M&G Real Estate commits to net zero carbon emissions by 2050

M&G Real Estate, a global financial solutions provider for real estate investors, is accelerating its aim of reducing net carbon emissions to zero across its assets under management by 2050 after delivering target-beating energy cuts.

The announcement was made alongside the release of M&G Real Estate’s Responsible Property Investment (RPI) Report which focuses on promoting environmental excellence, health, wellbeing and occupier experience, as well as the contribution it makes to society.

M&G’s commitment follows news that real estate is estimated to account for 40 per cent of global carbon emissions and is therefore a key focus for government reduction targets worldwide. It is also becoming widely accepted that to mitigate the worst effects of climate change, companies must limit global warming to below two degrees. For real estate to meet these objectives, all new buildings must operate at net zero carbon from 2030 and 100% of buildings must operate at net zero by 2050.
M&G Real Estate is currently developing fund specific, net zero pathways which will help the company understand where portfolios are on the journey to net zero and the measures that will need to be taken at an asset level to achieve the goal. This will be used to define net zero strategies which will be embedded in its decision making and acquisition process.
M&G Real Estate has already achieved success through this focus within its global real estate portfolio, where it has driven a 25% reduction in energy intensity compared to 2012/13 baseline and continues to deliver in the sustainability performance of its real estate portfolios and assets worldwide. Ten of M&G’s participating funds were awarded Green Star ratings, with an average score of 4 Green Stars, with two funds achieving 5 Green Stars*.
Throughout its report M&G highlights a broad range of examples of how it continues to root RPI within its activities to deliver real impact. This includes over 250 events which were held for residents, occupiers and visitors in 2019, with 44 locations globally benefitting from community programmes and more than 1.1 million people having been reached by its health, wellbeing and inclusivity programmes.
Tony Brown, Head of M&G Real Estate, says: “Despite the impact caused by the ongoing Covid-19 pandemic, the need to reduce carbon emissions remains a crucial priority for us. We are already embracing the need to reposition our business across M&G, with a commitment to achieving net zero across our assets under management by 2050 and cutting our own corporate emissions to zero by 2030.
“By proactively integrating net zero thinking into our investment processes, we can smooth the transition to low carbon investing and optimise value for investors. Each of our funds has a targeted programme of works and metrics to deliver positive outcomes, and we remain dedicated to generating and managing social value opportunities across our portfolio. This report will help us to make strides towards our vision for a better, more sustainable world.”
Nina Reid, Director of Responsible Property Investment at M&G Real Estate, adds: “There is definitely momentum behind the need for all buildings to achieve net zero carbon being driven from various angles – from regulators and occupiers to investors. We are making good progress, but we cannot underestimate the challenge of transitioning all buildings to net zero carbon - this will require buildings to be designed, built and refurbished in very different ways.
“We also need to consider which factors enable or challenge buildings in their net zero status and embed these considerations into our buying decisions. From an opportunity perspective, we are seeing occupiers setting targets that outpace regulatory requirements, driving the demand for high performing buildings.
“We will maintain a strong focus on driving energy reductions throughout our portfolio, using green building certificates to highlight the performance of those assets to investors.”