Measuring the ‘S’ in ESG

Effective tools for quantifying the social impact of real estate – the so-called ‘S’ in ESG – are proliferating across the industry, as regulatory bodies look to define their frameworks around the topic. This evolution is also being driven by the volumes of professional investors tackling the issue, which is in turn compelling more institutional-grade capital to create social strategies.

While science-based metrics for measuring environmental impact lend themselves more readily to standardisation, metrics for social impact can be more challenging. But it’s not an impossible task and proxies can be used effectively, for example, use metrics on outdoor green spaces or catering facilities can enable us to measure social interactions.

Our project in Alicante is being designed to Passivhaus principles, which contributes to thermal performance gains contributing to E (environmental), whilst also allowing for precise air quality management that bears a positive impact on the health and wellbeing of residents. Data can therefore also be used as a proxy for S (social).

At Amro, we also use gamification to bring down operational emissions. “While emissions are an E metric, measuring student engagement and contribution to that purpose is arguably an ‘S’ outcome,” said Ami.

You can read the full article on IPE Real Assets here, or in the Jan/Feb 2025 print issue, if you’re a subscriber.