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The State of ESG Reporting
in Real Estate

December 31, 2021

The State of ESG Reporting in Real Estate.

The growth in environmental, social, and governance (ESG) investing over the past several years is astounding. Global flows to sustainable funds and exchange-traded funds (ETFs) have topped $100 billion for each quarter in 2021, reported by Morningstar. According to The Forum for Sustainable and Responsible Investment (US SIF), the assets invested using ESG criteria now totals $17 trillion, or 1 of every 3 professionally managed dollars. These flows have a huge effect on the investment management industry. Fund managers launched hundreds of ESG ETFs and mutual funds. Most major asset managers now offer ESG choices.

Investors, both professional and individual, are clearly allocating more assets to sustainability funds. A reasonable question is, are companies responding? Are they operating more sustainably than before? Undoubtedly. More companies are reporting their sustainability performance and more are committing to action than ever before. In 2021, over 13,000 companies disclosed climate-related information to the non-profit CDP (formerly the Carbon Disclosure Project), almost double the number of reporters in 2017. Chart 1 shows the trend toward more disclosure and increased transparency is clear.

Chart 1: Increasing in companies disclosing to CDP

Chart 1: Increasing in companies disclosing to CDP

The real estate sector is responsible for over 30% of the world’s greenhouse gas (GHG) emissions, 12% of water use, and 40% of waste. As such, it is critical that real estate companies measure and manage their impact. How are they doing?

When we launched the Vert Global Sustainable Real Estate Fund in late 2017, ESG data on REITs was difficult to find. The real estate sector was considered by many to be a laggard as only a minority of companies reported ESG performance . No longer. An incredible coalition of leading REITs, industry associations, and researchers have collaborated to rapidly advance the quantity and quality of ESG reporting. Companies voluntarily reporting to the Global Real Estate Sustainability Benchmark (GRESB) in 2021 number over 1,500. In 2017, it was only 850 firms.

There is rapid progress in the US, with the majority of larger REITs now actively and voluntarily disclosing ESG performance. The National Association of Real Estate Investment Trusts (NAREIT), the industry body for REITs in the US, publishes an annual ESG report highlighting the progress REITs are making. Chart 2 below shows the increase climate metrics that companies report.

Chart 2: NAREIT members increase reporting on climate metrics 2017-2020

Chart 2: NAREIT members increase reporting on climate metrics 2017-2020

Europe is the leader in ESG disclosure. Collectively the European Union (EU) and the United Kingdom (UK) continues to set the standard, with more companies than not achieving high marks for reporting. 2021 marks the 10th Anniversary of the European Public Real Estate Association’s (EPRA) Sustainability Best Practices Recommendations. Every year EPRA awards companies based on adherence to their reporting standards. Companies scoring above 85% get a Gold Award, those scoring between 70-85% receive Silver, and 60-69% obtain a Bronze Award. In 2021, 102 companies, or 62% of EPRA members, received an award, up from only 18% in 2012. The chart shows most companies receive the Gold Award.

Chart 3: EPRA recognize more companies in Gold Award category

Chart 3: EPRA recognize more companies in Gold Award category

Europe is the leader in ESG disclosure. Collectively the European Union (EU) and the United Kingdom (UK) continues to set the standard, with more companies than not achieving high marks for reporting. 2021 marks the 10th Anniversary of the European Public Real Estate Association’s (EPRA) Sustainability Best Practices Recommendations. Every year EPRA awards companies based on adherence to their reporting standards. Companies scoring above 85% get a Gold Award, those scoring between 70-85% receive Silver, and 60-69% obtain a Bronze Award. In 2021, 102 companies, or 62% of EPRA members, received an award, up from only 18% in 2012. The chart shows most companies receive the Gold Award.

The explosion in quantity and quality of ESG data in real estate increases our, the fund manager, capabilities to discern which companies are committed to sustainability. Questions about how committed companies are remain, and greenwashing is certainly a growing concern. The increase in disclosures makes it easier to communicate with companies about their ESG goals.

Investors, and investment managers, have an important role to play in encouraging corporate ESG reporting. Not only should they be asking for more reporting, they should ask for better reporting. Reporting is the central focus in our Engagement Strategy since our Fund launched. Each year we write to every company we hold and ask them to improve their disclosure. Past campaigns focus on the following:

  • 2018: Standardize year-on-year reporting of company Greenhouse Gas Emissions.
  • 2019: Report company Climate Risks according to the Task Force for Climate Related Financial Reporting (TCFD).
  • 2020: Clarify and detail the company’s Net Zero strategy.
  • 2021: Disclose the company’s Healthy Buildings certifications.


We also communicate with other stakeholders on improving disclosures. Some examples include petitioning the SEC on ESG disclosures in regulatory filings and asking real estate industry advocacy organizations such as NAREIT and EPRA to improve member diversity disclosures.

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Please refer to the Prospectus for full risk disclosures. All data as of December 31, 2021 and subject to change daily.

The Vert Global Sustainable Real Estate Strategy operated as mutual fund from October 31, 2017 and prior to the fund reorganization on December 4, 2023. The investment objectives have not changed.

Investing involves risk. Principal loss is possible. Investors should be aware of the risks involved with investing in a fund concentrating in REITs and real estate securities, such as declines in the value of real estate and increased susceptibility to adverse economic or regulatory developments. Investments in foreign securities involve political, economic and currency risks, greater volatility and differences in accounting methods. A REIT’s share price may decline because of adverse developments affecting the real estate industry. REITs may be subject to special tax rules and may not qualify for favorable federal tax treatment which could have adverse tax consequences. The Fund’s focus on sustainability may limit the number of investment opportunities available to the fund and at time the fund may under perform funds that are not subject to similar investment considerations. Diversification does not assure a profit or protect against loss in a declining market.

Please refer to the prospectus for important information about the investment company including investment objectives, risks, charges and expenses which must be considered carefully before investing. You may also obtain a hardcopy of the prospectus by calling 1-844-740-VERT. Read it carefully before investing.

The performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when sold or redeemed, may be worth more or less than their original cost and current performance may be lower or higher than the performance quoted. Performance is annualized for periods greater than 1 year. For performance current to the most recent month end please call 1-844-740-VERT. Standardized performance of the Fund is viewable under the Information tab. Click here for standardized performance of the Fund.

Fund holdings and/or sectors are subject to change at any time and are not recommendations to buy or sell any security. Current and future holdings are subject to change. Click here for the Fund’s current top ten holdings.

Basis points are otherwise known as bps or “bips,” are a unit of measure used in finance to describe the percentage change in the value of financial instruments or the rate change in an index.

The Fund is offered only to United States residents, and information on this site is intended only for such persons. Nothing on this web site should be considered a solicitation to buy or an offer to sell shares of the Fund in any jurisdiction where the offer or solicitation would be unlawful under the securities laws of such jurisdiction.

ETFs are subject to additional risks that do not apply to conventional mutual funds, including the risks that the market price of an ETF’s shares may trade at a premium or discount to its net asset value, an active secondary trading market may not develop or be maintained, or trading may be halted by the exchange in which they trade, which may impact a Fund’s ability to sell its shares. Shares of any ETF are bought and sold at market price (not NAV) and are not individually redeemed from the Fund. Brokerage commissions will reduce returns.

Environmental, social, and governance (ESG) criteria refer to activities that contribute to the business that not quantified in typical financial reporting.

The Vert Global Sustainable Real Estate ETF is distributed by Quasar Distributors, LLC.

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