“The aim of the regulation is transparent, sustainability-related disclosure. The transparency obligations include, for example, whether and how ESG risks are taken into account in investment decisions or also the main negative impacts of the investment decision on sustainability factors. In addition, the Disclosure Regulation regulates further transparency obligations at product level in the sales prospectuses, on the website and in the regular reports.”

Iris Hagdorn, Head of Sustainability, HIH Invest Real Estate – 10. März 2021

HIH Invest is well aware of the growing significance of environmental and social issues as important factors, and is making an intense effort to implement sustainability criteria so as to live up to its responsibility vis-à-vis investors, employees, the environment and society at large.

By 2021 at the latest, transparency obligations will be mandated by the European Union (EU) for the corporate and product level. The first stage of the information requirements, governed by the EU’s Sustainable Finance Disclosure Regulation that will come into force on 10 March 2021, sets binding rules for all financial market players and products, including real estate funds (AIF), as to which aspects should be presented transparently with regard to sustainability.

The objective: Sustainability, which used to be more or less optional in the real estate sector, will become obligatory for all market players. Accordingly, ESG will be a key criterion for investment decisions, in addition to yield and risk criteria.

For the further development and implementation of the sustainability strategy, the senior management of the HIH Group set up an ESG team that is annexed to the corporate control units of HIH Invest Real Estate and works closely with the senior management. The ESG team consists of members of all HIH Group divisions, which means that the competencies from the various corporate units are effectively bundled in a single team. HIH Real Estate pursues a sustainability strategy that takes the EU regulations as well as its ESG mission statement into account on the product and corporate levels. ESG criteria are taken into account throughout the entire investment process.

The sustainability strategy as refined by the ESG team seeks to

  • reduce resource depletion,
  • optimise resource efficiency and
  • contribute to a welcoming social environment.

The team developed and implemented a corresponding ESG mission statement for the company – along with a sustainable investment strategy adapted for the fund products. Many requirements have yet to be specified by the German legislature, and successive adjustments are sure to follow in future.