Sustainable profits: ESG is not going away
Gillian Tett wrote in the FT Weekend (£) about the current political pullback from “ESG” in politics. While all the noise may be created by those talking it down, the economic drivers behind sustainability goals remain. Whether it be Texas’ penchant for renewables, or Big Tech’s huge power needs seeking cheaper supplies, there are plenty of reasons you might be into sustainability, regardless of whether you think net zero goals are part of the “woke agenda”.
This was also one of the takeaways from the BPF’s Sustainability Conference 2025 (kindly hosted by Travers Smith) which my colleague Sophie Smith and I had the pleasure of attending. We heard how renowned eco-warriors such as British Land, Landsec, Canary Wharf Group, and Related Argent (among others) continue to pursue higher ESG performance. Each of them are realising value in doing so, whether it be through classic supply and demand (in the UK demand for high quality low carbon space outstrips supply) or more holistic placemaking benefits. Occupiers and customers are increasingly picky about the “feel” of a place, and creating higher quality spaces to attract them (and their money) has been a driver for investment for all these big hitters – whether placemaking at Related Argent’s renowned King’s Cross redevelopment, the launch of Canary Wharf’s Eden Dock project in partnership with the Eden Project, or British Land’s complete overhaul of Exchange Square. Investment in ESG is critical to creating, and protecting, investment value.
There are of course many challenges that the real estate world is grappling with, but there is strong support for achieving sustainability goals from individuals in the sector. Whether or not you see ESG as “the right thing to do”, the fact that it can have a positive effect on the balance sheet means it is probably sticking around.
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https://www.ft.com/content/81feb7d2-2763-4023-806b-89237743f07d
