local communities, including the Great Green Wall, Trees for the Future, the Green Network, Las Laguna Ecological Park, Justdiggit, and Treedom. Partnership with local support ensures Timberland’s efforts are connected with on-the-ground experts.

Microsoft

Microsoft has consistently been a leader in ambitious environmental goals with a commitment to carbon neutrality by 2030 and net zero by 2050 (removing from the environment all carbon the company has emitted either directly or by electrical consumption since it was founded in 1975). To meet these ambitious goals, Microsoft is seeking aggressive carbon reductions through its operations and scaling carbon removal. Its 250-megawatt power purchase agreement with black-owned Volt Energy shows the possibility of combining environmental goals, sustainable procurement, and racial justice.

Volt Energy also commits to “invest[ing] a portion of the revenue from the Power Purchase Agreement in community impact funding initiatives, which will support programs that bring the benefits of renewable energy closer to communities that have not been significantly included in the wave of clean energy initiatives undertaken by the private and public sectors.” In this manner, supporting a sustainable economy can also mean supporting an equitable economy.

CVS Health

CVS has committed $1.5 billion to social impact investment with an understanding of racial disparities in health outcomes and environmental health. To achieve the company’s goal of healthy communities, CVS is focusing on access to health care, social determinants of health like housing and food security, and supporting local health organizations.

CVS practices a multi-stakeholder approach by mapping the most vulnerable to disparate health outcomes, senior citizens, Black communities, and Hispanic communities. Initiatives such as partnership with the Conference of National Black Churches to improve immunization rates shows a commitment to meeting underserved communities where they are and understanding historical contexts to disproportionate health outcomes.

Project Health is another program that provides basic screening services such as blood pressure, body mass index, and glucose testing to the uninsured, along with information for customers looking for mental health and follow-up care resources. CVS thus aligns its expansion strategy with an environmental justice goal, understanding the economic and restorative opportunities within health care.

ABOUT THE AUTHOR

Gia Hoa Lam is a G&A Institute Analyst-Intern. Due to his previous work as a corporate sustainability intern at Ceres, a sustainability nonprofit, Gia Hoa has sustainability consulting experience across multiple industries from sustainability planning for the apparel industry to analyzing human rights policies for investment banks. On campus, Gia Hoa is a founding member of Bentley University’s Green Revolving Fund, facilitated the Bentley 2026 Sustainability & Climate Action planning process, and is currently advocating for endowment stewardship.

Gia Hoa centers people in his sustainability work with a deep passion for climate justice, DEI, and climate refugees. Initially interested in psychology, Gia Hoa realized mental wellbeing was directly linked with access to environmental and social resources. Thus, he began his journey to be a change leader through stakeholder engagement and facilitation. He believes the corporate world has the capacity for compassionate and collaborative change.