As we dive into the 2023 GRESB Infrastructure Public Results, we celebrate another year of growth in participation, with 172 funds and 687 assets contributing to this year’s benchmark. This expansion now encompasses a USD 393 billion in GAV at the fund level and USD 1.2 trillion at the asset level. The industry continues to make improvements, but the pressing question remains: is the pace of our progress aligning with the urgency of our climate goals?
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EMEA demonstrates steady growth and continues to be the most widely covered region. In relative terms, regions that experienced significant growth in participating assets include Oceania and the Americas. At the country level, a notable increase of 26% was seen in Korea.
- Covering over 350 assets, EMEA remains the most represented region
- The Americas experienced an 11% year-on-year increase with 20 new infrastructure assets
- Similarly, Oceania is among regions with the highest year-on-year growth with a 10% increase and 12 new infrastructure assets
- Participating assets in Korea increased to include 19 entities
An industry in transition – the GRESB Model
GRESB Scores and their underlying data provide valuable insights for investors and stakeholders about the performance and risk associated with individual assets or a portfolio within a fund or company. The chart below shows entities that excel in both management policies (vertical axis) and implementation performance (horizontal axis) in the upper right quadrant. Over time, the upper right-hand quadrant has become more densely populated, reflecting a positive trend in both management strategies and performance across infrastructure assets and funds, which signifies notable industry improvement overall.
Average GRESB scores for assets jumped by four percentage points to 83 and for funds by one point to 83.
Firms are doing more and performing better
As the cluster of top performers continues to grow, this presents a developmental challenge for the industry, resulting in a need for new inventive approaches to distinguish themselves and stimulate continued improvements in both practices and performance. Development of the GRESB standards will involve initiatives aimed at deepening awareness regarding the actions and accomplishments of these market leaders. Take a look at some examples in our manager case studies.
Regional scores breakdown
Independent studies have demonstrated that companies and funds with high GRESB scores outperform their counterparts as investments, which both GRESB participation and performance being significant predictors of fund returns. The graphic below shows average GRESB score by starting year of assessment participants. On average, GRESB participants see a 10-percentage point increase in their GRESB score during their second year of reporting.
Average scores per aspect
During the early years of GRESB, emphasis was placed on enhancing data coverage, ensuring participants could collect and disclose a growing portion of their ESG data consistently. Presently, the focus has shifted towards enhancing performance by boosting energy efficiency and reducing overall emissions. The objective is to recognize achievements that drive substantial, enduring transformations within the infrastructure sector.
Key indicator reporting
GRESB Infrastructure Members are further enhancing their data coverage, with an increasing number of participants now reporting on key metrics such as Air Pollution, Biodiversity & Habitat, Waste and Employees engagement.
Gender diversity across the GRESB Infrastructure Assessments
Like in previous years, the gender split across all employees remained constant at 40:60 (female to male) at the fund level. At the asset level, most assets tend to have gender ratios with a split of 70:30 in favor of men, except for social infrastructure assets which display a 49:51 gender split across employees.
Recent changes to the 2023 GRESB Standards have enabled us to monitor net-zero progress and track information on net-zero policies, commitments, and targets for the first time.
- In 2023, 60% of global asset participants reported a net-zero policy, with Oceania and Europe leading the charge with 65% of participants in the regions having a net-zero policy in place. While only 40% of global assets reported net-zero commitments, 60% have already set net-zero targets.
- At the fund level, 68% of reporting funds have a net-zero policy in place, while 70% have already shared net-zero commitments and 60% set net-zero targets.
- Regarding net-zero targets, 37% of global asset participants have set targets for Scope 1 and 2 location-based direct emissions. However, only 22% currently possess the capability to track Scope 3 emissions within their supply chain. In terms of market-based emissions, the average coverage stands at 20% across the board.
- Renewable power assets remain the sector with the highest reporting coverage on Scope 3 emissions at 40%.
GRESB Rating Cutoff
The GRESB Rating is determined by the GRESB Score and its position within the quintiles of all participants in the GRESB Assessment, with the model being calibrated annually. Entities in the top quintile receive a GRESB 5 Star rating, while those in the bottom quintile receive a GRESB 1 Star rating, and so on.
Because the GRESB Rating is calculated in comparison to the global performance of reporting entities, it provides a clear indication of your standing on a global scale. GRESB 5 Stars represents the highest rating, acknowledging you as an industry leader. Each year, 20% of entities achieve a GRESB 5 Star rating. You can use the GRESB Rating Logo in your communications.
GRESB assesses alignment with TCFD recommended disclosures based on the reported presence of leadership structures, risks, and other climate-related processes related to the four core elements outlined by TCFD. The maximum alignment, reflected in the full TCFD alignment percentage, represents the highest level of alignment achievable through GRESB Assessments. Although this evaluation determines if an entity has effectively reported on all 11 TCFD recommended disclosures, achieving a maximum score does not imply that there isn’t room for improvement in enhancing the quality and scope of these disclosures.