How Technology can Enable ESG Reporting in Social Housing
ESG (environmental, social and governance) has become a buzzword in the social housing sector. The reporting of which is a way to compare organisations on how responsible they are in three key areas. Some investors now use ESG reports to evaluate investments on a responsible basis. For example, CBRE Global Investors’ new affordable housing fund is focusing on social housing providers who satisfy ESG targets. Housing Associations (HAs) can also use these ESG reports to kill two birds with one stone. The recent UK government White Paper Charter on resident engagement has emphasised a growing need to report on landlord performance, and on resident engagement in particular. All HAs will be aware of this whitepaper. However, they may not be aware that the reporting metrics recommended by the whitepaper fall under the social component in an ESG report! The importance of ESG reporting is clear. But how can HAs accurately measure and report on this?
Investors and lenders currently use different ESG questionnaires to assess the ESG performance of HAs[i]. HAs are becoming accustomed to this, as seen by an Inside Housing survey showing 44% of HAs have an ESG strategy in place[ii]. However, the lack of a sector standard is a problem. The Good Economy has recommended some key metrics to measure ESG performance in housing [iii], but these are yet to be adopted by the sector. This lack of standard and issues with data are the main barriers preventing proper ESG reporting in the housing sector.
Barriers to ESG Reporting
Data
Good data is the starting point for ESG reporting. Sadly, this is not easy: data collection can be difficult and expensive. Furthermore, the Good Economy’s suggestions require data to be collected from different HA departments (communications, development, finance etc.). This complicates ESG reporting as data from multiple sources must be amalgamated and managed.
Once HAs have the data, it needs to be analysed and visualised. However, this is made difficult by the lack of a sector standard.
Furthermore, existing technology in the housing sector is outdated and not able to provide the required data analysis and visualisations. Skillsets to develop this inhouse are not common in the sector. The use of dedicated technology is a more efficient solution than retraining or employing new staff.
Lack of Sector Standard
As mentioned above, the lack of a sector standard complicates data analysis and visualisation. It also makes it difficult for investors and stakeholders to assess ESG performance across different HAs. Without a standard, like for like cannot be compared.
The Solution
Gridizen
Gridizen is a comprehensive property management system (PMS). Our platform includes a resident engagement tool, rent management, smart device integrations such as thermostats and smart meters, and more. HAs and their residents use Gridizen as part of their daily operations, and we use these operations to passively collect ESG data! For example:
- Affordability metrics from our rent management tool
- Resident satisfaction from our engagement tool
- Energy usage from smart devices to measure environmental impact
ESG data is collected automatically without any additional work or expenditure from landlords.
Centralised ESG Dashboard
All the data which we collect feeds into Gridizen’s dedicated ESG dashboard. The calculations in our dashboard are done using The Good Economy’s metrics.
What Gets Measured, Gets Managed
Gridizen is an accessible solution that simplifies ESG reporting for HAs. This will save associations time and money. As investors and customers focus more on companies’ values, the saying “what gets measured, gets managed” cannot be truer.
For more information on Gridizen, please contact: kmahmood@gridizen.co.uk
[i] The Good Economy, 2020. THE SUSTAINABILITY REPORTING STANDARD FOR SOCIAL HOUSING. Available at: https://thegoodeconomy.co.uk/resources/reports/SRS_final-report_2020-11-16-094356.pdf
[ii] Inside Housing, 2020, IS THE SECTOR MEASURING UP ON ESG? Available at: https://www.insidehousing.co.uk/sponsored/sponsored/is-the-sector-measuring-up-on-esg
[iii] The Good Economy, 2020. UK SOCIAL HOUSING Building A Sector Standard Approach For ESG Reporting. White Paper. [online] Available at: https://thegoodeconomy.co.uk/resources/reports/UK-Social-Housing-Building-a-Sector-Standard-Approach-to-ESG-Reporting-May-2020.pdf
