8 Sustainability Reporting Frameworks to Use for Your Buildings in 2024

As the world becomes more conscious of environmental, social, and governance (ESG) issues, there are high expectations for businesses to demonstrate their commitment to sustainability and responsible practices. One of the key areas where sustainability is crucial is in the construction and operation of buildings. Buildings significantly impact the environment, consuming vast amounts of resources and energy while emitting greenhouse gasses and contributing to waste generation.

To address these challenges, sustainability reporting frameworks have emerged as valuable tools for businesses to measure, monitor, and report on the sustainability performance of their buildings. These frameworks provide a structured standard that allows organizations to assess various aspects of their buildings' environmental, social, and economic impacts. By using them, businesses can identify areas for improvement and take targeted actions to ensure continuous sustainability for their buildings.

Understanding Sustainability Reporting

Sustainability or ESG reporting discloses information on a company's environmental, social, and governance performance. It gives stakeholders a comprehensive view of a company's sustainability initiatives and impact. They offer a standardized approach, setting standards and guidelines for businesses to operate responsibly.

ESG reporting promotes transparency and accountability. Companies demonstrate their commitment to sustainable practices and provide stakeholders with valuable information. These frameworks enable measurement and monitoring of sustainability progress in crucial areas such as energy management, emissions, diversity, and supply chains. They facilitate comparability among companies, aiding risk assessment, investment decisions, and resource allocation. Sustainability reporting frameworks drive improvement and positive change in organizations and industries.

The Importance of Building a Sustainability Reporting Framework

Building a sustainability reporting framework is crucial for several reasons:

Transparency and Accountability: A robust sustainability reporting framework creates transparency by requiring companies to disclose information about their ESG performance. This allows stakeholders, such as investors, customers, and employees, to assess a company's sustainability initiatives and hold them accountable for their actions.

Risk and Opportunity Management: Implementing a sustainability reporting framework helps companies identify and manage ESG-related risks and opportunities. By systematically measuring and monitoring environmental and social impacts, businesses can pinpoint areas of improvement, leading to increased operational efficiency and cost savings. By partnering with a robust energy analytics platform real estate leaders can continually monitor energy consumption trends on a granular level.

Enhanced Reputation: A robust sustainability reporting framework enhances a company's reputation. As consumers and investors become more conscious of environmental and social issues, they prefer to support and invest in companies that prioritize sustainable practices. By demonstrating a commitment to ESG principles, companies can build trust, credibility, and long-term relationships with stakeholders.

Attractiveness to Investors, Customers, and Employees: Investors increasingly integrate ESG factors into their decision-making processes. A well-developed framework allows companies to communicate their ESG performance effectively, demonstrating their alignment with sustainable investment strategies. Additionally, customers are more likely to support businesses that embrace sustainable practices, and employees are increasingly attracted to companies that prioritize social and environmental responsibility.

Alignment with Global Goals and Regulations: Sustainability reporting frameworks enable companies to align their practices with global sustainability goals, such as the United Nations Sustainable Development Goals (SDGs). It also helps companies comply with relevant regulations and guidelines related to ESG reporting, ensuring they stay ahead of evolving sustainability requirements.

By establishing a comprehensive framework and using a powerful cloud-based property operations platform, companies can effectively measure, manage, and communicate their sustainability performance, driving positive impact and positioning themselves for long-term success.

How to Use Sustainability Reporting Standards

To effectively use sustainability reporting standards, companies should follow these steps:

Identify Material ESG Issues: Conduct a materiality assessment to determine the ESG issues that are most relevant and impactful for the business. Engage with stakeholders to understand their expectations and concerns.

Select Appropriate Reporting Framework: Choose the suitable sustainability reporting framework based on the industry, target audience, and regulatory requirements. Consider frameworks like GRI, SASB, or TCFD that align with specific needs and goals.

Collect and Analyze Data: Gather relevant data from various sources, such as energy consumption records, waste management systems, employee diversity statistics, and community engagement initiatives. Ensure data accuracy and reliability through monitoring and verification processes so that you can easily conduct energy audits.

Measure ESG Performance: Analyze collected data to measure ESG performance. Track progress, identify areas for improvement, and set targets for future sustainability initiatives.

Disclose ESG Information: Share ESG information through reports, surveys, or online platforms following the guidelines of the chosen reporting framework. Ensure transparency, comprehensiveness, and accessibility for stakeholders.

By following these steps, companies can effectively utilize sustainability reporting standards to drive positive change, enhance stakeholder relationships, and contribute to a more sustainable future.

Types of Sustainability Reporting Frameworks

Various sustainability reporting frameworks are available, each with its own set of performance indicators and reporting requirements. These vary by geography, category, and more. Here are eight of the most popular ESG reporting standards across the globe.

Leadership in Energy and Environmental Design (LEED)

LEED is one of the most widely recognized sustainability reporting frameworks for buildings. Developed by the U.S. Green Building Council (USGBC), LEED provides a comprehensive rating system that evaluates various aspects of a building's sustainability, including energy efficiency, water usage, materials selection, indoor environmental quality, and innovation.

Building Research Establishment Environmental Assessment Method (BREEAM)

BREEAM is a widely adopted sustainability reporting framework that originated in the United Kingdom. It assesses the environmental performance of buildings across several categories, such as energy, water, waste, materials, and pollution. BREEAM certification helps building owners and managers identify areas for improvement and achieve higher sustainability standards.

Green Star

Green Star is an Australian sustainability reporting framework that assesses the environmental impact of buildings. It focuses on various aspects, including energy efficiency, water conservation, indoor environment quality, materials selection, and emissions reduction. Green Star certification demonstrates a building's commitment to sustainable practices.

Living Building Challenge

The Living Building Challenge is an ambitious sustainability reporting framework that aims to create regenerative buildings. It sets rigorous performance requirements across seven performance areas, known as "Petals," including site, water, energy, health, materials, equity, and beauty. Achieving Living Building Challenge certification signifies the highest level of sustainability achievement.

WELL Building Standard

The WELL Building Standard focuses on the health and well-being of building occupants. It addresses air quality, lighting, thermal comfort, acoustics, and natural access. The WELL Building Standard enhances overall sustainability and occupant satisfaction by integrating wellness into building design and operation.

Global Reporting Initiative (GRI)

The Global Reporting Initiative (GRI) provides a comprehensive framework for sustainability reporting across various sectors. While not specific to buildings, the GRI framework offers guidelines for reporting environmental, social, and economic impacts. Organizations can use GRI to disclose their sustainability performance and engage stakeholders effectively.

ISO 14001

ISO 14001 is an internationally recognized standard for environmental management systems. Although not exclusively focused on buildings, it provides a framework for organizations to establish and implement an effective environmental management system. By adhering to ISO 14001, buildings can minimize their environmental impact and continuously improve their sustainability practices.

The EDGE Certification

The EDGE Certification is a sustainability reporting framework that focuses on emerging markets. It assesses the resource efficiency of buildings and promotes the adoption of green technologies. EDGE certification helps buildings in developing economies enhance their sustainability performance while keeping costs in check.

Choosing the Best Framework for Your Building

Choosing the best sustainability reporting framework for your building requires careful consideration of several factors. Here are some key considerations to help you make an informed decision.

Materiality Assessment

Start by conducting a materiality assessment to identify the ESG issues that are most relevant and impactful for your building. Consider the environmental, social, and governance risks and opportunities unique to your industry and operations.

Industry Relevance

Look at the frameworks that companies in your industry commonly use. Consider the reporting requirements and performance indicators most relevant to your sector. Frameworks tailored to your industry can provide more specific guidance and benchmarks.

Stakeholder Needs

Consider the information needs of your stakeholders, including investors, customers, and employees. Different stakeholders may have different priorities when it comes to ESG reporting. Choose a framework that aligns with their expectations and provides the information they are interested in.

Regulatory Requirements

Be aware of any regulatory requirements or reporting mandates that apply to your building. Ensure that the chosen framework meets these requirements and helps you comply with relevant regulations.

Compatibility and Integration

Consider the compatibility and integration of different frameworks. Some organizations are working to align and harmonize their reporting frameworks, making it easier for companies to use multiple frameworks simultaneously. Look for frameworks that you can integrate with existing reporting processes and systems.

Reporting Resources

Assess the resources available within your organization for ESG reporting. Consider the time, expertise, and data required to meet the reporting requirements of different frameworks. Choose a framework that is realistic and feasible, given your available resources.

Building sustainability frameworks with cloud-based proptech solutions

ESG reporting frameworks are essential for companies demonstrating their commitment to sustainability and responsible practices. By building a sustainability reporting framework, companies can create transparency, manage ESG risks and opportunities, enhance their reputation, and align with global sustainability goals. Choosing the proper framework requires considering materiality, industry relevance, stakeholder needs, regulatory requirements, compatibility, and available resources. By selecting the best framework for your building, you can contribute to a more sustainable future and meet the expectations of investors, customers, and employees.

To best use your ESG framework, you need a technology partner like Facilio, who can give you visibility into energy consumption data across your portfolio. With rich insights into electricity, water, and HVAC consumption patterns, real-time leakage detections, advanced fault detection and diagnostics, predictive maintenance model, and IoT-powered building automation systems, you can ensure that your building is always compliant. Facilio’s smart building solution provides granular level reports for all your stakeholders from the boiler room to the board room, ensuring that you are always audit-ready and reducing the risk of penalties.