23 June 2022
In an article originally published in Property Week, Christian Phipps, our first Sustainability Manager, discusses how the industry can make a significant and lasting contribution to the environmental sustainability agenda.
It is heartening that in recent years there has been a huge step change in the regard that the property industry has for environmental sustainability.
It is fair to say that in times gone by it has been more difficult to prioritise. Go back to the global financial crisis and what little gains that had been made were largely squandered as government and companies focused on the economy.
Since then, the world has woken up to the existential threat posed by climate change and progress has continued to be made. My appointment at FirstPort is a case in point.
I joined FirstPort as the company’s first sustainability manager just shy of a year ago. Despite the challenging Covid-stricken landscape, FirstPort pressed ahead with the recruitment process, knowing that the threat of climate change could not be ignored.
FirstPort wasn’t alone. I have been an environmental professional for my entire career – at the Environment Agency, in consultancy and latterly at waste company Veolia – and I have never seen the job market as it is today. Yes, the economy as a whole is crying out for workers, but the situation in the environmental sector is of a different order of magnitude entirely, experiencing an unprecedented demand for skilled experts.
This is, of course, great news and fills me with optimism, but we are very much still in the foothills: Everest awaits. After all, residential property alone is responsible for 11% of global greenhouse gas emissions.
I get the sense that the property industry understands that, hence the desire to recruit professionals with a real depth of knowledge to help companies get their heads around the short-, medium- and long-term challenges ahead. That is certainly how I see my role at FirstPort. We are at the beginning of a journey, but at least we have started and we hope to demonstrate leadership in this area within the industry.
For instance, since I started, we have already gained ISO 14001 accreditation, which is designed to provide assurance to company management and employees as well as external stakeholders that environmental impact is being measured and improved, and we are one of the first property management companies to do so. We are also now procuring 100% of our energy from green sources.
Vitally, we are now in the midst of a huge research project aimed at building a detailed and accurate picture of the greenhouse gas emissions associated with our business. For those that are not familiar with the jargon, greenhouse gas emissions are categorised into three groups or ‘scopes’ by the most widely-used international accounting tool, the Greenhouse Gas Protocol.
Scope 1 covers direct emissions from owned or controlled sources, while Scope 2 covers indirect emissions from the generation of purchased electricity, steam, heating and cooling consumed by the reporting company. Scope 3 includes all other indirect emissions that occur in a company’s supply chain.
Scope 1 and 2 emissions are easy enough to measure and can be relatively straightforward to reduce. Reporting on Phase 3 of the Energy Savings Opportunity Scheme (ESOS) is due at the end of 2023 and we have already started our analysis and response. This involves auditing our existing energy usage and identifying ways to reduce it.
As we work for the freeholder or residents’ management company (RMC) on behalf of leaseholders, it is vital that we work with both parties to plan the interventions that will have the most impact and best serve our customers.
One area we are exploring is solar panels, which we are being asked about by residents more than ever before. The investment required is far lower than it was five years ago, meaning that the payback period is shorter. It is also now generally recognised that solar panels add value to a property, making a compelling case for installation, and something we are proactively pursuing at a number of developments.
Electric vehicles (EV) is another area that is gaining interest. The EV market may be taking off strongly – electric passenger car sales increased by 186% in 2020 and EVs enjoyed a record year in 2021 against a market that was 28.7% below pre-Covid-19 levels – but they are still far from ubiquitous. As of December 2021, it is estimated that just 2% of the cars on the road in the UK are EVs.
As a property manager, we have to weigh up the benefits to the whole community. What about those who do not drive an EV, or indeed don’t drive at all? While we work through this, it is important we are doing the preparation to get us into a position to be ready to provide the necessary infrastructure to be part of the EV revolution, and then it will be important to consult with leaseholders to decide what works for their community.
Scope 3 emissions are a different matter entirely owing to the fact that these are mostly tied into how our suppliers operate. They are, however, vitally important to hitting net zero targets – we estimate that Scope 3 emissions represent around 90% of the emissions with which the company is associated.
This is a long-term, in-depth project that we are working through, working closely with our specialist procurement team to engage with companies across our supply chain so we can work in partnership to achieve the best results.
Then there are environmental initiatives that may not involve direct carbon savings but that are nevertheless environmentally important. For instance, we are involved in conversations with multiple waste authorities and are already drawing up in-depth benchmarking case studies that will be used to improve recycling rates, for instance.
Biodiversity net gain
Biodiversity is another area of focus for us. The Environment Act may have created mandatory 10% biodiversity net gain for new developments, but we see no reason why it shouldn’t be improved on existing sites. To that end, we currently have students working on wildlife and countryside management plans at one of our retirement developments. Their recommendations will be acted upon and hopefully rolled out more widely. We are also working in conjunction with one of our key suppliers, Ground Control, to investigate improving biodiversity across all the developments we manage.
Integral to our approach is a robust plan of action across all areas of environmental sustainability. There is, of course, a compelling moral argument for that standpoint, but there is also a compelling business argument, too. As managing agents, we are increasingly being asked by existing and prospective clients to demonstrate and evidence our sustainability credentials – something that is vital for their reputation as well as ours.
As much as anything, that requires cultural change, something that I am pushing hard internally, as well as with clients, suppliers and residents. We are at the start of a journey and it is vital that we take our responsibilities seriously and demonstrate the value. If we do this, I truly believe our industry can make a significant and lasting contribution to the sustainability agenda.