What every country can learn from the Australian real estate leadership in carbon reduction

As we adjust to COVID-19’s global effects, it is clear that local and national politics play a critical role in delivering minimum standards and implementing guidelines and best practices. The decisions of political leaders can heavily influence outcomes, effects, and long-term wellbeing on a national—and even local—scale. As we navigate the continuously evolving challenges of COVID-19, it is also clear that effective delivery of standards cannot be done without the support of the private market, scientists, experts, and individual citizens. This multi-pronged approach to addressing the global pandemic is similar to undertaking the carbon emissions challenge.

Australia has created a cluster of excellence for evidence-based sustainability in the property sector. For the last nine years, the Australian commercial building sector has outperformed all other regions around the world as measured by the GRESB index, and has delivered more signatories to net zero than any other region.

There, commercial building owners recognize their role in carbon emissions, often citing that buildings and construction contribute nearly 40% of total carbon emissions in the region. The standard developed to catalyze change in Australia, was the National Australian Built Environment Rating Scheme (NABERS). This scheme was backed by strong government support with elements adopted into local law and state policy. Though NABERS’ success is uniquely impactful on the Australian market, this is also largely applicable on a global scale. In the United States, Leadership in Energy and Environmental Design (LEED) and similar ‘green building standards’ have been largely adopted into evolving building code. Though LEED focuses more heavily on design and operational strategies, the next phase of this evolution will focus on carbon emissions.

Nowadays, the significant returns Australian property owners enjoy from capital investment in building data management, operational efficiencies and renewable energy solutions are the only incentives that building owners in Australia need. Because it is clear that meeting carbon commitments makes business sense, private real estate ownership now drive emissions reduction in the commercial property sector, regardless of the politics of national commitments. This Australia-specific example is widely applicable, especially in the United States, where the commercial building industry holds the same significance in total carbon emissions.

The United States has the opportunity to leverage the leadership of the private commercial real estate sector, just as Australia. We have seen the effects of business decisions that lead to the decarbonizing process and have the playbook for effective data management, building operations, and renewable energy purchasing to bring the private commitments to reality. The effective delivery of these commitments will set precedents and establish best practice, which will push the industry forward and guide the establishment of a governmental policy, which is often just a ‘minimum standard’.

Global challenges require multi-pronged solutions. Much like carbon emissions or COVID-19, the private sector has the opportunity to push national carbon commitments and governmental standards. In the US, the private building sector has the opportunity to drive those national commitments in a similar fashion to Australia. With the help of experts and even individuals, the corporate real estate industry can set a precedent that can be adopted into a national standard and together, we can drive the national commitment to reducing carbon emissions.