Our industry is engaged in an important dialogue to improve sustainability through ESG transparency and industry collaboration. This article is a contribution to this larger conversation and does not necessarily reflect GRESB’s position.
In the early days of sustainability, some argued, quite vehemently, that pushing too hard on environmental safeguards and other sustainability policies would hurt and slow economic growth and progress. It seems we have now long since established quite the opposite – that strong leadership on sustainability and environmental stewardship is foundational to a stronger and more resilient economy.
Over the years, important financial frameworks have taken root with the very purpose of bringing to light this powerful linkage at the company level. For example, the Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD), established in late 2015, provides a framework for companies to provide better data and increased transparency around climate-related issues to financial markets in order to ensure a more efficient flow of capital and ultimately support a more resilient global economy.
The work of TCFD and similar efforts are even more valuable today as world leaders remain locked in the global public health battle against COVID-19, while concurrently determining the best path forward to reopen their respective economies. What’s been made even more clear is the inextricable interconnections across climate change, human health, and economic resilience. As we’ve long said at the International WELL Building Institute (IWBI), planetary health and human health, at scale, are the same thing. Both are imperatives, and both are critical to economic health and resilience.
As an example, in the midst of this pandemic, certain companies have shown they are better positioned than others. Unsurprisingly, given the nature of the crisis, many of the most effective measures aimed at mitigating the impacts of the pandemic on companies focused on investments in human capital. One example is remote work readiness. As a response to the pandemic, companies that had previously adopted flexible work arrangements and had work-from-home policies in place were able to respond faster when economic shutdowns rippled around the world.
Prior to the COVID-19 crisis, these types of policies, however, may have been seen as nice-to-have or even trendy. Yet they likely attracted higher quality talent, potentially reduced turnover, and may have contributed to positive returns for those companies. But now, more unequivocally, this employee benefit, formerly seen as luxurious, is proving to be one of the most valuable employee management strategies a service-based organization could have implemented. In addition, we have seen a number of WELL community members, who are also supporters of the TCFD, utilize WELL to fulfill their commitment to protect the environment while keeping their workers safe, enabling their teams to work effectively at home and seeking ways to provide a work environment to which they actually want to return.
Clearly, COVID-19 has laid bare the seemingly obvious, yet often overlooked, fact that ensuring employee (not to mention customer and supply chain worker) safety and health is critical to having an operational business. It is a shame it has taken a global health crisis to further underscore and highlight the importance of environmental sustainability and human health to the performance and resilience of the global economy. Moving forward, we’re confident the ensuing crisis will be a wake-up call for all investors to universally acknowledge the materiality of climate change and human health.