ESG in the built environment

July 2, 2025

The Policy Liaison Group’s first sector-specific Westminster roundtable examined how ESG principles can be more effectively integrated across the built environment. Building on discussions held at UKREiiF, the session explored the practical barriers preventing the construction and real estate sectors from translating sustainability ambitions into tangible outcomes. Amid growing pressure to decarbonise existing building stock, participants considered the need for clearer standards, stronger infrastructure and more coordinated policy delivery.

Key contributors:

  • Charles Golding, Senior Specialist in Valuation and Investment Advisory at RICS
  • Professor Tim Broyd of The Bartlett School of Sustainable Construction at UCL
  • Anna Hollyman, Co-Head of Policy and Places at UKGBC
  • Lord Bailey of Paddington, Member of the House of Lords Built Environment Committee.

Summary

This roundtable explored the evolving role of ESG within the built environment and the challenges associated with embedding sustainability throughout the construction and property sectors. Participants highlighted that the growing number of reporting standards, assessment frameworks and local planning requirements has created unnecessary complexity. Discussion focused on the need to simplify and better align ESG frameworks, while ensuring that sustainability considerations are embedded within property valuation, investment and procurement decisions. The conversation also examined the barriers facing retrofit projects, including outdated EPC methodologies, grid capacity constraints and the absence of a coherent national approach, alongside the difficulties experienced by SMEs operating within long and fragmented supply chains. Participants argued that stronger collaboration between government, industry and professional bodies will be essential to creating a more consistent and investable framework for sustainable development.

Recommendations

  • Streamline ESG reporting by aligning UK frameworks with global standards like IFRS S1/S2 and the UK Net Zero Carbon Building Standard. 
  • Embed ESG risks and opportunities into property valuations via collaboration with RICS to ensure sustainability is priced into decision-making. 
  • Set a national sustainability baseline to support local authorities with a flexible framework for defining material ESG priorities based on local social and environmental needs. 
  • Reform public procurement to ensure ESG risks and costs are shared fairly across the value chain, with support tools to enable SME participation. 
  • Reform EPC methodology to reflect actual energy consumption and emissions, and align pricing signals with net zero goals.