Today, amid a global Covid-19 pandemic, we can no longer ignore the importance of climate change and business ethics.

And whether for business reasons or of our own free will, we must all align ourselves around actions that go beyond the economic profitability of a company.

The path was gradual, and a decade ago the developers of industrial parks began to carry out actions in favor of sustainability; interpreted in principle in relation to the environment.

Several incorporated the construction of energy-saving buildings (LEED), more square meters of green areas, water treatment plants for common areas and the use of solar cells, among other aspects.

Later, since sustainability also encompassed the social sphere, the developers undertook tasks in favor of the community in which they are located: planting trees, giving scholarships to disadvantaged students or building rural schools, all under a philanthropic approach.

But as a result of the "Earth Summit" in 1992 the market reacted accordingly, demanding "sustainable industrial spaces" /

Large real estate companies were adapting to these new trends, but more for a business issue than for knowledge of the 2030 Agenda and the Sustainable Development Goals (SDG) defined in 2012, within the framework of the United Nations Conference on Sustainable Development held in Rio de Janeiro.

Although the term ESG (environment, social sphere and corporate governance) emerged in 2004 as a proposal by Kofi Annan - then Secretary General of the UN - to create responsible companies.

It is not until recent years that the market has placed emphasis on evaluating companies based on criteria that go beyond financial statements, emphasizing the social impact of an investment in a company.

Check here: Border cities concentrate almost 50% of industrial demand

According to a recent study by S&P Global Market Intelligence, 26 low-yield funds in 2019, operating under ESG criteria, doubled the value of their portfolios in 2020, amidst the global epidemic.

These types of companies proved to be less vulnerable to the economic crisis by resisting market corrections thanks to a balanced vision between profitability, social and environmental impact.

For example, when acquiring assets, investors consider aspects such as the climate risk of properties, security standards, resilience strategies, state-of-the-art systems for portfolio management or adequate insurance, among other aspects.

Today the market has instruments such as “green bonds”, created in 2014 by the International Capital Markets Association (ICMA), which facilitate the issuance of debt for projects that demonstrate a positive impact on the environment.

Actions such as reducing carbon dioxide (CO2) emissions, deforestation and the effect on the biosphere, as well as efficient water management and the use of clean and renewable energy are part of these green bond initiatives.

The social sphere evaluates the way in which the company relates and operates with employees and workers, the neighboring community and its political environment, in addition to considering the vision for the future regarding the positive impact on the market and consumers.

Of interest: Monterrey in Nuevo León, main destination for real estate investment

Insecurity in the country, violence, femicides and poverty are also issues that are now being discussed in company councils, as they are phenomena that impact the integrity of personnel.

Also, mental health has become a hot topic in these times of pandemic.

The psychological risks and stress due to the need for confinement are affecting people's work and family life.

Hence the importance of the recent Mexican Standard 035 STPS, which obliges companies to detect and prevent psychosocial risks that may arise in daily activities within the company.

Regarding governance criteria, ESGs take into account the governance structure, executive compensation policies, investor relations, anti-corruption practices, business ethics and transparency, as well as lobbying and political influence practices of the company.

In particular, companies listed on stock exchanges must report on the functioning of the board of directors and the selection policies of its members in terms of diversity, equity and inclusion.

It is a success that the market encourages more companies to apply ESG criteria in the interest of increasing the value of their assets.

However, it is also necessary for managers to do so out of full awareness of contributing to the fulfillment of the SDGs and the mitigation of climate change, thinking about future generations and not only for monetary and market reasons.

In Solili you can consult industrial buildings in Ciudad Juárez, Monterrey and Mexico City

Original note