Mergers & Acquisitions names the 2021 PE Innovators in ESG, including, the Green Cities Company.
For a firm to have a successful ESG program, its executive leadership has to fully embrace its ESG values and strategy, says Renee Loveland, director of ESG for the Green Cities Company, a real estate private equity manager based in Portland, Oregon, with $1.7 billion under management.
Another key to success: publicly communicate the firm’s commitment and ESG reporting, which creates legitimacy and buy-in from both internal and external stakeholders, Loveland says.
Green Cities is a sustainable investment, development and property management firm—founded in 2009 as Gerding Edlen Investment Management–that integrates ESG into all stages of its investment lifecycle. Its own ESG communication effort includes an annual ESG report that quantifies value creation at the asset level using the framework of its new Green Cities Index and more than 100 key performance indicators. Throughout the investment lifecycle, the firm communicates ESG value creation, which is reflected in property financial metrics including occupancy, rents, net operating income and, at disposition, lower capital rates and higher overall valuations.
Over the past year, Green Cities overhauled its ESG platform by conducting an in-depth assessment for several months to identify the primary ESG-related impacts to the business. The results were incorporated into the new Green Cities Index, a proprietary ESG measurement system that covers its entire portfolio and guides how it pursues its ESG goals within its funds. Green Cities measures ESG-related impacts in five categories: environmental impact, climate change mitigation, resilience, health and well-being, and equitable communities.