A new report claims that Australia's property sector is doing an abysmal job in terms of sustainability.
According to the new report, although there are a few bright spots for sustainability in the Australian property sector, the industry as a whole is failing to satisfy even modest performance benchmarks.
The report, entitled Building sustainability: A review of company performance in the commercial real estate and property sector, was undertaken by Catalyst Australia in collaboration with union United Voice, with contributions by academics, stakeholders and sponsors.
The report assessed the sustainability chops of players in the property sector across a broad range of criteria via the use of multiple indicators and sub-indices, with main categories including environmental impact, sustainability engagement, supply chains, gender equality, labour standards and community investment.
In the report’s view, only four property groups – Stockland, GPT, DEXUS and Mirvac – managed to log respectable figures across a broad range of sustainability indices, making the effort to “[integrate] environmental and social issues into their business performance and evaluation.”
Even this select coterie failed to achieve a single outstanding performance, however, with only the top two groups managing to obtain a mark of 13 out of a possible 24 points in total, for a mediocre percentage score of a mere 54 per cent.
In the retail sector the two biggest players – Westfield Group and Westfield Retail Trust – pulled overall performance down, scoring sub-par marks for most indicators.
Their impact was particularly pronounced given that they comprise a massive 34.2 per cent of the market capitalisation of the sector, with their own market capitalisation pegged at approximately $33.3 billion.
Key areas in which the property sector as a whole is underperforming included carbon emissions and energy efficiency, although there was significant disparity between the scores of top performers and laggards.
The report also singled out Westfield and DEXUS for rising energy consumption – a particularly worrisome trend given the huge value of their retail and official portfolios.
“The performance of these two, along with other under performing companies, is worrying considering the project increase of energy use in commercial buildings, which is likely to be accompanied by increasing carbon emissions,” the report said.