ESG reporting standard launched for social housing sector

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The Sustainability Reporting Standard for Social Housing was unveiled today by the ESG Social Housing Working Group, a collaboration of 18 banks and investors, housing associations, service providers and impact investing organisations.

The working group was set up in 2019 following concerns that ESG (Environmental, Social and corporate Governance) investment was being inhibited by a lack of a common reporting standard within social housing sector.

The Standard is a voluntary reporting framework, which covers 48 criteria across ESG considerations such as affordability, safety standards and zero carbon targets.

Sarah Forster, CEO of The Good Economy, which led the process of developing the Standard, commented on the announcement: “By working together, the social housing sector and financial sector have demonstrated how the lack of consistency, transparency and comparability in ESG reporting can be overcome.

“We’re delighted so many significant lenders, investors and housing associations have already committed to using the Standard and believe it will improve access to finance for the social housing sector – helping deliver quality, affordable housing for all those who cannot afford to buy or rent in the private market.”

So far, 70 organisations (39 housing associations and 31 lenders and investors) have committed to become early adopters of the Standard.

Participating housing associations – including Sovereign, Optivo, Clarion and Peabody – will report against the standard on an annual basis.

Meanwhile lenders and investors, including Lloyds Banking Group, LGIM Real Assets, M&G and NatWest, have agreed to use the standard in their investment and credit policies, processes and/or product design.

An initial version of the reporting standard was published in a White Paper in May 2020 and then opened to a public consultation and feedback process.

More than 400 individuals took part, with 53 organisations providing feedback which was used in shaping the final reporting standard.

The Standard will be overseen by a new Social and Affordable Housing: Sustainability Reporting Standards Board, which will be established in early 2021.

A Governance Steering Committee has been set-up to oversee the establishment of this board, chaired by Susan Hickey, a former Chief Financial Officer at Peabody Trust, with secretariat support from the Impact Investing Institute.

The Standard was unveiled in the final report of the ESG Social Housing Working Group, which is available on their website.